HC Deb 28 May 1952 vol 501 cc1533-49

(1) Notwithstanding anything in any enactment contained, if an individual whose total income for any year of assessment exceeds two thousand pounds, proves to the satisfaction of the Commissioners that

  1. (a) his total income for that year of assessment includes income earned by him by the exercise or turning to account of his own personal skill and talent (hereinafter referred to as his income from the exercise of personal skill and talent); and
  2. (b) but for his income from the exercise of personal skill and talent his total income for that year of assessment would not have exceeded two thousand pounds,
he shall be entitled to elect by notice in writing to the Commissioners not later than six months from the end of that year of assessment that his liability to surtax shall be computed as if an amount of his income from the exercise of personal skill and talent equivalent to the amount by which his total income for that year of assessment exceeds two thousand pounds had been wholly or in part income of his for any one or more of the six years of assessment immediately preceding that year of assessment, and in such amounts in relation to any one or more than one of those six years of assessment as he shall decide, and if he so elects his liability to surtax shall be computed accordingly.

(2) In this section the expression "personal skill and talent" means personal skill and talent in authorship, in any of the arts, in study or research in any branch of science or learning or as an inventor.

(3) This section shall be of no effect in any case in which the result of any such election would or might be directly or indirectly to increase the liability to tax of any kind of any person other than the individual making the election.—(Sir F. Soskice).

Brought up, and read the First time.

Sir F. Soskice

I beg to move, "That the Clause be read a Second time."

At this late hour, I do not propose to make a long speech in introducing a Clause which has a very limited and modest objective. Prima facie, one would have thought that if two people over a period of years earn exactly the same amount of money, they should, if they had to pay Surtax, pay the same amount of Surtax. But that is not the way in which our law works, because if one of them has the misfortune to earn a large amount of his earnings in one year, because of the ascending nature of the Surtax scales he has to pay much more than a person who earns the same amount evenly over the period of years.

Mr. Millard Tucker in his Report called attention to the anomaly which that discloses and, particularly in paragraphs 85 onwards, suggested solutions of it. Obviously, to remedy the anomaly on a comprehensive scale would need drastic changes in the present provisions as to Surtax, and that I am not proposing. All that I propose is, on a very limited scale, to try to remedy the position so far as it affects members of our community who are particularly disadvantaged by the working of the Surtax provisions.

I refer in particular to authors. There is on the Order Paper another Clause—(Relief to certain persons where copyright assigned for lump sum or lump sums)—in the name of my hon. Friend the Member for Aston (Mr. Wyatt) which is designed to do something in this regard. What I propose in my Clause only goes a little further than an enactment already contained in Section 471 of the Income Tax Act, 1952.

That Section enables authors to spread back for three years the emoluments which they receive from the assignment of a copyright in a work which they produce. What I seek to do in the Clause is, first, rather to enlarge the relief which that Section confers already upon authors, and, second, to try to remedy two defects in the Section, to one of which Mr. Millard Tucker calls attention in paragraph 85 of his Report.

Those two defects are these. First, it is not clear whether Section 471 of the Income Tax Act covers the case of an assignment, not for a single lump sum, but for two or more lump sums. My Clause remedies that defect by including any payments received within a single year in such an amount as pushes up the Surtax scale. The second defect of the Section is that it does not cover sums received in respect of accrued royalty payments. My Clause is worded sufficiently wide to include payments of that sort. I have tried, therefore, to embody the purpose expressed in the Clause of my hon. Friend the Member for Aston, which unfortunately, I believe, is out of order.

In drafting my Clause I have taken the opportunity of going a little farther in the measure of relief accorded by Section 471. I have enabled the author to spread his payments back over six years, instead of three, and I have enabled him to choose which of the six years is most in his favour, whereas under the provisions of Section 471 he has to average out over the three years in which he spreads his payments. I have also somewhat enlarged the definition of authors and other persons within the purview of the Clause. My definition, I frankly concede, might go too far. My object is to invite the Parliamentary Secretary to say that he will give the matter consideration, perhaps with a view to altering provisions I have put in my Clause, perhaps to limit them.

