The Queen's Finances: Benn acquires an unexpected ally

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WITH HIS statement that the Queen is to pay tax, John Major unwittingly implemented clause 40 of Tony Benn's Commonwealth of Britain Bill. Welcoming this first step, the republican MP for Chesterfield said there was now a growing interest in the idea of wider constitutional reform.

'There are people in Britain who would like to be allowed to elect their head of state as America does,' Mr Benn said. He called for an inquiry into the constitution and called the reception given by MPs to the Commons announcement as 'creepy-crawly bowing and scraping'.

Mr Major said: 'The Conservative Party, and I believe every member of it and many beyond it as well, are very strong monarchists and would not wish to see changes in the constitutional hereditary monarchy that we have in this country.'

John Smith, the Labour leader, said there would be widespread acceptance of the principle that the Queen and the Prince of Wales should not be exempt from tax on their income, but he questioned why all private assets passing from one sovereign to the next should also be exempt.

Mr Major said the exemption was necessary to protect the independence of a hereditary monarchy. 'The concern I would have if the arrangements were 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 few people in this country would welcome.'

For the Liberal Democrats, Simon Hughes, who two years ago introduced a Bill to tax the Queen, said: 'If the Royal Family is as responsive to the public mood in the future as it has been over the recent past on this issue, it will ensure its continuance for a long time to come.'

From the Tory benches, Sir Michael Grylls, MP for Surrey NW, said the decision demonstrated the Queen's excellent judgement. Richard Page, MP for Hertfordshire SW, called for a realistic policy on expenses. 'This country is looking for a monarch to represent the traditions and pride of this country. It is not looking for a cut-price basement option.'

Patrick Nicholls, MP for Teign bridge, said if more had been done to publicise the fact that the Queen handed over 80 per cent of her income from Crown lands, pressure for her to be taxed would not have arisen. 'If that money she receives in the civil purse, which is itself payable out of the Crown lands, is to be taxed in so far as it is there for personal purposes, in all equity the whole of her income from the Crown lands should be taxed at the applicable rate (25 and 40 per cent) and not the effective rate of 83 per cent on which she is taxed already.'