HC Deb 09 April 1940 vol 359 cc468-9
71. Mr. Lathan

asked the Chancellor of the Exchequer whether he is now in a position to state the circumstances in which, according to the Official Receiver's report, the Inland Revenue Department became an unsecured creditor against the estate of the late Jack Abraham Phillips for the sum of £150,000; if he will state the period covered by these arrears of taxes; and the nature of the steps taken to obtain payment currently, or within a reasonable limit of time?

Sir J. Simon

I have had before me the report for which I called in this matter. I am, of course, precluded from divulging details of a taxpayer's affairs, but the report shows that the liabilities concerned related to very complicated transactions and involved difficult points of law and accountancy, in regard both to the existence and measure of the liabilities and to the years to which profits should properly be referred. Mr. Phillips was latterly in extreme ill-health and there was much delay in the production of accounts and of information, which only he could furnish. In these circumstances assessments which had been made for 1932–33 and subsequent years were all under appeal, and although tax was collected in respect of the undisputed liability, the disputed elements could not be determined by the appellate tribunal until shortly before Mr. Phillips's death, and then not for the latest years concerned; for these years the assessments are still under appeal.

Mr. Lathan

While thanking the Chancellor of the Exchequer for that reply, may I ask him if he is aware that benches of magistrates in London and elsewhere are constantly required to issue summonses and committal orders against defaulters for small sums of money, and does he realise that cases of the character dealt with in the Question encourage the view that well-to-do defaulters are dealt with very differently from poor people?

Sir J. Simon

I am glad that the hon. Member has put his supplementary Question, because it gives me the opportunity of stating that, whether that impression exists or not, it certainly is not true. It was for the very purpose of ascertaining the circumstances that I called for a special report in this case. I regret very much that there should have been so much delay. Both small taxpayers and big taxpayers, usually speaking, pay their taxes very promptly.

Mr. Benjamin Smith

Will the right hon. Gentleman consider putting the matter back into the hands of the Special Commissioners, because a taxpayer himself sitting in judgment upon a fellow taxpayer would not have allowed this period to elapse?

Sir J. Simon

It is quite true that this case was dealt with by the General Commissioners and not by the Special Commissioners, and that is another reason why I wanted to look at it myself. I think that the existing system can hardly be changed on the grounds given, but I appreciate the point which the hon. Member makes.