New Clause. — (Relief to Certain Persons Where Copyright Assigned for Lump Sum or Lump Sums.)

Orders of the Day — Finance Bill – in the House of Commons at 12:00 am on 17th June 1952.

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Section four hundred and seventy-one of the Income Tax Act, 1952, shall have effect as if there were added after subsection (3) thereof the following subsection: — (4) If the consideration for such an assignment or grant as is mentioned in subparagraph (b) of subsection (1) of this section consists wholly or partially of more than one lump sum payment, he may without prejudice to any other claim which he is by the preceding provisions of this section authorised to make, claim that this section shall apply as if for the words 'a lump sum payment' contained in the said sub-paragraph (b), there were substituted the words 'lump sum payments,' and as if for the words at the end of the said subsection (1) 'that payment,' there were substituted the words 'each of those payments';and furthermore as if—

  1. (a) subsection (4) of the said section were renumbered subsection (5), and as if after the words "under subsection (1),"therein there were inserted the words" or subsection (4)"; and
  2. (b) in subsection (8) thereof there were inserted after the word "returnable" the words "and a payment in respect of accrued royalties":
Provided always that this section shall be of no effect in any case in which the result of any person making a claim under section four hundred and seventy-one of the Income Tax Act, 1952, as amended by this section, or the result of the application of the said section of the Income Tax Act, 1952, as amended by this section, in consequence of such a claim would or might be to increase the amount of any tax payable by any person other than the person making the said claim. —[Mr. Wyatt.]

Brought up, and read the First time.

Photo of Mr Woodrow Wyatt Mr Woodrow Wyatt , Birmingham Aston

I beg to move, "That the Clause be read a Second time."

I should like to say at the outset that I should not be able to move this Motion at all if it were not for the unremitting labours of my right hon. and learned Friend the Member for Neepsend (Sir F. Soskice) in getting this previously intractable Clause into order, a task which has defeated many people in the past and which defeated us for a time even this year. The fact that this new Clause is now on the Order Paper will give pleasure to a great many people, many of them distinguished, as correspondence in the columns of "The Times" has shown, because there is a great deal of sympathy and support for this new Clause.

Nobody, I think, will be more glad to see this new Clause now in order and called by you, Mr. Deputy-Speaker, than the present Chancellor of the Exchequer, because he himself in the past laboured in vain to get this new Clause in order so that it could be called in this House. Well, we have done the job for him. We have at least been able to get in order the new Clause which he himself last year put on the Order Paper, although, unfortunately, he did not have the skilled services of my right hon. and learned Friend the Member for Neepsend to assist him through this arduous course. We have done it for him, and we cannot but expect that he will accept this new Clause gladly by the time we have concluded the debate upon it, because it is his own child.

My reasons for putting this new Clause down are exactly the same as those which actuated the present Chancellor last year, only I do have some additional reasons as well, about which I propose to tell the House. This new Clause seeks to amend Section 471 of the Income Tax Act, 1952. Very briefly, Section 471 of the Income Tax Act, 1952, enables authors, artists, composers and sculptors to get some equity in their Income Tax payments, but not very much. It enables them to spread back over the three previous years the advance lump sum payment they may have received for the book, or the piece of sculpture or painting concerned. This applies only where they have, in fact, taken three years to make the particular literary or artistic work. If they have taken only two years to make it, they may spread the advance lump sum back over the previous two years.

That has a great defect in it, because the Section as at present in operation in the Income Tax Act, 1952, does not appreciate the method on which publishers, for example, work, because the system in the publishing business is that most authors receive quite a modest advance royalty, and the speculation as far as the publishers and the author is concerned is with regard to the subsequent royalties which may be earned upon the work. If an author is paid an advance royalty of, say, £200 and his book earns £6,000 for the first year, he is only allowed to spread back the first £200 and not the subsequent £6,000.

What has been done by this curious system is to make authors, artists, painters, composers and sculptors pay more Income Tax than any other section of the community upon a similar average sum. In fact, we have penalised those who live by producing artistic works of one kind or another more heavily than those who do not.

For example, supposing two men earn an average of £2,500 for seven years, the man who earns his £2,500 flat each year pays less Income Tax and Surtax than the man who earns it unevenly—and most authors who manage to keep up an average of £2,500 over a period of seven years will earn it unevenly. In one year it may be £5,500; in another year it will be only £1,000. The net effect of it is that the man who earns his average of £2,500 a year and actually earns £2,500 a year pays something like £350 less in Surtax than the man who earns it unevenly—the man, in fact, who lives by writing books, composing music or painting pictures.

