§ Just a word with regard to the Excess Profits Duty. As I have explained to the House, there is a very large sum in arrear. I recognise one could do nothing but injury by being too exacting at the present time in the collection of the sums due in respect of that duty, and, accordingly, as I announced in December last year, I shall propose to the Committee an arrangement whereby the payment of the duty shall, in appropriate cases, be spread over five years from the 1st January last, and that, in the meantime, as from that date, interest shall be charged at the net rate of 5 per cent. per annum, without allowance for Income Tax, upon all Excess Profits Duty due for payment.
§ There is another matter which arises in connection with the Excess Profits Duty, upon which very urgent representations have been made to me, both by the Federation of British Industries and by the chambers of commerce. It arises out of a decision which is known as the Gittus Case, which has had the effect of creating great hardship where the personnel of a firm has changed. Where a firm first has realised profits and paid heavy Excess Profits Duty, and subsequently, after a change of personnel has taken pace, heavy losses have been incurred, this case laid down that it was impossible to put the subsequent losses against the previous duties paid. It would be very expensive indeed to attempt to meet all the cases which have been put before the Exchequer in this matter, but there is one class of case of great hardship with which I would propose to deal, and that is the kind of case in which the transfer is made of a business from a proprietor to his spouse or some lineal descendant. That kind of case does set up a very great grievance, and I propose merely to deal with that, if the Committee will allow me. That will cost, in all, a sum of£3,000,000, of which£2,000,000 will be incurred in the present year, and the remainder in the following year.
§ The alterations I have indicated in the Income Tax law, together with their re-action on the Super-tax, will cost for the full year 1922–23 a net amount of 1037 £1,700,000, of which£700,000 will be effective by the 31st March next. These figures, of course, are explainable by the fact that, while some of the proposals involve a loss to the Exchequer, some will afford a slight gain. The concession in regard to changes of ownership for Excess Profits Duty purposes will, as I have said, cost the Exchequer in all£3,000,000, of which£2,000,000 will fall in the present year.