HC Deb 23 April 1903 vol 121 cc254-5

Now, Sir, I should like to say with regard to the Income Tax that I am not quite satisfied with many matters in connection with it. It is forty-two years now since an inquiry was made into it, and my own opinion is that it would be advisable that further inquiry should now be made into its incidence, the equity of the burden, its machinery, and the evasions. I am told that the evasions are very great. An illustration has been given to me by a friend of mine who is an Income Tax Commissioner. One of the most successful modes of evasion is to make no return of income, the Income Tax payer preferring to be assessed by the Commissioners. In this particular case my friend saw that a particular firm, of which he knew something, had adopted that plan, and that the Commissioners had assessed them, I think it was at something like £3,000 or £4,000. My friend said: "What, £3,000 or £4,000; that is preposterous! These people are making gigantic profits." The Commissioners replied "Then we will make it £5,000." "£5,000!" my friend said, "put it up to £55,000." The Commissioner acted upon this advice, and the tax was paid. If much of this kind of thing goes on, we who are honest [laughter]—I am one of those individuals who cannot claim much credit for being honest, because my Income Tax is taken off for me—but, however, there can be no doubt that if this practice prevails much, the just must suffer for the unjust, and there ought to be some method by which this leakage can be stopped. Probably if that were the case, we might be able to take a penny or two pence off the Income Tax and still get the same sum from Income Tax. On the other hand, there are complaints that men who have real grievances to urge are not properly attended to. I have heard it alleged as a grievance that a man has not the right to bring his solicitor or his accountant before the local Income Tax Commissioners if they with old their consent. I think there is some ground for complaint there, but I do not want to go into the various matters of complaint, and I would really say this, that I think the time has arrived when, having regard to the fact that it is likely to remain at a high sum for some years to come, we ought to have some inquiry into the operation of the tax. There is only one court of inquiry which I think would be adequate for the occasion, and that is a Committee of the House of Commons. If I find that this suggestion of mine is favourably received, I shall be very glad to act upon it, and have the inquiry made.