HC Deb 19 June 1930 vol 240 cc705-32
The CHAIRMAN

Mr. Remer.

Mr. REMER rose——

Mr. MARJORIBANKS

On a point of Order. I understood from your predecessor that the first Amendment on the Paper to this Clause standing in the name of the hon. Member for Macclesfield (Mr. Remer) is either out of order or not selected. I rather gathered that it was considered out of order. On it, I had hoped to raise the whole question of the London valuation, and the inclusion of London in the new Income Tax valuation. I cannot see how it is out of order to discuss that matter.

The CHAIRMAN

I called on the hon Member for Macclesfield (Mr. Remer) to move his Amendment.

Mr. REMER

I beg to move, in page 18, line 3, to leave out the word "quin-quennial."

There are numerous consequential Amendments following. The next Amendment is to insert after the word "revaluation" in line 3, the words "every ten years."

I have put it in the English language because I do not know what the Latin is for "ten years" to replace "quinquennial." It does seem to me that to have these revaluations every five years is a waste of public money. I cannot see what is the necessity for having reassessments as often as every five years. It must be well known to everybody that property does not increase so rapidly that it can be worth the public expenditure which is entailed in having revaluation every five years. I want to suggest that this is an entire breach of pledge, and that during the last Government there were pledges given by the hon. Member for Farnham (Mr. A. M. Samuel), in which he definitely promised property owners that under no circumstances whatever should the valuations under the Rating Act be used to increase the assessments of property during the period that these assessments were being enforced. I cannot see what advantage there is to the Chancellor of the Exchequer in this matter, because all that is wanted is that the property owners of the country shall be divided so as to provide equally a fair amount. May I point out also to the Chancellor that there are many property owners who let their property on a lease, possibly for 10 years, and that during that period they are going to have forced upon them revaluation of their properties and an alteration of their assessment which will put them at a considerable disadvantage by having a great portion of their rents taken away from them in the form of taxation.

Mr. P. SNOWDEN

The hon Member proposes that, instead of the suggested quinquennial revaluation, there should be, to use the English word, a 10-year valuation. It was the practice, I believe, for a considerable time about 15 or 20 years ago to have this quinquennial revaluation, but this was suspended during the War, and there has not been any revaluation of property since 1922 or 1923. Therefore, assessments for Income Tax are on the values fixed eight or 10 years ago. The purpose of Schedule A is to get Income Tax on the income which is derived from property. There are certain concessions made for repairs, and therefore it is not on a gross amount that the tax is paid. I think the Committee will agree that as far as it is possible, the owner of properties should pay on that part of his income which may be regarded as net income. The value of property has in a vast number of cases changed materially since the last valuation. Where a person is assessed under Schedule A, and proves that there has been some reduction in the income of his property, he is entitled in the interim to ask for and get a reduction of the assessment. Five years is a very reasonable period to make these revaluations. The precedent is the Rating and Valuation Act of three or four years ago. I do not know anything about the pledge of the hon. Member for Farnham (Mr. A. M. Samuel), to which the hon. Gentleman referred, but I can hardly believe that the hon. Gentleman quite clearly and accurately interpreted the pledge, if one were given, because in the Provinces, although the valuation for rating purposes is taken as a help in fixing the valuations for Income Tax purposes under Schedule A, it is not a determining factor.

The main objection to the hon. Member's Amendment is that 10 years is far too long. There might be the widest change in valuation during such a long period. The hon. Member said something about fairness as between taxpayer and taxpayer. If we had a large class which pays Income Tax much below their real income from property, it would be unfair to other bodies of taxpayers, because a certain amount of revenue must be raised, and, if one section is paying less than in justice they ought to pay, another section of the community must make it up and must pay a larger proportionate share. I am sure that the proposal which we are making here in regard to a quinquennial valuation is one which will commend itself as a practical proposition.

Amendment negatived.

The CHAIRMAN

The next Amendment I select is that in the name of the hon. Member for Leominster (Sir E. Shepperson)—in page 18, line 11, at the end, to insert the words: Provided always that any re-assesment of agricultural land made by virtue of the Rating and Valuation Act, 1925, shall not be taken into consideration when a revaluation of agricultural land for assessment under Schedules A and B is made in 1931–32, or in any quinquennial revaluation.

Mr. MARJORIBANKS

On a point of Order. I understand that you have ruled out of order my Amendment in page 18, line 4, after the word "Britain" to insert the words except such lands, tenements, and hereditaments in the administrative county of London with respect to which the valuation list under the Valuation (Metropolis) Act, 1869, is by that Act made conclusive for purposes of Income Tax. I beg to submit that this Amendment is in order, and it would save time if it were selected now.

Mr. P. SNOWDEN

The hon. Member, I think, sees that this Amendment will raise the whole question of the inclusion or exclusion of London. That matter is of such importance that it would be better to raise it in a more appropriate place, which is in Clause 26.

Mr. MARJORIBANKS

I bow humbly to anything which the Chancellor of the Exchequer says, and I am glad that he recognises the importance of the Amendment. I submit, however, that the proper moment to bring it forward is on the first possible occasion on which the whole of this subject matter is discussed, and that Clause 22 begins the discussion and raises this particular question absolutely and specifically. Under Clause 22 a new valuation is contemplated, and I submit that the proper place to insert words which would exclude London is in the Clause where the general proposition is raised. The Chancellor of the Exchequer will notice that in line 6 the year 1931–32 is mentioned. That would mean a new valuation quite apart from the valuation of 1930–31 which is going on in the Metropolis under the Act of 1869. I really cannot see how my Amendment can be out of order. I may be told that it would be more convenient to raise the question on Clause 26.

The CHAIRMAN

I told the hon. Member that his Amendment was equivalent to omitting Clause 26, and, even if that were not so, that the proper place on which to bring it forward was on Clause 26.

Mr. MARJORIBANKS

I understood that it was ruled out of order.

The CHAIRMAN

I said the reason why I had come to a decision not to call it was that it seemed to be out of order because it was equivalent to omitting Clause 26, and that, even if it were not out of order, the proper place for it was Clause 26.

Mr. MARJORIBANKS

I have studied this matter very carefully and I wish to make this submission, that if we discuss this now it will avoid a general discussion which must inevitably be raised by my friends and myself on the question of the Clause standing part; and, further, it would be unnecessary to raise it again on Clause 26. We wish to deal with the whole of this important question once for all. I think it would save the time of the Committee to consider it now.

Mr. P. SNOWDEN

I ask the hon. Member to accept my word that I certainly desire to put no obstacle in the way of a full discussion of the question of a change in the valuation of London, and if the hon. Member will accept my suggestion—I will not say my advice—I think he will have a much better chance of raising the subject on Clause 26.

Mr. MARJORIBANKS

I thank the Chancellor of the Exchequer for his advice, which I am sure is very wise, but I would like to explain that my sincere purpose in raising the matter now was to save time and to avoid two discussions.

Sir ERNEST SHEPPERSON

I beg to move, in page 18, line 11, at the end, to insert the words: Provided always that any re-assessment of agricultural land made by virtue of the Rating and Valuation Act, 1925, shall not be taken into consideration when a revaluation of agricultural land for assessment under Schedules A and B is made in 1931–32, or in any quinquennial revaluation. The first Sub-section of this Clause provides for a revaluation of property in respect of which Income Tax is chargeable under Schedules A and B, and my Amendment is to secure that any reassessment of agricultural land under the Rating and Valuation Act of 1925 shall not be taken into consideration when a re-valuation is made under Schedules A and B or in any quinquennial revaluation. The purpose of this Amendment is merely to safeguard the owner-occupier of agricultural land from being injuriously affected by anything that took place under the Rating and Valuation Act, 1925, and the assessments made under that Act. I would like to remind the Committee that an owner-occupier of land is doubly affected by an increase of his assessment under this Clause. In the first place, he is affected as an owner by an increase of Income Tax under Schedule A if his assessment is increased; and, in the second place, he is also affected by an increase in the Income Tax under Schedule B. Therefore if his assessment is increased, the owner-occupier of land is doubly affected by any increase of his assessment, and to this extent it is very important that his assessment should be fair and just. The Committee will naturally wonder how a man can possibly be aggrieved by an assessment made under the Rating and Valuation Act, 1925, and how that can prejudice his case. In this connection, I would like to point out that Sub-section (2) of Section 43 of the Rating and Valuation Act, 1925, provides that: Any rating authority, on application by a surveyor of taxes, shall furnish to him a copy of their valuation list as for the time being in force, or of any rate for the time being in force or any extract from the rate or list, on payment of a sum not exceeding the rate of five shillings for every hundred entries. That implies that the Inland Revenue authorities have the statutory right to come to the local authorities and ask for that information, and, under those circumstances, the Inland Revenue authorities already have power to find out what is the assessment for rating purposes, and, naturally, they would adjust their assessment with that knowledge in front of them. The Committee will recollect that many safeguards were provided under the Act of 1925 to prevent the ratepayer from being unduly assessed, and in view of that, probably Members of the Committee will wonder how it is possible that a taxpayer can be aggrieved if the Inland Revenue authorities take for taxation purposes the assessment made by the local authorities under the Rating and Valuation Act, 1925. Under that Act the local rating authority issues a list of the assessments, and it is quite an easy process for any person who feels himself aggrieved to appeal to the local assessment committee which consists of people who know the applicant. If the aggrieved person loses that appeal, then he has a right of appeal to quarter sessions, and in these circumstances it seems to me to be inconceivable that any assessment made under such conditions will be unjust or unfair.

