Oral Answers to Questions — National Finance – in the House of Commons am 12:00 am ar 27 Tachwedd 1947.
asked the Chancellor of the Exchequer whether he is aware that the retail purchaser of a bespoke suit is required to pay the increased Purchase Tax imposed by the recent Budget with effect from the date of the Financial Resolution, whereas the purchaser of a ready-made suit is still able to buy at the old rate of Purchase Tax; and what steps he will take to remove this anomaly.
Yes, Sir; this situation results from the fact that under Purchase Tax law goods bear the tax in force at the time of their delivery by the registered supplier, whether direct to the customer in the case of a bespoke suit, or to a retail shop in the case of ready-made clothing.
Does the Financial Secretary realise that considerable hardship is caused to people who are outsize and have to order clothes, particularly in view of the fact that orders have to be given a long time before the clothes are delivered? Cannot some arrangement be made to remove this anomaly?
This kind of thing inevitably arises in a matter of this kind. There are bound to be anomalies, because the tax must be levied at the wholesale stage. It, therefore, arises in the case of suits where there is no intermediate stage and the tailor himself acts as the wholesaler. It does not arise in the case of a ready-made suit on which tax has been levied long before it reaches a peg in the shop.
Mrs. Manning:
Does my right hon. Friend recollect that last year the Chancellor made some such remissions as this on electrical and other appliances? Some of these suits have been ordered for as long as six or eight months, and amounts of money have already been paid on them. This is a very unfair infliction on these people.
There is no analogy between what happened then and the case of the increase of Purchase Tax in this Budget. In the former case the tax was put on; later the Chancellor agreed to reduce it, and amounts were refunded.
Will the right hon. Gentleman have another look at this and see whether, before the Committee stage of the Finance Bill, he can find a solution to the problem, which many Members wish to solve?