HC Deb 22 July 1914 vol 65 cc518-26

Section sixty-eight of the Finance (1909–10) Act, 1910 (which gives to individuals whose total income does not exceed five hundred pounds relief from Income Tax equal to the amount of tax on ten pounds in respect of every child under the age of sixteen years), shall have effect as if twenty pounds were substituted for ten pounds.


I beg to move, at end of Clause, to add the words "and the expression 'child' shall be extended to include a child permanently adopted."

This is a very modest Amendment—not nearly so ambitious as a great many which have been proposed, and I think I can safely say it is a very cheap Amendment. I hope on both those grounds that the Government may be able to look upon it with favour. At present no relief at all can be obtained in respect of an adopted child for this reason, that the term "child" under the Finance Act, Section 68, in addition to a legitimate child, only includes a stepchild or an illegitimate child whose parents happen to have married afterwards. But take the case of a widow with two or three children having to earn her own living. In order to relieve the burden of those children, it is quite possible that relations and friends may come forward and adopt one or more of those children permanently. In fact, it often happens. They undertake to bring them up and educate them and provide for the whole of their maintenance. Take the case again of a father who is left with young children. It is an enormous relief to him that someone should come forward and permanently adopt one or more of the children who have been left behind, to look after their interests and their education, and, of course, it is not only an enormous relief to the father, it is of the greatest benefit to the child, who cannot possibly be looked after by the father if he happens to be a working man, out at his work all day long.

But under the existing law adoptive parents cannot get any relief under this Section or under previous Acts. I really do not think it is fair. I think it is only fair to help those people who, out of kindness and generosity of heart, come forward and agree to permanently adopt the children of other people who happen to be in very poor circumstances. I cannot conceive anybody going to the trouble and expense of adopting a child merely in order to get the relief I am trying to persuade the Government to give. It certainly would never happen. I think it is quite conceivable that want of relief, and holding the relief back, will very often discourage the adoption in cases where it would really be of inestimable benefit. I have no estimate of what the cost will be, but I cannot imagine that the cost will be at all large, and I am certain that it would not be anything but a very small proportion compared with the great benefit which would accrue to a great many poor people.

The Government may possibly reply that it is impossible to define the term "permanently adopted." But, after all, that will have to be a question of fact, and all through the Income Tax laws it is over and over again a question of fact as to whether a tax has or has not been paid, or whether relief is given or not. For instance, take the case of the control of a company. It very often has to be decided whether the control of a company is in this country or abroad. That is merely a question of fact. There is no absolute definition. Take, again, a trader's profits. It has continually to be decided what really are the profits. It has to be decided whether what ought to be profits appear in the accounts of the year. That, again, is merely a question of fact. Take, again, the Chancellor of the Exchequer's own Clause 5—the question of domicile. That, again, is merely a question of fact as to whether a person is domiciled or not in this

country, and the right hon. Gentleman has since put down an Amendment dealing with persons not ordinarily resident in the United Kingdom. That, again, is merely a question of fact. And I maintain that in just the same way the term "permanently adopted" would be a question of fact which would have to be settled, just as other questions of fact have to be settled, under the Income Tax law. Therefore, I do very much hope that this Amendment will not be rejected. It will be of great advantage to many poor people.


I beg to second the Amendment.


It is impossible really, to accept this Amendment, and I cannot help thinking that when the hon. Member sees the difficulties it would produce, he will understand that himself. He proposes to make a concession in favour of those who permanently adopt a child. It is impossible to say that a child is permanently adopted. You might adopt a child to-day and abandon it to-morrow. There is no such thing known to the law as "permanently adopted." Nobody suggests that you can have a child permanently adopted, and, therefore, this Amendment would enable a person to adopt a child in order to get relief for a few months and then to get rid of the child. I think the only way of dealing with this matter is to confine the Clause to those for whom the reduction was originally intended.

Question put, "That those words be there inserted in the Bill."

The House divided: Ayes, 180; Noes, 271.

