Mr. LYULPH STANLEYasked the Chancellor of the Exchequer whether, in calculating the value of land for the purposes of the Increment Tax in Frankfort, any allowance is made for the loss of income consequent on the purchaser having invested his capital in undeveloped land; and whether he will consider whether he could allow an owner who has invested his money in undeveloped land in the United Kingdom to deduct from the valuation for the purposes of Increment Duty such an amount as will represent the difference between the amount he has actually received from the property and the amount he would have received if he had invested the purchase money, or the amount for which the property was originally valued, at 3½ per cent.?
§ Mr. HOBHOUSEAt Frankfort, in cases of unbuilt-on land not used by the owner for purposes of agriculture or industry carried on by himself, interest at the rate of 4 per cent. on the purchase money is allowed, plus expenditure, on repairs and maintenance, and minus all receipts from the property. If the owner uses the land himself for purposes of agriculture or industry, no allowance would be made even if the profits derived by him from the property did not amount to 4 per cent. I may add that in the case of Hamburg there is no allowance of interest in similar cases. My right hon. Friend does not see his way to accept the suggestion contained in the second part of the question.
§ Sir PHILIP MAGNUSWhat is the allowance made at Essen?
§ Mr. HOBHOUSEI am afraid I cannot carry all the details of these German towns in my head.
§ Sir PHILIP MAGNUSIs the right hong. Gentleman aware that the allowance made there is 5 per cent.
§ Mr. HOBHOUSEIf the right hon. Member knows it, I do not know why he should ask me the question.