New Clause. — (Repeal of s. 36 of 8 and 9 Geo. V, c. 15.)

Part of Orders of the Day — Finance Bill. – in the House of Commons on 8th July 1924.

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Photo of Mr William Graham Mr William Graham , Edinburgh Central

I am going to ask the hon. Member not to press this new Clause, because its effect will go very far beyond what he himself thinks. The Amendment in the Act of 1922 to which he has referred was designed to impose a check upon attempts to evade the payment of Super-tax. Where the amount distributed was regarded as a reasonable part of the income the Special Commissioners were given power to assess the income accordingly. I believe the difficulty suggested by the hon. Member has been more than met by the proviso which was inserted in the Act of 1922 to the effect that the Commissioners, in fixing the amount of the income, should have regard not only to the current requirements of the company but also to the needs of the business from the point of view of future development. I am advised that the effect of the hon. Member's new Clause would be to weaken the protective value of this Clause from the point of view of the evasion of Super-tax, and it would tend to put these people in a position to evade that Super-tax. If there is any doubt or ambiguity about the effect of the proviso in the Act of 1922 the Government would agree with the hon. Member in trying to remove it, provided also that we do not in any way weaken the safeguard which the Clause is intended to provide. If therefore the hon. Member will withdraw the Clause I am quite willing to look into the matter to see if there is any ambiguity as he has stated, and to try and remedy it between now and the Report stage. But we cannot possibly do anything which would weaken the Clause as regards the protection it affords against the evasion of the payment of Super-tax.