§ 17. Mr. Kinnockasked the Chancellor of the Exchequer why the Inland Revenue has decided that travelling and meal allowances paid to employees of the South Wales Electricity Board are now liable for income tax.
§ Mr. NottThese allowances have always been liable to income tax. Their true nature has emerged only recently and arrangements are now being made to subject them to PAYE.
§ Mr. KinnockWill the hon. Gentleman agree that this is a very unfair position for these workers who, through no fault of their own and because of the closure of local offices, have been forced to move up to 20 miles to gain employment? When does he propose—will he ever dare to do so—to extend such double taxation to, let us say, company executives and directors or even Members of Parliament?
§ Mr. NottIt is a general rule which applies to everyone that payments in respect of house-to-work travelling and meal allowances at a normal place of work are taxable. As I said in answer to the hon. Gentleman initially, these allowances were always liable to income tax. It is only recently that their true nature has emerged. No action will be taken to recover tax on payments made in past years.