This not only applies to Surtax payers but to people of quite modest incomes. For example, somebody who earns an average income of £600 a year, who is married with one child, if he earns £600 a year each year pays £34 less Income Tax than the author who earns his income unevenly over, say, three years if he earns £400 in each of the first two years and £1,000 in the third year; the author would have been subject to paying £34 more Income Tax than the person earning the same amount each year. Surely this cannot be the intention of our Income Tax law, for it is putting a penalty on those who add to the artistic works of the nation.

I could give a good many examples of how this operates in actual cases, but, as the hour is late, and I do not want to prolong the discussion, I will content myself with only one or two. Take the case of a novel which occupied about three years in writing, which produced £1,800 in advance payments from at home and abroad, for which, in the year of publication, an additional £4,000 was received by way of royalties. Under the operation of Section 471 of the Income Tax Act, 1952, that £4,000 is taxed as income for that single year, and the author can only spread back the advance of £1,800, although during the years when the book was in process of writing, the author's earnings were practically negligible.

Another example is that of a historical work, and here there was a publisher who was not very generous, and the advance payment was only £100. In the year of publication royalties amounted to some £640, but, as in all such cases, the author could spread back only the £100. There is the case of a writer whose normal income was £300 a year from writing and who had an isolated success. He had written for a number of years without great commercial profit, although the critics considered his work as having considerable distinction. Then this writer produced this success, well written, and well received, and he received £6,000; but he could spread back only the small advance royalty which he had received.

Such examples could be duplicated many hundreds of times. I am a member of the Executive Committee of the Society of Authors, and I know that many more examples could be quoted. I would, however, call attention to the fact that, under the operation of the law at present, the more scholarly type of book, which is not generally welcomed by commercial publishers because it is not likely to earn a great deal of money, may come from an author who then writes a great popular success. But, of course, he gets no benefit from the Section at all.

The Chancellor knows all these arguments because it was he who last year promoted a similar Clause to that on which I am speaking. Therefore, I will not labour my points, because his acceptance of the Clause must be a foregone conclusion. But, to reinforce the argument, I would just add that this would not only help authors, but artists, composers of musical works, and sculptors who assign the copyright of their works. But, it helps authors most, because the majority of books take many months, or more than a year to write; yet the system of most publishers is that, after the original advance payment is made, subsequent royalties are paid every six months—two a year—and all the Clause seeks to do is to enable an author, and the other persons concerned, to get the benefit, not only for the original lump sum, but also for the accrued royalties paid in the first year of publication.

10.45 p.m.

Although this is only a very small and modest attempt to right wrongs which are at present done to authors and others by the Income Tax laws, I think it would be regarded as a very important step towards righting those wrongs, and I think that the Government, having begun the closing down of museums and art galleries and thus disappointed those who thought quite wrongly that the Conservative Party was the guardian of our culture, might seek to redeem themselves a little tonight by showing a genuine interest in culture rather than by trying to curtail its enjoyment.

The author is not allowed to turn his works into capital as are most people in other trades. He has no pension rights; he cannot plough back his profits in order to ensure a continuity of product, and he has no means of providing for the day when his machine wears out because he is the machine, and he will reach a spent period at some point in his life.

Today we have an arrangement by which we try not to tax knowledge. There is no Purchase Tax on books, but by some curious compensatory mechanism in the Treasury mind the tax falls on the authors instead. Therefore, the authors are taxed more heavily than those of comparable earning capacity. I have pleasure in moving this new Clause, and I am sanguine that the Chancellor will accept it.

Photo of Sir Frank Soskice Sir Frank Soskice , Sheffield Neepsend

I beg to second the Motion.

The principle upon which the Clause, so ably moved by my hon. Friend the Member for Aston (Mr. Wyatt), is based has already been accepted for many years past as part of our tax code. The principle was first introduced into the Finance Act, 1944, and is now reproduced in Section 471 of the consolidating Income Tax Act, 1952. All this Clause does is to propose two very modest extensions to that principle in the existing code. My hon. Friend has explained what they are.

The second one, which he took first, is that which would include royalties as well as payments on account of royalties in advance. My hon. Friend has explained the reason for that, which particularly applies to authors and the general method of payment which they receive. The other point with which the Clause deals is to provide that the existing Section shall be applicable not only where a single lump sum payment which the author desires to spread back is concerned, but where there is more than one lump sum payment which in a given year he receives as part of his remuneration

The Clause seeks to compass those two objects which, as I have said, are really very modest extensions of the existing Section, and for the reasons which my hon. Friend gave I very much hope the Chancellor will be able to see his way to accept what is, in effect, his own Clause in a slightly different form.

