- (1) The following paragraphs shall be substituted for paragraphs (i) and (ii) of paragraph (1) (b) of Rule 7 of No. V in Schedule A (which relates to the allowance for repairs):
- "(i) where the owner is occupier or chargeable as landlord, or where a tenant is occupier and the landlord has undertaken to bear the cost of repairs, by a sum equal, where the amount of the assessment does not exceed twenty pounds, to one-fourth part of that amount, and, where the amount of the assessment exceeds twenty pounds but does not exceed forty pounds, to one-fifth part of that amount, and where the amount of the assessment exceeds forty pounds, to one-sixth part of that amount; and
- (ii) where a tenant is occupier and has undertaken to bear the cost of repairs, by such a sum, not exceeding one-fourth, one-fifth or one-sixth part of the amount of the assessment, as the case may be, as may be necessary to reduce the amount of rent payable by him:
- (2) In paragraph (2) of the said Rule 7, for the words "one-sixth" there shall be substituted the words "one-fourth, one-fifth or one-sixth, as the case may be," and in paragraph (1) of Rule 8 of the said Number V in Schedule A for the words "one-sixth part" there shall be substituted the words "one-fourth, one-fifth or one-sixth part, as the case may be."
- (3) This Section shall not have effect as respects Income Tax for the year 1922–23 and shall, unless Parliament otherwise determines, cease to have effect on the fifth day of April, nineteen hundred and twenty-eight.
§ Mr. G. LOCKER-LAMPSON
I beg to move, in Sub-section (3), to leave out the word "not" ["This Section shall not have effect"].
This Clause deals with an additional allowance for repairs.
§ The CHAIRMAN
The Committee stage came on rather unexpectedly soon. I called the hon. and gallant Gentleman, but he was not then present. I am afraid it is not possible to go back.
§ 4.0 P.M.
§ Mr. LOCKER-LAMPSON
The additional allowance is not going to be made for this year. The right hon. Member for Chelmsford (Mr. Pretyman) is a great authority on these questions, and I do not know whether he is going to agree with me that it ought to be allowed. I do not really see why the Government has introduced a provision saying that it shall only take effect next year and onwards for the following seven years. It is possible the Government will argue that the reason they are not giving it for the coming year is that the present assessment is very low indeed and that it is not necessary to give this additional allowance until a re-assessment has been made, but he may have forgotten that the cost of repairs has been perfectly enormous during the last few years. This increased cost of repairs entirely neutralises the existing low assessment, if the existing assessment be really too low. I should also like to point out that not only have the repairs been excessively and abnormally costly during the last few years, but landlords have been under the Rent Restrictions Acts and have not been able to meet the higher cost of repairs out of increased rents. Therefore, I feel that this additional allowance ought not to be postponed till next year, but ought to be allowed in the present year and the following eight years. I should very much like the Chancellor of the Exchequer to consider this question and to tell us exactly why it is that the allowance is not going to be made this year.
§ Mr. PRETYMAN
I feel that this Clause and the next Clause do not cover quite the same ground. The point raised by my hon. Friend is material and important to this Clause, because it is one which increases the statutory allowance of one-sixth to one-fifth and one-fourth for small houses. The reason, I understand, is that owing to the greatly increased cost of repairs, in practically all eases where owners or occupiers of small 1338 property have to carry out the work, the cost exceeds the one-sixth allowance, which is, on the old rent, restricted under the Rent Restrictions Acts. This is not principally a question of equity and fairness. The question of equity and fairness can be dealt with under the provisions of Section 69, which are being extended by the next Clause, and any overpayment can be recovered. Under the present law, if a man spends, instead of one-sixth, one-fifth or one-third, he can by a reclaim get his money back, and therefore there is no actual loss. It is thought better during the present emergency—this is not a permanent Clause like the next one; it is a temporary Clause to deal with an emergency—to save the great amount of waste of time and tissue due to the presentation of innumerable claims for repairs on small property. Therefore, although the same considerations do not refer to the next Clause because you get your repairs under the five years' average, what I said on the Second Reading applies to this Clause. If I am right in supposing that the main object of this Clause is to save expense, time, and trouble, there does not seem any very good reason for postponing it for a year. The Chancellor of the Exchequer has met us very fairly and sees the thing over the whole ground, so I do not wish to do more than put the point before him and ask if he and his Department have given it full consideration. I am aware that the assessments are going to be increased, and that may make some difference in future years, but the new assessments will not apply this year, and the fact that it will be possible to make reclaims which the alterations, when they do come in, will not affect is a special reason for making this Clause operative at once.
