Income Tax (Schedule A)

HC Deb 03 December 1959 vol 614 cc1350-3

7. Mr. Gurden

asked the Chancellor of the Exchequer how many owner- occupiers receiving National Assistance grants are paying some of this money to the Inland Revenue in the form of Schedule A tax.

The Financial Secretary to the Treasury (Sir Edward Boyle)

I regret that this information is not available.

Mr. Gurden

Does my hon. Friend think it fair that pensioners and those living on small incomes should continue to pay Schedule A tax which in effect means that they subsidise those who are better off?

Sir E. Boyle

The owner-occupier in receipt of National Assistance would not be liable to tax unless he had other income, including the net Schedule A assessment on his house, amounting in the year in question to at least £180 for a single person and £300 for a married couple, and I believe that such cases are rare.

8. Mr. Gurden

asked the Chancellor of the Exchequer how many old-age pensioners are paying full Schedule A tax as demanded.

Sir E. Boyle

I regret the information is not available.

Mr. Gurden

Does my hon. Friend realise that people who have paid, say, £500, for a house are having to pay Schedule A tax and other people, who paid £1,000 for their dwelling, pay none at all?

Sir E. Boyle

I know the concern felt by my hon. Friend about this matter. I have looked carefully into these facts. I believe it is hardly possible for a person over 65 to be liable to tax if his only income, apart from his retirement pension, is the annual value of his own house.

Mr. Woodburn

Can the Minister make clear to any old-age pensioner involved that he is entitled to recover this tax and that he is not liable to the tax, according to the figures which the hon. Gentleman has already given?

Sir E. Boyle

Yes. For example, a single woman aged from 60 to 65 with nothing but her pension and her house would be liable to tax only if the net annual value of the house exceeded £50, but I believe that there are far fewer cases of this kind than is generally realised.

9. Mr. Cleaver

asked the Chancellor of the Exchequer how many taxpayers are required to pay tax based on an estimate of their income made by the Inland Revenue.

Sir E. Boyle

I regret that this information is not available.

Mr. Cleaver

Is my hon. Friend aware that the owner-occupier who receives no rent income incurs heavy expense and still receives Schedule A notices? Does not he agree that the activities of efficient Inland Revenue officers would become positively popular if they adopted as their motto, "No income, no tax"?

Sir E. Boyle

In the case of owner-occupied property it has long been the principle of our taxation law that Schedule A assessment has to be made on an estimate of the amount of rent which the property would be worth were it let, taking one year with another. I realise the concern on this matter of many of my hon. Friends, but I think that we should consider carefully before going back on a very long established principle.

Mr. Paget

Is there any moral reason at all why property investment should not be taxed like any other investment and is not the utilisation by hon. Members opposite of the old-age pensioner as a "stalking horse" rather unsavoury?

Sir E. Boyle

I have always been told that at Question Time it is not wise to express views on moral issues, but I have no doubt that there will be future occasions which will prove suitable for such debates, when I shall look forward to a speech from the hon. and learned Gentleman.

10. Mr. Cleaver

asked the Chancellor of the Exchequer if he will give the owner-occupier similar facilities in dealing with his Schedule A tax as are given to industrial enterprises.

Sir E. Boyle

I am not clear exactly what point my hon. Friend has in mind. If he will let me know, I shall be glad to consider it.

Mr. Cleaver

Is my hon. Friend aware that a trading limited company is allowed to deduct its net Schedule A assessment from its profits before paying Schedule D tax which, in effect, means that it pays no Schedule A tax, and does he agree that similar rights are not offered to the owner-occupier?

Sir E. Boyle

A company which owns business premises is allowed to deduct Schedule A assessment when computing its profits under Schedule D. I will write to my hon. Friend about the case he has in mind, but we must always draw a distinction between what is a trading company and what is, after all, a basic necessity of life, namely, housing.

11. Mr. Gurden

asked the Chancellor of the Exchequer if he will impose Schedule A tax on owners of caravans to bring about equality with house holders.

Sir E. Boyle

My right hon. Friend has noted my hon. Friend's suggestion.

Mr. Gurden

Will not my hon. Friend be a little forthcoming in his Answers to these Questions about Schedule A tax? Is he aware that, year after year, the Answer to such Questions is that the Government cannot anticipate the Budget statement. Would it not be fairer to say frankly that this matter will not be considered until the time of the next Budget statement?

Sir E. Boyle

It has always been the custom that one does not promise or rule out on Budget matters at this time, but takes pleasure in giving a neutral reply. I hope that my hon. Friend will remember that caravan dwellers form a very small part of the total population and that the majority of them hope to move into a house after a few years.

Mr. Fletcher

Is not there something anomalous in the attitude of hon. Gentlemen opposite in wanting, at one and the same time, to abolish Schedule A tax and to extend it?

Sir E. Boyle

I do not think there is anything unreasonable about hon. Members on this side of the House taking an interest in Schedule A taxation and wanting it to be as fair and as rational as can be devised. It is on that basis that I am trying to answer the questions put to me this afternoon.

Mr. Lipton

Will the hon. Gentleman resist the demand from his hon. Friends to impose additional taxation, which is what this Question is suggesting?

Sir E. Boyle

I think that the questions asked from hon. Members on this side of the House are as well phrased as most supplementary questions asked by hon. Members opposite. I have no complaint to make, and therefore I do not think that the supplementary question asked by the hon. Gentleman adds very much.