§ 93. Mr. GILBERTasked the Chancellor of the Exchequer if soldiers and non commissioned officers serving in the Army are liable to Income Tax; if so, at what rate they have to pay; and will he state if a man's pay, his allowances for wife and family, and any allowance made by 1467 his employers are all estimated as income on which tax is charged, less the usual allowances?
§ Mr. BONAR LAWSoldiers and noncommissioned officers serving in the Army are liable to Income Tax, but under Section 30 of the Finance Act, 1916, reduced rates of tax, ranging from 9d. to 3s. 6d. in the £, are charged on the service pay, and, where the total income from all sources does not exceed £300, the pre-war exemption limit (£160) and abatement allowance (£160) still apply. The answer to the last part of the hon. Member's question is in the affirmative.
§ Mr. PETOIs the right hon. Gentleman aware that the concession to soldiers and sailors in the matter of Income Tax has been made practically inoperative owing to words in the Act just quoted that all deductions must be made from the final pay, and that, therefore, in the case of the smaller pays they all go away in Income Tax?
§ Mr. BONAR LAWNo, I am not aware of that. I am sure that that was not the intention of my right hon. Friend who preceded me in this office. If the facts are as stated I shall look into them.