I suggest the present definition of the persons who come within Section 471 is perhaps a little narrow. For example, a person engaged in scientific research may produce a work that can be hardly said to be a literary work; it may be a dry-as-dust volume of scientific research which possibly may possess literary qualities but which is not what people ordinarily understand as a literary work. Certainly it would not be a dramatic work, still less a musical or artistic work. A person of that sort might well not be within the ambit of the Section in the 1952 Act that at present deals with the position.

I sought in my definition to include persons of that sort. Equally I have included inventors. I have gone further and perhaps included persons who have, according to some opinions, less claim; although other people might think their claim even greater. There are singers. A singer or another person who engages in some kind of live entertainment has often to spend many years training and perfecting himself in his art, and then only at the end of a series of years does he begin to reap the reward, which may occur in a short professional life in large amounts in one, two, or three years. In my Clause I bring him within the provisions and enable him to spread back the large emoluments he receives in one, two, or three years, during which he has attained the summit of his success, and choose the years in the previous six years to which he would wish to apportion his earnings.

I hope the Parliamentary Secretary will say he will consider it carefully. It embodies a principle that certainly is called for by considerations of justice, and it certainly does bring help particularly to authors, who deserve especially well of the community because of the services they render. A Clause on these lines is certainly necessary. Frankly, the definition is a difficult part of it, and it may go too far. It may include persons who are not deserving; but it includes persons who are deserving. I commend the Clause to the Parliamentary Secretary and hope he will give it a favourable welcome.

Viscount Hinchingbrooke

When the right hon. and learned Gentleman talks about deserving cases, does his case cover large motor car manufacturers?

Sir F. Soskice

I do not think it can be said that they are persons engaged in any of the arts. An inventor is brought within the Clause, but a manufacturer does not necessarily come within that definition. Maybe that ought to be more limited. At any rate, I have put them in to invite consideration of the proposals I have made. For those reasons—which, if he is fortunate to catch the eye of the Chair, my hon. Friend the Member for Aston (Mr. Wyatt) desires to amplify by illustrations which he has collected—I commend the Clause to the Committee.

12.15 a.m.

Mr. Woodrow Wyatt (Birmingham, Aston)

I feel that I should begin by asking the indulgence of the Committee for venturing to speak on a Finance Bill, which I have not previously done for the seven years that I have been in the House. This is a special preserve of my hon. Friends who are economists and sit behind and in front of me, and I feel somewhat uneasily sandwiched between them. I should also declare a possible self-interest. It is conceivable—though not very likely—that at some point I might write a book which might produce sufficient royalties to benefit under this Clause, if it became law.

The background to this Clause has been sketched by my right hon. and learned Friend the Member for Neepsend (Sir F. Soskice). I would only add that it is obvious that in any community there is bound to be a small group of people who are going to have fluctuating incomes because they do not depend on regular salaries for their livelihoods. These people often have no hope of accumulating any capital—

Mr. Nabarro

Is the hon. Gentleman seriously suggesting that, with taxation at its present level, anybody can accumulate capital?

Mr. Wyatt

I did not know that I was going to excite such controversy.

I suppose that anybody could begin a bicycle factory and make his income out of it for a number of years, at the end of which time he could sell it as capital and pay no Income Tax on it but the author is unable to sell the copyright of his own books for capital. He may write 50 books; but at the end of his writing life he is not allowed to sell the copyright in those books for an outright sum. [HON. MEMBERS: "Why not?"] Because that is the law. If it were not, he would be able to do so. I think it is fair to say that this group of people have been more adversely affected by increasing Surtax than those who have a steady income. I hope to be able to show why in a moment.

This Clause is designed to help one particular section of this group of persons with fluctuating incomes. My right hon. and learned Friend has outlined the persons who are included in that group. I am inclined to agree that it includes too large a variety of people. I think the phrase "in any of the arts" is a rather loose one, and it might be taken to include music hall performers and all sorts of persons whom we would not think were particularly deserving of the community from the point of view of Surtax. [HON. MEMBERS: "Why not?"] I do not think they have any special claim on the community in the way that those who are engaged in the arts have.

