§ Mr. Simmonds
asked the Chancellor of the Exchequer whether he can now make any statement regarding income-tax allowances in connection with expenditure upon air-raid precautions schemes?
§ Sir J. Simon
The question of the extent to which expenditure on air-raid precautions may be admissible as a deduction in computing trading profits for Income Tax purposes is primarily one for the respective bodies of Income Tax Commissioners, to be determined in accordance with the provisions of the Income Tax Acts. So far as the Board of Inland Revenue are concerned, the treatment which, in their view, would be appropriate to the various classes of expenditure which a trader might incur is indicated below. It will be appreciated that it is not possible on such a subject-matter to give more than general outlines: the particular application will depend upon the particular facts of different cases.
- 1. Expenditure on such items as the following would be deductible:
- (a) civilian duty and service respirators;
- (b) protective clothing for staff engaged on air-raid precautionary duties;
- (c) the training of employees in such duties;
- (d) covering of glass with wire netting;
- (e) dark blinds, screens and paint to render windows opaque;
- (f) equipment and stores for first aid parties;
- (g) equipment of decontamination squads.
- 2. A wear and tear allowance would be due in respect of equipment in the nature of plant and machinery, such as fire appliances and air filtration plant.
- 3. No deduction would be allowable in respect of expenditure of a capital nature, for example, expenditure which results in the physical alteration of, or in the incorporation of additions to, the structure of the trading premises. The Board, however, would not be disposed to regard as within this category expenditure on items such as steel shutters for protection of windows or timber frames and screens to provide air locks at doors or windows, which are not part of the permanent structure but represent fixtures or fittings required and used only for the emergency, and they would not object if the Commissioners allowed deduction of such expenditure.