Division No. 196.] AYES. [7.2 p.m.
Agg-Gardner, James Tynte Boscawen, Sir Arthur S. T. Griffith- Courthope, George Loyd
Aitken, Sir William Max Bowden, G. R. Harland Craig, Captain James (Down, E.)
Amery, L. C. M. S. Boyle, William (Norfolk, Mid) Craig, Norman (Kent, Thanet)
Ashley, Wilfrid W. Boyton, James Craik, Sir Henry
Astor, Waldorf Bridgeman, William Clive Dalrymple, Viscount
Baird, John Lawrence Bull, Sir William James Dalziel, Davison (Brixton)
Baker, Sir Randolf L. (Dorset, N.) Burdett-Coutts, W. Denison-Pender, J. C.
Baldwin, Stanley Burn, Colonel C. R. Denniss, E. R. B.
Barnston, Harry Butcher, John George Dickson, Rt. Hon. C. Scott
Barrie, H. T. Campbell, Captain Duncan F. (Ayr, N.) Dixon, C. H.
Bathurst, Hon. A. B. (Glouc., E.) Campion, W. R. Duncannon, Viscount
Bathurst, Charles (Wilts, Wilton) Carlile, Sir Edward Hildred Eyres-Monsell, Bolton M.
Beach, Hon. Michael Hugh Hicks Carson, Rt. Hon. Sir Edward H. Faber, George Denison (Clapham)
Beckett, Hon. Gervase Cautley, Henry Strother Fell, Arthur
Benn, Ion Hamilton (Greenwich) Cave, George Fisher, Rt. Hon. W. Hayes
Bennett-Goldney, Francis Cecil, Evelyn (Aston Manor) Fitzroy, Hon. Edward A.
Bentinck, Lord H. Cavendish- Cecil, Lord Hugh (Oxford University) Fletcher, John Samuel
Beresford, Lord Charles Cecil, Lord R. (Herts, Hitchin) Forster, Henry William
Bigland, Alfred Chaloner, Colonel R. G. W. Foster, Philip Staveley
Bird, Alfred Clive, Captain Percy Archer Gastrell, Major W. Houghton
Blair, Reginald Clyde, J. Avon Gibbs, George Abraham
Gilmour, Captain John Lockwood, Rt. Hon. Lt.-Colonel A. R. Smith, Rt. Hon. F. E. (L'pool, Walton)
Glazebrook, Captain Philip K. Long, Rt. Hon. Walter Smith, Harold (Warrington)
Goldman, C. S. Lowe, Sir F. W. (Birm., Edgbaston) Spear, Sir John Ward
Grant, J. A. Lyttelton, Hon. J. C. Stanier, Beville
Greene, Walter Raymond MacCaw, Wm. J. MacGeagh Stanley, Hon. G. F. (Preston)
Gretton, John Mackinder, Halford J. Starkey, John Ralph
Guinness, Hon. Rupert (Essex, S. E.) M'Neill, Ronald (Kent, St. Augustine's) Staveley-Hill, Henry
Guinness, Hon. W. E. (Bury S. Edmunds) Magnus, Sir Philip Steel-Maitland, A. D.
Gwynne, R. S. (Sussex, Eastbourne) Mason, James F. (Windsor) Stewart, Gershom
Haddock, George Bahr Mildmay, Francis Bingham Strauss, Arthur (Paddington, North)
Hall, Marshall (Liverpool, E. Toxteth) Moore, William Swift, Rigby
Hamilton, C. G. C. (Ches., Altrincham) Morrison-Bell, Capt. E. F. (Ashburton) Sykes, Alan John (Ches., Knutsford)
Hamilton, Lord C. J. (Kensington, S.) Mount, William Arthur Talbot, Lord Edmund
Hardy, Rt. Hon. Laurence Newdegate, F. A. Terrell, George (Wilts, N. W.)
Harris, Leverton (Worcester, East) Newman, John R. P. Terrell, H. (Gloucester).
Harris, Henry Percy (Paddington, S.) Newton, Harry Kottingham Thomas-Stanford, Charles
Helmsley, Viscount O'Neill, Hon. A. E. B. (Antrim, Mid) Thompson, Robert (Belfast, North)
