§ 2.44 p.m.
§ [The Question was as follows:
§ To ask Her Majesty's Government what would be the cost to the Revenue in a year if the maximum taxation levied on any individual income from whatever source was limited to 15s. Od. in the pound.]
§ THE MINISTER WITHOUT PORT FOLIO (THE EARL OF DUNDEE)My Lords, to retain the present surtax scale on incomes up to £6,000, when the rate now reaches 6s. 6d. in the pound, and to charge all income in excess of that amount at 6s. 6d. so that the maximum combined rate of income tax and surtax was 15s. in the pound, would cost about £17 million a year.
THE EARL OF WOOLTONMy Lords, may ask Her Majesty's Government whether, in view of the comparatively insignificant yield of this punitive tax, it is retained for the purposes of revenue or for political purposes?
§ THE EARL OF DUNDEEMy Lords, I will put that distinction to my right honourable friend the Chancellor of the Exchequer with conviction, but without much hope.
§ VISCOUNT STANSGATEMy Lords, in view of the importance of the Question asked by the late chief of the Conservative Party, may I ask the noble Earl whether he has made any suggestion as to which taxpayer should pay the deficit caused by the exemption of the surtax payer?
§ THE EARL OF DUNDEEI have made no suggestion and I do not think anybody else has.
LORD HAWKEMy Lords, do the figures given by my noble friend make any allowance for the increased revenue from the increase in taxable profits of firms and partnerships which could be expected if the proprietors were to have a stake of 25 per cent. instead of the minimum of 5 per cent. in the financial decisions of the firm?
§ THE EARL OF DUNDEENo, they do not. I think my noble friend might make something more out of that.
VISCOUNT ALEXANDER OF HILLS BOROUGHMy Lords, could we have an estimate from the noble Earl—I am sure he has been into the matter, in view of the Question—of what has been the total relief given by the present Government to the surtax payer, both in,the remission of 1s. off income tax and the remission of surtax, which we believe in one year alone was over £30 million?
§ THE EARL OF DUNDEEMy Lords, there has been no alteration in surtax rates, I think, since 1947, when the highest surtax rates went to 10s. in the pound where they still remain. As for relief, I think some noble Lords opposite look at it from the point of view that you are giving people something when in fact you are merely taking away less from them.
VISCOUNT ALEXANDER OF HILLS BOROUGHMy Lords, what is the total relief, then, from the reduction of income tax in the one case and the surtax reliefs in the other?
§ THE EARL OF DUNDEEIf the noble Viscount is referring to the reduction of income tax, I do not think that has anything to do with the Question.
§ VISCOUNT ALEXANDER OF HILLSBOROUGHMy Lords, it would be enormously greater than the sum of £17 million. Would it not be better to put it back where it was before, so that there was more justice to those less well off?
§ THE EARL OF DUNDEEThe Question of the noble Earl, Lord Woolton, is a very specific question relating to how much revenue would be sacrificed if a certain thing was done, and I have answered that Question correctly.
§ LORD STONHAMMay I ask the noble Earl whether, if he is going to make representations to his right honourable friend the Chancellor of the Exchequer about the burdens borne by those whose incomes invite tax above 15s. in the pound, he will at the same time represent the claims of the old age pensioners to a 10s. Christmas gift, and perhaps a restoration of the concessions on babies' milk, and, if there is any small change, something for the Arts Council?
§ LORD LAWSONMy Lords, is not the noble Earl on rather dangerous ground in giving the answers he is giving to-day?
§ THE EARL OF DUNDEEMy Lords, I am nearly always on dangerous ground at one time or another.