§ 51. Sir ADRIAN BAILLIEasked the Chancellor of the Exchequer if a tax is paid by foreign film-producing companies on payments made to them by renting houses in the United Kingdom in respect of the hire and exhibition of their films in the United Kingdom?
Mr. CHAMBERLAINAs I stated on 1st June, 1933, in reply to a question by my hon. Friend the Member for East Dorset (Mr. Hall-Caine), the Income Tax chargeable under the provisions of the Income Tax law in respect of profits arising in this country from foreign films is, of course, duly assessed and paid.
§ Sir A. BAILLIEIn view of the fact that it is estimated that between £6,000,000 and £7,000,000 is paid annually to foreign film-producing houses by British renting houses for the hire of films in this country, would not the right hon. Gentleman contemplate some amendment of the Income Tax laws whereby this considerable sum, so far as it represents profits, could be made subject to British taxation and contribute to the revenue of this country?
Mr. CHAMBERLAINUnder the existing Income Tax laws, Income Tax is not chargeable upon profits made by foreign firms who enter into contracts with British firms on ordinary commercial terms. Of course, if a British firm is acting as agent for a foreign firm, or there is any special arrangement between them under which the profits actually shown do not represent the ordinary trading profits, that matter is already covered.
§ Sir A. BAILLIEDoes the right hon. Gentleman realise that at least 75 per cent. of the £6,000,000 or £7,000,000 which goes abroad annually in this way is actual profit, and that this acts as a subsidy to foreign film producers, to the detriment of British producers?