Expenditure on refurbishment, decor and fittings in hotels was held to be plant though forming part of the setting of the hotels. The House considered the interpretation of undefined expressions in fiscal legislation, such as ‘trade’, ‘income’, ‘office’ and ‘plant’. Lord Wilberforce said: ‘It naturally happens that as case follows case, and one extension leads to another, the meaning of the word gradually diverges from its natural or dictionary meaning. This is certainly true of ‘plant.’ No ordinary man, literate or semi-literate, would think that a horse, a swimming pool, moveable partitions, or even a dry dock was plant-yet each of these has been held to be so: so why not such equally improbable items as murals, or tapestries, or chandeliers?’ and ‘There is no universal formula which can solve these puzzles. In the end each case must be resolved, in my opinion, by considering carefully the nature of the particular trade being carried on, and the relation of the expenditure to the promotion of the trade. I do not think that the court should shrink, as a backstop, from asking whether it can really be supposed that Parliament desired to encourage a particular expenditure out of, in effect, taxpayers’ money, and perhaps ultimately, in extreme cases, to say that this is too much to stomach.’
Court: HLDate: 01-Jan-1982
Judges: Lord Wilberforce
References: [1982] 1 WLR 322, (1982) 55 TC 251
Cited By:
- Shove (Inspector of Taxes) -v- Lingfield Park 1991 Ltd, ChD, Cited, (Times 11-Aug-03, Gazette 18-Sep-03)
- Lingfield Park (1991) Limited -v- Shove, CA, Cited, (Bailii, [2004] EWCA Civ 391, Times 26-Apr-04)
