HC Deb 22 June 1925 vol 185 cc1136-45

Section twenty-two of the Finance Act, 1920 (which provides for a deduction from assessable income in respect of dependent relatives), shall have effect as if for the words "twenty-five pounds" there were substituted the words "fifty pounds."—[Mr. Charleton.]

Brought up, and read the First time.

Mr. CHARLETON

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

I want to make an appeal to the benevolence of the Chancellor of the Exchequer on behalf of a very deserving class of the community—those people who just come within the lower range of the Income Tax, and who have, as many have, the misfortune to have children who are mentally defective or crippled, who will never earn anything themselves, and who are a constant worry to their parents to provide for them throughout their days, and also for them should they be left behind. There is also that class of person, school teachers and others, who have charge, sometimes, of afflicted brothers and sisters and other relatives. Those people have a big struggle, and at present they only get a little relief in the form of a deduction of £25. On both sides of the House we like to do things gradually. We do not believe in making any big changes, and, as these deductions have been in operation for three or four years, and seem to have worked all right, cannot the right hon. Gentleman see his way to give these people a little more relief?

Mr. MORGAN JONES

I beg to second the Motion.

The CHANCELLOR of the EXCHEQUER (Mr. Churchill)

I am sorry I cannot meet the hon. Gentleman upon this point, because it would involve £700,000 in a full year, and in the present Budget we are already making a special feature of helping the small Income Tax payer. It is one of the greatest features of the remissions in the Budget. He gets the advantage of the 6d. on the flat rate and he also gets the benefit of the increased discrimination between earned and unearned income. The whole yield in a full year from the Silk Duties, roughly £7,000,000, we are going to hand over to the small Income Tax payers, and the relief is given in greater proportion to the tax as the scale is descended. Such a concession to a large class of Income Tax payers will result in exempting altogether some who used to pay last year while others will have their tax reduced by the equivalent of 2s. in the £ in the lower reaches, tapering away to about 10d. in the £ in the higher ranges.

The proposal in this new Clause was put forward last year, and failed to receive anything from the right hon. Member for Colne Valley (Mr. Snowden), except that sympathy which, in common with other Chancellors, he would naturally show to a proposal of this kind. When a Clause similar to this was proposed last year during the Labour administration, on the advice and instigation of the right hon. Gentleman opposite, it was rejected by 180 to 80 votes. I have been able to go a great deal further in relieving this very class of Income Tax payers than was open to the right hon. Gentleman last year, when he was dealing with other aspects of the fiscal question—Tea, Sugar and Entertainments Duties. We have been able to go further in relieving the Income Tax payers than he was, and, in these circumstances, I am afraid I cannot at the present time take the step recommended, and must entrench myself behind the position taken up by the right hon. Gentleman opposite.

Captain BENN

I do not think the Chancellor's argument about last year's Budget has any weight at all. It is perfectly true amendments are moved by the Opposition, and whether or not they are to be recommended depends on the character of the Budget. The Chancellor of the Exchequer last year made enormous remissions in the way of indirect taxation to poor people, and to say that because he was not willing to give this concession, the present Chancellor of the Exchequer, who is doing nothing of the kind for the ordinary consumer, is fortified by the ex-Chancellor's view, does not seem to have any weight at all.

Mr. CHURCHILL

I am the inheritor of all his concessions. The whole process of Budget relief is cumulative.

Captain BENN

A small thing like this, which would only cost £700,000, is surely not an item at which the Chancellor of the Exchequer should boggle, Having given relief to richer classes running into millions and tens of millions. The point I want to make is that the right hon. Gentleman has greatly increased indirect taxation. He spoke of giving the whole produce of the Silk Duty to Income Tax payers, but I believe that when everything which comes under that duty is taxed it will produce very much more than the Budget estimate. It is a very great and increasing burden of indirect taxation. There are also other indirect taxes to pay. There is the Lace Duty, which, I suppose, will amount to about £300,000, or at least £200,000. Furthermore, there is this peculiarity about this year's Budget. It is not complete. We have not yet got a proper survey of the relative amounts of direct and indirect taxation, because we may be faced with supplementary Bills increasing the burden of indirect taxation.

