HC Deb 06 March 1945 vol 408 cc1823-4
47. Miss Rathbone

asked the Chancellor of the Exchequer whether children's allowances payable under the Family Allowances Bill, when implemented, will be liable to Income Tax.

The Chancellor of the Exchequer (Sir John Anderson)

The children allowances under the Bill will generally be treated as taxable income for Income Tax purposes and the taxpayer will continue to enjoy the personal allowance of £50 per child which the Income Tax law at present provides.

Miss Rathbone

Does that mean that if a taxpayer receives an allowance in the form of a rebate on his Income Tax he is not expected to pay tax on that rebate, but that if he gets it directly under the new Bill he will pay Income Tax on it? Will that not be in favour of the well-to- do section of the community rather than the poorer?

Sir J. Anderson

I am afraid I have not been able entirely to follow the hon. Lady's argument. The answer I have given comes down quite simply to this: Allowances which are an addition to income will be treated as income, but the introduction of the new allowances will not be attended by any withdrawal of the existing relief.

Mr. Quintin Hogg

Will the tax be payable by the father or the mother?

Mr. Rhys Davies

Can the right hon. Gentleman give an estimate of the total sum that is to be paid by the State in family allowances, and how much of the total sum will come back in taxes?

Sir J. Anderson

I could not possibly give an estimate of that kind.