§ Lord Stanley of Alderley
asked Her Majesty's Government:
Whether it is true that any investment made in a farm business is ineligible for tax relief under the Business Expansion Scheme should that person decide to work on, or manage the farm; and, if so, whether such a regulation encourages absentee farmers and landowners to the detriment of the rural scene.
§ Lord Glenarthur
The Business Expansion Scheme provides a generous tax incentive for individual outside investors in unquoted trading companies rather than people putting money into their own company. In this way it focuses directly on the needs of new and expanding businesses for additional sources of equity. However, relief is not given if investors have more than 30 per cent. of the business. There is therefore no encouragement for an outsider to take control of a farming or any other business.