§ Sir J. Edenasked the Chancellor of the Exchequer whether he has made any estimate of the extent to which the changes in tax law made in 1974 will affect the British film industry through the large-scale withdrawal of American participation therein; and if he will make a statement.
§ Dr. GilbertI see no reason why the provisions of the Finance Act 1974 should adversely affect American participation in the British film industry. The effect of these provisions is broadly that a person of foreign domicile who is resident in the United Kingdom and employed by a concern which is not resident here is liable to United Kingdom tax from April 1974 on 50 per cent. of his earnings for the services he performs here and also on any amounts received or remitted here in respect of his earnings for services performed abroad. If he is also ordinarily resident here his liability is on 50 per cent. of his earnings for services performed wholly or partly in this country, whether received or remitted here or not. From April 1976 the liability increases from 50 per cent. to 75 per cent. for those who have been resident here for 363W nine years or more. His liability to United Kingdom tax on foreign investment income and earnings from employments carried on wholly abroad was not affected by the Finance Act 1974 and continues to be on the amounts received or remitted here.