§ 56. Brigadier-General Clifton Brownasked the Chancellor of the Exchequer whether he is aware that by a recent decision of the courts the £2 subsidy for land ploughed up by order of the Ministry of Agriculture is in future to rank for Income Tax; and whether, in the interests of production and justice to the farmer, he will alter the law accordingly?
§ Sir K. WoodI assume that my hon. and gallant Friend is referring to the recent decision of the Special Commissioners of Income Tax in a selected case that came before them. I understand that the appellant proposes to take that case to the courts and in these circumstances I do not consider it would be proper for me to express any view regarding the decision.
Brigadier-General BrownWas not this payment in the nature of compensation? Why do the Government set a bad example?
§ Sir K. WoodI do not think I had better comment on this matter, as it is apparently still before the courts.
Mr. De la BèreDoes not the right hon. Gentleman realise that the Government's attitude to agriculture is becoming more and more impossible?
§ Mr. KirkwoodWould it not be fairer to give 30s. to the farmer and 10s. to the ploughman who ploughs the land?
§ Sir John MellorWhy should not the Government legislate on the matter and save costs?
§ Sir K. WoodI think we had better wait and see the decision of the court.
§ 61. Mr. Bossomasked the Chancellor of the Exchequer whether farmers in the past have had to include as income the Government allowance of £2 per acre granted to them for ploughing up new land; and whether it is intended that any money received for ploughing up such land in the future shall be subjected to Income Tax?
§ Sir K. WoodAs I stated in my reply of 2nd July, 1942, to the hon. Member for the Forest of Dean (Mr. Price)—a copy of which I am sending to my hon. Friend—the view of the Board of Inland Revenue is that the ploughing grant is of a Revenue nature and should be taken into account in computing profits for taxation purposes. Assessments have been made in accordance with this view, subject to the farmer's right of appeal. As my hon. Friend is doubtless aware, the Board's view has recently been supported by the Special Commissioners of Income Tax, on appeal, and as I said in reply to my hon. and gallant Friend the Member for Newbury (Brigadier-General Clifton Brown), I understand that the appellant in that case proposes to take the matter to the Courts.
§ Mr. BossomAm I to infer from that that farmers in the past have always had this matter regarded as income and have actually paid Income Tax upon it?
§ Sir K. WoodNo, Sir, I would not like my hon. Friend to infer anything more than I have said in my reply.
Mr. AstorWill the right hon. Gentleman not consult with the Minister of Agriculture before taking this view?
§ Sir K. WoodNo, Sir, I consult the views of the Board of Inland Revenue in regard to Income Tax matters.
§ Mr. KirkwoodOn this£2 subsidy will not the right hon. Gentleman see that 30s. is given to the farmer and that 10s. goes to the ploughman who ploughs the land instead of it all going to the farmer?
§ Sir K. WoodI must remind my hon. Friend that I have no power to accede to that request.
§ Mr. LevyIs my right hon. Friend aware that the majority of farmers think that they have been deceived? They expected that the compensation would be £2 net, and it was never realised that it would be subject to 50 per cent. deduction.
§ Sir William DavisonIs not this payment more a matter of compensation?
§ Sir K. WoodAs the matter is being discussed in the court, I therefore cannot comment upon it.