Henderson, Major H. (Berks, Abingdon) Orde-Powlett, Hon. W. G. A. Thomson, W. Mitchell- (Down, North)
Henderson, Sir A. (St. Geo., Han. Sq.) Ormsby-Gore, Hon. William Thynne, Lord Alexander
Hewins, William Albert Samuel Paget, Almeric Hugh Tobin, Alfred Aspinall
Hickman, Colonel Thomas E. Parker, Sir Gilbert (Gravesend) Touche, George Alexander
Hill-Wood, Samuel Pease, Herbert Pike (Darlington) Tryon, Captain George Clement
Hoare, S. J. G. Peel, Lieut.-Colonel R. F. Valentia, Viscount
Hohler, Gerald Fitzroy Perkins, Walter F. Watson, Hon. W.
Hope, Harry (Bute) Peto, Basil Edward Weigall, Captain A. G.
Hope, James Fitzalan (Sheffield) Pretyman, Ernest George White, Major G. D. (Lancs., Southport)
Hope, Major J. A. (Midlothian) Pryce-Jones, Colonel E. Willoughby, Major Hon. Claud
Horner, Andrew Long Quitter, Sir William Eley C. Wills, Sir Gilbert
Houston, Robert Paterson Randles, Sir John S. Wilson, A. Stanley (Yorks, E. R.)
Hume-Williams, William Ellis Ratcliff, R. F. Wilson, Captain Leslie O. (Reading)
Hunt, Rowland Rees, Sir J. D. Wilson, Maj. Sir M. (Bethnal Green, S. W.)
Ingleby, Holcombe Remnant, James Farquharson Wood, Hon. E. F. L. (Yorks, Ripon)
Jardine, Ernest (Somerset, East) Rolleston, Sir John Wood, John (Stalybridge)
Jessel, Captain H. M. Ronaldshay, Earl of Worthington Evans, L.
Kerry, Earl of Rutherford, John (Lancs., Darwen) Wortley, Rt. Hon. C. B. Stuart-
Kinloch-Cooke, Sir Clement Rutherford, Watson (L'pool, W. Derby) Yate, Colonel C. E.
Lane-Fox, G. R. Samuel, Sir Harry (Norwood) Younger Sir George
Larmor, Sir J. Samuel, Samuel (Wandsworth)
Law, Rt. Hon. A. Bonar (Bootle) Sanders, Robert Arthur TELLERS FOR THE AYES.—Mr.
Lawson, Hon. H. (T. M'mts., Mile End) Scott, Sir S. (Marylebone, W.) G. Locker-Lampson and Mr. Cassel
Abraham, William (Dublin, Harbour) Clancy, John Joseph George, Rt. Hon. D. Lloyd
Acland, Francis Dyke Clough, William Gladstone, W. G. C.
Agnew, Sir George William Clynes, John R. Glanville, Harold James
Ainsworth, John Stirling Collins, Godfrey P. (Greenock) Goddard, Sir Daniel Ford
Alden, Percy Collins, Sir Stephen (Lambeth) Goldstone, Frank
Allen, Rt. Hon. Charles P. (Stroud) Compton-Rickett, Rt. Hon. Sir J. Grey, Rt. Hon. Sir Edward
Armitage, Robert Cornwall, Sir Edwin A. Griffith, Rt. Hon. Ellis Jones
Arnold, Sydney Crooks, William Guest, Hon. Frederick E. (Dorset, E.)
Asquith, Rt. Hon. Herbert Henry Crumley, Patrick Gwynn, Stephen Lucius (Galway)
Baker, Harold T. (Accrington) Cullinan, John Hackett, John
Baker, Joseph Allen (Finsbury, E.) Dalziel, Rt. Hon. Sir J. H. (Kirkcaldy) Hancock, John George
Balfour, Sir Robert (Lanark) Davies, David (Montgomery Co.) Hardie, J. Keir
Baring, Sir Godfrey (Barnstaple) Davies, Ellis William (Eifion) Harmsworth, Cecil (Luton, Beds)
Barnes, George N. Davies, Timothy (Lincs., Louth) Harvey, T. E. (Leeds, West)