I would like the Committee to follow me in my reason for asking for this Amendment. At the time when these assessments were made by the local authorities, the local authorities had a number of interests in raising generally the assessments for rating in their areas. In the first place, many of the assessments were very old, and it was only right that they should be brought up to date; while, secondly, an increased assessment would mean, in normal cases, a decrease in the poundage of the rates. These increases of assessments were kept in check generally by the right which the ratepayer had to appeal. If the assessment committee or the rating authority put up the assessment to too high a figure, they would know that the ratepayer would appeal, and probably the assessment would be reduced. Therefore, the assessments made were generally a compromise between what the assessment committee would desire and what the ratepayer thought was just.

I come to the question of agricultural land. As I have said, the assessment in the ordinary way was a compromise, because the assessment committee knew that an aggrieved ratepayer would appeal; but, in the case of agricultural land, it was known, at the time when these assessments were made, that the land was going to be de-rated, and, that being so, there was no purpose in an occupier of land appealing against his increased assessment. It has come to my knowledge that in many cases local authorities have raised their assessments of agricultural land, because, by so doing, when the land was de-rated, they obtained a larger grant from the national Exchequer in respect of loss of rates; and, further, they knew that there was going to be no appeal by the occupier of the land, because he was not going to pay any more rates. In these circumstances, I put it to the Chancellor of the Exchequer that it may be possible, when the assessments on the land in agricultural areas are too high, that, if that information is given to the Inland Revenue authorities, the rates for Income Tax under Schedules A and B will be unjustly high, and, therefore, the owner-occupier will be hit. I appeal to the Chancellor of the Exchequer to give this justice to the owner-occupier of agricultural land.

Mr. P. SNOWDEN

The concluding remarks of the hon. Member, in which he let the cat out of the bag, were, I think, the most conclusive argument that could be advanced in support of the rejection of this Amendment. The hon. Member's point was that, since the De-rating Act, which relieves agricultural land from any contribution to local rates, the local authorities, in order to get more money from the national Exchequer, have put up their assessments beyond reasonable figures. What the hon. Member now asks me to do is to give a further advantage to the agricultural interest because they have alrealy taken advantage of the leniency of the national Exchequer. I hardly think that that is an argument which will commend the Amendment to the Committee.

To come to the more serious part of the hon. Member's argument, it is not proposed in this Clause to take the assessment for local rates as a basis of assessment for Schedule A. The broad principle is that the assessment of agricultural land should follow the same line as the assessment of other properties. Where agricultural land is let, the rack rent is to be taken as the annual value, and where it is not let the annual value is to be the amount at which it would let at a rack rent. That course will be followed in the proposed revaluation. Even supposing we accepted the words of this Amendment, the assessment would still be fixed by the local commissioners of taxes, who could not be debarred from knowing what the value of the property for local purposes was. No words in the Act of Parliament could prevent them from taking that matter into consideration. It is not proposed that they should be bound by the valuation for local purposes, but that they should take that matter into consideration along with all other relevant matters. I am sure the sense of justice of the Committee will be on the side of treating the income from agricultural land just as the income from all other forms of property is treated and, if the income is derived from the letting of agricultural land, surely there is no case at all why that should not pay Income Tax at the same rate as Income Tax is paid upon other forms of property. I really cannot accept the Amendment.

Mr. BEAUMONT

I very much regret that the Chancellor of the Exchequer cannot see his way to accept the Amendment. I perfectly understand these reasons he has advanced, but we come up in this case against the difference between theory and practice. In theory, of course, the assessment of the Revaluation Act, 1925, should have been on a perfectly fair rack rent basis, and the assessment for Income Tax, Schedule A, should also be on a perfectly fair rack rent basis, but in practice, as those of us who have to deal with those assessments know only too well, that is not always the case. I do not expect the right hon. Gentleman to deal with landlords or landowners in a generous spirit—we all know his prejudices in that direction—but I do not think even he is anxious to deal with this in a particularly unfair spirit, and what we are asking is that those who have to assess Schedule A shall be asked to assess it on a basis unbiassed by any unfairness there may have been in the rating assessment of 1925. Of course, they must know what that assessment has been. We quite understand that. If it is unfair against the owner and occupier of land, any unfairness of that sort in paying Schedule A reacts against both the tenant and the wage earner on agricultural land. We ask that any unfairness shall be disregarded and that words to that effect shall be put into the Bill. I hope the right hon. Gentleman will see if he cannot meet us in some way so that those who do these reassessments shall not be biassed by any existing unfairness in the 1925 rating assessments.

Sir E. SHEPPERSON

I feel that I have gained my point in moving the Amendment. I accept the right hon. Gentleman's statement that these two things will not be considered unjustly, and I ask leave to withdraw my Amendment.

Amendment, by leave, withdrawn.

Mr. MARJORIBANKS

I beg to move, in page 18, line 11, at the end, to insert the words: Provided that in no case shall an increase of assessment of any house property made by any new valuation hereunder take effect in any one year by more than five per cent. in excess of the previous assessment. I can claim, without any very great pride, paternity for the phrasing of this Amendment. I have said "without any great pride" because the matter is one of very great difficulty. I turned over in my mind and on paper a, number of ways in which to put this very important point. I came to the conclusion that this Amendment, although in no way perfectly phrased, expresses a very real grievance which will arise under the new valuation. I do not wish to bind the Chancellor of the Exchequer to accept the phrasing of the Amendment, but I ask him to accept the principle of it, and to give effect to it by an Amendment of his own. The question of rating and Income Tax assessment is a very difficult matter. There are differences between London and the provinces. I would like, in the very simplest terms, to express the position to the Committee. There are in this country two main forms of taxation—local taxation and national taxation. One, of course, is rated and the other comes under Income Tax. In the rated, I think I should be right in saying that reassessment has been left, very largely, to the whim, caprice and will of the local authority, and in many cases, except in London, there has not been a re-assessment for many years. In theory there was an Income Tax re-assessment every five years, except during the War, and since 1923 the Finance Act from year to year has continued the old assessment.

Therefore, it might be thought that in the provinces there was a fairly permanent re-assessment of property bringing it up to date from time to time. This has not really been the case, because the country officials responsible for the administration of rates and taxes formed the conclusion that property, after all, had one value for all purposes, that it was worth the same thing for taxes and for rates. Income Tax officials in many parts of the country very properly took the rating assessment as the assessment by which they were bound. Nothing can be more calculated to raise grievances in the taxpayer's mind than to find the same house valued in different ways for different purposes. Naturally, it would be a grievance to a simple-minded person, and most people are simple-minded. The Income Tax official in many parts of the country was bound by the rating assessment, and in many parts of the country there has been no re-assessment either for rates or for Schedule A for many years. We do not depart in the least from the principle advanced by the Chancellor of the Exchequer in this matter. We maintain that there should be a single valuation both for Income Tax and for rates, but, of course, if you suddenly make a change from an antiquated system to a new system, you may create very great injustice indeed. As a Conservative, I believe in the inevitability of gradualness.

The only purpose of this Amendment is to act as a buffer or brake to see that no drastic injustice is done to certain people. I could give many instances in which grave injustice might be done in individual cases under this new revaluation. There has been no great revaluation of property in many parts of Great Britain for many years, and in 40 years values have enormously changed. Rates will go up and, indeed, have gone up as a result of the re-assessment of last year. Income Tax will go up too; but there is this fundamental difference between local and national taxation. In local taxation you have generally an agreed amount to be raised by an area, and the purpose of the local taxers is to see that this amount of money is raised fairly throughout the area. The assessments may be raised, but the poundage will go down, and no great change takes place. Take my own constituency of Eastbourne, where the value of property has gone up enormously. They were re-assessed last year and their assessments went up, but as they have a limited amount of expenditure to meet their poundage went down and no great change takes place.

