§ A person who has paid land tax from which, by virtue of Section twelve of the Finance Act, 1898, as amended by the Finance Acts, 1920 and 1927, he might have claimed an exemption or abatement, shall be entitled to repayment of the amount overpaid, provided that the certificate of income mentioned in that section shall have been produced to the collector within twelve months after the expiration of the year of assessment.—[Mr. Keeling.]
§ Brought up, and read the First time.
§ 11.35 p.m.
§ Mr. Keeling
I beg to move, "That the Clause be read a Second time."
1866 I shall be very brief, not only because the hour is late and the subject of the Clause is not a very exhilarating one, but also because the Clause almost explains itself. It provides that a person who has paid Land Tax in error shall be able to recover his money, just as a person who has paid Income Tax in error can recover it.
As the Committee are aware, a landowner whose income does not exceed £160 a year is exempt from Land Tax, and one with an income between £160 and £400 is liable for the tax at only half rate. There is, however, absolutely no provision for the repayment of any of the tax paid in error. I am well aware that payments in error are not very common, because for the purposes of exemption it is the income of the previous year that is taken into account, and therefore a landowner can normally claim exemption before he makes his payment. But hard cases do occur, and I submit that as income Tax paid in error can be recovered the same principle ought to apply to Land Tax, especially as the people chiefly concerned are farmers, who are not always very expert bookkeepers.
Land Tax is normally collected from the occupier, and he may be a tenant who, after paying the tax, deducts the amount from the rent and sends the receipt for the tax to the landlord. In that case the landlord, if he is entitled to an abatement, may find himself with a receipt for an irrecoverable amount. I have here more than one case, supplied to me by the National Farmers' Union, in which that has recently happened. In another recent case Land Tax at the full rate was demanded, though the landlord was only liable at half rate. While his claim to abatement was under investigation by the inspector of taxes the collector sent in a peremptory demand for payment at full rate, threatening distraint. Under this threat the landlord paid the amount in full, thinking, in his ignorance, that if he established his claim he could recover what he had paid in excess. He found that under the law he could not. I could give other instances to the Committee, and I will send them to my right hon. Friend if he wishes to have them. I submit that the present law loads the scales of justice, however slightly, against the taxpayer and in favour of the Exchequer, and I suggest that it ought to be amended.
§ 11.37 p.m.
§ Sir J. Simon
The new Clause which my hon. Friend has moved deals with quite a minor point, which arises very seldom. I have looked into it rather closely, and in view of the fact that the Land Tax Act makes no provision for the recovery of tax when once it has been paid, as in the hard case which my hon. Friend quoted as an illustration, probably everyone will agree that we ought to see whether such a position cannot be rectified. I could not accept the words of the new Clause in their present form, but if my hon. Friend will agree, I will see before the Report stage whether it is not possible to draft a Clause which will secure what is here aimed at, because I think it is not quite fair that there should be no case in which relief can possibly be obtained.
§ Mr. Keeling
I am very grateful to my right hon. Friend, and I beg to ask leave to withdraw the Clause.
Motion and Clause, by leave, withdrawn.