HC Deb 22 May 1912 vol 38 cc2044-5W

asked the Chancellor of the Exchequer whether he is aware that under the rules made by the Commissioners of Inland Revenue in pursuance of Section 3, Sub-sections (2) and (3), of the Finance (1909–10) Act, 1910, the Commissioners have declared that the proper proportion of Increment Value Duty payable by a lessee on the transfer of his leasehold interest is a fraction of the full increment value of the site ascertained on a revaluation of the fee simple, and that such fraction depends solely on the length of the lessee's unexpired term, and not upon the consideration for the transfer or upon any benefit of the lessee; whether he is aware that, under the method of calculating the proper proportion adopted by the Commissioners, a lessee may have to pay a large sum for Increment Value Duty, even if he receives nothing on the transfer of his lease, and that the sum so paid by the lessee is credited as part payment of the Increment Value Duty eventually payable by the owner of the fee simple; and whether he will take steps to have the rules made by the Commissioners amended so that the proportion of duty payable by the lessee on the transfer of his interest may be ascertained on an equitable basis?


The site value, and therefore the increment value, on the occasion of a transfer of a leasehold interest is arrived at on the basis of the consideration paid, and the rules in question provide an equitable basis for determining the proportion of the duty on the whole increment which is attributable to the interest transferred. I see no reason to take such steps as the hon. Member suggests.

Forward to