We have tried to narrow down this section to cover the people who make the spirit of the country. I think that authors, writers, artists and musicians do, in fact, make the spirit of the country. Without them literature, painting and music would die. [An HON. MEMBER: "What about gin distillers?"] I dare say that gin distillers would continue to thrive, but there are other interests of a more lasting nature than drinking gin. I think the world would be a drab place without music, literature and painting—and, as one of my hon. Friends remarked, without gin, also.

I feel that this Committee ought to be concerned with nurturing those engaged in the arts in one form or another—either in painting, writing, music or literature. But, in fact, far from doing anything of the sort it penalises them. It discriminates against them. We do not do anything to shield or help artists today, but we put them under penal taxation. I think I can demonstrate how that happens if one takes a particular example of two people. If the first one earns a steady income of £2,500 a year for seven years he would have earned £17,500 at the end of that period.

On the other hand, take a creative writer—and this is quite a common case—who may earn the same amount in seven years but does not earn it in such even sums as the other person who may be a Civil Servant or director of a commercial firm. He may earn it in more uneven sums. He might earn an average of £2,000 a year for the first six years, and may have the luck in the last of the seven years to have a book which is outstandingly successful and which might earn £5,500 for him in that one last year. That would make the same total as the first man—£17,500—but, because we penalise the creative artist, he will have to pay £649 10s. in Surtax over that period, whereas the man who is in the humdrum, regular, safe, secure occupation will pay only £350 in Surtax. So the man who has something of a different quality to offer to the community, and is bound to rely on his own speculative enterprise, is penalised to the extent of about £300 for doing so.

This Clause, as my right hon. and learned Friend has said, is designed to allow him to spread any sudden increase back over any of the six years he chooses to put him in the same position as the man who earned the same amount of money more evenly. Perhaps this Clause is a little wide. But there is a precedent for the spreading back of receipts, and that is in Section 24 of the Finance Act, 1944. That allows anybody who has written a literary, musical or dramatic work of art, or has produced some other work of art to spread any lump sum back up to three years provided he has taken three years to produce that work of art, or over two years if he has taken two years.

In the case of authors, the original lump sum may not bear any relation to what the work of art may earn in the first year it is on the market and, as the Tucker Report says, it works particularly unfairly against authors. I would just like to quote from paragraph 85 of that Report: One class which is perhaps more exposed than most to fluctuations is that of authors; thus a particular book may enjoy a spectacular success, and substantially the whole of the royalties may be received in a single year; even though the author does not repeat his success, so that his literary profits in the years before and after are small or non-existent the high rates of Surtax take away by far the greater part of his reward. It refers to Section 24 of the Finance Act of 1944, which I have already mentioned, and adds that this provision may have the effect of giving relief in a limited number of cases; it does not touch the general problem for it is directed to quite a different point, namely, that of relieving cases where the fruits of one or more years' work are enjoyed by the receipt of a lump sum payment in a single year, and further it does not apply to ordinary royalties. Of course, all this was relevant to my Amendment which has not been called.

Mr. E. Fletcher

Would my hon. Friend continue with his quotation and read the next two sentences?

Mr. Wyatt

If I read the next two sentences I shall have to read the next five paragraphs in order to put those sentences into context; and since I do not wish to keep the Committee here all through the night, I think it as well that I get on. Might I also add that I feel almost obliged to claim the privilege of a maiden speaker in asking not to be interrupted as I proceed with these technical points?

I should like to give some examples of how unfairly this provision operates; and these examples are all of actual authors whose names are very well-known. But, for various reasons, I do not wish to disclose them; they were all obtained from the Society of Authors, which is the most representative organisation of authors in the country, and of whose executive committee I have the honour to be a member.

Mr. E. Fletcher

Why?

