§ 27. Rear-Admiral ADAIRasked the First Lord of the Admiralty whether any decision has yet been come to as to the rate of Income Tax to be charged on the pay of naval officers; and whether, if the full civilian rate is to be charged, provision will be made in the forthcoming Navy Estimates for such increases in the pay of officers as will compensate them for this charge?
§ Mr. LONGThe answer to the first part of the question is that it has been decided by the Government that as from the 1st April next Income Tax is to be charged on the assessable service emoluments of naval officers at the ordinary rates applicable to the rest of the community: and to the second part that no provision of the nature suggested has been made, the principle of charging increased rates of Income Tax having been decided upon when the new increased rates of pay were sanctioned. This decision was promulgated in the Fleet Order as the new rates of pay.
§ Viscount CURZONIs the right hon. Gentleman aware that in Admiral Halsey's Report with reference to the pay of naval officers it was recommended that if the Service rate of Income Tax were no longer to be charged the question of their pay would have to be reconsidered?
§ Mr. LONGThat: is quite correct, but when the question was finally considered and decided that recommendation was not adopted.
§ Sir E. CARSONIs the right hon. Gentleman aware that in some cases the Income Tax will very nearly swallow up the whole of the increased pay?
§ Mr. LONGI do not think so. I have looked through a great many specimen 876 cases myself and that point was considered when we had the whole proposal before us, but there is hardly any case where the description would be applicable. No doubt, when you come to rearrange things, the new rates always adversely affect some of the old conditions.
§ Lieut. - Commander KENWORTHYAre we to understand that officers serving abroad on long commissions are to be charged civilian rates of Income Tax?