HC Deb 05 March 1957 vol 566 cc163-4
16. Dr. King

asked the Chancellor of the Exchequer to what extent lump sums paid by tenants to landlords as part of new tenancy agreements upon the decontrol of property by the Rent Bill will be subject to Income Tax; and if he will introduce legislation to ensure that such sums are taxable in all cases.

Mr. P. Thorneycroft

Under my right hon. Friend's proposals for the amendment of the Rent Bill it will, for the period of three years from the coming into force of the Bill, be illegal to require the payment of any premium for the grant of a tenancy of premises freed from control by subsections (1) or (2) of Clause 9. The hon. Member's Question does not, therefore, arise.

Dr. King

As, in spite of what the Chancellor and the Minister have said, there is still widespread fear that premiums may be charged, would not the Chancellor agree that as the premiums are merely rent collected in one year instead of being spread over a number of years, and as rent is subject to Income Tax, the premiums should also be subject to Income Tax?

Mr. Thorneycroft

That raises a somewhat wider question, as to whether premiums should be the subject of Income Tax in general, and that is a budgetary question.

Mr. Gibson

Is the right hon. Gentleman aware that the new Clause dealing with premiums is completely "phoney" and will not stop anybody charging premiums?

Mr. Thorneycroft

Happily, that is a question which should be addressed to my right hon. Friend.

17. Dr. King

asked the Chancellor of the Exchequer whether he will introduce a capital gains tax to be levied on such properties as are increased in capital value by the Rent Bill.

Mr. Langford-Holt

On a point of order, Mr. Speaker. Would it not be quite improper for the Chancellor to answer this Question? Were he to do so, he would probably be confronted with another Motion of censure on the ground that he had given away another Budget secret.

Mr. P. Thorneycroft

I cannot anticipate my Budget statement.

Dr. King

As the Government are, by Act of Parliament, deliberately adding millions of pounds to the value of property, will not the Chancellor at least have the decency in his forthcoming Budget to levy a tax on this unearned increment?