Photo of Sir Arthur Baxter Sir Arthur Baxter , Southgate

I have not studied this Clause sufficiently to know whether or not this is the best way to handle this matter, but it seems to open up a bit of hope that we shall do something to treat the creative artist in a more civilised and kindly way than we do now. I do not think there is any country in the world where the creative artist has the cards stacked so heavily against him as here.

The other day we saw the case of an author who wanted to sell even up to 20 years of publication the copyright of his novel and was not allowed to do so. That was regarded as income. The author cannot charge anything, for renewal of plant, and yet he has an engine in his head which needs rest and renewal. For a country of such great civilised standards as this, the creative artist is treated absolutely unfairly; and whether this is the best way or not, it is a move in the right direction.

I think the Chancellor of the Exchequer is a Fellow of the Royal Society of Literature. He does not deny it and does not accept it. If he is not, I can arrange that he become one, for a payment of 4 guineas—I got it by paying 4 guineas. Therefore, I support this in atmosphere and climate, but no further.

Photo of Mr Christopher Hollis Mr Christopher Hollis , Devizes

I have a double interest to declare: that of an author and a publisher. In my capacity as an author I want authors to get as much money as possible; in my capacity as a publisher I want them to get as little money as possible. I approach this impartially, but I join with other speakers in hoping that the Chancellor of the Exchequer will either be able to accept this Clause or something to the same effect, because, whether or not this is the best way of dealing with the problems of authors, it is certainly an improvement, as Members opposite showed.

There may be a great deal to be said for examining the whole legal basis of authorship. Here we are not being asked to do that, but to apply a principle already embodied in the law. It is fairly shown and proved that authors do suffer under an exceptional disability, or rather a number of exceptional disabilities, from the point of view of tax.

First, as the hon. Member for Aston (Mr. Wyatt) said, everyone who earns his income unevenly has a rough passage with the Income Tax as things are at present. Secondly, as my hon. Friend the Member for Southgate (Mr. Baxter) said, authors cannot charge against expenses as other people can. I remember a distinguished author, Mr. X, once went to the Income Tax authorities and they agreed that it must be a very expensive thing to be Mr. X, and wrote down several thousand pounds in respect of his being that distinguished person. But that could not happen in these stricter days. Furthermore, it takes not merely three years to write a book. All artistic work is the product of a whole lifetime. Whistler once said that a picture had taken him a lifetime. Therefore, to charge the author the total Income Tax on the receipts of one particular year— receipts that accidentally fall in that year —is an extremely inequitable thing.

What exactly, in this Clause, constitutes a lump or, still more, two lumps, I am not quite certain. I should have thought that payments against royalties were not lump sums at all; they might be crumbs, but not lumps. The point I want to make is that it would be, in general, very inequitable to charge an author his entire Income Tax simply in relation to the year in which he receives his income.

The principle has already been conceded in allowing him to spread over three years his advance royalty payments. There cannot conceivably be any argument that it is right to allow him to spread advance royalty payments over three years and not to allow him to spread his accruing royalty payments over three years. That is all hon. Members are asking in this Clause, and it seems to me that it would be very hard indeed to deny what they are asking.

Photo of Mr R.A. Butler Mr R.A. Butler , Saffron Walden

The hon. Member for Southgate (Mr. Baxter) is not quite correct. I did not buy my Fellowship of the Royal Society of Literature at the cost of three guineas; I was elected President at no cost at all. Therefore, while in my present office I would willingly grant the hon. Member the dignity he so fully deserves, of a Fellow of the Society, even if he were to approach me in the right sense without undue financial sacrifice I could not say that our cases are exactly equal because his merit is greater than mine.

The hon. Member for Devizes (Mr. Hollis) has spoken on a subject which he knows better than I and with the rank of publisher as well as author and has given us a very balanced view of the position. The hon. Member for Aston (Mr. Wyatt) has said that if a book is well written and well received it deserves proper attention from the Inland Revenue. I can only say that I was glad to congratulate him on his recent book on South-East Asia to which I would like to give this unsolicited publicity and say that it was well written and, by me, well received.

