HC Deb 22 September 1943 vol 392 cc209-11
143. Mr. Kirkwood

asked the Financial Secretary to the Treasury whether he has now completed his examination of the problem of paying Income Tax on current earnings; and whether he has any statement to make?

144. Mr. Pethick-Lawrence

asked the Financial Secretary to the Treasury whether he has any statement to make as to the possibility of applying the principle of pay-as-you-go to the Income Tax of wage-earners?

145. Sir Adam Maitland

asked the Financial Secretary to the Treasury whether his inquiries into the question of assessment on wages of workers on current earnings have now been completed; and whether he is in a position to make a statement thereon?

146. Major Woolley

asked the Financial Secretary to the Treasury whether, in view of the many difficulties arising from the present method of collecting Income Tax from wage-earners, he is in a position to make any statement upon the adoption of a pay-as-you-go system of collecting such taxes?

147. Mr. Graham White

asked the Financial Secretary to the Treasury whether he is in a position to state what progress has been made in working out a practical scheme for the deduction of Income Tax from small earnings on the principle of pay-as-you-go?

148. Sir Arnold Gridley

asked the Financial Secretary to the Treasury whether he has now considered alternative suggestions for the payment of Income Tax on a pay-as-you-earn basis; and whether he can make a statement?

149. Mr. John Wilmot

asked the Financial Secretary to the Treasury whether he proposes to introduce a system of pay-as-you-go Income Tax before the next Finance Bill?

The Financial Secretary to the Treasury (Mr. Assheton)

In view of the large number of Questions on this subject, I should like, with Mr. Speaker's permission, to make the following statement: I am glad to be able to inform the House that I am now able to put before them the proposals for a new system for the taxation of weekly wage-earners, which was devised by the late Chancellor of the Exchequer to confer on the wage-earner all the benefits of a pay-as-you-earn basis by regulating the weekly deduction of tax so as to keep in step both with the weekly earnings and the liability for the whole year. A full explanation of the new system will be found in a White Paper presented to-day, which will be available for Members in the Vote Office. It is proposed that the new system shall be brought into force for the Income Tax year 1944–45, commencing 6th April, 1944; and to enable this to be done it will be necessary for legislation to be passed before the end of the present Session. A Bill Will therefore be presented as soon as possible; it is hoped that the drafting will be completed in time for the text to be in the hands of Members in about 10 days' time.

Mr. Kirkwood

Is the hon. Gentleman aware that this will give great satisfaction to wage-earners, particularly shipbuilders and engineers?

Sir H. Williams

As this proposal involves forgiving about six months' Income Tax in the case of all those concerned, is it proposed to extend that to the rest of the taxpayers, so that all shall get equal treatment?

Mr. Assheton

A full explanation of the scope of the proposals will be given on the Second Reading of the Bill. But I may say now that the scheme outlined in the White Paper is designed to meet those difficulties which have been so constantly raised by Members of the House in respect of wage-earners whose earnings fluctuate and tax is deducted in respect of higher wages in weeks when wages are much lower. There is no such difficulty or disadvantage when the taxpayer's income is constant or is on a rising scale.

Mr. Stephen

Will the hon. Gentleman consider applying this principle also to the payment of Excess Profits Tax, in view of what happened after the last war, when so much of the Excess Profits Tax was never paid?

Mr. Assheton

That does not arise from these proposals.

Mr. McEntee

Will the term "workers" include what are generally known as black-coated workers?

Mr. Assheton

If the hon. Member will study the White Paper to-day, he will find all those questions answered.