Mr. Wyatt

I am asked why; it is because I am the first person in this Committee ever to put this case. It is a good thing to have somebody on the committee to be here to make that case known. The first example which I wish to give concerns a novel which took three years to write, and for which the author received an advance in royalties of £1,800 from publishers in Britain and abroad. In the first year of publication, there was £4,000 in addition, in royalties, in one single year; but this author was only allowed to spread back the original lump sum of £1,800—the advance payment—and not the £4,000 which he received in the single year. In the years when he was writing the book his earnings from literature were comparatively negligible.

Secondly, I would quote the case of a historical work, which occupied three years in writing. This author had a publisher who was neither bold nor generous, and who gave him only £100 as advance payment. In the first year of publication, £640 was earned in royalties, and over the three years this author could only spread back the original £100, and not the £640, which was treated as income for the year in which it was received.

Thirdly, a novel which in the first year of publication made £5,800 in royalties, but the author was unable to claim anything while writing it, and he paid income tax on the £5,800 in a single year.

Mr. Crosland

I am certain my hon. Friend read the new Clause he is supporting; but if he reads it more carefully he will find that the example he has just given is not covered by the Clause.

Mr. Wyatt

My hon. Friend is quite wrong. I was referring to a person receiving an advance of £100 and who then earned £640 in the first year in which the book was in publication. Of course, he did not only depend on literature for his livelihood. If he had done so at this rate of income he would have done badly. It was the £640 which brought him into the Surtax class.

Mr. Crosland

Then my hon. Friend should have given us more details.

Mr. Wyatt

If I mentioned every detail in the life of these authors we should be here a long time.

Mr. Ede (South Shields)

It would be much more interesting.

12.30 a.m.

Mr. Wyatt

The next case is that of a writer whose normal income from writing is about £300 a year. He had an isolated success which earned him £6,000 from a book in the first year of publication, but, again, he lost all the benefit. Those examples show how frequent is the great handicap inflicted on authors from the incidence of our somewhat archaic Income Tax laws. It is crippling artistic endeavour, which is already difficult enough in these days.

In the moments when I have come into the Chamber during the Finance Bill I have heard concessions being made costing the country millions of pounds, concessions in relation to something called E.P.L. which have benefited business men and commercial firms to a vast extent. No doubt they are worthy people, but I am sure that they cannot be any more worthy than the authors and artists upon whom our claim to be remembered in a couple of hundred years' time will depend.

Last year the Chancellor put down an Amendment in similar terms to the one which has unfortunately been ruled out of order this year. I have put down my Clause for precisely the same reasons as he put down his, which were good last year and are good this year. He was aided in this enterprise by the Parliamentary Secretary to the Ministry of Civil Aviation who is now sitting beside him.

If the right hon. Gentleman will not accept the wider Clause which has been moved, I hope he will accept my slightly narrower point. There are some arguable legal points on how to get this in order, but the important thing to remember on the spreading of more sums than the original lump sum payment which authors receive is that all royalties are paid in a lump sum; publishers pay every six months in a lump sum after several payments have accrued. So it should not be very difficult to make it possible for lump sum payments as well as a lump sum payment to be given the benefit of the spreading device.

Over the years the State has tended for very good reasons to eliminate the possibility of private patronage. I do not think that the private patron ever existed so exuberantly or so generously as is sometimes said, but certainly the private patron did assist many authors, poets and other writers to do very fine work which otherwise could not have been done. As we move on inexorably to making it less and less possible for private patrons to exist, it is the duty of the State to replace the private patron and exercise public patronage in a more intelligent way. I hope the Government will, therefore, give very sympathetic consideration to the spirit behind the Clause.

Sir Edward Keeling (Twickenham)

I want very briefly to support the Motion. A Clause of this sort has been advocated for a good many years in "The Times" and elsewhere by an ex-Member of this House, Sir Alan Herbert. He has no personal interest in it, for he does not produce one book in a lifetime: he produces at least one a year and at least two articles or poems every week. But there are people, as hon. Members have indicated, who pour out their whole soul in one book and it would be an elementary act of justice to concede the spirit of this Clause. I hope that the Chancellor who is, I believe, the President of the Society of Authors, will do something about it.

