HC Deb 16 December 1948 vol 459 cc1383-4
57. Mr. De la Bère

asked the Chancellor of the Exchequer whether he will consider, in connection with the taxation of investment income, excluding royalties from consideration as investment income.

Mr. Glenvil Hall

I assume that the hon. Member's Question relates to the special contribution. Royalties are in some circumstances treated as earned income for Income Tax purposes, and if so, do not form part of the recipient's investment income on which contribution is payable. For the rest, my right hon. and learned Friend does not see his way to propose any alteration of the existing law.

Mr. De la Bère

Am I to understand that with regard to the special contribution, royalties are not included in that? Is that what the right hon. Gentleman has told us—that they are not included in the special contribution?

Mr. Glenvil Hall

It all depends upon whether they rank as earned or unearned income. In some cases certain royalties are unearned income. In a very large proportion of cases they are earned income.

Mr. Benn Levy

Are we to understand that if they are earned income, they are exempt, but if they are unearned income they are not?

Mr. Glenvil Hall

We are talking here about the special contribution which only applies to unearned income—investment income.