I beg to move amendment No. 150, in page 22 leave out lines 35 and 36 and insert—
'(c) repayment is not made.'.
Clause 20 provides that where a delay is involved in the repayment of VAT to a registered trader, a repayment supplement shall be paid in addition to the sum owed. There is a de minimis provision to cut out entitlement to the supplement where there is only a short delay. The
period chosen is 30 days. When the 30-day period has elapsed, the registered trader becomes entitled to his supplement.
There is a deficiency in the clause that would be remedied by my amendment. The clause provides that the commissioners should not repay VAT and pay the supplement, but should merely issue a written instruction for the repayment. That will normally be sufficient, but there have been strikes involving Customs and Excise employees and if they are repeated in future an order for repayment may be made, but no cheque might he issued to the taxpayer.
If that happened, the taxpayer would suffer the loss of the interest that he would otherwise have been able to gain on the money repaid to him. It would be unfair if that extra cost were imposed on taxpayers and I hope that my right hon. and learned Friend the Chief Secretary will accept the amendment or at least think about the matter and return to it next year.
My hon. Friend the Member for Tatton (Mr. Hamilton) moved his amendment with characteristic lucidity and brevity. He discussed the matter in Committee so I am aware of and understand his concern. We have thought long and hard about his arguments in Committee, but on reflection we are still not able to meet the point for practical reasons.
The Customs and Excise deal with about 50,000 claims a week, most of which are dealt with within seven days. My hon. Friend will be among the first to admit that the system works smoothly and that delays do not usually occur. My hon. Friend mentioned postal strikes and the computer strike six years ago.
The system is clear cut. The Customs and Excise is able to say with precision when the period has expired because that is when the instruction is given. My hon. Friend will appreciate that sometimes it will not be able to check. During a postal delay it will have to depend upon the records of the recipient or the registered trader. It will be in his hands.
My hon. Friend might argue that if there is inconvenience it should be borne by the Administration rather than by the taxpayer. However, I hope that he and the House will bear in mind that the repayment supplement is generous. We are talking about a 5 per cent. supplement. It is not even calculated on a per annum basis. It is difficult to estimate the cost of my hon. Friend's amendment, but it might cost as much as £1 million a year.
I recognise my hon. Friend's anxiety, but I hope that he and the House will be impressed by the practical limitations.
We are moving into new territory. The Keith committee did not recommend an amendment such as that proposed by my hon. Friend, but we shall keep the matter under review. If hardship is caused, we shall examine the matter again.
My hon. Friend has done the House a service by underlining the problem. I hope that he will feel that justice has been done and will leave the matter where it is.