§ 58. Mr. Millanasked the Chancellor of the Exchequer what consideration he has given to the recent report of the Comptroller and Auditor General that certain companies in receipt of large capital allowances for Income Tax purposes have paid gross dividends of £228 million which have been treated in the hands of the recipients as having borne Income Tax, but have been assessed for Income Tax on profits and other income of only £127 million; if he will state the number of companies involved in, and the period covered by, these figures; if he will give an estimate for the same period of the sums involved for all companies whose gross dividends exceeded their taxable profits; and if he will introduce legislation to provide that in the 177W circumstances described Income Tax deducted from excess dividends paid shall be paid over to the Inland Revenue.
§ Mr. MaudlingI should await the report of the Public Accounts Committee on the Comptroller and Auditor General's Report. I cannot give an estimate of the total sums involved, but I cannot in any case accept the implication that dividends paid by companies which have borne the proper tax on their profits can be "excess".
§ Mr. Millanasked the Chancellor of the Exchequer, in view of the recent report of the Comptroller and Auditor General that dividend payments made by certain subsidiary companies to parent companies exceeded by £32 million the profits on which the subsidiary companies were assessable to Income Tax, thus allowing the parent companies to reclaim £12 million tax which was never in fact paid, if he will state the number of companies involved in, and the period covered by, these figures; if he will give an estimate for the same period of the total sums of tax reclaimed in the circumstances described; and if he will introduce legislation to provide that parent companies will not be allowed to reclaim tax in these circumstances.
§ Mr. MaudlingI understand that these figures refer to five subsidiary companies and cover various periods up to 27 years. I am afraid that I cannot give an estimate of the total sums involved over any period and I cannot comment on suggestions for legislation in a future Finance Bill.