§ 52. Sir Leonard Lyleasked the Chancellor of the Exchequer if he will reconsider his decision not to extend Pay-as-you-Earn to serving men and women so as to avoid any accumulation of heavy indebtedness which they will otherwise have to defray at the end of their service.
§ Sir J. AndersonMy hon. Friend is under a misapprehension in thinking that the existing basis of taxation of the Forces leaves an accumulation of arrears of tax at end of service. As I explained on the Second Reading of the Income Tax (Offices and Employments) Bill last February, the Forces already pay as they go inasmuch as the tax chargeable on them is deductible within the Income Tax year; the system of collecting tax many months in arrear which formerly applied to most civilian employments does not apply to the Forces. The Forces were excluded 1566 from the full "Pay-as-you-Earn" system because of the practical difficulties of bringing them in under war-time conditions, but it was specially provided that they would enjoy the current year basis of income instead of the preceding year basis if more favourable.