§ The contributions of employers and employees to a superannuation fund and any income arising from the investment of such fund or funds shall not be liable to Income Tax.—[Mr. Tyson Wilson.]
§ Brought up, and read the First time.
§ Earl WINTERTONOn a point of Order. Can we not discuss the Clause which stands in the name of the hon. Member for Bury St. Edmunds (Lieut.-Colonel Guinness) in reference to the remuneration of directors and managers?
§ The DEPUTY-CHAIRMANNo, I am riot selecting that Amendment.
§ Earl WINTERTONIt does seem a rather important point in reference to 2862 directors' and managers' remuneration, and there has been another Amendment on the Paper on the point.
Mr. WILSONI believe that some people argue that the contributions of employers and employés to superannuation funds are exempt from Income Tax, but my information from some of those associations is that they are not exempt. My object is to make the point quite clear, and I move the Clause so that there shall be no misunderstanding in connection with a matter of this kind. I understand that contributions under the Insurance Act are exempt from Income Tax, and I submit that if workmen and employers contribute to a fund which is going to be used for the purpose of maintaining workmen when out of employment, those contributions ought to be exempt from Income Tax as well. We ought to remember that the fact that these persons are contributing to a superannuation fund means that in the great majority of cases they will not take the Old Age Pension. It is, therefore, sound economy to exempt superannuation funds from Income Tax. The Royal Commission which considered the question of the Income Tax recommended that the contributions of employers and of workmen towards superannuation funds should be exempted and that the income arising from the investment of those funds should also be exempted. All I ask the Chancellor of the Exchequer to do is to accept the recommendations of the Royal Commission.
Mr. CHAMBERLAINThe Clause deals with three pointsâthe employers' contributions, the workmen's contributions and the income derived from their invested funds. Subject to the fulfilment of certain conditions, the normal practice is that the contributions of the employer and of the employed are exempt, but according to my information the difference between the practice and what is desired by my hon. Friend is in respect of the invested funds. It is quite true that the Royal Commission made on this point recommendations which, like a great many of their recommendations on detailed matters, I have not been able to take up in the present Finance Bill, but have reserved for the Revenue Bill, when- 2863 ever I can introduce that. I shall go into the matter very carefully then, and my expectation is that in regard to most of these matters I shall be able to follow the recommendations of the Commission and incorporate them. in the Bill. If the hon. Member has particular cases in mind where he thinks that the practice conflicts with that which I have described as the normal practice, I shall be much obliged if he will send me particulars so that I may have them investigated.
Mr. T. WILSONTs it not the fact that the only contributions which are exempt are the contributions which carry a benefit of not more than £1 a week. I am told by the Association of Municipal Employ£s that their contributions and the municipalities' contributions are not exempt. If the right hon. Gentleman is prepared to give sympathetic consideration to the principle contained in this Clause, when dealing with the Revenue Bill, I do not know that I shall press the matter now.
Mr. CHAMBERLAINI certainly shall give most sympathetic consideration to the recommendations of the Royal Commission in respect of it. They are rather complicated and will require a good deal of legislation. I will make further inquiries on the matter and will communicate to the hon. Member the result.
§ Motion and Clause, by leave, withdrawn.