The purpose of this section is to act as an incentive, an inducement, to industrialists so to modernise and equip their industries that industry in Ireland will be enabled to take its proper place and produce goods efficiently. If I were, for example, to go back before the commencement of this financial year, I would be doing away completely with the incentive. There would be no incentive in giving to an industrialist a concession of this sort when he had already bought his machinery. The purpose is to induce people, by giving them this acceleration of wear and tear, to purchase new machinery, to modernise, and, with that modernisation, to be able to produce their goods more efficiently. Representations were made to me that we should go back beyond 6th April last, for different periods. If one went back at all, there would be no reason why one would not go right back, say, to 1922, but to do so would be to give an uncovenanted benefit, and completely destroy the incentive intentions of the section.
Senator O'Brien mentioned the fact that I did not deal with other recommendations in the taxation committee's report. That is quite true. I received the report only a very short time indeed before the date fixed for the Budget, and it was far from possible to have all the implications of the many recommendations involved in it fully and completely examined in that time. I should have thought, frankly, that far from there being criticism that I had not implemented all the recommendations this year, there would have been commendation on the fact that I had moved so quickly in respect of one of the main recommendations included in the committee's report.
As I have said already, other recommendations will be examined home, and when we have seen the full implications of them, we will be in a better position to judge.
I should, perhaps, also mention, when speaking of the date of implementation, that, in Britain, what the Chancellor did was to announce that he was going to introduce an initial allowance in 1944, but he did not bring it in in his Finance Bill until 1945. This made it operative from the date of its announcement. I am doing announcement and legislative enactment in the same year, which is the same in practice but more speedy in operation than what was adopted in Britain ten or 11 years ago.
I differ entirely, I am afraid, from Senator Burke. I want to see the most modern machinery that can be got being obtained for this country. I want to make certain that every inducement and assistance is given to people who are prepared to purchase the most modern machinery. I appreciate that at times it may happen that second-hand machinery may be obtained that is good and is suitable for the purpose, but I think it would be entirely wrong that I should stress the possibility of purchasing second-hand machinery to that extent by including second-hand machinery in this section. We must face the fact that there have been cases here, a good many cases, where people have got second-hand machinery. We had it sometimes that people came over as a subsidiary of another firm and the establishment of the Irish factory was availed of for the purpose of off-loading out-of-date machinery. I do not think we should do anything in any way at all that would open the possibility of that being done, while, at the same time, securing a tax advantage. I feel very strongly indeed that what we want in this case is to give the maximum incentive towards the provision of the most modern machinery that can be obtained.
People can still obtain other machinery, if they wish, but if they do that, they do not get this accelerated allowance. The purpose of the accelerated allowance, as provided in the section, is to assist people who want to get the most modern new machinery to get it by means of providing a quick write-off for them when they get it.
I can assure Senator O'Donnell that in respect of this section there will be very substantial amounts indeed writen-off from tax revenue next year. It will operate in the assessment year 1957-58, because industry is assessed under Schedule D on the profits of the preceding year, and there will be a very considerable concession arising in respect of this concession in the 1957-58 revenue accounts.