Mr. CHURCHILL

No.

Captain BENN

The right Gentleman cannot say no. He knows the Government are pledged to have this investigation, and to take the necessary steps. Therefore, in view of the fact that the burden of indirect taxation has been made heavier by the Chancellor of the Exchequer, and it will probably be largely increased before the end of the year, this Clause is one which certainly deserves much more sympathy and consideration than the right hon. Gentleman has given to it.

Mr. MACLEAN

As the hon. and gallant Gentleman has just said, the Chancellor of the Exchequer has made quite a number of concessions to other people, and it is not enough for him to say that, because the late Chancellor of the Exchequer made concessions, he is the inheritor of those concessions. If the present Chancellor of the Exchequer moves to a higher position in the Government, or the Government cease to exist as a Conservative Government next year, and others take their place, does he mean to say that that particular Chancellor, however much opposed to the concessions given by his predecessor, is the inheritor of those concessions? If so, he is carrying on a very bad inheritance indeed. The Chancellor has been all the time talking about balancing his Budget. I think he will go down to history as the Cinquevalli of the Exchequer, one of the most expert jugglers who has ever appeared in this House.

I am quite certain of this, that the right hon. Gentleman may be complimented upon the very careful, the very neat, and the very adroit way in which he has proceeded; he will not need a balancing pole to get to the end of the tight rope. But I would ask him to exercise a little charity in regard to these poor people whom this Amendment is asking him to consider. Last week he was appealed to to do a certain thing by some of his own supporters. He gave a concession to the landlords of this country of £500,000. They did not appeal to his benevolence as my hon. Friend is now appealing to him. They merely put it to him! Then the Chancellor of the Exchequer immediately rose, and said: "Certainly, I have £500,000 stowed away ready for you, and you can have it." Here is a concession asked for for a poorer class of £700,000 as the Chancellor himself estimates. I have always noticed that when the Chancellor of the Exchequer estimates a concession that he does not intend to give that he estimates it as a greater sum than it actually is, but if he is going to give away something to some of his political friends and supporters he estimates the concession something less than it turns out to be when the result is made known.

This concession, I am certain, would not come to the sum the Chancellor has said. Even, however, though it did come to the £700,000 I would ask the right hon. Gentleman how many concessions has he made to the poorer classes of the community, or even to that smaller section of the working classes which pay on the lower rate of Income Tax and who just come within the Income Tax level? If the Chancellor can afford £500,000 for the landlords of this country, he can afford to give £700,000, even if this concession came to that sum. The object has been outlined by the hon. Member who moved the proposed new Clause. I hope the right hon. Member will take the matter into his reconsideration, and for the first time during the period of these Debates give at least one concession to those who have appealed to him from the outside. He may look upon the matter as one of benevolence on his part if he gave it. I for one say that, while it may be looked upon by some as benevolence, I should, I think, demand it as a matter of strict justice and equity. I hope in all the circumstances of the case the right hon. Gentleman will reconsider the matter, and give this concession that he has been asked to give.

Mr. ERNEST EVANS

I trust that the right hon. Gentleman the Chancellor of the Exchequer will give a little more consideration to this Amendment than he appears to have done judging from the remarks he has addressed to the House. So far as I can understand he based his attitude upon two grounds. The first was that his predecessor refused a similar Amendment last year. I have very great respect for his predecessor, but I should be surprised and disappointed to learn that the right hon. Gentleman based his political conduct upon the standard set up by his predecessor in regard to the acceptance of Amendments in the Budget, or other matters. Secondly, the right hon. Gentleman declined on the score that the cost of accepting the Amendment would be £700,000. I quite appreciate the fact that the Chancellor is anxious to get as many pennies as be can, but it must not be forgotten that the Government hope they may be able to collect revenue from other sources not provided for in the Finance Bill of the year. The Lace Duty has been introduced since the Finance Bill first came before the House. We have discussed that, and cannot therefore do so any further, but it is within the range of the possibility of the Government that they may be looking at other industries also. However, leaving that aside, I trust that the right hon. Gentleman, having already made concessions costing much more than this—there is the concession he has made in connection with the Silk Duties—will do something in this connection.

