§ 74. Lord APSLEYasked the Chancellor of the Exchequer whether, seeing that cooperative societies have violated the terms of the exemption from the payment of Income Tax granted under Section 24 of the Industrial and Provident Societies Act, 1893, now repealed and transferred to Section 39 (4) of the Income Tax Act, 1918, he will say what action he proposes to take?
Mr. CHAMERLAINUnder the provisions of Section 39(4) of the Income Tax Act, 1918, a society registered under the Industrial and Provident Societies 1028 Act, 1893, is entitled to exemption from tax under Schedules C and D, unless it both sells to persons not members thereof, and limits the number of its shares by its rules or practice. A society selling to non-members does not forfeit the exemption unless the number of its shares is limited. I am not aware that the above-mentioned provisions have been applied to any society in whose case the Statutory requirements are not met, but if my Noble Friend has in mind any such case and will let me have the necessary particulars, I will have the matter investigated and communicate the result to him in due course.
§ Mr. HANNONDoes the Treasury at any time take any measures to ascertain whether co-operative societies are in fact dealing with other people than members and are, therefore, liable under this Section to payment of Income Tax?
Mr. CHAMBERLAINI am afraid my hon. Friend did not give close attention to my answer. If he had done so, he would have seen that there are two conditions.