The opposite will be the case if Income Tax assessment is increased. The Chancellor of the Exchequer, rightly, raises as much money as be can. There is no limit, and if the assessment goes up the amount goes up too; and it will bring about injustice. Hon. Members opposite can quite easily place themselves in the position of a retired man with limited means. He seeks to go to some place where he can spend the evening of his days. If he is wise he will choose my constituency. One of the elements in his choice, where conditions are pleasant and where living is economic, would be, of course, the lowness of the rates and the lowness of Income Tax assessment. Suppose the Income Tax assessment was unjustifiably low, he would naturally think that he had made a great bargain in buying his house and he would order his life on that basis. He would say, "I have bought this house, which is my own, and I can live in it for the rest of my days." He can plan out his expenditure, but he does not take into consideration the fact that the assessment of his house will go up enormously. My hon. Friend who sits on these benches will be able to produce instances where the assessment will inevitably go up enormously, perhaps 100 per cent. or 150 per cent. Such a man will have to pay enormously more now than he did before. That cannot be right. Under the old system, perhaps unjust and antiquated, he thought he had the right to consider his way of life permanent, and it is quite outside his calculations that this change should take place. Of course, private rights must give way to public policy.

I think it is absolutely correct in principle and unchallengable that there should be a fair assessment of property from time to time, in order that there should be no injustice, but I say that when you are going to upset individual people, and, perhaps, change the whole tenour of their lives, you must do it gradually. That is the whole purpose of the Amendment. It is not a difference in principle from what is proposed by the Chancellor. I would accept far less than I am asking for, but I do ask the Chancellor to consider this, for it is a very, very serious matter. It is not a party question. Hon. Gentlemen opposite, when they go down to their constituencies at the next election, will have to face this question. They have supporters who are Income Tax payers. Many of them are Income and Super-tax payers themselves, and they will have to face this matter in their constituencies. It will be well for hon. Gentlemen opposite to be prepared for the argument which will be put to them, and the only answer they can give will be that it was necessary to bring about the change and say, "We saw to it that the change was gradual, and did our best to see nobody had drastically to change the manner of their lives as the result of this action."

Mr. P. SNOWDEN

There is a better answer to any person who may be aggrieved by an increase in the assessment for Schedule A purposes than that which the hon. Member gave in his concluding remarks, and it is this: The hon. Member in this Amendment asks that the new assessments, if there be an increase in any particular instances, shall not be based upon the actual income from the property, but that if there be any increase, it shall be limited to 5 per cent. It is true, he did not commit himself definitely to that figure of 5 per cent., but, at any rate, his point is that there shall not be an increase proportionate to any increase in the rent which may have taken place since the last valuation. He said that in his constituency there might be cases where the increase in assessment would be 100 per cent., or even 150 per cent. I do not think the hon. Member really apprehended what a statement like that involves. It is now 10 years since the last assessment took place, and during each of those 10 years there has been an increase in the value of the income from these properties.

Mr. MARJORIBANKS

With great respect, I was referring really to the owner-occupier. I am glad the right hon. Gentleman has raised this question, because I would have liked to limit my Amendment to the owner-occupier. The valuation is raised but his income does not go up, and if he has to pay it, he has to provide for further taxation without any further resources to meet it.

Mr. P. SNOWDEN

The hon. Member is surely wrong there. If the value of the property goes up, and he is the owner-occupier of the property, that is really an increase in his income.

Mr. MARJORIBANKS

No. If he wanted to sell and move elsewhere, that would be so, but supposing he wants to remain in his home?

Mr. P. SNOWDEN

The annual value of the property is really part of his income, and, if he cared to let the property, that would be increased by the 100 per cent. or the 150 per cent. which the hon. Member mentioned. That is the answer which my hon. Friends would give in case they were ever called upon to justify their position in this matter. The hon. Member indicated the line which he is going to take when the question of the re-assessment of property in London is under consideration. He says that he wants local rating to be made the basis of that assessment, but the hon. Member again exposed the weakness of his case by saying that in the case of local rating it does not matter very much what the assessment is, because the local authority has to raise a certain amount from the rates and therefore, if the assessable value be low, the poundage rate is so much higher. He went on to say that that is not the case with the Income Tax, but is it not? He says that if we raise the assessment we get a larger return wad that is quite true, but just as the amount of money needed by the local authority is a fixed sum, so the amount which the Exchequer wants from Income Tax is also s, fixed sum. [HON. MEMBERS: "No!"] Yes, it is, the sum fixed for the year, exactly as the sum fixed for the local rates is a sum fixed for the year, and therefore if the assessments under Schedule A were increased, the yield would be greater and, then, just as in the case of the revenue of the local authority, unless the needs of the national Exchequer were increased there would be provision in that increased yield from Schedule A for a reduction in the general rate.

Apart from the fact that the hon. Member's suggestion would enable a person whose property had increased in rateable value to escape his fair contribution to the Income Tax, let us take a concrete case and see how it would work out—not an exaggerated case or rather an extreme case such as he suggested of an increase of 100 per cent. or 150 per cent. It seemed to be generally accepted by the Committee when I spoke on the last Amendment that the assessments under Schedule A are to be based on the income from the property subject, of course, to the deductions to which I have referred. Is not that a fair way of doing it? But if the hon. Member's suggestion were accepted, the result would be a very grave injustice between taxpayer and taxpayer, because the reductions which these people were getting below the real income from their property would have to be made up by other Income Tax payers. Supposing that property previously assessed at £100 can be justly re-assessed at £120, that is the income upon which Income Tax has to be paid. What would the hon. Member's Amendment do? It would say, "This man is getting £120 a year either in rent, or in value if he be the owner occupier, but we will not increase his assessment up to the amount of the income which he is actually getting; we will only raise it by £5."

11.0. p.m.

It must be remembered that there are a large number of these assessments. I believe that about 10,000,000 valuations have to be taken. Some of them, of course, will fall on the revaluation and some will increase, but there would be an enormous loss to the Revenue in cases where there had undoubtedly been an increase in the annual value of the property since the last valuation if the hon. Member's Amendment were carried. In the case which I have just quoted where it had risen from £100 to £120, the hon. Member would say, "No, we will not put the figure of the income, we will only put it at £105." Therefore, that man is escaping Income Tax upon £15 of income which he has received. I think it cannot be said that that is either a just or in any way an equitable proposal.

Mr. ATKINSON

I would like to give an illustration which I think that even the Chancellor of the Exchequer will admit is a case of gross injustice. I accept the principle that he has laid down that a man ought to be taxed in accordance with his income, but there are two classes of owner who will be adversely affected by this change. There is the owner-occupier, who has been mentioned, and there is the owner of a building who granted 21-year leases, say, 12 years ago. I had a case within the last fortnight—and I can verify the truth of what I am saying—of a building in the City of London, with various floors let off as offices, the sole source of income of a lady, a widow. The leases were granted in 1916 for 21 years at various rents. The uncontradicted evidence given is that the rental values are at least double to-day what they were at that time. For example, one floor which was let by her at £145 a year has been sublet for £300 a year. When you come to assess this building—and of course the Committee appreciates that this increase of rental value does not increase the owner's income by a penny, and that for another seven or eight years her income remains constant, however valuable these rents may become—what will happen to her? Under the first of the general rules, the method of valuing such buildings for Income Tax purposes is that the annual value is to be understood to be the amount of the rent by the year at which they are let, if they are let at a rack rent, and if the amount of that rent has been fixed by agreement within seven years, but if they are not let at a full annual value, then the full annual value which they are worth is to be taken.

