Royal Taxation
11 FEBRUARY 1993
Royal Taxation
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[Mr. John Smith]
House this afternoon as will be provided at the press briefing to be given by the Lord Chamberlain and a senior Treasury official at 4.15 pm?
The Prime Minister: On the latter point, so far as I am aware, there is no information available or which is relevant that I am unable to give the House but that will be given later today. I believe that I am able to give as much information as will be available later.
I am grateful to the right hon. and learned Gentleman for his support for the proposals and Her Majesty's initiative and for the new arrangements for the royal collection.
As for inheritance tax, the right hon. and learned Gentleman will accept that there is a unique circumstance in a heriditary monarchy and it is right therefore that there should be specific exemptions from assets passing from one sovereign to his or her successor. I believe that is necessary to protect the independence of the monarchy, and I would not wish to detract from that independence in any way. The concerns that I would have were the arrangements to be any other would be the danger of the assets of the monarchy being salami-sliced away by capital taxation through generations, thus changing the nature of the institution in a way that few people in this country would welcome.
The sum total of the Civil List is about £8 million. I cannot immediately give the right hon. and learned Gentleman the total of the privy purse, not least because many aspects of the privy purse relate to income from the Duchy of Lancaster and not to matters of which I might immediately be aware. I will find the answer and write to him.
The right hon. and learned Gentleman's point on payments to the Consolidated Fund being set against tax is entirely accurate, and I believe that that is a proper provision against expenditure made by Her Majesty the Queen.
Sir Peter Hordern (Horsham): Are there any implications in my right hon. Friend's statement for the royal yacht or for any other forms of transport for the royal family?
The Prime Minister: The royal yacht and the other facilities such as the royal flight are provided by Government Departments in support of the Queen's role as Head of State. The expenditure is carried on votes approved by the House. These long-standing arrange- ments are completely unaffected by the announcements I have made this afternoon.
Mr. Simon Hughes (Southwark and Bermondsey): As the hon. Member who introduced a Bill two years ago to achieve these objectives, my right hon. and hon. Friends have asked me to respond.
The Prime Minister's statement will not only be welcome on our Benches, but will be seen in the country as principled and popular and one that enhances rather than reduces the status of the royal family. If the royal family is as responsive to the public mood on this issue in the future as it has been in the recent past, it 'will ensure its continuance for a long time to come.
Only one factual question was left unanswered; and I ask the Prime Minister to be explicit. Can he confirm that
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the implication of what he said is that the tax rate at which the monarch and the Prince of Wales will pay will be the same as that for everyone else in their tax bracket? Will the right hon. Gentleman and his Government be as speedy to respond to propositions from these Benches as the Queen has been in this respect?
The Prime Minister: It may of course depend on the merit of the proposal, but I will always be anxious to respond speedily whenever I can.
I am grateful to the hon. Gentleman for his welcome for these proposals. I can confirm that Her Majesty will pay income tax at the marginal rate of 25 per cent. and 40 per cent. in precisely the same way as every other taxpayer.
Mr. Michael Shersby (Uxbridge): Is my right hon. Friend aware that his announcement this afternoon will be widely welcomed not only by the House but by the vast majority of people in Britain? It brings to a conclusion the discussions that have been taking place over several months, and I trust that he is aware that the outcome will be regarded as most satisfactory.
Is my right hon. Friend further aware that his announcement on capital gains tax and, in particular, inheritance tax is also satisfactory? Is he also aware that many people in the United Kingdom will regard the transfer of assets from one monarch to another as an essential part of the monarchy together with its maintenance at a standard which the country desires for many years to come?
The Prime Minister: I am most grateful to my hon. Friend for his warm support for these proposals. I strongly agree with his remarks about inheritance tax. I suspect that it would be the overwhelming wish of people in this country that the natural and important assets of the monarchy should be sustained and that it is necessary to make appropriate inheritance tax arrangements to ensure that that remains the case.
Mr. Robert Sheldon (Ashton-under-Lyne): Is it not clear that this is the first time that there will be a comprehensive list of the royal collection which will enable us to see what is owned personally by the Queen and what is owned as a result of her position as sovereign? Will there be publication of what is owned by her position as sovereign? More importantly, why will the royal collection not be owned by the royal collection trust, a body to be set up to administer it?
The Prime Minister: It was thought more appropriate to establish trustees to deal specifically with the new arrangements for ensuring that the collection was generally available, more widely seen and operated on a basis which required no subsidy either by the Exchequer or by Her Majesty the Queen. There were detailed discussions as to the best method to achieve that and the one chosen was the one that I announced this afternoon.
I am grateful to the right hon. Gentleman for his welcome for the new arrangements for the royal collection. Certainly there is no doubt that the royal collection will be codified. Whether those elements of it that will be owned by the Queen will be set out in a separate pamphlet, I cannot immediately confirm, but I see no objection to that.
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Mr. Patrick Nicholls (Teignbridge): Does my right hon. Friend accept that maný. Conservative Members believe that, if greater steps: had been takën to publicise the fact
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