Charge of Income Tax for 1978–79

Part of Orders of the Day — Finance Bill – in the House of Commons at 12:00 am on 10 May 1978.

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Photo of Mr Douglas Crawford Mr Douglas Crawford , Perth and East Perthshire 12:00, 10 May 1978

I am talking about giving incentives to the people in industry who will create jobs for unskilled and semi-skilled people. That is where my party stands. If we give incentives to people on £7,000 to £8,000, which is, de facto, £9,000 to £11,000, they will create the jobs that we badly need in Scotland.

I hold no brief for the CBI, but the chairman of the CBI's smaller firms working group in Scotland, Mr. Ron Lander, has said: I believe that coupled with SNP proposals to reduce the basic rate of income tax by 2p, … a raising of the proposed £7,000 limit to £8,000 … will be … a move in the right direction. We in Scotland, more than any other part of the United Kingdom, have to rely on inventiveness for the prosperity of our economy. We have to rely on high-value, low-volume products. This means inventiveness. It means the ability to translate invention into commercial reality. It means the ability to translate commercial reality into acceptable products, and it means the ability to sell acceptable products throughout the world.

The raising of the basic tax band from £7,000 to £8,000 means, given the allowances for wives and children, building society mortgages and so on, a de facto widening of the band from about £9,000 to £10,000, but above that level we feel that the imposition of higher rates of tax is not inequitable.

If we are talking about differentials and the need to maintain them, I see nothing to suggest that a man earning, say, £30,000 is three times as good, three times as productive or capable of producing three times as many jobs as a successful middle manager earning £10,000. That is why we shall not be supporting Amendments Nos. 20 and 21.

In all this, the SNP is taking a firmly pragmatic line. Without middle management and people in the earnings bracket of £9,000 to £11,000, industry in Scotland and elsewhere in the United Kingdom will suffer. Obviously the Government have recognised this, but it is essential to maintain the competitive nature of industry and stimulate the springs of industrial inventiveness. We believe that tax incentives for middle management should be enhanced, but there is no way in which we can support a reduction of the tax rates at the top end.