When they come to revalue the building, the assessable value on that basis will be double, and therefore the Income Tax which this lady will have to pay will also be double. If that rule is applied when you come to revalue that building for Income Tax purposes, as the rents are not, the full annual rents fixed within seven years, the second part of the rule will have to be applied, with the result stated, that, the annual value having been doubled, the assessment will be doubled for rating and Income Tax purposes, and there is somebody whose income cannot be increased by a penny, but whose Income Tax will be doubled right away and whose rates will be doubled right away. I hope some answer will be given to this illustration, but I do not see what reply there can be. Where it is the case of an owner-occupier, as the Chancellor of the Exchequer said, the fact that your house has doubled in value, although it does not increase your income at all, it is not unfair that you should pay more Income Tax on your more valuable house. It is hard on the person who happens to live there, but there may be an argument there. But in the case of the person whose income cannot be increased and who does not enjoy the advantage of living in the more valuable place, but whose income is limited by rents fixed by leases more than seven years old, there is no argument that I can see. [Interruption.] Increased taxation will be got from people whose income has not increased, and cannot increase, by one penny. It is to protect that class of people that I have added my name to the Amendment. The Chancellor of the Exchequer made the point that these people have been led into a sense of false security because year has followed year without their assessments being raised. Landlords have got into the way of granting leases of 21 years.

Mr. MacLAREN

Does the hon. and learned Member suggest that the property was let without the owner knowing to the last penny the annual value of that property? Did the person not know, or was he not advised, of the current possible rental of the property?

Mr. ATKINSON

The owner got what were fair rentals at that time in 1916, but property has gone up in value and rent has increased, as we all know, to our cost. In this particular building it has been proved by expert evidence that if these rules were made to-day the full annual value would be at least twice as much, and when the assessors come to revalue that property, if they carry out the rule in its rigid sense, the Income Tax and rates of that person will be doubled, without any possibility of the income increasing by one penny. One point that, I was making when the hon. Member for Burslem (Mr. MacLaren) asked me a question, was that because of the method on which the valuations in London have been conducted in the past, by accepting a fixed valuation which has continued year after year, landlords have got into the way of granting these long leases of 21 years, whereas if they had known that there was going to be revaluations on this basis, they would have been very chary at granting these long leases. They would have protected themselves by granting only short leases. The long leases are in favour of the lessees, because they are given the option of breaking at various terms the the position of the lessors who have given the leases of 21 years—the Chancellor of the Exchequer shakes his head. I should be very relieved if there is a satisfactory answer, but I should like the Chancellor of the Exchequer to have the wording of the rule in front of him when he gives his answer, because it seems to be quite explicit as to what is to be done. The amount of the rent is to be taken only if the premises are let at the full annual value by agreement made within the last seven years. If they are not let at the full annual value by agreement within the last seven years, the amount to be taken is the full annual value. Am I right there?

Mr. P. SNOWDEN

I quoted that.

Mr. ATKINSON

If that is the rule when you come to deal with a building leased within the last seven years—in the case in question, the lease is 14 years old, and the rental values have doubled—if the rule is to be rigidly applied the lessors are going to be unjustly hit. My hon. Friend forgets that by the terms of this lease the lessor agrees to pay all rates. It is the common practice, where you let flats or shops, for the rents to be fixed, but the landlord pays the rates. That is one class of case. The owner-occupier is another case, and, where his income is not going to be raised at all, he may be called upon to pay a very much larger sum. Therefore, we suggest that some method of graduation to meet the increased burden should be made.

Mr. P. SNOWDEN

I think the hon. and learned Member is under a misapprehension. Let us take an imaginary case where the assessment may be increased during the existence of a lease by 100 per cent. Supposing this property is let at £1,000 a year and that when the revaluation comes along it is decided that it is worth £2,000 a, year and that is the sum fixed for Income Tax purposes under Schedule A. The lessor would not be affected at all during the tenancy of the lease by any increase in the assessment. There are, of course, other answers to the points made by the hon. and learned Gentleman in the earlier part of his remarks. Under the present system of assessment in London, on the basis of rates, the valuation is much too low for Income Tax purposes. I do not want to enter into the case of valuation in London, but it is very well known that there is something like half-a-million a year lost by under assessment of property for Income Tax purposes and that money is now going into the pockets of property owners and has to be made up by other classes of Income Tax payers. The lessor of the property to which the hon. Member referred will not be charged during the continuance of the lease the full annual value of that property. But what has she got? During the continuance of that lease the property is increasing in value, and at the termination of the lease it will be found that the property is worth not £1,000, but £2,000 a year. Therefore, during that lease of 21 years, the value of her property has doubled, and as she would only have been paying Income Tax on the £1,000 which she has received, she has escaped the Income Tax all these years on the increase.

Mr. WARDLAW-MILNE

I am in agreement in regard to this question of the tenant who pays a rental and who deducts Schedule A tax from the landlord, but there is a class of tenant which the Chancellor has forgotten, although I am not here to defend him. I refer to that class of tenant who pays inclusive rentals. My hon. and learned Friend had that class in view. In the City of London there are a very large number of properties which are let out in different offices on different floors at inclusive rentals for long periods. In these cases it is perfectly clear that the landlord under this Clause would have to pay considerably higher Schedule A assessments, but would be unable to pass it on to the tenant, because in these particular cases there is an entirely inclusive rental. I only mention that because I know that it exists, and I want to bring it to the Chancellor's notice. I agree with what the right hon. Gentleman said regarding the ordinary case, but there are those cases, of which I know plenty, in which the tenant only has the right to terminate the lease, and the landlord is bound for a period of 21 years on inclusive rentals—which very often include things other than rent—and in those cases the landlord would be unable to pass the extra charge on to the tenant.

I want to turn to another point which is of great importance in connection with this Amendment. In the case of London I do not think that there is so much grievance, because after all the quinquennial valuation has been in force for a very long time, but in the country the position is totally different. It was rather difficult to hear the Chancellor, but if I heard him correctly, he referred to the fact that these were cases in which there has not been regular valuations. I can tell him of cases in different parts of the country where there has been no revaluation for 50 years, and the Committee will rightly understand, therefore, that I am not against the principle of this Clause. It is desirable that we should gradually bring about a settled system throughout the country, but the difficulty is that the valuations are carried out in different parts of the country not by any one authority, but by different authorities. In many parts of the country, the expert valuers have been done away with and in the last year, revaluation has taken place in some cases by people who, to put it frankly were not over-qualified for the purpose. The consequence is that in one county or one district there may be one town in which the valuation has gone up by 25 and 30 per cent. In another case, and near by, they have gone up by only 5 per cent. It is clear that it is going to be grossly unfair on those people whose valuations have been put up to a high figure if they are suddenly called upon to pay these increased assessments without having an opportunity of levelling down their assessments as regards others in the neighbouring places.

This Amendment may not be possible in the form in which it is printed, but I hope that between now and the Report stage the Chancellor will consider whether it is not necessary to make some sliding scale, so that where there has been a largely increased valuation it will not press too hardly at once upon the Income Tax payers. The Financial Secretary may remember that some months ago I drew his attention to the allegation that in various parts of the country ordinary assessments under the Rating and Valuation Act were being made use of by the Income Tax Commissioners under Schedule A. He gave me a rather surprising answer. He said that surely was what was intended. He must now be aware that, as a matter of fact, this was not intended at all, and that it was quite improper for the commissioners to make use of the new assessments.

This does wit mean that I am not in favour of a quinquennial valuation, but I would point out what is the position in the country as against London. In London we have had the system carried out more or less by experts over many years, and therefore there is no likelihood of there being unfairness between one taxpayer and another. In the country there are certain areas where the valuation has been carried out by fairly expert people and assessments have gone up reasonably, shall we say, whereas in other places, quite near by, the valuations have gone up out of all knowledge simply, I am sorry to say, because in some cases the people who made the valuations had not expert knowledge.

The moment they apply Schedule A taxation to these assessments there will be a grossly unfair incidence of taxation as between one set of taxpayers and another. This is not a question affecting one class of taxpayers with incomes beyond a certain amount. It will affect all kinds of taxpayers, some of them the very smallest people, because it will apply to very small houses more than anything else, and in a great many cases the landlord has the right to pass on the whole or a large proportion of this taxation in the rent. I do not ask the Chancellor to give me an answer now, but I do ask him to consider whether it is not possible to graduate the thing in some way, so that in cases where there has been an undue inflation—I use my own words, and I do not accuse him of being intentionally unfair—as a result of the Rating and Valuation Act, there shall not be an immense immediate increase of payments but a graduation over a series of years.