Mr. Crosland

I am neither for nor against this Clause. I am bound to say, from the speeches we have heard, that more clarification is needed of what is intended. We had, first of all, a speech of studied moderation from my right hon. and learned Friend the Member for Neepsend (Sir F. Soskice), which was delivered in all good faith and prejudiced me in favour of this Clause. But this was followed by a speech from my hon. Friend the Member for Aston (Mr. Wyatt), which I can only describe as extremely arrogant and which has prejudiced me very much against the Clause.

My hon. Friend said that we ought to be engaged in "nurturing those engaged in literature." He described himself as a creative artist, one of the people whom we should be engaged in nurturing. But why should we nurture my hon. Friend? The only modest thing which my hon. Friend did was to declare his interest in the Clause at the start. Judging from his writings in the "Daily Herald" and "Tribune," and elsewhere, I should have thought that that was totally unnecessary, because I see not the slightest chance of his coming under the scope of this Clause whatsoever.

Mr. Wyatt

I did make that clear at the beginning: I explained that I thought it would never apply to me.

Mr. Crosland

My hon. Friend is in agreement with almost all the serious critics of his own literary work. The purpose of this Clause, as I understand it from my hon. Friend, is to isolate those people who are engaged in non-humdrum and unsafe occupations as opposed to those in humdrum and safe occupations; and the definition of a non-humdrum unsafe occupation is that of writers and those engaged in the arts. But why leave out a group which is subject to all these risks and fluctuations, namely, Members of Parliament?

It is all very well for my hon. Friend the Member for Aston, with a majority of 45,000. It is perfectly clear that in his case politics is a humdrum safe occupation; indeed, he carries it out in a particularly humdrum and boring manner. My right hon. and learned Friend the Member for Neepsend tried to make this Clause attractive by confining it to writers. It is perfectly true if we take this Clause as only applying to writers who are carrying on the cultural tradition of the country, and so on—articles to the "Tribune" and the "Daily Herald"—we can certainly make it very attractive. But the Clause as worded is not confined to writers at all. It includes the expression "in any of the arts."

I wish seriously to suggest that the expression "in any of the arts" is, to say the least of it, ambiguous. Rumours have been circulated as to what induced my right hon. and learned Friend to propose this Clause. Just take the most simple of these cases. It is quite clear that actors and actresses would be able to put in a perfectly fair claim to be considered as coming under the phrase "any of the arts." First of all, we exempt actors and actresses in serious Shakespearian drama. Having done that, all the other actors and actresses on the London stage would bitterly complain and say that they should be included. We cannot distinguish between serious and un-serious actors and actresses; we have to include them. Having done that, film stars say you must include film actors and actresses; so all film stars have to be included. As soon as that happens, music hall stars would claim to be included on the same grounds. It may be a good thing, but I want to know where it stops.

Mr. Wyatt

What we want to know is where it starts—not where it stops.

Mr. Crosland

Well, it is perfectly clear it starts at my hon. Friend.

If we take this expression "in any of the arts," what is the first and most obvious of all the arts? The art of government. Many people would think that was not being exercised in a particularly creditable manner in recent legislation, but it is quite impossible to go into that matter now. The Chancellor could claim that he was exercising the art of government—by introducing the Budget several weeks too early, altering the date, introducing a nonsensical tax, and then amending it. All this can be called the art of government. I personally would be sympathetic because if it is not an art, the only other thing it could he would be a science—and it could not be that.

There is the serious case where the present Chancellor of the Exchequer is Chancellor for one year only. This will probably happen this year. The right hon. Gentleman and his followers will have one year of office. We know from the speeches made from the other side of the Committee that all right hon. Gentlemen opposite were impoverished members of the lower strata. Before they became Cabinet Ministers they were living on £600 or £700 a year, or whatever it might have been. All these right hon. Gentlemen who will be in power for a year at the most on present indications, if the local elections are any guide, will benefit under this Clause.

12.45 a.m.