Barran, Sir John N. (Hawick Burghs) Davies, Sir W. Howell (Bristol, S.) Haslam, Lewis
Beale, Sir William Phipson Dawes, James Arthur Havelock-Allan, Sir Henry
Beauchamp, Sir Edward De Forest, Baron Hayden, John Patrick
Beck, Arthur Cecil Delany, William Hayward, Evan
Benn, W. W. (T. Hamlets, St. George) Denman, Hon. Richard Douglas Helme, Sir Norval Watson
Bentham, George Jackson Devlin, Joseph Henderson, Arthur (Durham)
Bethell, Sir John Henry Dewar, Sir J. A. Henry, Sir Charles
Birrell, Rt. Hon. Augustine Dickinson, Rt. Hon. Willoughby H. Herbert, General Sir Ivor (Mon., S.)
Black, Arthur W. Dillon, John Higham, John Sharp
Boland, John Pius Donelan, Captain A. Hinds, John
Booth, Frederick Handel Doris, William Hobhouse, Rt. Hon. Charles E. H.
Boyle, Daniel (Mayo, North) Duffy, William J. Hodge, John
Brady, Patrick Joseph Duncan, C. (Barrow-in-Furness) Hogge, James Myles
Brocklehurst, William B. Duncan, Sir J. Hastings (Yorks, Otley) Holmes, Daniel Turner
Brunner, John F. L. Edwards, Sir Francis (Radnor) Holt, Richard Durning
Bryce, J. Annan Edwards, John Hugh (Glamorgan, Mid) Hope, John Deans (Haddington)
Buckmaster, Sir Stanley O. Esmonde, Dr. John (Tipperary, N.) Howard, Hon. Geoffrey
Burns, Rt. Hon. John Esmonde, Sir Thomas (Wexford, N.) Hudson, Walter
Burt, Rt. Hon. Thomas Esslemont, George Birnie Hughes, Spencer Leigh
Buxton, Noel Fenwick, Rt. Hon. Charles Jones, Edgar (Merthyr Tydvil)
Byles, Sir William Pollard Ffrench, Peter Jones, H. Haydn (Merioneth)
Carr-Gomm, H. W. Field, William Jones, J. Towyn (Carmarthen, East)
Cawley, Sir Frederick (Prestwich) Fitzgibbon, John Jones, Leif (Notts, Rushcliffe)
Cawley, Harold T. (Lancs., Heywood) Flavin, Michael Joseph Jones, William (Carnarvonshire)
Chancellor, Henry George France, Gerald Ashburner Jones, William S. Glyn- (Stepney)
Chapple, Dr. William Allen Furness, Sir Stephen Wilson Jowett, Frederick William
Churchill, Rt. Hon. Winston S. Gelder, Sir W. A. Joyce, Michael
Kellaway, Frederick George O'Connor, T. P. (Liverpool) Sherwell, Arthur James
Kelly, Edward O'Doherty, Philip Shortt, Edward
Kennedy, Vincent Paul O'Donnell, Thomas Simon, Rt. Hon. Sir John Allsebrook
Kenyon, Barnet O'Dowd, John Smith, Albert (Lancs., Clitheroe)
Kilbride, Denis O'Kelly, James (Roscommon, N.) Smith, H. B. Lees (Northampton)
King, Joseph O'Malley, William Smyth, Thomas F. (Leitrim, S.)
Lambert, Rt. Hon. G. (Devon, S. Molton) O'Neill. Dr. Charles (Armagh, S.) Spicer, Rt. Hon. Sir Albert
Lambert, Richard (Wilts, Cricklade) O'Shaughnessy, P. J. Strauss, Edward A. (Southwark, West)
Lardner, James C. R. O'Sullivan, Timothy Sutherland, John E.
Law, Hugh A. (Donegal, West) Outhwaite, R. L. Sutton, John E.
Lawson, Sir W. (Cumb'rld, Cockerm'th) Palmer, Godfrey Mark Taylor, John W. (Durham)
Levy, Sir Maurice Parry, Thomas H. Taylor, Thomas (Bolton)
