§ 8. Sir A. Meyerasked the Chancellor of the Exchequer what representations he has had in connection with abolishing or reducing investment income surcharge on income derived from compensation awarded by the courts.
§ Mr. Robert SheldonMy right hon. Friend has received occasional representations to this effect.
§ Sir A. MeyerSince this compensation is awarded by the courts to someone who, by definition, has suffered great misfortune, perhaps bereavement, certainly 1626 resulting in a substantial loss of income, what conceivable moral justification is there for applying a penal rate of taxation on the interest on such sums?
§ Mr. SheldonSeveral problems arise in connection with this matter, but we hope to be able to deal with certain aspects of it. I am sure that these matters will be brought up during the Committee stage of the Finance Bill.
§ Mr. Peter ReesArising out of the Financial Secretary's reply and the anomalies that have been disclosed as the result of my hon. Friend's Question, and in view of the Labour Party's continuing commitment to a wealth tax, does the Financial Secretary not feel that there may be a case for the total abolition of the investment income surcharge?
§ Mr. SheldonThe views of the Opposition seem to be curiously divided on this matter. If the hon. and learned Gentleman is now saying that it is the Conservatives' intention to abolish the investment income surcharge, I should have thought that that would be a matter for his right hon. and learned Friend the Member for Surrey, East (Sir G. Howe). If the Conservatives draw no distinction between money that is in the form, say, of inherited wealth or acquired assets, and that which is obtainable by the work of the individual, with the consequential expenses incurred in earning a living, I can only say that that is not the view of the Government.