Major ELLIOT

I wish to point out to the Chancellor of the Exchequer that there are one or two points which have not been covered by his reply. The right hon. Gentleman's answer was that if some people pay less others will have to pay more. Our contention is that the variations which have existed throughout the country are now to be flattened out, and quite reasonably, by this valuation. The lowly-rated and the lowly taxed areas are having their burdens increased by the more highly-taxed areas. In local government practice a proposal of that kind is by no means unknown or unusual, but very often it is arranged step by step so that the increased local taxation is not raised by a single bound to the level of the taxation of the neighbouring area, but is raised by a series of steps and by a gradual process. The result may be that certain areas have got off with the lower rate but it is felt that if there is a sudden change an alteration of levels is undesirable. In one particular case the Chancellor of the Exchequer said that the owner-occupier, if he wished, could recover this increased value by selling or by letting his property. But, supposing he does not wish to sell or let his property, that owner-occupier will find his taxation increasing without any corresponding increase from which to pay the taxation. [Interruption.] The owner-occupier of a house would have great difficulty in realising under those circumstances. A man with an unrealisable asset will suddenly find that his assessment has been increased and his taxation will correspondingly be increased, and therefore he has a grievance. In those circumstances it is only reasonable to suggest to the rest of the community that any increase should come gradually instead of suddenly. [Interruption.]

Major COLFOX

On a point of order. I should like to ask if I should be in order in suggesting that hon. Members opposite would be able to hold their conversation with more comfort if they went to some other place.

Major ELLIOT

My first point is the setting up of differential rating and the sending up of taxation from a low level to a high level. In the second place, an owner-occupier cannot realise an asset on which he is to be taxed correspondingly, and he finds himself subjected to a sudden rise in his taxation. My third point is the one which was made by the hon. Member for Eastbourne (Mr. Marjoribanks), that local taxation does not matter because an increased assessment is reflected in the lower poundage. The amount of money required is fixed, and consequently, if more money is involved, a lower levy is made. The Chancellor of the Exchequer said the same thing was true of the Income Tax, but that is not the case, because local taxation is collected on the basis of the rates, while Imperial taxation is collected on the basis of a number of different taxes. If the Income Tax should be found to yield more, I think it would be very hard for the Chancellor of the Exchequer to advance the argument that he would therefore lower the Income Tax. The right hon. Gentleman would use the money in relief of some other form of taxation. Therefore, the right hon. Gentleman's argument falls to the ground. An increase in the amount collected from the Income Tax will not mean a lower tax or a penny off the Income Tax in future years, but it will mean that he will knock off some other taxation in some other field. The increased amount will not inure to any of those upon whom this extra amount is being levied. The Chancellor of the Exchequer has given a figure of £500,000 a year for the City of London——

Mr. P. SNOWDEN

Not the City of London.

Major ELLIOT

I beg pardon; for the area of London alone.

The CHAIRMAN

May I ask the hon. and gallant Gentleman to address his remarks to me, and not to hon. Members below the Gangway?

Major ELLIOT

I beg pardon, Mr. Young. The Chancellor of the Exchequer was assuming this very large amount for London alone, and of course for the whole country it would be considerably more. It will not go back to the Income Tax payers, but will be given to other classes of taxpayers. Income Tax payers will thus suffer a double injustice. We say that it is only reasonable that it should be gradual, and we have provided for certain proportions. If the Chancellor accepts the principle, we should be prepared to provide different proportions, but, in view of the fact that the quinquennial valuation is now being brought in, we ask the right hon. Gentleman to accept this proposal. If he cannot make any concession on that point, we shall be reluctantly compelled to divide the Committee.

Captain Sir WILLIAM BRASS

The Chancellor of the Exchequer has stated that in London we were short to the extent of £500,000 owing to the present valuation under Schedule A in London, as far as Income Tax was concerned. I think that that is an insult to the assessment committees in London, accusing them of under-assessing the property in their areas. With regard to the principle which the Chancellor of the Exchequer has laid down as to the valuation for rates and for taxes, he pointed out just now that the valuation for the purpose of rates was a low valuation because only a certain amount of money had to be raised for local purposes, and he really inferred that the local assessment committees were not giving the proper value to property in their areas, but were giving it a lower value because of the amount of money that they had to raise in their local areas. Surely, however, a property is either worth a certain amount or it is not, and, if it is worth a certain amount, the taxes can be raised on that amount, and the rates also. The property can only have one value, and on that the local taxation and also the national taxation is raised. That is what happens in London, but not in other parts of the country. I think that the principle which has been laid down by the Chancellor of the Exchequer is absolutely wrong.

Mr. ATKINSON

I would ask the Chancellor of the Exchequer to reconsider the answer that he gave me just now, comparing Rule 1 of Schedule A and No. 7 of Schedule A, because Rule 8 provides, as I thought, that the assessment shall be made upon the landlord in respect of any building which is let in different apartments or tenements. Where the owner is assessed in that way, the only way of making a valuation is by No. 1 of Schedule A, and, therefore, I venture to think that the right hon. Gentleman's answer does not meet the point.

Question put, "That those words be there inserted."

The Committee divided: Ayes, 137; Noes, 262.