Lewis, Rt. Hon. John Herbert Pearce, Robert (Staffs, Leek) Tennant, Rt. Hon. Harold John
Low, Sir Frederick (Norwich) Pearce, William (Limehouse) Thomas, J. H.
Lundon, Thomas Pease, Rt. Hon. Joseph A. (Rotherham) Thorne, G. R. (Wolverhampton)
Lyell, Charles Henry Phillips, John (Longford, S.) Thorne, William (West Ham)
Lynch, Arthur Alfred Pirie, Duncan V. Toulmin, Sir George
Macdonald, John M. (Falkirk Burghs) Pratt, J. W. Trevelyan, Charles Philips
McGhee, Richard Price, C. E. (Edinburgh, Central) Verney, Sir Harry
MacVeagh, Jeremiah Priestley, Sir W. E. B. (Bradford, E.) Walsh, Stephen (Lancs., Ince)
M'Callum, Sir John M. Primrose, Hon. Neil James Walters, Sir John Tudor
McKenna, Rt. Hon. Reginald Radford, George Heynes Walton., Sir Joseph
Manfield, Harry Raffan, Peter Wilson Warner, Sir Thomas Courtenay T.
Markham, Sir Arthur Basil Rea, Rt. Hon. Russell (South Shields) Wason, Rt. Hon. E. (Clackmannan)
Marks, Sir George Croydon Rea, Walter Russell (Scarborough) Wason, John Cathcart (Orkney)
Marshall, Arthur Harold Reddy, Michael Watt, Henry Anderson
Meagher, Michael Redmond, John E. (Waterford) Webb, H.
Meehan, Francis E. (Leitrim, N.) Redmond, William (Clare, E.) Wedgwood, Josiah C.
Meehan, Patrick J. (Queen's Co., Leix) Redmond, William Archer (Tyrone, E.) White, J. Dundas (Glasgow, Tradeston)
Middlebrook, William Rendall, Athelstan White, Sir Luke (Yorks, E. R.)
Millar, James Duncan Richardson, Albion (Peckham) White, Patrick (Meath, North)
Molloy, Michael Richardson, Thomas (Whitehaven) Whitehouse, John Howard
Molteno, Percy Alport Roberts, Charles H. (Lincoln) Whittaker, Rt. Hon. Sir Thomas P.
Mond, Rt. Hon. Sir Alfred Roberts, George H. (Norwich) Whyte, Alexander F. (Perth)
Montagu, Hon. E. S. Roberts, Sir J. H. (Denbighs) Wiles, Thomas
Mooney, John J. Robertson, Sir G. Scott (Bradford) Wilkie, Alexander
Morgan, George Hay Robertson, John M. (Tyneside) Williams, Aneurin (Durham, N. W.)
Morrell, Philip Robinson, Sidney Williams, Penry (Middlesbrough)
Morison, Hector Roch, Walter F. (Pembroke) Wilson, Rt. Hon. J. W. (Worcs., N.)
Morton, Alpheus Cleophas Roche, Augustine (Louth) Wilson, W. T. (Westhoughton)
Muldoon, John Roe, Sir Thomas Winfrey, Sir Richard
Munro, Rt. Hon. Robert Rowlands, James Wing, Thomas Edward
Murphy, Martin J. Rowntree, Arnold Wood, Rt. Hon. T. McKinnon (Glasgow)
Murray, Captain Hon. Arthur C. Runciman, Rt. Hon. Walter Yeo, Alfred William
Nicholson, Sir Charles N. (Doncaster) Russell, Rt. Hon. Thomas W. Young, William (Perthshire, East)
Nolan, Joseph Samuel, Rt. Hon. H. L. (Cleveland) Yoxall, Sir James Henry
Norman, Sir Henry Samuel, J. (Stockton-on-Tees)
Norton, Captain Cecil W. Scanlan, Thomas
Nugent, Sir Walter Richard Scott, A. MacCallum (Glas., Bridgeton) TELLERS FOR THE NOES.—Mr.
Nuttall, Harry Seely, Rt. Hon. Colonel J. E. B. Illingworth and Mr. Gulland.
O'Brien, Patrick (Kilkenny) Sheehy, David

