HC Deb 10 May 1923 vol 163 cc2594-7W

asked the Financial Secretary to the Treasury whether the assessments now being made by the income Tax authorities are based upon the special valuation authorised by the Finance Act, 1922, or upon the last quinquennial valuation; whether owner-occupiers who have purchased their houses since 1914 are being assessed on the basis of the inflated prices they were compelled to pay; what steps he proposes to take to ensure that injustice is not inflicted in such cases; whether he will fix a standard basis of assessment limited to a percentage above the pre-War values of similar houses; and whether he will extend the period allowed for appeals to be lodged against over-assessments?


The reassessment of land and houses for Income Tax purposes is now proceeding in accordance with the decision reached by Parliament last year and embodied in Section 32 of the Finance Act, 1922. It is being made under the old-established law which, broadly speaking, provides that the annual value of property is the rent at which it is let, or is worth to be let, by the year under an ordinary tenancy. It is not based on a past quinquennial valuation, the reference to which I scarcely understand. As regards houses occupied by their owners, I have already stated in reply to other hon. Members that there is no intention whatever of determining the annual values of such properties by reference to the enhanced prices at which they may have been purchased in the circumstances suggested by my hon. and gallant Friend. It is commonly the case that a fair estimate of the annual value in these instances is readily obtainable by reference to the actual rents paid for similar properties in the vicinity. In reply to the last part of the question, the Inland Revenue authorities, unless in any case there is some special reason to the contrary, do not propose to object to an appeal on the ground that the notice of appeal was not given within the time limited therefor.


asked the Chancellor of the Exchequer the approximate number of appeals which have been already entered against the new re-assessment under Schedule A: and whether he is aware that such re-assessment has yielded a 100 per cent. increase in some cases over assessments made within the last five years?


The information for which the hon. Member asks in the first part of his question is not yet available, but so much information as I at present have indicates that the number of appeals received, though it may be larger than on previous re-assessments, is not greatly removed from the normal. In some cases rents, especially of business premises, have been increased by 100 per cent and more, and in these instances it is proper that the assessment should be correspondingly raised in order that the landlord may be charged to Income Tax on the basis of his actual income.


also asked the Chancellor of the Exchequer the number of cases in which the new re-assessment has raised the assessable value of houses above £20 annually, thus throwing a new burden on tenants concerned, who will have to pay the Inhabited House Duty?


The information for which the hon. Member asks will not be available for some time.


asked the Chancellor of the Exchequer whether his attention has been called to the diverse practice of different assessors of Income Tax in serving notices of recently increased assesments, namely, in some cases notices served on the landlord and in other cases served on the tenant; whether notices of appeal must be signed by the person to whom the assessment is addressed; whether notices of appeal signed by the landlord will be accepted as valid in cases where the notice of assessment has been served upon the tenant; and whether the Treasury can arrange that no notice shall be served upon a tenant without intimation to the landlord upon whom the payment of Income Tax ultimately falls so that the payer of Income Tax may not be deprived of his right to appeal by reason of ignorance that an assessment has been made?


I would refer my hon. Friend to the reply given yesterday on this subject to the hon. Member for North East Leeds (Major Birchall). I am sending my hon. Friend a copy of that reply.


asked the Chancellor of the Exchequer if he is aware of the discontent aroused in the provinces of the country in respect to the demand notes issued for the payment of Income Tax and Inhabited House Duty for the year 1923–24, especially among working men who own their own houses and live in them and who think they have been overcharged; and will he set up a committee of inquiry into the whole matter?


I would refer the hon. Member to a reply which I have given on this subject to the hon. Member for Finchley (Colonel Newman) on the 8th May. I am sending the hon. Member a copy of that reply.


asked the Chancellor of the Exchequer whether he is aware that, where the new assessment of properties is based on the present rental whether this includes 40 per cent. increase or not, notices of re-assessment are not being sent out except in cases where it is anticipated that there are primâ facie grounds for appeal; and will he instruct the Inland Revenue authorities to issue these notices in all cases?


I would refer my hon. Friend to the reply which was given yesterday on this subject to the hon. Member for North East Leeds (Major Birchall). I am sending my hon. Friend a copy of that reply.


asked the Chancellor of the Exchequer, having regard to the fact that the Inhabited House Duty has operated from the year 1851, since when no alteration has been made in the minimum rental of houses coming within the scope of the duty, whether, in view of the change in money values compared with 72 years ago, he will take immediate steps to revise the scale of rental values subject to Inhabited House Duty, and suspend the operation of the new valuations for Schedule A of Income Tax assessments until such revision has been carried out?


This is a matter which might appropriately be argued in the forthcoming Debates on the Finance Bill. As at present advised, I do not see sufficient ground for adopting the hon. Member's suggestion.