Division No. 381.] AYES. [9.14 p.m.
Adamson, Rt. Hon. W. (Fife, West) Grenfell, D. R. (Glamorgan) Marshall, Fred
Adamson, W. M. (Staff., Cannock) Griffith, F. Kingsley (Middlesbro' W.) Mathers, George
Addison, Rt. Hon. Dr. Christopher Griffiths, T. (Monmouth, Pontypool) Matters, L. W.
Aitchison, Rt. Hon. Craigle M. Groves, Thomas E. Messer, Fred
Alpass, J. H. Grundy, Thomas W. Middleton, G.
Ammon, Charles George Hall, F. (York, W. R., Normanton) Millar, J. D.
Arnott, John Hall, G. H. (Merthyr Tydvil) Mills, J. E.
Aske, Sir Robert Hall, Capt. W. P. (Portsmouth, C.) Milner, Major J.
Attlee, Clement Richard Hamilton, Mary Agnes (Blackburn) Montague, Frederick
Ayles, Walter Hamilton, Sir R. (Orkney & Zetland) Morgan, Dr. H. B.
Baker, John (Wolverhampton, Bilston) Harbord, A. Morley, Ralph
Baldwin, Oliver (Dudley) Hardie, George D. Morris, Rhys Hopkins
Barnes, Alfred John Hastings, Dr. Somerville Morrison, Herbert (Hackney, South)
Barr, James Haycock, A. W. Morrison, Robert C. (Tottenham, N.)
Batey, Joseph Hayday, Arthur Mort, D. L.
Bellamy, Albert Hayes, John Henry Moses, J. J. H.
Benn, Rt. Hon. Wedgwood Henderson, Right Hon. A. (Burnley) Mosley, Lady C. (Stoke-on-Trent)
Bennett, Capt. Sir E. N. (Cardiff C.) Henderson, Arthur, Junr. (Cardiff, S.) Mosley, Sir Oswald (Smethwick)
Benson, G. Henderson, Thomas (Glasgow) Muff, G.
Bentham, Dr. Ethel Henderson, W. W. (Middx., Enfield) Muggeridge, H. T.
Bevan, Aneurin (Ebbw Vale) Herriotts, J. Murnin, Hugh
Birkett, W. Norman Hirst, G. H. (York W. R. Wentworth) Nathan, Major H. L.
Bondfield, Rt. Hon. Margaret Hirst, W. (Bradford, South) Newman, Sir R. H. S. D. L. (Exeter)
Bowen, J. W. Hoffman, P. C. Noel Baker, P. J.
Broad, Francis Alfred Hollins, A. Oldfield, J. R.
Brockway, A. Fenner Hopkin, Daniel Oliver, George Harold (Ilkeston)
Bromfield, William Horrabin, J. F. Oliver, P. M. (Man., Blackley)
Brooke, W. Hudson, James H. (Huddersfield) Owen, H. F. (Hereford)
Brothers, M. Hutchison, Maj.-Gen. Sir R. Palin, John Henry
Brown, C. W. E. (Notts, Mansfield) Isaacs, Georga Paling, Wilfrid
Brown, Ernest (Leith) Jenkins, W. (Glamorgan, Neath) Palmer, E. T.
Buchanan, G. John, William (Rhondda, West) Parkinson, John Allen (Wigan)
Burgess, F. G. Johnston, Thomas Perry, S. F.
Burgin, Dr. E. L. Jones, F. Llewellyn- (Flint) Pethick-Lawrence, F. W.
Buxton, C. R. (Yorks, W. R. Elland) Jones, Rt. Hon. Leif (Camborne) Phillips, Dr. Marion
Caine, Derwent Hall- Jones, Morgan (Caerphilly) Potts, John S.
Cameron, A. G. Jones, T. I. Mardy (Pontypridd) Price, M. P.
Cape, Thomas Jowett, Rt. Hon. F. W. Pybus, Percy John
Carter, W. (St. Pancras, S. W.) Jowitt, Rt. Hon. Sir W. A. Quibell, D. J. K.
Charleton, H. C. Kedward, R. M. (Kent, Ashford) Ramsay, T. B. Wilson
Chater, Daniel Kelly, W. T. Rathbone, Eleanor
Church, Major A. G. Kennedy, Thomas Raynes, W. R.
Clynes, Rt. Hon. John R. Kenworthy, Lt.-Com. Hon. Joseph M. Richards, R.
Cocks, Frederick Seymour Kinley, J. Richardson, R. (Houghton-le-Spring)
Compton, Joseph Kirkwood, D. Riley, Ben (Dewsbury)
Cove, William G. Knight, Holford Riley, F. F. (Stockton-on-Tees)
Cowan, D. M. Lambert, Rt. Hon. George (S. Molton) Ritson, J.
Daggar, George Lang, Gordon Roberts, Rt. Hon. F. O. (W. Bromwich)
Dallas, George Lathan, G. Romeril, H. G.
Dalton, Hugh Law, Albert (Bolton) Rosbotham, D. S. T.
Day, Harry Law, A. (Rossendale) Rowson, Guy
Denman, Hon. R. D. Lawrence, Susan Salter, Dr. Alfred
Dickson, T. Lawson, John James Sanders, W. S.
Dudgeon, Major C. R. Lawther W. (Barnard Castle) Sandham, E.
Dukes, C. Leach, W. Sawyer, G. F.
Ede, James Chuter Lee, Frank (Derby, N. E.) Scrymgeour, E.
Edmunds, J. E. Lee, Jennie (Lanark, Northern) Scurr, John
Edwards, E. (Morpeth) Lees, J. Sexton, James
Egan, W. H. Lewis, T. (Southampton) Shaw, Rt. Hon. Thomas (Preston)
Elmley, Viscount Logan, David Gilbert Shepherd, Arthur Lewis
Foot, Isaac Longbottom, A. W. Sherwood, G. H.
Forgan, Dr. Robert Longden, F. Shield, George William
Freeman, Peter Lovat-Fraser, J. A. Shields, Dr. Drummond
Gardner, B. W. (West Ham, Upton) Lowth, Thomas Shillaker, J. F.
Gardner, J. P. (Hammersmith, N.) Lunn, William Short, Alfred (Wednesbury)
George, Major G. Lloyd (Pembroke) Macdonald, Gordon (Ince) Simmons, C. J.
George, Megan Lloyd (Anglesea) MacDonald, Rt. Hon. J. R. (Seaham) Sinkinson, George
Gibbins, Joseph MacDonald, Malcolm (Bassetlaw) Sitch, Charles H.
Gibson, H. M. (Lancs, Mossley) McElwee, A. Smith, Alfred (Sunderland)
Gill, T. H. McEntee, V. L. Smith, Frank (Nuneaton)
Gillett, George M. Maclean, Sir Donald (Cornwall, N.) Smith, H. B. Lees- (Keightey)
Glassey, A. E. Maclean, Neil (Glasgow, Govan) Smith, Tom (Pontefract)
Gossling, A. G. MacNeill-Weir, L. Smith, W. R. (Norwich)
Gould, F. McShane, John James Snell, Harry
Graham, D. M. (Lanark, Hamilton) Malone, C. L'Estrange (N'thampton) Snowden, Rt. Hon. Philip
Graham, Rt. Hon. Wm. (Edin., Cent.) Mansfield, W. Snowden, Thomas (Accrington)
Granville, E. Markham, S. F. Sorensen, R.
Gray, Milner Marley, J. Stamford, Thomas W.
Stephen, Campbell Walkden, A. G. Whiteley, Wilfrid (Birm., Ladywood)
Strachey, E. J. St. Loe Walker, J. Whiteley, William (Blaydon)
Sullivan, J. Wallace, H. W. Wilkinson, Ellen C.
Sutton, J. E. Wallhead, Richard C. Williams, David (Swansea, East)
Taylor, R. A. (Lincoln) Walters, Rt. Hon. Sir J. Tudor Williams, Dr. J. H. (Llanelly)
Thorne, W. (West Ham, Plaistow) Watkins, F. C. Williams, T. (York, Don Valley)
Thurtle, Ernest Watson, W. M. (Dunfermline) Wilson, C. H. (Sheffield, Attercliffe)
Tillett, Ben Watts-Morgan, Lt.-Col. D. (Rhondda) Wilson, J. (Oldham)
Tinker, John Joseph Wedgwood, Rt. Hon. Josiah Wilson, R. J. (Jarrow)
Toole, Joseph Wellock, Wilfred Winterton, G. E. (Leicester, Loughb'gh)
Tout, W. J. Welsh, James (Paisley) Young, R. S. (Islington, North)
Townend, A. E. Welsh, James C. (Coatbridge)
Trevelyan, Rt. Hon. Sir Charles West, F. R. TELLERS FOR THE AYES.—
Vaughan, D. J. Westwood, Joseph Mr. Charles Edwards and Mr. B.
Viant, S. P. White, H. G. Smith.
NOES.
Acland-Troyte, Lieut.-Colonel Erskine, Lord (Somerset, Weston-s. M.) Oman, Sir Charles William C.
Amery, Rt. Hon. Leopold C. M. S. Everard, W. Lindsay O'Neill, Sir H.
Atholl, Duchess of Falle, Sir Bertram G. Penny, Sir George
Atkinson, C. Fermoy, Lord Percy, Lord Eustace (Hastings)
Balfour, George (Hampstead) Fielden, E. B. Peto, Sir Basil E. (Devon, Barnstaple)
Balniel, Lord Fison, F. G. Clavering Ramsbotham, H.
Beaumont M. W. Ford, Sir P. J. Rawson, Sir Cooper
Berry, Sir George Forestier-Walker, Sir L. Reid, David D. (County Down)
Betterton, Sir Henry B. Fremantle, Lieut.-Colonel Francis E. Remer, John R.
Bevan, S. J. (Holborn) Ganzoni, Sir John Reynolds, Col. Sir James
Birchall, Major Sir John Dearman Glyn, Major R. G. C. Richardson, Sir P. W. (Sur'y, Ch't'sy)
Bird, Ernest Roy Gower, Sir Robert Ross, Major Ronald D.
Boothby, R. J. G. Graham, Fergus (Cumberland, N.) Ruggles-Brise, Lieut-Colonel E. A.
Bourne, Captain Robert Croft Grattan-Doyle, Sir N. Russell, Alexander West (Tynemouth)
Bowyer, Captain Sir George E. W. Greene, W. P. Crawford Salmon, Major I.
Brass, Captain Sir William Grenfell, Edward C. (City of London) Samuel, A. M. (Surrey, Farnham)
Briscoe, Richard George Gunston, Captain D. W. Samuel, Samuel (W'dsworth, Putney)
Burton, Colonel H. W. Hacking, Rt. Hon. Douglas H. Sandeman, Sir N. Stewart
Cadogan, Major Hon. Edward Hall, Lieut.-Col. Sir F. (Dulwich) Savery, S. S.
Carver, Major W. H. Hannon, Patrick Joseph Henry Shepperson, Sir Ernest Whittome
Cautley, Sir Henry S. Harvey, Major S. E. (Devon, Totnes) Skelton, A. N.
Cayzer, Sir C. (Chester, City) Haslam, Henry C. Smith, R. W. (Aberd'n & Kinc'dine, C.)
Cayzer, Maj. Sir Herbt. R. (Prtsmth, S.) Herbert, Sir Dennis (Hertford) Smith-Carington, Neville W.
Chamberlain, Rt. Hn. Sir J. A. (Birm., W.) Horne, Rt. Hon. Sir Robert S. Smithers, Waldron
Chapman, Sir S. Howard-Bury, Colonel C. K. Somerville, D. G. (Willesden, East)
Christie, J. A. Hurd, Percy A. Southby, Commander A. R. J.
Cobb, Sir Cyril Hurst, Sir Gerald B. Spender-Clay, Colonel H.
Cohen, Major J. Brunel Kindersley, Major G. M. Stanley, Maj. Hon. O. (W'morland)
Colfox, Major William Philip King, Commodore Rt. Hon. Henry D. Tinne, J. A.
Colville, Major D. J. Lamb, Sir J. Q. Todd, Capt. A. J.
Courtauld, Major J. S. Lane Fox, Col. Rt. Hon. George R.- Train, J.
Courthope, Colonel Sir G. L. Law, Sir Alfred (Derby, High Peak) Vaughan-Morgan, Sir Kenyon
Cranborne, Viscount Leighton, Major B. E. P. Wallace, Capt. D. E. (Hornsey)
Croft, Brigadier-General Sir H. Lewis, Oswald (Colchester) Warrender, Sir Victor
Crookshank, Cpt. H. (Lindsay, Gainsbro) Llewellin, Major J. J. Waterhouse, Captain Charles
Culverwell, C. T. (Bristol, West) Locker-Lampson, Rt. Hon. Godfrey Wayland, Sir William A.
Dalrymple-White, Lt.-Col. Sir Godfrey Locker-Lampson, Com. O. (Handsw'th) Wells, Sydney R.
Davidson, Major-General Sir J. H. Maitland, A. (Kent, Faversham) Williams, Charles (Devon, Torquay)
Davies, Dr. Vernon Makins, Brigadier-General E. Windsor-Clive, Lieut.-Colonel George
Davies, Maj. Geo. F. (Somerset, Yeovil) Margesson, Captain H. D. Winterton, Rt. Hon. Earl
Dawson, Sir Philip Marjoribanks, E. C. Womersley, W. J.
Dixon, Captain Rt. Hon. Herbert Meller, R. J. Wood, Rt. Hon. Sir Kingsley
Duckworth, G. A. V. Merriman, Sir F. Boyd Worthington-Evans, Rt. Hon. Sir L.
Dugdale, Capt. T. L. Mitchell, Sir W. Lane (Streatham)
Eden, Captain Anthony Moore, Sir Newton J. (Richmond) TELLERS FOR THE NOES.—
Edmondson, Major A. J. Muirhead, A. J. Sit Frederick Thomson and Major
England, Colonel A. Nield, Rt. Hon. Sir Herbert The Marquess of Titchfield.

