HC Deb 30 March 1944 vol 398 cc1569-71W
Lieut.-Colonel Wickham

asked the Chancellor of the Exchequer whether he will consider modifying the terms of the prospectus of Tax Reserve Certificates with a view to enabling subscribers to earn interest on Certificates which are not surrendered for tax due within the prescribed period of two years.

Sir J. Anderson

As my hon. Friend will be aware, the rate of interest allowed on Tax Reserve Certificates is a generous one. For that reason, and because the primary object of the Certificates was to facilitate the setting aside of provision for taxes as the taxable profits accrue, a limitation of the period for which the Certificates can earn interest is justified. I am satisfied, however, that the limitation of two years for an effective surrender for tax payments reacts hardly in certain cases, and I have decided to amend the Prospectus so as to provide that Certificates shall be accepted in payment of any tax or contribution deemed to be due not more than five years from the date of the Certificate, subject, however, to the condition that interest will not be allowed on any Certificate for more than two years. The change will not the training centres; the number who have already commenced work at the coal mines; and if he can give these particulars for the various areas.

Mr. E. Bevin,

pursuant to his reply [OFFICIAL REPORT, 23rd March, 1944; col. 1016, Vol. 398] supplied the following statement:

involve any extension of the period for which a Certificate accepted in payment of tax or contribution is treated as capital employed in a trade or business for the purposes of Excess Profits Tax. A new Prospectus embodying the change will be issued as soon as possible, but the revised terms will be applied to all Certificates at present held by subscribers or purchased hereafter. They will also be applied in certain cases where a Certificate has already been accepted without interest in lieu of cash payment of tax due more than two years from the date of the Certificate, or where a Certificate has been tendered to the Inland Revenue in payment of such tax and action thereon has not yet been completed. In all such cases the necessary adjustments will be made by the Inland Revenue without application from the holders. In other cases subscribers may already have cashed their Certificates without tendering them in payment of taxes, with the result that they have lent money free of interest to the Government for considerable periods. To meet such cases any subscriber will be entitled, on making application to the Bank of England, to have any Certificate or Certificates, which he now holds or may in future hold, antedated for a period equivalent to the period for which he can show that he has lent the same or a larger amount of money to the Government free of interest on a Certificate bought before to-day.