§ Notwithstanding anything contained in paragraph five of Part I. of the Fourth Schedule of the Finance (No. 2) Act, 1915, an appellant may, if he is dissatisfied with the direction of 1461 the Commissioners of Inland Revenue, have the right to appeal there from to the Commissioners for the General Purposes of the Acts relating to Income Tax or to the Commissioners for the Special Purposes of those Acts, and all regulations concerning an application for a case to be stated for the opinion of the High Court from the decision of the General or Special Commissioners shall apply."—[Mr. G. Terrell.]
§ Brought up, and read the first time.
§ Mr. G. TERRELL
I beg to move,That the Clause be read a second time.I hope the Chancellor of the Exchequer will be able to accept this Clause. The intention is to remedy a very real grievance. It all arises out of the Finance Act, No. 2, of 1915, which was passed in a very great hurry. Under the Fourth Schedule, paragraph (5), it is provided that:Any deduction allowed for the remuneration of directors, managers, and persons concerned in (the management of the trade or business shall not, unless the Commissioners of Inland Revenue, owing to any special circumstances or to the fact that the remuneration of any managers or managing directors depends on the profits on the trade or business, otherwise direct, exceed the sums allowed for these purposes in the last pre-war trade year.7.0 p.m.
From that it will be seen that the manager of a business is limited to the remuneration of a pre-war trade year—that is, five years ago. Then there is an. appeal to the Commissioners, under which they can increase that allowance for special circumstances. There is a good deal of complaint, and I think it is well founded, that the Commissioners are acting somewhat arbitrarily, and that they are not giving the fullest consideration to the circumstances of each particular case. What I seek by my Clause is to give any person who feels aggrieved the right of appeal to the Commissioners for the General Purposes of the Acts relating to Income Tax or to the Commissioners for the Special Purposes of those Acts. I do not think my right hon. Friend would really be worried with many appeals, but it would be a great concession to people who have a very solid grievance if he could see his way to give them a right of appeal. That is all I ask. I have been asked to deal with this Amendment by an employer's organisation. There is a genuine grievance that these cases are not receiving the full sympathetic consideration to which they are entitled. I do not want to press the case unduly. If my right hon. Friend, for any reasons of his own, does not wish to accept the Amendment in this form, I shall be quite satisfied 1462 if I have an assurance from him that in any case of special grievance he will look into the matter personally. That is not an unreasonable request to make. He has to remember that the Finance Act of 1915 would never have gone through at any other time than a period of grave emergency. It was accepted by the House. We did not examine it Clause by Clause, as we should to-day; it was purely a war measure. The War is happily over, and my hon. Friend ought to regard complaints of this character with a sympathetic ear. I only want a right of appeal. My case is simply this. There are instances where the Commissioners are acting oppressively. When a person is aggrieved, give him a right of appeal from those Commissioners. I do not care one bit to whom the appeal should be made, but we just want to feel that there is a right of appeal, and we should then have some confidence that instead of the arbitrary, aggressive manner in which these cases are at present being dealt with greater consideration would be shown to each particular case. I do ask my right hon. Friend to be sympathetic in his reply. He has made very few concessions this afternoon. Here is an opportunity for him to make a concession which I do not think will cost the Treasury anything, but will give a great deal of satisfaction to people who have a grievance. I do not want to confine him to the terms of the Clause. If he will state to the House that he personally will look into any case of grievance I shall be perfectly satisfied to leave it in his hands, but I do ask that the grievance shall be met in some form or another.
§ Mr. BALDWIN
This is a subject with which my hon. Friend and myself are quite familiar, and I do not think I need keep the House more than three or four minutes in saying what I have to say upon it. There was a reason, in the case of these rules dealing with excess profits, for not giving a right of appeal, and I think it might just clear our minds if we recollect that that reason was: Whereas, in regard to Income Tax practice, you had more than half a century of custom and precedent behind you, here, in regard to excess profits, you were starting new machinery dealing with an entirely new and hitherto untried method of taxation. It was perfectly obvious, in those circumstances, that if you were to got any uniformity of practice—and uniformity of practice in taxation is essential 1463 for dealing even-handed justice amongst the taxpayers—you must concentrate your authority for interpreting rules in as few hands as possible, and not give a right of appeal to various bodies of authorities situated in different parts of the country who would certainly have taken widely different views on the same points submitted to them in different districts. That was the reason. This system has worked from the inception of the Excess Profits Tax, a matter of something like five years. The Excess Profits Tax is getting very near its end, and I cannot see that any advantage could come to anyone in altering, in what may be its last months, a tax, and substituting a different method of conduct from that which has obtained during the greater course of its existence. I would only say one more word, and that is that I do not think my right hon. Friend would have tire time to set himself up as an arbitrator in these difficult and complicated cases. But I will give my hon. Friend this assurance, that at any time he likes to bring to me cases that he thinks deserve investigation I will give them my personal attntion.
§ Mr. TERRELL
The hon. Gentleman must know that individuals do not bring their cases to a Member of this House. He must know that all these cases are private and confidential. He has records of them.
§ Mr. BALDWIN
If they are private and confidential, of course, I do not see them; that is the difficulty.
§ Mr. BALDWIN
My hon. Friend, through the association with which he is concerned, will have every opportunity of bringing grievances before me. I am quite sure that on any typical grievance that he maybe in a position to bring I might possibly be able to confer with the Inland Revenue authorities to some advantage.
§ Mr. TERRELL
Before the hon. Gentleman concludes. May I take it as his reply that he will look into cases which are referred to him by any of the important employers' organisations?
§ Mr. BALDWIN
I want to be quite clear on this matter. I am quite willing to investigate typical cases in which there may be a real sense of grievance. I make no offer to stand as arbitrator or a court of appeal. I would remind him, what he pro- 1464 bably is not aware of, that though these rules have been in existence six years, and. though they have been administered by this system of which he complains, the actual complaints reaching the Departmemt have not been numerous. My impression, from the discussions I have had with the Inland Revenue people, is that, generally speaking, there is satisfaction. Of course, there always will be people who think they ought to get a great deal more than they are getting, and I cannot hold out any hope to them that anything I should do will ameliorate their position.
§ Question put, and negatived.