Question, "That the Clause stand part of the Bill," put, and agreed to.

Division No. 382.] AYES. [11.36 p.m.
Acland-Troyte, Lieut.-Colonel Everard, W. Lindsay O'Neill, Sir H.
Amery, Rt. Hon. Leopold C. M. S. Falle, Sir Bertram G. Ormsby-Gore, Rt. Hon. William
Atholl, Duchess of Ferguson, Sir John Percy, Lord Eustace (Hastings)
Atkinson, C. Fielden, E. B. Peto, Sir Basil E. (Devon, Barnstaple)
Baillie-Hamilton, Hon. Charles W. Ford, Sir P. J. Ramsbotham, H.
Baldwin, Rt. Hon. Stanley (Bewdley) Forestler-Walker, Sir L. Reid, David D. (County Down)
Bainiel, Lord Fremantle, Lieut.-Colonel Francis E. Remer, John R.
Betterton, Sir Henry B. Gault, Lieut.-Col. Andrew Hamilton Reynolds, Col. Sir James
Bevan, S. J. (Holborn) Gibson, C. G. (Pudsey & Otley) Richardson, Sir P. W. (Sur'y, Ch'ts'y)
Bird, Ernest Roy Gilmour, Lt.-Col. Rt. Hon. Sir John Rodd, Rt. Hon. Sir James Rennell
Boothby, R. J. G. Glyn, Major R. G. C. Ross, Major Ronald D.
Bourne, Captain Robert Croft Gower, Sir Robert Russell, Alexander West (Tynemouth)
Bracken, B. Graham, Fergus (Cumberland, N.) Salmon, Major I.
Briscoe, Richard George Greene, W. P. Crawford Samuel, A. M. (Surrey, Farnham)
Brown, Brig.-Gen. H. C. (Berks, Newb'y) Gretton, Colonel Rt. Hon. John Samuel, Samuel (W'dsworth, Putney)
Buckingham, Sir H. Guinness, Rt. Hon. Walter E. Sandeman, Sir N. Stewart
Bullock, Captain Malcolm Gunston, Captain D. W. Sassoon, Rt. Hon. Sir Philip A. G. D.
Burton, Colonel H. W. Hacking, Rt. Hon. Douglas H. Savery, S. S.
Butt, Sir Alfred Hall, Lieut.-Col. Sir F. (Dulwich) Shepperson, Sir Ernest Whittome
Cadogan, Major Hon. Edward Hartington, Marquess of Skelton, A. N.
Carver, Major W. H. Harvey, Major S. E. (Devon, Totnes) Smith, R. W. (Aberd'n & Kinc'dine, C.)
Cayzer, Sir C. (Chester, City) Haslam, Henry C. Smith-Carington, Neville W.
Cayzer, Maj. Sir Herbt. R. (Prtsmth, S.) Heneage, Lieut.-Colonel Arthur P. Smithers, Waldron
Chamberlain, Rt. Hn. Sir J. A. (Birm., W.) Hoare, Lt.-Col. Rt. Hon. Sir S. J. G. Somerville, A. A. (Windsor)
Chamberlain, Rt. Hon. N. (Edgbaston) Hurd, Percy A. Somerville, D. G. (Willesden, East)
Christie, J. A. Iveagh, Countess of Southby, Commander A. R. J.
Churchill, Rt. Hon. Winston Spencer Jones, Sir G. W. H. (Stoke New'gton) Stanley, Maj. Hon. O. (W'morland)
Cobb, Sir Cyril King, Commodore Rt. Hon. Henry D. Stuart, Hon. J. (Moray and Nairn)
Cockerill, Brig.-General Sir George Lamb, Sir J. Q. Thomas, Major L. B. (King's Norton)
Colville, Major D. J. Lane Fox, Col. Rt. Hon. George R. Thomson, Sir F.
Courtauld, Major J. S. Leighton, Major B. E. P. Titchfield, Major the Marquess of
Courthope, Colonel Sir G. L. Llewellin, Major J. J. Todd, Capt. A. J.
Cranborne, Viscount Locker-Lampson, Rt. Hon. Godfrey Train, J.
Croft, Brigadier-General Sir H. Long, Major Eric Wardlaw-Milne. J. S.
Crookshank, Capt. H. C. Margesson, Captain H. D. Warrender, Sir Victor
Culverwell, C. T. (Bristol, West) Marjoribanks, E. C. Waterhouse, Captain Charles
Cunliffe-Lister, Rt. Hon. Sir Philip Mason, Colonel Glyn K. Wayland, Sir William A.
Dalkeith, Earl of Merriman, Sir F. Boyd Wells, Sydney R.
Dalrymple-White, Lt.-Col. Sir Godfrey Monsell, Eyres, Com. Rt. Hon. Sir B. Williams, Charles (Devon, Torquay)
Davidson, Rt. Hon. J. (Hertford) Moore, Sir Newton J. (Richmond) Windsor-Clive. Lieut.-Colonel George
Davies, Dr. Vernon Moore, Lieut.-Colonel T. C. R. (Ayr) Winterton, Rt. Hon. Earl
Davies, Maj. Geo. F. (Somerset, Yeovil) Morrison, W. S. (Glos., Cirencester) Wolmer, Rt. Hon. Viscount
Dawson, Sir Philip Morrison-Bell, Sir Arthur Clive Womersley, W. J.
Dixon, Captain Rt. Hon. Herbert Muirhead, A. J.
Duckworth, G. A. V. Newton, Sir D. G. C. (Cambridge) TELLERS FOR THE AYES.—
Edmondson, Major A. J. Nicholson, O. (Westminster) Sir George Penny and Captain
Elliot, Major Walter E. Nicholson, Col. Rt. Hn. W. G. (Ptrsf'ld) Sir George Bowyer.
NOES.
Adamson, Rt. Hon. W. (Fife, West) Buchanan, G. Forgan, Dr. Robert
Adamson, W. M. (Staff., Cannock) Burgess, F. G. Freeman, Peter
Addison, Rt. Hon. Dr. Christopher Burgin, Dr. E. L. Gardner, B. W. (West Ham, Upton)
Aitchison, Rt. Hon. Cralgie M. Caine, Derwent Hall- Gardner, J. P. (Hammersmith, N.)
Alexander, Rt. Hon. A. V. (Hillsbro') Cameron, A. G. George, Major G. Lloyd (Pembroke)
Alpass, J. H. Cape, Thomas George, Megan Lloyd (Anglesea)
Ammon, Charles George Carter, W. (St. Pancras, S. W.) Gibbins, Joseph
Arnott, John Charleton, H. C. Gibson, H. M. (Lancs. Mossley)
Aske, Sir Robert Chater, Daniel Gill, T. H.
Attlee, Clement Richard Church, Major A. G. Gillett, George M.
Baldwin, Oliver (Dudley) Clarke, J. S. Glassey, A. E.
Barnes, Alfred John Cluse, W. S. Gossling, A. G.
Barr, James Cocks, Frederick Seymour Gould, F.
Batey, Joseph Colfox, Major William Philip Graham, D. M. (Lanark, Hamilton)
Beaumont, M. W. Compton, Joseph Graham, Rt. Hon. Wm. (Edin., Cent.)
Bellamy, Albert Daggar, George Granville, E.
Benn, Rt. Hon. Wedgwood Dallas, George Grenfell, D. R. (Glamorgan)
Bennett, Capt. Sir E. N. (Cardiff C.) Dalton, Hugh Griffith, F. Kingsley (Mlddlesbro' W.)
Benson, G. Davies, E. C. (Montgomery) Griffiths, T. (Monmouth, Pontypool)
Bentham, Dr. Ethel Day, Harry Groves, Thomas E.
Bevan, Aneurin (Ebbw Vale) Denman, Hon. R. D. Grundy, Thomas W.
Birkett, W. Norman Dickson, T. Hall, G. H. (Merthyr Tydvil)