§ The CHANCELLOR of the EXCHEQUER (Sir Robert Horne)
The situation is really as described by my hon. Friend the Member for Wood Green (Mr. G. Locker-Lampson). The proposal to make an increased allowance for repairs is due to the fact that in recent years there have been difficulties experienced in connection with these allowances, and it has been made plain that, so far as the properties with which the Clause deals are concerned, the allowances ought to be raised. There are, as my right hon. Friend the Member for Chelmsford (Mr. Pretyman) has said, 1339 means by which the hardship to which the hon. Member referred—those cases where the actual expense is shown to be greater than the allowance and where a claim can always be made on sufficient cause being shown—can be met. The reason we have postponed the actual operation of these increased allowances till next year is this. It is recognised, I think, that at the present time the assessments do not represent actual values. There have been no re-valuations for a long period, and I do not think that anybody can question the fact that the present assessments are not adequate. Accordingly, we are going to make a revaluation, and we propose to bring the two things—the new valuation and the increased allowance for repairs—into operation at the same time.
Lieut.-Colonel Sir J. HOPE
I would like to point out that the right hon. Gentleman's Department have made a reassessment since the War. An increased valuation was made in 1919.
§ Mr. RATCLIFFE
I would also like to point out to the right hon. Gentleman that the assessments in Bradford have recently been increased by something over 30 per cent., amounting in actual figures to between £500,000 and £600,000. It would be grossly unfair, therefore, when ratepayers or property owners are being assessed at that higher valuation, that this Clause should not operate for another 12 months.
§ Amendment negatived.
§ Motion made, and Question proposed, "That the Clause stand part of the Bill."
§ Major GRAY
May I take this opportunity of suggesting to the Chancellor of the Exchequer that, before the Report stage, he might look into an apparently small question to which I have already drawn the attention of the learned Solicitor-General. It is a matter which affects the London area particularly. Under the Metropolis Valuation Act, 1869, certain deductions in respect of repairs may be made from the assessment for the payment of rates. This Clause provides for deductions in respect of repairs from the assessment for the payment of Income Tax. It is desirable that the range of deductions for rates and Income Tax should be the same, and they are the same excepting for two very 1340 small items in this Clause. The deduction for rates is in regard to sums below £20 and below £40. In this Clause, the words are "not exceeding £20" and "not exceeding £40." The result is that in regard to the deduction for rates it will be one-fifth on £20, and in regard to the deduction for Income Tax it will be one-quarter on £20. The same difficulty will arise when the next figure of £40 is reached. It will be a somewhat larger deduction for Income Tax than for rates.
I am advised by the Local Government Committee of the London County Council that this will lead to considerable administrative inconvenience. A man will never be able to understand why he pays on a certain amount of assessment for rates and on a different amount of assessment for Income Tax. The Chancellor of the Exchequer should so arrange the Clause that it should read "up to £20" and "up to £40," in-accordance with the Amendments which I have upon the Paper and which I apologise for not being in my place to move. I can assure him that the financial experts on the London County Council advise me that it would be a very substantial concession to the payers of rates and of taxes in the Metropolitan area. As he will recognise, the alteration cannot be made in regard to the payment of rates, because that is already fixed by the Metropolis Valuation Act, 1869, which we cannot to-day amend, but a slight Amendment of this Clause would bring the rating procedure and the taxing procedure in the London area into harmony, which, I take it, is very desirable from an administrative point of view. Incidentally, the Exchequer would lose nothing, because, whatever difference there might be, it would be a slight gain to the Exchequer, because it would alter by one unit the scale upon which the payment would be made. It is a comparatively small point, although one of importance in the Metropolitan area, and I hope that, when the Clause comes up on the Report stage, the right hon. Gentleman will be able to see his way to make this small concession.
§ Sir R. HORNE
I have studied the Amendments of the hon. and gallant Member as closely as I can, and, after very carefully reading them with the original words, I have come to the conclusion that, in substance, there is no 1341 difference between his proposal and that contained in the Clause. I am not quite sure that my hon. and gallant Friend has adverted sufficiently to the proviso in the Clause, which really prevents the very kind of effects that he seeks to deprecate. I am not aware of the precise form that the London rating takes, and it may be that there is some technical element which might make it easier if our Clause were expressed in the same language as the London Clause, but it seems to me plain that it has the same effect. The wording is different, and it might be an advantage to have the wording expressed in the same form, but as to that I express no opinion. I suggest that my hon. and gallant Friend might get into touch with the Inland Revenue authorities on this matter, and, if he can make plain to them a difference which is not plain to me, I shall be pleased to give it consideration.
§ Question, "That the Clause stand part of the Bill," put, and agreed to.