It does seem to me, when we consider what this Clause really means, that it refers only to people who are either very old or else suffering from infirmity, that this is a matter where we can claim the benevolence of the Chancellor of the Exchequer better than in any other of the

cases where he has made the concession. The amount involved is comparatively small compared to the other circumstances in which the Chancellor has given way. After all, the Income Tax is a tax which is supposed to cover the amount of money that a man has for himself, and available for his own expenditure. Where you get a man who, it may be, is charitably disposed, or from a sense of duty thinks that he ought to maintain somebody who is infirm or somebody too old to obtain any income for himself beyond the limit in the Act, it does seem to me that the cost might legitimately be deducted from the total income of the person concerned. He should not be penalised for his kindliness or for his charity by having to pay Income Tax on an amount from which he himself derives no benefit at all, and which is devoted entirely to the maintenance of those who cannot maintain themselves. There are other interests for which the same kind of claim cannot be made. I do not think we are asking too much in pressing upon the attention of the right hon. Gentleman, and the House, a demand like this which will cost comparatively little, in relation to a portion of income that is devoted entirely to charitable purposes, and that is in the relief of those who take upon themselves the burden of maintaining those who cannot maintain themselves.

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

The House divided: Ayes, 101; Noes, 264.

Division No. 193.] AYES. [4.53 p.m.
Adamson, W. M. (Staff., Cannock) Graham, D. M. (Lanark, Hamilton) Jones, Morgan (Caerphilly)
Alexander, A. V. (Sheffield, Hillsbro') Graham, Rt. Hon. Wm. (Edin., Cent.) Jones, T. I. Mardy (Pontypridd)
Ammon, Charles George Greenall, T. Kelly, W. T.
Attlee, Clement Richard Grenfell, D. R. (Glamorgan) Kennedy, T.
Baker, J. (Wolverhampton, Bilston) Griffiths, T. (Monmouth, Pontypool) Kenyon, Barnet
Baker, Walter Groves, T. Lansbury, George
Barnes, A. Grundy, T. W. Livingstone, A. M.
Beckett, John (Gateshead) Guest, J. (York, Hemsworth) Lowth, T.
Benn, Captain Wedgwood (Leith) Hall, F. (York, W. R., Normanton) Macdonald, Sir Murdoch (Inverness)
Bromley, J. Hall, G. H. (Merthyr Tydvil) Mackinder, W.
Charleton, H. C. Hamilton, Sir R. (Orkney & Shetland) MacLaren, Andrew
Cluse, W. S. Hardie, George D. Maclean, Neil (Glasgow, Govan)
Collins, Sir Godfrey (Greenock) Harney, E. A. March, S.
Cove, W. G. Hayday, Arthur Maxton, James
Crawfurd, H. E. Hayes, John Henry Mond, Rt. Hon. Sir Alfred
