§ 59 Mr. CAMPBELLasked the Chancellor of the Exchequer (1) whether, in view of the fact that the sums placed to reserve by co-operative societies for the purpose of extending their businesses are not subject to Income Tax under Schedules C and D, he will grant similar exemption to all forms of private enterprise for the purpose of encouraging the trade and commerce of the nation;
(2) whether he is satisfied that the provisions of Section 24 of the Industrial and Provident Societies Act, 1893, are being observed with regard to the exemption of co-operative societies from payment of Income Tax under Schedules C and D if they do trade with non-members; and, if he is not, whether he will have the necessary action taken to enforce the provision regarding co-operative societies trading with non-members;
(3) whether the Government will cause co-operative societies to keep separate records of trading transactions with nonmembers in order that the trading profit therefrom may be accessible to Income Tax under Schedules C and D?
§ Mr. P. SNOWDENThe hon. Member is mistaken in supposing that the exemption from Income Tax, Schedules C and D, to which he refers, is invalidated by sales to non-members. The exemption still applies unless there is in addition a limitation on the society's shareholding. Nor is he correct in assuming that the undistributed income of the societies is entirely exempt from taxation, for in fact the societies pay Income Tax, Schedules A and B, on their property. I must point out that the whole question of the taxation of cooperative societies has frequently been discussed in Finance Bill Debates in recent years and successive Governments 1802 have declined to alter the existing basis of taxation.
§ Mr. CAMPBELLWill the right hon. Gentleman start a precedent by going into the whole question and taking steps to tax them?
§ Mr. MARJORIBANKSDoes not a state of emergency arise?
§ Mr. SNOWDENThere is no need for me to go further into the matter. I think I understand the position and, if an inquiry were necessary, I certainly would not prejudice it by making up my mind beforehand, as the hon. Member suggests.
§ 69. Mr. THORNEasked the Financial Secretary to the Treasury, with reference to the instructions which have been issued to the clerical staff of the Income Tax department to work overtime until April next in consequence of the changes that have been made in the scales of Income Tax, if he will state the number of hours per week to be worked; whether special rates are to be paid; the estimated cost of the overtime; and whether he has considered the advisability of employing extra temporary men and women having the necessary qualifications for this work?
§ The FINANCIAL SECRETARY to the TREASURY (Major Elliot)The amount of additional work resulting from the projected changes in the Income Tax law cannot yet be ascertained with precision, and accordingly no reliable estimate of its cost can be given at present. It is clear, however, that the volume of work will be considerable. Wherever practicable, additional temporary staff will be employed, but I am afraid it will not be possible to find any substantial number of men and women possessing the qualifications to which the hon. Member refers. The nature of the work to be carried out is such as to preclude the employment of untrained staff to any large extent. In these circumstances there is no alternative but to call upon the clerical staff to work an abnormal amount of overtime. This may amount to as much as 15 hours a week per head, but there will, of course, be suitable intervals free of overtime. The usual arrangements in regard to rates are being modified in some respects to meet the altogether exceptional circumstances which have arisen.
§ Mr. THORNEAm I to understand from that answer that, although it is rather a technical job, there are no people knocking about qualified to assist in getting through this work at all?
§ Major ELLIOTNot quite that. This is work of a special character, and, in view of the necessity of getting it through, the skilled staff will be more effective than people taken on temporarily.