§ 5. Mr. Pageasked the Chancellor of the Exchequer the annual cost, in each of the past ten years, of the administration of claims in respect of property assessed to tax under Schedule A for repairs and maintenance, for lost rents and for voids, respectively.
§ Mr. SimonThe precise figures of cost are not available. The work on maintenance claims required about 600 staff units in 1958 as compared with about 100 in 1949. The work on lost rent and void claims required about 20 staffs units throughout the period.
§ Mr. PageMay I ask my hon. and learned Friend whether it is the fact that only a very small proportion of people entitled to make maintenance claims actually make them? Does he agree that if everybody entitled to do so did make a claim, it would make it not worth while collecting Schedule A?
§ Mr. SimonCertainly not all those entitled to claim do so. The second part of my hon. Friends supplementary question is hypothetical.
§ 6. Mr. Pageasked the Chancellor of the Exchequer whether he will give an estimate of the cost of the quinquennial revaluation of rented property for Schedule A tax; and whether he is satisfied that such cost is justified having regard to the fact that, by virtue of the provisions for the collection of tax upon excess rents, the assessment for Schedule A tax is irrelevant to the amount of revenue collected.
§ Mr. SimonQuinquennial revaluations for Schedule A were suspended in 1940 until Parliament decides to reintroduce them.
§ Mr. PageBefore Parliament decides to reintroduce the revaluations, will my hon. and learned Friend consider whether it is really worth while continuing the two systems of collection of tax on Schedule A and on excess rents? Would not it be more economical to do away with Schedule A, collecting it all on total rents?
§ 18. Mr. Gowerasked the Chancellor of the Exchequer what proportion of Schedule A tax was paid last year in respect of owner-occupied houses and fiats; and what consideration he has given to abolishing this tax in respect of such premises.
§ Mr. SimonThe total Income Tax for last year attributable to owner-occupation of houses and flats is estimated at about £35 million. My right hon. Friend will keep this and all other taxes under review in preparing his Budget.
§ Mr. GowerIn keeping this matter under review, will my hon. and learned Friend ask my right hon. Friend to take into account the fact that it would be a great stimulus to house ownership if this tax were abated or removed?
§ Mr. SimonI will certainly draw my hon. Friend's remarks to the attention of my right hon. Friend.
§ Mr. BellengerWas that the gross figure or the net figure after maintenance claims had been made?
§ 29. Mr. Pageasked the Chancellor of the Exchequer what revenue would be lost by abolishing Schedule A tax upon owner-occupied business premises.
§ Mr. PageWould my hon. and learned Friend agree that this is a very cumbersome way of collecting tax—by charging it on one Schedule and giving it back on another? Is not this another instance of the Chancellor being able to do away with Schedule A?
§ Mr. SimonNo, Sir. There may be respectable arguments for the abolition of Schedule A on owner-occupation, but 1296 this is not one of them. The income charged under Schedule A does not qualify for earned income relief, and it would be quite inequitable to abolish the Schedule A charge on owner-occupied business premises. The trader who occupies premises at a rack rent cannot claim earned income relief on so much of his gross income as is paid away in rent and deducted in arriving at his profits for Income Tax purposes, and there is no reason why more favourable treatment should be given to his competitor who owns his own premises. That point was made by the Royal Commission on the Taxation of Profits and Income, together with other arguments.