§ (1) His Majesty may by Order in Council declare—
- (a) that under the law in force in any of His Majesty's Possessions Excess Profits Duty is chargeable in respect of any profits in respect of which Excess Profits Duty is also payable in the United Kingdom; and
- (b) that arrangements have been made with the Government of any such Possession whereby, in respect of any profits, only the duty which is higher in amount is to be payable, and the amount of such duty is to be apportioned between the respective Exchequers in proportion to the amount of duty which would otherwise have been payable in the United Kingdom and in that Possession respectively.
§ (2) Where any such Order in Council is made, then if the Commissioners are satisfied that any case is one which any such arrangements relate they may, in lieu of any relief granted under Rule 4 of Part 1. of the Fourth Schedule to the principal Act, allow or make such remission or adjustments of duty as may be necessary to give effect to such arrangements, so, however, that the effect of such remission or adjustment shall not be less favourable than the relief in lieu of which they are allowed or made.
§ (3) The obligation as to secrecy imposed by Sub-section (8) of Section 45 of the principal Act shall not prevent the disclosure to the Government of the possession concerned of such facts as may be necessary to enable such arrangements as aforesaid to be carried into effect.
I beg to move, in Subsection (1), paragraph (a), after the word "possessions," to insert the words "or in Allied countries."
The Chancellor of the Exchequer has put this valuable Clause into the Bill so that the man who earns money in one of our Dominions and has that money remitted to him here does not pay both Excess Profits Duties, but only the higher of the two. We and our Dominions make an arrangement by which the sum collected is divided between the two countries in proportion to the size of the two taxes. Why should not that arrangement be extended to the Allied countries as well? A manufacturer makes a profit in France, and he has to pay 60 per cent. Excess Profits Tax. He therefore gets only 40 per cent, remitted to him in this country. That is subject here to Excess Profits Duty of 80 per cent., which takes £32, and leaves him with only £8. That again is subject to Income Tax to the extent of one-fourth, and that leaves him with £6. If the Chancellor of the Exchequer thinks it necessary, when a man makes money in the Colonies and has it remitted to him 1021 here in this country to see that he is not taxed twice and to see that everything is not taken from him so that he would be very much better off not to carry on his business in the Colonies but to put his money into the Five per Cent. War Loan, saving his time, his energy, and doing nothing, why should he not do the same with regard to our Allies? We are all fighting for the same thing. The object of the tax is to raise funds to resist German aggression, and there is no distinction and can be no distinction in justice to the individual between the two cases.
§ Mr. BONAR LAW
I hope my hon. Friend will not press this Amendment. It is just one of those cases with which one has a good deal of sympathy, but as a matter of fact it is difficult to arrange to make the exception in regard to our own Dominions, so that the Excess Profits Duty in the one country should be taken into account in the other. There is only one way in which it can be done, and that is by a definite arrangement with the Government of the Colonies in question. It is not easily done. It is a very complicated thing to arrange. There is this further to be said. Up to the present the Excess Profits Duties in the Allied countries have hardly come into effect. A good part of this financial year has already gone, and I am sure, that it would not be wise to diminish our own revenue by attempting to make the arrangement at the present time.
My right hon. Friend has overlooked the fact that this is only to be done by an Order in Council. I do not know how an Order in Council is going to affect our Allies or bind them.
I beg to withdraw the Amendment, and in doing so I wish to say that I brought this forward principally because this Clause is permissive. It is only if an arrangement can be made with our Allied countries that it would come into force at all. I do not think that there is anything in the object of my hon. Friend about the Order in Council.
§ Amendment, by leave, withdrawn.
§ Clause ordered to stand part of the Bill.