Dalton, Hugh Henderson, Rt. Hon. A. (Burnley) Montague, Frederick
Day, Colonel Harry Hirst, G. H. Morris, R. H.
Dennison, R. Hirst, W. (Bradford, South) Morrison, R. C. (Tottenham, N.)
Duncan, C. Hore-Belisha, Leslie Nayior, T. E.
Edwards, John H. (Accrington) Hudson, J. H. (Huddersfield) Oliver, George Harold
England, Colonel A. Hutchison, Sir Robert (Montrose) Paling, W.
Evans, Capt. Ernest (Welsh Univer.) Jenkins, W. (Glamorgan, Neath) Pethick-Lawrence, F. W.
Gillett, George M. John, William (Rhondda, West) Ponsonby, Arthur
Gosling, Harry Johnston, Thomas (Dundee) Potts, John S.
Richardson, R. (Houghton-le-Spring) Stephen, Campbell Westwood, J.
Scrymgeour, E. Sutton, J. E. Wheatley, Rt. Hon. J.
Shaw, Rt. Hon. Thomas (Preston) Taylor, R. A. Williams, David (Swansea, East)
Short, Alfred (Wednesbury) Thomas, Rt. Hon. James H. (Derby) Williams, T. (York, Don Valley)
Smith, Ben (Bermondsey, Rotherhithe) Thomson, Trevelyan (Middlesbro. W.) Windsor, Walter
Smith, H. B. Lees- (Keighley) Thorne, G. R. (Wolverhampton, E) Wright, W.
Smith, Rennie (Penistone) Thorne, W. (West Ham, Plaistow) Young, Robert (Lancaster, Newton)
Snell, Harry Thurtle, E.
Snowden, Rt. Hon. Philip Trevelyan, Rt. Hon. C. P. TELLERS FOR THE AYES.—
Spencer, George A. (Broxtowe) Viant, S. P. Mr. Allen Parkinson and Mr. T. Henderson.
Stamford, T. W. Watts-Morgan, Lt.-Col. D. (Rhondda)
NOES.
Acland-Troyte, Lieut.-Colonel Curzon, Captain Viscount Kennedy, A. R. (Preston).
Agg-Gardner, Rt. Hon. Sir James T. Dalkeith, Earl of Kindersley, Major Guy M.
Ainsworth, Major Charles Dalziel, Sir Davison Kinloch-Cooke, Sir Clement
Albery, Irving James Davies, Maj. Geo. F.(Somerset, Yeovil) Lamb, J. Q.
Amery, Rt. Hon. Leopold C. M. S. Dawson, Sir Philip Lane-Fox, Lieut.-Col. George R.
Applin, Colonel R. V. K. Dean, Arthur Wellesley Lister, Cunliffe-, Rt. Hon. Sir Philip
Ashley, Lt.-Col. Rt. Hon. Wilfrid W. Dixon, Captain Rt. Hon. Herbert Locker-Lampson, G. (Wood Green)
Astor, Viscountess Drewe, C. Locker-Lampson, Com. O.(Handsw'th)
Atholl, Duchess of Eden, Captain Anthony Loder, J. de V.
Baldwin, Rt. Hon. Stanley Edmondson, Major A. J. Looker, Herbert William
Balfour, George (Hampstead) Elliot, Captain Walter E. Lougher, L.
Balniel, Lord Ellis, R. G. Lowe, Sir Francis William
Banks, Reginald Mitchell Elveden, Viscount Luce, Maj.-Gen. Sir Richard Harman
Barclay-Harvey, C. M. Erskine, Lord (Somerset, Weston-s.-M.) Lumley, L. R.
Barnett, Major Richard Erskine, James Malcolm Monteith Macdonald, Capt. P. D. (I. of W.)
Beamish, Captain T. P. H. Fairfax, Captain J. G. McDonnell, Colonel Hon. Angus
Beckett, Sir Gervase (Leeds, N.) Falle, Sir Bertram G. Macintyre, I.
Berry, Sir George Fanshawe, Commander G. D. McLean, Major A.
Betterton, Henry B. Fermoy, Lord Macnaghten, Hon. Sir Malcolm
