54. Lieut.-Colonel Sir FREDERICK HALLasked the Chancellor of the Exchequer what was the volume of trade done by the co-operative societies of this country in the years 1919, 1920, 1921, 1922, 1923, and 1924, respectively; and will he say whether such trading is subject to Income Tax?
§ Mr. CHURCHILLI would refer my hon. and gallant Friend to the Report of the Chief Registrar of Friendly Societies for the year 1924, Part III of which gives particulars of trading of all co-operative societies from 1913 to 1923 inclusive. Similar particulars for distributive trading societies for the year 1924 are given in the Statistical Summary showing the operations of co-operative societies (distributive trading) issued by the chief Registrar on the 12th October last. Co-operative societies registered under the Industrial and Provident Societies Act, 1893, are entitled to exemption from Income Tax under Schedules C and D unless sales are made to persons who are not members and the number of the society's shares is limited either by rules or practice. There is, however, no general exemption from Income Tax enjoyed by co-operative societies. If reference is made to the Report of the Royal Commission on the Income Tax (Command Paper 615 of 1920) it will be seen that the tax paid by the societies and their members under the legal provision which governs their case does not greatly differ from that which would be payable under the ordinary Income Tax law.
Sir F. HALLSeeing that the right hon. Gentleman has admitted in his answer that the co-operative societies are receiving some benefit from which the ordinary shopkeeper is precluded. [HON. MEMBERS: "Question!"] Will he look into the matter and see, in the preparation of his forthcoming Budget, whether something might be derived from these people, so as to place the co-operative societies more on an equity with the poorer trading people?
§ Mr. CHURCHILLI shall certainly give consideration to the matter. Like my predecessors, I have already given some consideration to it, but, on its merits, the case is doubtful, and controversy over it would be very fierce and the results exceedingly small.
§ Mr. KIRKWOODIs it not the case that, had it not been for the Labour party, the Tory party would have taxed the co-operative societies, as desired by the hon. and gallant Gentleman who put the question?
§ Mr. CHURCHILLThe sense of ray answer was that they are already taxed practically on the same scale as the rest of the community, and they were so taxed even under other Governments than this!
Sir F. HALLArising out of the supplementary question of the hon. Member for Dumbarton (Mr. Kirkwood)—