I do ask my hon. Friend and my right hon. and learned Friend whether they have considered the significance of what they are doing. Have they the slightest idea of what they are doing because that is, in fact, what will be the consequence. My own view is that if it is possible to find a wording which can genuinely be confined to writers and artists in the normal and proper sense of the words then I can see a case for giving an exemption, but I am extremely nervous of suggestions of alleviation of Surtax which are made in as loose a manner in such phrases as "in any of the arts."

The Millard Tucker Report has already been mentioned. My hon. Friend the Member for Aston, whose speeches on foreign affairs have a clarity and honesty which do him credit, but which have not been apparent in his speech tonight, quoted two sentences from the Report. He was then interrupted by my hon. Friend the Member for Islington, East (Mr. E. Fletcher), who asked him why he did not read on. The hon. Gentleman replied that if he read on he would have to read five more pages. Why not? Why did he not read on?

Mr. Wyatt

Because a series of mathematical examples are given over the next five pages on how the recommendations would help authors in exactly the same way as we are trying to do in this Clause, and it would have taken too long to read them all.

Mr. Crosland

I am sorry that my hon. Friend chooses to be flippant. If he had read on he would find this sentence: There are many other professional persons, business men, farmers and the like…. This is really a serious point. One can either exempt writers, artists, and such like, and they alone, on the grounds that their incomes fluctuate, or make this concession to all people, including all business men, farmers and professional men whose incomes fluctuate. Which do we want? I do not think that my hon. Friend or my right hon. and learned Friend made it clear. I would support a Clause which genuinely restricted the concession to writers and artists, but without hearing more powerful arguments than have been produced I would be against any concession to all commercial and business men.

Because I regard this Clause as the thin end of the wedge, and one bound to be extended, I am extremely suspicious of it. I am sorry to see two hon. Gentlemen, respected, as they are, for different reasons, on personal as well as political grounds—one of them having taken a consistently useful part in our discussions and the other having made a slightly belated appearance—supporting a Clause which may be extended to include a general concession which would make the rich richer—although it would not make my hon. Friend the Member for Aston any richer unless the whole standard of his writing improves. Such a Clause would be wholly undesirable on social grounds and unless I hear stronger arguments in favour of it I cannot give it my support.

Mr. Maudling

I fear that after the speech which we have just heard what I have to say will inevitably sound humdrum. I shall try to make up by brevity what I shall lack in wit. We had, first, from the right hon. and learned Gentleman the Member for Neepsend (Sir F. Soskice) a cogent argument in support of this new Clause. We then had a maiden incursion into these matters by the hon. Member for Aston (Mr. Wyatt), who made a vivid speech in support of a new Clause of his own which, though not actually before us, bore some relation to the one which we are considering.

The Government have a good deal of sympathy with the reasons behind this new Clause. Undoubtedly, when Surtax rates are very high, as they are at present, this bears hardly on people whose incomes fluctuate from year to year. That, I think, goes without argument. This Clause is subject to certain technical defects which I think the right hon. and learned Gentleman himself rather suspects.

There is, of course, the question of definition to which many hon. Members have referred, and especially the question of whether a music hall artiste would fall within or without. I wonder whether all hon. Gentlemen are inclined to be quite so supercilious about music hall turns. I find it difficult to say whether or not they should be included within the definition. The suggestion of the sixth year would enable a taxpayer to allocate part of his income back into a year which, by the effluxion of time, would be beyond assessment. Those are technical difficulties.

To turn to the principle, the Government feel that there is a great deal of force behind the general argument. It was referred to by the Millard Tucker Committee. The Government consider the proposal of that committee, along with other proposals, in framing the Finance Bill this year.

As the Committee knows, a number of the proposals of the Millard Tucker Committee have been accepted and embodied in the Bill. This one was not accepted, for two reasons: first, because the proposal of the Committee did not flow from a comprehensive review of fluctuating incomes but only of fluctuating incomes within the limited field of trade and the professions. Secondly, it was not accepted because the Millard Tucker scheme would be most complicated to work and expensive in staff in practice. We suggest that those are two strong reasons for not including a proposal of this character in this year's Finance Bill.