Bird, E. R. (Yorks, W. R., Skipton) Fielden, E. B. Maitland, Sir Arthur D. Steel-
Blades, Sir George Rowland Fleming, D. P. Makins, Brigadier-General E.
Bonthby, R. J. G. Ford, P. J. Malone, Major P. S.
Bourne, Captain Robert Croft Forestier-Walker, L. Manningham-Buller, Sir Mervyn
Bowater, Sir T. Vansittart Foster, Sir Harry S. Margesson, Captain D.
Bowyer, Captain G. E. W. Foxcroft, Captain C. T. Marriott, Sir J. A. R.
Boyd-Carpenter, Major A. Fremantle, Lieut.-Colonel Francis E. Meyer, Sir Frank
Brass, Captain W. Ganzoni, Sir John Milne, J. S. Wardlaw-
Brassey, Sir Leonard Gates, Percy Mitchell, Sir W. Lane (Streatham)
Briscoe, Richard George Gilmour, Lt.-Col. Rt. Hon. Sir John Moles, Thomas
Brittain, Sir Harry Goff, Sir Park Monsell, Eyres, Com. Rt. Hon. B. M.
Brocklebank, C. E. R. Gower, Sir Robert Moore, Lieut.-Colonel T. C. R. (Ayr)
Brooke, Brigadier-General C. R. I. Greene, W. p. Crawford Morrison, H. (Wilts, Salisbury)
Broun-Lindsay, Major H. Grenfell, Edward C. (City of London) Morrison-Bell, Sir Arthur Clive
Brown, Brig.-Gen. H.C.(Berks, Newb'y) Grotrian, H. Brent Murchison, C. K.
Buckingham, Sir H. Guinness, Rt. Hon. Walter E. Nall, Lieut.-Colonel Sir Joseph
Bull, Rt. Hon. Sir William James Gunston, Captain D. W. Nelson, Sir Frank
Bullock, Captain M. Hacking, Captain Douglas H. Newman, Sir R. H. S. D. L. (Exeter)
Burgoyne, Lieut.-Colonel Sir Alan Hall, Capt. W. D'A. (Brecon & Rad.) Nicholson, Col. Rt. Hn. W. G. (Ptrsf'ld.)
Burman, J. B. Hannon, Patrick Joseph Henry Nuttall, Ellis
Burton, Colonel H. W. Harrison, G. J. C. Oakley, T.
Butler, Sir Geoffrey Harvey, G. (Lambeth, Kennington) O'Neill, Major Rt. Hon. Hugh
Cadogan, Major Hon. Edward Harvey, Major S. E. (Devon, Totnes) Oman, Sir Charles William C.
Calne, Gordon Hall Haslam, Henry C. Ormsby-Gore, Hon. William
Campbell, E. T. Hawke, John Anthony Pennefather, Sir John
Cautley, Sir Henry S. Headlam, Lieut.-Colonel C. M. Penny, Frederick George
Cayzer, Sir C. (Chester, City) Henderson, Capt. R. R. (Oxf'd, Henley) Percy, Lord Eustace (Hastings)
Cayzer, Maj. Sir Herbt. R. (Prtsmth. S.) Henderson, Lieut.-Col. V. L. (Boot's) Perring, William George
Cazalet, Captain Victor A. Heneage, Lieut.-Col. Arthur P. Peto, Basil E. (Devon, Barnstaple)
Cecil, Rt. Hon. Sir Evelyn (Aston) Hennessy. Major J. R. G. Pilditch, Sir Philip
Chadwick, Sir Robert Burton Henniker-Hughan, Vice-Adm. Sir A. Pownall, Lieut.-Colonel Assheton
Chamberlain, Rt. Hon. N. (Ladywood) Herbert, S. (York, N.R, Scar. & Wh'by) Preston, William
Charteris, Brigadier-General J. Hogg, Rt. Hon. Sir D.(St. Marylebone) Price, Major C. W. M.
Christie, J. A. Holbrook, Sir Arthur Richard Rawlinson, Rt. Hon. John Fredk. Peal
Churchill, Rt. Hon. Winston Spencer Homan, C. W. J. Rawson, Alfred Cooper
