§ 44. Sir BASIL PETOasked the Chancellor of the Exchequer whether he will consider amending Section 24 of the Industrial and Provident Societies Act, 1893, in order to replace the revenue now lost to the Exchequer by the progressive absorption by the co-operative societies of retail trade and industrial production which is or has been carried on by limited companies or private individuals whose profits are subject to Income Tax?
§ Mr. HORE-BELISHAThe Section to which my hon. Friend refers has been repealed, and no question of amending it can arise.
§ Sir B. PETOIs it not, in fact, still the law of the land, although the hon. Gentleman says that it has been repealed, and is not that the reason why the co-operative societies are not charged Income Tax on their full revenue?
§ Mr. HORE-BELISHANo, Sir. The Section no longer has any effect. It provided for the exception of industrial and 1923 provident societies from Income Tax under Schedules C and D, and, of course, that no longer applies.
§ Mr. THORNECan the Financial Secretary give any reason for this vicious propaganda against the co-operative societies?
§ Mr. LAWSONAre not these Gentlemen rather giving the game away too openly?
§ 41. Mr. SUMMERSBYasked the Chancellor of the Exchequer the percentage increase in the trading profits of retail co-operative societies in England and Scotland, respectively, in 1933 compared with 1918?
§ Mr. HORE-BELISHAI would refer my hon. Friend to the statistical summaries, showing the capital, sales, surplus, etc., of co-operative societies in Great Britain, published in Part 3 of the Annual Reports of the Chief Registrar of Friendly Societies. Separate figures for England and Scotland are not published.
§ 42. Mr. SUMMERSBYasked the Chancellor of the Exchequer whether any estimate has been formed of the amount lost to the national revenue during the past year by the absorption of private trading concerns by co-operative societies?
§ Mr. HORE-BELISHAThe answer is in the negative.
§ Mr. SUMMERSBYIs it not a fact that records must be kept of the net profits or tax paid by private traders; and, if and when such traders' businesses have been purchased and carried on with the same trading results by co-operative societies, could not the smaller tax paid by the latter he subtracted from the sums paid by the former to provide the answer to my question?
§ Mr. HORE-BELISHAI should be only too glad to give my hon. Friend all the information that he desires, but to answer his question we should require to know the number of private traders absorbed by co-operative societies, whether they would have continued in existence if they had not been absorbed, what profits they would have made if they had not been absorbed, and what would have been the tax on the 1924 income from the capital sums paid by co-operative societies for the purpose of taking over private traders. I am sure my hon. Friend will see that, without details on all these points, I could not possibly answer his question.
§ Sir B. PETOAlthough there may be such details as the Financial Secretary has pointed out, which are difficult to compute, is it not very necessary that the Treasury should make the best estimate that they can, in view of the fact that the co-operative societies' policy is to eliminate all private traders, and that, if that policy is achieved, the Treasury will have to find sources of revenue to replace the consequent loss in that direction?
§ Mr. HORE-BELISHANaturally, we should desire to see justice done, but our primary function is to make sure that we receive all the tax that is due to us. I can assure my hon. Friend that we are most vigilant in that regard.
§ Mr. THORNEIf any individual has the maximum amount of money, namely £200, invested in a co-operative society, has he not to show that information on his Income Tax return?
§ Mr. HORE-BELISHAAll profits have to be shown.