INCOME TAX.—RESOLUTION. (Hansard, 11 June 1886)

§ MR. HICKMAN (Wolverhampton, W.)
, in rising to move— That, in the opinion of this House, all persons in any way concerned in the assessment of the Income Tax should be paid by salary and not by poundage or in proportion to the amounts of such assessments, said, that it had become necessary for the House to affirm such a Resolution as this, in order to compel the attention of the authorities to what was really a substantial grievance. The Chancellor of the Exchequer, in his Budget Speech, stated that during the last nine years an increase of taxation amounting to £11,600,000 had been put upon the Income Tax payers of this country. Looking at that fact, it was 1508 essentially necessary not only that the assessments should be fair, but that the taxpayer should believe them to be fair. The number of assessments made in the year 1883–4 was 1,600,000; and with respect to no loss than 1,200,000 of these either exemption or abatement was granted in consequence of the income being less than £150, or under £400 per annum. All these 1,200,000 persons were admittedly over-assessed. It might be said that they were not obliged to pay; but in many cases they did pay from ignorance of the law; and if they did not pay it was a substantial grievanee that they should have to appeal, and so lose time and money. Then it might be said that the Commissioners had to decide the matter. But it should be remembered that the clerks, who were paid by poundage, practically decided, because as experts they were acquainted with all the circumstances of each case, and naturally exercised over the Commissioners a preponderating influence. In some cases the over-assessment had been distrained for; and, where it was proved to be unfair after the distraint had been made, the Treasury recouped the amount. In these cases, however, the persons did not receive the costs of the distraint; and it was a poor consolation to a man who had his goods sold that he should only have the amount over-assessed returned to him, while his credit was injured, and he lost the costs and expenses of the distraint. He believed that the Commissioners were as good men as could be chosen; but he complained that in his particular district their names were not made public. He submitted that they ought to know who their judges were. He had no complaint to make against the clerks or assessors; but what he did say was that they were placed in a false position, which was unfair to themselves as well as to the public. He moved the Resolution which stood in his name, and hoped that the House would agree to it.

§ THE SECRETARY TO THE TREASURY (Mr. HENRY H. FOWLER) (Wolverhampton, E.)
said, that his hon. Friend had raised two points, one referring to the administration of the Income Tax, and the other to a question of general principle. With regard to the administration of the tax, he had overlooked one or two matters as to over-assessment, and the amount reduced on appeal. The large amount which the Chancellor of the Exchequer referred to was not the amount reduced by reason of excessive charge, but the great bulk was in respect of incomes on which deductions were claimed. With regard to the suppression of the names of the Commissioners, he might say that that was done advisedly. The names of the General Commissioners who were responsible for the administration of the Income Tax were very well known. They sat as a Court of Appeal, and their decisions carried weight with them. But these Gentlemen had Commissioners to assist them in the assessment of the Income Tax, and the duties of the Assistant Commissioners were of a very private and important character. It was thought, rightly or wrongly, that these gentlemen would be subject to a great deal of unpleasant pressure on both sides if their names were generally known. A large number of these gentlemen would resign if their names were made public. The duty was one which they undertook without any remuneration whatever. It was the desire of the Treasury to remove as far as possible all friction in the assessment and collection of the tax; and every case brought before them had been investigated and dealt with, he believed, to the satisfaction of those gentlemen who had communicated with them. He thought the principle was not to be defended of paying assessors by poundage; and his right hon. Friend (Mr. Childers), when Chancellor of the Exchequer, did his utmost to induce the House to adopt an entirely different mode of payment, stating that £50,000 a-year might be saved by doing so; but, unfortunately, he was defeated in a very full House. People ought not only to be fairly assessed, but to believe that they were 1510 fairly assessed; but it was open to doubt so long as those who assessed them had a pecuniary interest in the matter. When Sir Robert Peel introduced the Income Tax he laid down the principle that, as far as possible, the assessment should be local, and should not pass into the hands of the Government. The Inland Revenue Authorities had carefully considered the question, and they thought that some other mode of payment not inconsistent with the local character of those officers and the local payment of the tax might be introduced. But the question was a very difficult one. The Government looked with the greatest possible sympathy upon the object his hon. Friend had in view. They believed the principle he had propounded was a good one. They would proceed further in the consideration of it on the lines indicated by his hon. Friend. He was satisfied that whether by the present or a future Government the matter must be dealt with, if, as he believed, the Income Tax was to remain a permanent part of our fiscal system. He hoped his hon. Friend would not press the Amendment to a division.

§ MR. GREGORY (Sussex, East Grinstead)
said, he happened to know that the present mode of assessment had given rise to great suspicion and grave dissatisfaction. Payment by poundage was a vicious system. The same remark was applicable to the payment of architects. They were paid by commission; but nothing could be more objectionable, for though you might meet with honourable men among them the system gave rise to suspicion. He hoped his hon. Friend would be content with what had fallen from the Secretary to the Treasury.

§ MR. HICKMAN
said, that after the appeal of the Secretary to the Treasury he would withdraw the Resolution.