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Tories Attack Licence Increases—but in Vain
Page 42
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TORY hopes of persuading—or forcing—the Government to change its mind about the increased goods vehicle duty were dashed last week. The Government refused to budge, and an Opposition amendment to the Finance Bill, designed to do away with the new rates, failed by 176 votes to 190.
Moving the amendment, Mr. Enoch Powell said that the costs of production and distribution had been increased by about £95 m. by the new excise and fuel duties. He asked the reason for this extraordinary act of picking upon a productive process and taxing it additionally and heavily in this way.
It was, he said, a complete misconception that if one taxed road transport one would produce a dramatic rearrangement of freight so that great masses of• it would go back to the railways.
Those who believed most strongly in the possibility of developing the railways for forms of freight transport for which they were specially suited had never pretended that more than a very small percentage of the traffic now using the roads—he had heard 2 per cent mentioned—could go back on to the railways in the best case.
The other leg of Labour theory was that road haulage was not paying its whack of the costs it caused. There was at least a conflict of evidence before the public at the moment, and the Geddes Committee, set up to resolve it, had not yet done so—at least so far as was known to the public.
Yet, said Mr. Powell, the Government, in advance of the Geddes Report, with this issue unresolved, had hurried forward to put this tax on road tax in addi
ng tion to the fuel duty imposed last November.
The whole proceeding reeks of prejudice. . . . This is the action of prejudiced men, of men who are profoundly prejudiced against one of the modern forms of production and distribution."
A plea for vehicles in Scotland to be relieved of the increase came from Mr. George Mackie (Lib., Caithness and Sutherland). The farther an area was from the large centres and the markets, the greater was the effect on it of an increase in costs.
Mr. George Younger (Cons., Ayr) drew attention to a point which, he said, was causing haulage contractors great concern. It used to be the case that if a vehicle had its unladen weight altered during a year in which it was registered the extra duty payable was calculated by charging the appropriate proportion of the duty that the extra weight would attract. Since the new increase in duty had been introduced, a different method was being used. If a vehicle registered in March had its unladen weight upgraded in May, ten-twelfths of the total charge was payable at the new rate, less ten-twelfths of the total charged at the old rate.
Mr. Younger gave as an example a vehicle weighing 8 tons 4 cwt. licensed in March, with duty of £162. The weight was revised to 8 tons 9 cwt. in May. The new rate of duty would be £252—an increase of £75 for the extra 5 cwt. By the old method the increase would have been only about £9 or, possibly, £7 He hoped this point would be looked at. Replying for the Government, Mr, Niall MacDermot, Financial Secretary to the Treasury, said that since the 1933 rate of duty on commercial vehicles was fixed it had risen in money terms by 20 per cent—which meant that in real terms it had fallen very substantially.
Opposition fears were quite misplaced, said Mr. MacDermot. It was not the Chancellor's intention by this taxation to impose any deterrent effect upon road transport. He was not seeking by means of this increase to drive goods back on to the railways.
Dealing with what he described as the " believed" increases in operating costs. Mr. MacDermot said that on vehicles up to one ton the effect would be just over lid. per ton-mile, and on vehicles over five tons just under one-tenth of a penny per ton-mile.
Although the increase on the lighter vehicles would be more than 15 times as much as that for the heavier vehicles. viewed in percentage terms it was the other way round. The larger increase on the lighter vehicles represented a 2 per cent increase while the very much smaller actual increase for heavier vehicles represented a 4 per cent increase.
These figures, he added, illustrated vividly the reason why it was right to have a graduated rate of duty and to impose such very much higher rates of duty upon heavier than upon lighter vehicles.
Mr. MacDermot promised to study carefully what Mr. Younger had said about vehicles which were increased in weight, and see whether there was any basis for changing the system. But he understood there was nothing new in the system proposed in the Finance Bill.
He rejected the suggestion that the increased duties had been in any way motivated by political prejudice.