Churchman, Sir Arthur C. Hope, Sir Harry (Forfar) Remnant, Sir James
Clarry, Reginald George Hopkins, J. W. W. Rentoul, G. S.
Cobb, Sir Cyril Hopkinson, A. (Lancaster, Mossley) Rhys, Hon. C. A. U.
Cochrane, Commander Hon. A. D. Howard, Capt. Hon. D. (Cumb., N.) Richardson, Sir P. W. (Sur'y, Ch'ts'y)
Cockerill, Brigadier-General G. K. Hudson, Capt. A. U. M. (Hackney, N.) Roberts, Samuel (Hereford, Hereford)
Cohen, Major J. Brunel Hudson, R. S. (Cumberland, Whiteh'n) Ropner, Major L.
Colfox, Major Wm. Phillips Hume-Williams, Sir W. Ellis Ruggles-Brise, Major E. A.
Cooper, A. Duff Hurd, Percy A. Russell, Alexander West (Tynemouth)
Cope, Major William Hurst, Gerald B. Rye, F. G.
Couper, J. B. Hutchison, G. A. Clark (Midl'n & P'bl's) Salmon, Major I.
Courtauld, Major J. S. Inskip, Sir Thomas Walker H. Samuel, A. M. (Surrey, Farnham)
Craik, Rt. Hon. Sir Henry Jackson, Sir H (Wandsworth Cen'l) Sandeman, A. Stewart
Croft, Brigadier-General Sir H. Jacob, A. E. Sanders, Sir Robert A.
Crook, C. W. James, Lieut.-Colonel Hon. Cuthbert Sanderson, Sir Frank
Crookshank, Col. C. de W. (Berwick) Jephcott, A. R. Sandon, Lord
Crookshank, Cpt. H. (Lindsey, Gainsbre) Jones, G. W. H. (Stoke Newington) Sassoon, Sir Philip Albert Gustave D.
Savery, S. S. Stuart, Hon. J. (Moray and Nairn) Wilson, R. R. (Stafford, Lichfield)
Scott, Sir Leslie (Liverp'l, Exchange) Sueter, Rear-Admiral Murray Fraser Winby, Colonel L. P.
Shaw, Lt.-Col. A. D. Mcl. (Renfrew, W) Sykes, Major-Gen. Sir Frederick H. Windsor-Clive, Lieut.-Colonel George
Shaw, Capt. W. W. (Wilts, Westb'y) Tasker, Major R. Inigo Winterton, Rt. Hon. Earl
Sheffield, Sir Berkeley Thompson, Luke (Sunderland) Wise, Sir Fredric
Simms, Dr. John M. (Co. Down) Thomson, F. C. (Aberdeen, South) Wolmer, Viscount
Skelton, A. N. Thomson, Sir W. Mitchell-(Croydon, S.) Womersley, W. J.
Smith, R. W. (Aberd'n & Kinc'dine, C.) Tinne, J. A. Wood, Rt. Hon. E. (York, W. R., Ripon)
Smith-Carington, Neville W. Tryon, Rt. Hon. George Clement Wood, E. (Chest'r, Stalyb'dge & Hyde)
Smithers, Waldron Vaughan-Morgan, Col. K. P. Wood, Sir Kingsley (Woolwich, W.).
Somerville, A. A. (Windsor) Waddington, R. Wood, Sir S. Hill- (High Peak)
Spender Clay, Colonel H. Wallace, Captain D. E. Woodcock, Colonel H. C.
Sprot, Sir Alexander Ward, Lt.-Col. A. L. (Kingston-on-Hull) Worthington-Evans, Rt. Hon. Sir L.
Stanley, Col. Hon. G.F. (Will'sden, E.) Warner, Brigadier-General W. W. Young, E. Hilton (Norwich)
Stanley, Lord (Fylde) War-render, Sir Victor
Stanley, Hon. O. F. G. (Westm'eland) Wells, S. R. TELLERS FOR THE NOES.—
Steel, Major Samuel Strang White, Lieut.-Colonel G. Dairymple Colonel Gibbs and Major Sir Harry
Stott, Lieut.-Colonel W. H. Williams, Com. C. (Devon, Torquay) Barnston.
Strickland, Sir Gerald Williams, Herbert G. (Reading)