HC Deb 16 June 1925 vol 185 cc458-61

The following paragraph shall he substituted for paragraph (2) of Rule 8 of No. V. in Schedule A (which grants relief in certain cases in respect of the cost of maintenance, repairs, etc.):— (2) For the purposes of this Rule the term "maintenance" shall include the replacement of farm-houses, farm build- ings, cottages, fences, and other works, and the term "replacement" shall include replacement according to an improved standard necessary, to meet modern requirements or to comply with any Act of Parliament or any regulations or bye-laws of a local authority. Provided that such replacement shall only be included in the term "maintenance" where the existing rent is not raised by reason of the replacement.—[Major Steel.]

Brought up, and read the First time.


I beg to move, "That the Clause be read a Second time."

This question was raised on the Finance Bill of 1921 and again last year. The whole object of the Amendment is to try to get similar rules for all collectors of taxes as to what may and what may not be included in a claim for allowance in respect of the maintenance of farms and farm buildings. At present there is no general complaint against the large majority of collectors of taxes but there is a certain number of collectors who will not allow to be included certain works of replacement which those for whom I speak think ought to be included. In all these matters there is no question of any increase in rent. That does not arise. The whole question is what is replacement and what may be included in the claim under the heading "replacement." We have always maintained that in repairing a farm cottage it is not only necessary to replace a rotten roof for instance by a new roof of similar type, but that it is necessary in repairing the cottage to bring it up to the higher standard which is required by the higher standard of living to which people are accustomed in these days, and that the Government ought to give every encouragement to owners of cottages on all possible occasions to improve their cottages. There is not the slightest doubt that the rural cottages stand in need of improvement just as much as the houses in the towns. This question was raised last year, and the late Financial Secretary to the Treasury treated it very sympathetically, and, although he did not accept the Amendment moved at that time, he himself moved an Amendment which I believe he intended to carry out the object which we had in view. It has not carried out that object in all cases. A case came to my notice the other day. It was a case of the owner of a cottage for which no rent was paid. The occupant of the cottage had to go to the nearest river to draw his water. When the cottage was being repaired the owner provided a new water supply at a cost of £164, and, in addition, spent a sum of £39 in installing a new water closet and the necessary drainage. The expenditure on the water supply and the closet was not allowed by the collector of taxes to be included in the maintenance claim. I am certain that the late Financial Secretary to the Treasury honestly believed that such a case would be covered by his Amendment. Unfortunately it was not, and that is the reason why we raise the question again this year.


We cannot accept this Amendment. It would give exemption to certain selected forms of expenditure, and it would be impossible to limit the exemption to this particular instance. I do not see how you could prevent great advantage being taken of such an Amendment by people who are well-to-do and do not need such a concession. Provision against the raising of rent is not entirely effective. There is nothing to prevent a landlord from getting an enhanced price for his property and the purchaser raising the rents on account of improvements which had been paid for out of remitted Income Tax on this particular form of selected expenditure.

Question, "That the Clause be read a Second time," put, and negatived.

The following New Clause stood on the Order Paper in the name ofSir ARTHUR CHURCHMAN:

(Relief in respect of savings of earned income.)

Notwithstanding anything in the Income Tax of 1918 it is hereby provided that where the income does not exceed two thousand five hundred pounds, and any part of that income is earned income, and where the claimant proves that he has made bona fide investments during any year, he shall be entitled hereafter to relief from tax in respect of the interest accruing from all investments either in Government securities or in companies registered under the Public Companies Act during the five years following each such investment.


In view of what has been said about the desire to get to bed early, I do not propose to move this Clause, but in view of its importance and value, and the fact that thrift is dear to the heart of the Chancellor of the Exchequer, I hope he will consider it before the Report stage.