Major TYRON (by Private Notice)asked the Chancellor of the Exchequer whether, in the event of a British local authority issuing securities in the United States of America with the approval of the 670 Treasury, the provisions of Section 46 (4) of the Income Tax Act, 1918, are sufficient to secure not only that such securities are exempt from liability to Income Tax and Super-tax if held by persons not ordinarily resident in the United Kingdom, but also that the local authority is entitled to deduct the interest paid on such securities from its income liable to Income Tax?
Mr. CHAMBERLAINInterest paid by a local authority in the United Kingdom on securities exempt from Income Tax under the provisions of Section 46 (4) of the Income Tax Act, 1918, will, if payable out of the taxable income of the local authority be allowed as a deduction in computing the liability to Income Tax of such authority.