The Old State House in St. George's has been freed of land tax.

MPs passed The Land Tax (Exemption) Order 2008 in the House of Assembly on Monday, writing off years of debt for the "national treasure".

Presenting the Order in the House, Finance Minister Paula Cox said: "The Old State House is a listed building that is almost 400 years old. In 1816, it was consigned in perpetuity to the use of Lodge St. George and the Corporation of St. George was made the Trustee.

"Over the years, demand notices for land tax were passed to the Corporation by Lodge St. George. The Lodge presumed that the tax was being paid by the Corporation. However, in November 2007, the Lodge St. George was presented with a demand notice for land tax representing many years of back tax. The Lodge was in a quandary and turned to the Ministry of Finance for assistance."

Deputy Premier Ms Cox said that in asking who was responsible for the tax, the Lodge argued the Corporation was responsible, but that ownership rested with Government.

She quoted a "delightful" letter from the Lodge, which said: "... The Trustee is the Corporation of St. George (an eternally impecunious organ if ever there was one) and the Tenant is Lodge St. George which has paid its (legally) prescribed rental without fail for over 200 years."

Ms Cox said: "That rental is the 'Peppercorn'. There was only a single course of action open to me as Minister of Finance! The Lodge of St. George had to be freed of this burden. We must bear one another's burdens.

"Government considers that Honourable Members would agree that The Old State House has immense historical and cultural significance and represents a national treasure.

"On these grounds alone, it ought not to be subject to taxation of any form."

She added the amount owed was "relatively small in the overall scheme of things".

Shadow Finance Minister E.T. (Bob) Richards replied: "How can one possibly object to that? We certainly support this tax exemption order."

Patricia Gordon-Pamplin, Shadow Works and Engineering Minister, added: "The Minister said she would be quite amenable in writing off the debt. It is the right thing to do, but I just wonder how we could drop the ball as to have this demand and have this debt for payment of land tax."