§ 48. Sir WILLIAM DAVISONasked the Chancellor of the Exchequer, seeing that double Super-tax or Surtax may in certain cases be payable by Super-tax payers in respect of the current year, what will be the ultimate gain to the revenue by reason of this double levy of an identical tax for the same period?
§ Mr. CHURCHILLMy hon. Friend must, I think, be under a misapprehension as to the realities of the position. The Super-tax for 1928–29 is chargeable upon the statutory income (as charged to Income Tax) of the preceding year 1927–28, and is payable on 1st January, 1929. The Surtax for 1928–29, i.e., the deferred instalment of the new graduated Income Tax, is chargeable upon the statutory income of the year 1928–29 and will not be payable until 1st January, 1930. This change is part of the simplification scheme which, as I explained to the House last year, will not result in any benefit to the Exchequer. While it is true that under that scheme the change in the law relating to the charge to tax in respect of the income of the last year of a taxpayer's life will mean a gain to the revenue, that gain is approximately equivalent to the loss of something over £1,000,000 in a full year consequent on the change of basis of assessment under Schedule E.
§ Sir W. DAVISONIs it not correct to say that in respect of the same year, Super-tax and Surtax are payable, although not payable at the same time, and that the revenue will ultimately benefit by one year's extra tax being paid, either by the taxpayer himself in his lifetime or by his executors?
§ Mr. CHURCHILLI went into the matter fully when the Budget of last year was being passed. Parliament assented to the proposal then made on behalf of the Government. The Exchequer gains nothing. No extra money at all comes to the Exchequer, the concession under Schedule E wiping out the £1,000,000 which arises in respect of the year in which the taxpayer dies being included.
§ Mr. HASLAMDoes the Super-taxpayer benefit under this concession under Schedule E?
§ Mr. CHURCHILLI cannot guarantee that exactly the same taxpayers in all 807 cases receive the same advantages and disadvantages. When you are carrying a large scheme of changes in taxation, it is obvious that there must be some discrepancies, but, so far as the Exchequer is concerned, we are taking no more from the taxpayers as a whole than we should have taken had no change taken place.
Sir F. HALLIs the right hon. Gentleman aware that a great many people are under the impression that this is another penalty on dying?
§ Sir W. DAVISONAre we quite clear that Surtax and Super-tax are not payable in respect of the same period?
§ Mr. CHURCHILLI should not like to give an answer on this extremely complicated and technical matter without having the advantage of referring to the advice of my officials.