§ 58. Captain DOUGLAS HALLasked the Chancellor of the Exchequer whether, in the case of holders of the Four per Cent War Loan free of Income Tax, the Government will undertake that if they decide to reduce the amount of income over which Super-tax is payable they will exclude the holders of the Four per Cent. Loan from the operation of Super-tax or allow a proportional reduction?
§ Mr. BONAR LAWI may remind my hon. and gallant Friend that the prospectus of the new War Loan definitely states that although dividends on the Four per Cent. Loan will be exempt from liability to assessment to British Income Tax, they are liable to Super-tax at the same rate and subject to the same conditions as income derived from any other source.
§ 61. Mr. G. FABERasked the Chancellor of the Exchequer whether he has been able to arrange with those in this House who are responsible for the control of party funds to make adequate contributions to the War Loan out of those funds?
§ Mr. BONAR LAWI have, as Chancellor of the Exchequer, made a general appeal to the public, and I am informed that those in control of such funds have liberally responded to it.
§ Mr. HOGGEWould not this suggestion perpetuate the party funds by keeping them intact for thirty years, which would be a great disadvantage?
§ Mr. BONAR LAWI hope that would not be the case, because the Loan would be saleable.
§ 63. Mr. MACMASTERasked the Chancellor of the Exchequer if he will consider the possibility of modifying the present system of investing in War Loan by substituting for the existing method the issue to investors under £50 of bearer bonds with interest coupons attached, which the investor might buy over the post office counter as simply as he may now purchase a book of stamps, such bonds to be numbered consecutively, and each postmaster to be held responsible for the numbers entrusted to him for issue, of which re would keep a record and make returns of the numbers sold and the names of the purchasers?
§ Mr. BONAR LAWExperience shows that the small investor does not like beaver bonds, and much prefers a nominal document. The fact that interest on inscribed or registered stock can be paid without deduction for Income Tax, whereas tax must be deducted at the source in the case of coupons is a further objection. The War Savings Certificates have proved a very popular and simple form of Government security suitable for the needs of investors of the kind which my hon. and learned Friend has in mind. These will, of course, continue to be on sale after the close of the period of subscription for the War Loans.
§ Mr. MACMASTERIs it not a fact that the War Savings Certificate is one that carries deferred interest payable five years hence, and, in that respect it is differentiated from the class of security referred to in the question, which is analogous to what is issued in France and has proved a tremendous success there?
§ Mr. BONAR LAWAs I informed my hon. Friend our experience is that the public do not like bearer bonds.