§ Mr. HAROLD COXasked whether a speculative builder was at present charged for Income Tax under Schedule D on the profit which he made by buying land, building upon it, and selling at an enhanced value; whether in estimating such profit the expenditure upon the buildings erected was deducted from the sale price of the land and buildings, so that Income 1194 Tax was paid upon the increment in the land value; and whether, under the Finance Bill, the increment so taxed for Income Tax would also be taxed for Increment Tax?
§ Mr. HOBHOUSEThe answer to the first part of the question is in the affirmative. In estimating such profit the expenditure upon the buildings is included in the deductions from the sale price of the land and building. Increment Value Duty paid by a builder in respect of land purchased and sold in the course of his business will be admissible as a deduction in estimating the balance of his trading profits for the purpose of assessment to the Income Tax.
§ Mr. COXAm I to understand that for Income Tax a speculative builder is charged 9d. in the pound on the net result of his profits and losses, but that for Increment Tax he is to be charged 4s. in the pound on his profits only?
§ Mr. HOBHOUSEBefore I make a statement to which the hon. Gentleman may attach importance, perhaps he will be good enough to put the question on the Paper.