Bondfield, Rt. Hon. Margaret Dudgeon, Major C. R. Hall, Capt. W. P. (Portsmouth, C.)
Bowen, J. W. Dukes, C. Hamilton, Mary Agnes (Blackburn)
Bowerman, Rt. Hon. Charles W. Ede, James Chuter Hamilton, Sir R. (Orkney & Zetland)
Broad, Francis Alfred Edmunds, J. E. Harbord, A.
Brockway, A. Fenner Edwards, C. (Monmouth, Bedwellty) Hardie, George D.
Bromfield, William Edwards, E. (Morpeth) Harris, Percy A.
Brooke, W. Egan, W. H. Hastings, Dr. Somerville
Brothers, M. Elmley, Viscount Haycock, A. W.
Brown, C. W. E. (Notts, Mansfield) England, Colonel A. Hayday, Arthur
Brown, Ernest (Leith) Foot, Isaac Hayes, John Henry
Henderson, Right Hon. A. (Burnley) Marley, J. Scurr, John
Henderson, Arthur, Junr, (Cardiff, S.) Marshall, Fred Sexton, James
Henderson, W. W. (Middx., Enfield) Mathers, George Shaw, Rt. Hon. Thomas (Preston)
Harriotts, J. Matters, L. W. Shepherd, Arthur Lewis
Hirst, G. H. (York W. R. Wentworth) Messer, Fred Sherwood, G. H.
Hirst, W. (Bradford, South) Middleton, G. Shield, George William
Hoffman, P. C. Mills, J. E. Shiels, Dr. Drummond
Hollins, A. Milner, Major J. Shillaker, J. F.
Hopkin, Daniel Morgan, Dr. H. B. Simmons, C. J.
Horrabin, J. F. Morley, Ralph Sinkinson, George
Hudson, James H. (Huddersfield) Morris, Rhys Hopkins Sitch, Charles H.
Jenkins, W. (Glamorgan, Neath) Morris-Jones, Dr. J. H. (Denbigh) Smith, Alfred (Sunderland)
John, William (Rhondda, West) Morrison, Herbert (Hackney, South) Smith, Ben (Bermondsey, Rotherhithe)
Johnston, Thomas Morrison, Robert C. (Tottenham, N.) Smith, Frank (Nuneaton)
Jones, F. Llewellyn- (Flint) Mort, D. L. Smith, Tom (Pontefract)
Jones, Rt. Hon. Leif (Camborne) Moses, J. J. H. Smith, W. R. (Norwich)
Jones, Morgan (Caerphilly) Mosley, Lady C. (Stoke-on-Trent) Snowden, Rt. Hon. Philip
Jones, T. I. Mardy (Pontypridd) Mosley, Sir Oswald (Smethwick) Snowden, Thomas (Accrington)
Jowett, Rt. Hon. F. W. Muff, G. Sorensen, R.
Jowitt, Rt. Hon. Sir W. A. Muggeridge, H. T. Stamford, Thomas W.
Kedward, R. M. (Kent, Ashford) Nathan, Major H. L. Stephen, Campbell
Kelly, W. T. Naylor, T. E. Strachey, E. J. St. Loe
Kennedy, Thomas Newman, Sir R. H. S. D. L. (Exeter) Strauss, G. R.
Kenworthy, Lt.-Com. Hon. Joseph M. Noel Baker, P. J. Sullivan, J.
Kinley, J. Oldfield, J. R. Sutton, J. E.
Kirkwood, D. Oliver, George Harold (Ilkeston) Taylor, R. A. (Lincoln)
Lang, Gordon Oliver, P. M. (Man., Blackley) Thurtle, Ernest
Lansbury, Rt. Hon. George Owen, H. F. (Hereford) Tinker, John Joseph
Lathan, G. Palin, John Henry Toole, Joseph
Law, Albert (Bolton) Paling, Wilfrid Tout, W. J.
Law, A. (Rosendale) Palmer, E. T. Townend, A. E.
Lawrence, Susan Parkinson, John Allen (Wigan) Viant, S. P.
Lawson, John James Perry, S. F. Walker, J.
Lawther W. (Barnard Cattle) Pethick-Lawrence, F. W. Wallace, H. W.
Leach, W. Phillips, Dr. Marion Watson, W. M. (Dunfermline)
Lee, Frank (Derby, N. E.) Potts, John S. Watts-Morgan, Lt.-Col. D. (Rhondda)
Lee, Jennie (Lanark, Northern) Price, M. P. Wellock, Wilfred
Lees, J. Pybus, Percy John Welsh, James (Paisley)
Lewis, T. (Southampton) Quibell, D. J. K. Welsh, James C. (Coatbridge)
Lindley, Fred W. Ramsay, T. B. Wilson West, F. R.
Logan, David Gilbert Rathbone, Eleanor Westwood, Joseph
Longbottom, A. W. Raynes, W. R. White, H. G.
Longden, F. Richards, R. Whiteley, Wilfrid (Birm., Ladywood)
Lovat-Fraser, J. A. Richardson, R. (Houghton-le-Spring) Wilkinson, Ellen C.
Lunn, William Riley, Ben (Dewsbury) Williams, David (Swansea, East)
Macdonald, Gordon (Ince) Ritson, J. Williams, Dr. J. H. (Llanelly)
MacDonald, Rt. Hon. J. R. (Seaham) Romerll, H. G. Williams, T. (York, Don Valley)
MacDonald, Malcolm (Bassetlaw) Rosbotham, D. S. T. Wilson, C. H. (Sheffield, Attercliffe)
McElwee, A. Rothschild, J. de Wilson, J. (Oldham)
McEntee, V. L. Rowson, Guy Wilson, R. J. (Jarrow)
MacLaren, Andrew Salter, Dr. Alfred Winterton, G. E. (Leicester, Loughb'gh)
Maclean, Sir Donald (Cornwall, N.) Samuel, Rt. Hon. Sir H. (Darwen) Young, R. S. (Islington, North)
Maclean, Neil (Glasgow, Govan) Samuel, H. W. (Swansea, West)
McShane, John James Sanders, W. S. TELLERS FOR THE NOES.—
Malone, C. L'Estrange (N'thampton) Sandham, E. Mr. T. Henderson and Mr. William
Mansfield, W. Sawyer, G. F. Whiteley.
Markham, S. F. Scrymgeour, E.

Amendment made: In page 18, line 16, leave out the word assessment", and insert instead thereof the word "revaluation."—[Mr. P. Snowden.]

The CHAIRMAN

The next Amendment I call is in the name of the hon. Member for Eastbourne (Mr. Marjoribanks) to leave out Sub-section (3).

Mr. MARJORIBANKS

I beg to move, in page 18, line 1, to leave out Subsection (3). I am rather surprised that, you have called this Amendment.

The CHAIRMAN

The hon. Member has no right to make any such reflection on the conduct of the Chair.

Mr. MARJORIBANKS

I had no intention of making any reflection on the Chair, but as this is consequential on a previous Amendment which the Committee has negatived I do not propose to put forward any arguments upon it.

The CHAIRMAN

I understand the hon. Member to say that this is a consequential Amendment to the one which has just been rejected. I had not noticed that or I should not have called it.

Question, "That the Clause, as amended, stand part of the Bill," put, and agreed to.