§ Mr. G. LOCKER-LAMPSONasked the Chancellor of the Exchequer whether he will consider means by which assessment to Income Tax in respect of investment income may discriminate as between inherited income and other income at present included as investment, with a view to relief being granted in respect of such portion of incomes as is derived from savings?
Mr. CHAMBERLAINThe question of the discrimination to be made for Income Tax purposes between incomes that are earned by personal exertion and incomes that are not so earned, was exhaustively considered by the Royal Commission on the Income Tax, whose recommendations on this matter were, as my hon. Friend is aware, given effect to in the Finance Act of last year. The proposal that differential treatment for taxation purposes should be extended to income derived from the investment of savings was specifically made too, and definitely rejected by the Royal Commission, who in paragraph 109 of their Report (Cmd. 615) expressed the view that "it would be unworkable in practice to attempt to decide how far income derived by a taxpayer from investments is in fact income derived from the saved portion of his earned income, and how far the income is derived from capital which was obtained from some other source, such as a speculation, a bequest, or the profit on an investment."
Major BARNESasked the Chancellor of the Exchequer how many persons subject to Income Tax have failed to pay the tax due for the years 1918, 1919, and 1920, respectively; and what steps have been taken to enforce payment in such cases?
Mr. CHAMBERLAINThe information asked for in the first part of the question is not available. In cases of refusal or persistent neglect to pay, arrears of Income Tax are recovered in manner directed by law. In this connection I would invite the attention of the hon. and gallant Member to the provisions of Part VIII. of the Income Tax Act, 1918.