The new Clause advanced by the right hon. and learned Gentleman, apart from the minor technical matter to which I referred, differs from the Millard Tucker proposal in several respects. In one way it is wider than the Millard Tucker proposal, because it brings in certain people in Schedule E as well as Schedule D. In other ways it is more limited, because it applies by no means to all professional people but only to certain professions. It is worth bearing in mind that the problem of fluctuating incomes applies not only to people who draw their living from the arts, but also to many people who are in trade or the professions.

Take, for example, underwriters and others whose income fluctuates inevitably from the nature of their occupation. Because of that fluctuation they suffer under the disadvantage that the total amount of tax they pay on their total income for a given number of years is higher than the amount of tax paid by another person earning the same total on a regular annual salary. They suffer from this disability, but they are not covered by this proposal.

Also, it is true to say that while some employees—research workers, for example—are included, this is only a small number. There are many other employees, especially people employed on commission, who suffer from these fluctuations and who would equally deserve consideration if a Clause of this kind were embodied in a Finance Bill.

The Government considered this general problem carefully. They considered the Millard Tucker proposals, and they also considered this new Clause which, in some ways, did not commend itself quite so much to the Government because it is not so comprehensive. My right hon. Friend does not consider it possible to introduce legislation of this character this year, but that by no means rules out the possibility of legislation on these lines in future. The Government will certainly consider this problem and in doing that they will draw much benefit from the argument put forward tonight from both sides of the Committee. In those circumstances, having explained the attitude of the Government to the principle involved, I ask the proposer of the Clause to consider whether he will withdraw it.

Mr. Wyatt

Would not the hon. Gentleman meanwhile—it is a very simple matter—make Section 24 of the Finance Act, 1944, work more effectively and fairly?

Mr. Maudling

That is a rather different matter from the question now before the Committee, which is that this Clause should be added to the Bill.

Sir F. Soskice

I am grateful to the Parliamentary Secretary to the Ministry of Civil Aviation for what he has said. I quite understand that a proposal of this sort is, in some respects, far-reaching because of its implications on the general structure of the Surtax scheme, and that it requires careful thought. I am grateful to the hon. Gentleman for saying he will give it that thought, although he cannot undertake to introduce any provision this year to give effect to it.

I, personally, think that there is quite a strong case, although there may be arguments against it, for introducing the principle which is embodied in the Clause in relation to all fluctuating incomes. I have in the Clause endeavoured to embrace only a very limited number of persons. The reason for having those persons particularly in mind was that, from such information as one sees in the Press, and so on, those were the persons who, I thought, were particularly affected: namely, authors, who in a particular year may have a big success with some work that they produce, although they may have had many lean years before and although they may have had to work for a number of years to produce the work which produces the income.

My hon. Friend has poured a certain amount of, perhaps, merited scorn on the words I chose in going beyond the description of authors. As far as I am concerned, I should have thought that people like singers, certainly serious actors, had a very strong claim also, and I should have desired to include them. Questions are asked about music hall actors, and so on. I do not feel so strongly about them, although I think they have a claim.

The definition, I agree, is the most difficult part of the Clause. I think the present definition in Section 471 of the Income Tax Act is too narrow. It would obviously exclude people like singers and pianists. I think they have a strong claim to be included. Therefore, I did not use the definition from that Section but sought to go without it.

I do not think that the words "engaged in any of the arts" is so difficult to eschew as my hon. Friend suggests. I am not wedded to those words, and if better words could be chosen I should be very ready to see them adopted. I simply put these forward as a suggestion in order that they might receive consideration, because, obviously, if one is to have a Clause on these lines, one has to consider very carefully the exact ambit of the persons who are to be within it.

Authors certainly, I think, ought to be within it. I should like to see people like pianists, singers and artistes also within it. When one goes beyond that, one is, perhaps, on more controversial ground. One point which has not yet been raised, and which I certainly do not put forward, is that a barrister is a person who practises in any of the arts. In view of what the hon. Gentleman has said, I conclude by asking leave to withdraw the Motion.

Motion and Clause, by leave, withdrawn.