Question, "That those words be there inserted in the Bill," put, and agreed to.

Sir J. D. REES

I beg to move, at the end Clause, to add the words, Section sixty-eight of the Finance (1909–10) Act, 1910, shall read as if for the words 'five hundred' the words 'one thousand' were substituted. By the Finance Act of 1909–10 it is provided that wherever a person who is liable for Income Tax proves that his income does not exceed £500, and that he has a child or children under sixteen years of age, he is entitled in respect of each child to relief from Income Tax on £10 of his income. By the present Bill that is altered to £20. My proposal to substitute the words "one thousand" for "five hundred" is avowedly in the interest of public servants abroad, and more particularly in India. I venture to submit that it is very advantageous that officials from our British Possessions with sons who are likely to follow in their footsteps should have the advantage of giving them educa- tion in a public school. By common consent of those acquainted with this subject, they make better administrators in foreign countries than those who have not enjoyed that advantage. I suggest that the limit should be altered from £500 to £1,000, in order to give this class a chance of giving their sons this kind of education. My hon. Friend the Member for the Wirral Division (Mr. Stewart) moved last night that a reduction of Income Tax should be allowed in respect of the amount spent by parents on the education of their children, and, in reply, the Attorney-General rather unfairly said that it was a proposal that every man who sent his son to Eton and paid £300 for his education should have a corresponding reduction in respect of the amount upon which Income Tax is charged. There is very little chance of men who have only £1,000 a year sending their sons to Eton. I submit that it is perfectly clear that men with £1,000 a year all told—they do not get so much net—cannot afford to send their sons to Eton. I think the privilege mentioned in the Chancellor of the Exchequer's first Act should be extended. This is quite a moderate proposal, and, for the reasons which I have given, I venture to commend it to the favourable consideration of the House.


I dealt with this matter before in reply to the hon. Gentleman; I forget whether when he was proposing an Amendment or foreshadowing this Amendment. I still adhere to the view which I then expressed, that if there is any extension it should be an extension of the allowance. I would very much prefer to increase the amount of the allowance to incomes under £500 than to extend the limit. People with less than £500 who have children are very hard hit by Income Taxes and rates. It is a very serious matter for persons with these incomes who have to try to keep up an appearance for professional purposes and the purposes of their business, as well as to spend money upon the education and the maintenance of their children, to have to pay additional rates and taxes. I think that there is a great deal to be said for increasing substantially the amount of the allowance for incomes under £500. I have no defence for the comparative smallness of the increase this year, except that the Exchequer could not afford to give a larger allowance. But I hope that some Chancellor of the Exchequer soon will be able to give a greater allowance than I could afford to submit to the House of Commons this year. I hope that when that time comes the House of Commons will take the view that the direction in which such allowance should be made is by increasing the amount in the case of small incomes before you come to the extension of the limit. For that reason I cannot see my way to accept the Amendment of the hon. Gentleman.


I beg to support the Amendment. I have been in India, and I know how hard it is for Indian Civil servants to pay all these taxes. I am for helping the man who has under £500 a year, but I do not see why relief cannot be given in both cases We are getting a lot of money now for rates and taxes, and there is no reason why the Chancellor of the Exchequer should not accept this Amendment.


This is a perfectly nonsensical Amendment. The amount of relief which is proposed to give to these people from India is 15s. on incomes of £1,000, and to say that an official from India cannot educate his child because he does not get relief to the extent of 15s., is perfectly ludicrous, and the hon. Member knows it.

Sir J. D. REES

Though I do not at all accept the views of the hon. Baronet, still this proposition is not one which seems to command support, and I do not think that I should be justified in asking the House to divide upon it.

Amendment, by leave, withdrawn.