I have sponsored this sort of Clause in the past. The only difference was that I was never able to get my Clause accepted by the Table, despite every sort of device and effort made in the last Finance Bill. But he, with the aid of his right hon. and learned Friend the Member for Neepsend (Sir F. Soskice) has been able to get an immediate result. I am sorry to see that the "heavenly twins," the hon. Members for Stechford (Mr. Roy Jenkins) and for Gloucestershire, South (Mr. Crosland) are not present. I hope that they will resume their attendance because they have been so regular and permanent a feature of our debates. I will then be able to leave the hon. Member's speech to the hon. Member for Gloucestershire, South.

Now we come to the merits of the matter. The position as I see it is that we are entitled to examine the Clause which, we are informed, is absolutely watertight thanks to that legal luminary the former Solicitor General, the right hon. and learned Member for Neepsend. One of my difficulties—and here I must apologise to the House for being slightly technical—is to understand the drafting of the Clause. I have taken great care to examine the legal aspects of the Clause, because I was so impressed that it was able to defeat the Chair. On examining the Clause I find that the arithmetic of the subsections is very badly done.

For example, after inserting the new subsection (4), it re-numbers the original subsection (4) as (5) but omits to provide for the consequential re-numbering of subsections (5) to (8). That I should have thought quite sufficient to prevent the Table accepting the Clause. But not at all. The right hon. and learned Gentleman is able to bull-doze his way through and to succeed in passing the Table, while I tried to pass it the whole of last year. I am suffering from a deep sense of injustice which is a relic of a year ago before I assumed the heights I have now.

I find there is great difficulty in construction regarding the time limit laid down by the right hon. and learned Member by the original subsection (4) which says that a claim under subsection (1) must be made within 12 months from the end of the year of assessment mentioned in that subsection. This means the year mentioned in subsection (1)—to stick to the pure clarity for which the right hon. and learned Member is so famed, but not on this occasion—for that is the subsection which has just been referred to, if I am not mistaken. But paragraph (a) of the new Clause would set beside that reference an alternative reference to the new subsection (4). The new subsection (4) makes no mention of any year of assessment. In the case of a claim by virtue of the new subsection, what, I would ask the right hon. and learned Member, is the time limit?

I think he will see that his Clause is riddled with difficulties and, were we able to accept the principle, we would find very great difficulty in accepting its practice and also for a further reason to which I shall come shortly, namely, that his definition of lump sum payment does not deal adequately with the question of royalties.

11.0 p.m.

Now I come to some of these other matters. The House will be aware, as has been stated, that the existing relief for authors was introduced by the then Chancellor of the Exchequer, now Lord Waverley. I hope that that name will cause no distress on the other side of the House. It was introduced, by a singularly inspired and intelligent Chancellor of the Exchequer, in 1944 by Section 24 of the Finance Act of that year. I anticipated that in putting forward this matter, hon. Members opposite would pretend that by using the introduction of Section 24 of the 1944 Act they were simply trying to persuade the House that they were pushing a little further into territory already mastered by an even greater intellect, namely, Lord Waverley. That is not the case.

When we go into this matter and examine the 1944 Act, and Section 24 of it, we find that the right hon. and learned Gentleman by trying to push further is entering territory already fully explored by the Millard Tucker Committee, and territory in which the difficulties are very great. Let me take the technical matter of these lump sum payments. In the 1944 Act, under Section 24, lump sum payments for copyright are already allowed to be spread, and they are demonstrably in a class by themselves. They are a lump sum in return for the sale of copyright, and they do not resemble the ordinary increments which are represented by royalties. I do not think that one can make similitude between lump sum payments as described in the Clause, and the original intention of the 1944 Act. This is only a technical matter.

The really difficult matter in dealing with the Clause is the question how we are to deal with persons other than authors, the problem of fluctuating rewards, the problem of amassing a large part of one's rewards in one year and then suffering tax on that. Amassing of rewards is not confined to authors, musicians, or to one section of the population. I will remind the House of what the Millard Tucker Committee said, speaking from memory, in paragraph 85. The Committee said that while it might be true that authors as a class are particularly exposed to vicissitudes of this nature, there are many other professional persons as well as owners of businesses whose profits are liable to wide fluctuations.

The Committee went on to say that a farmer might enjoy an especially profitable year sandwiched between two bad ones, and indeed almost any class of profession or business may earn in one year a far higher rate of profit than in the years before and after. It concluded that any relieving provisions ought to apply to professions and businesses generally. I am afraid that that must be the case.

I am myself personally interested in authors, and as has been previously stated in the House, I have attempted to move, and been unable to move, a Clause on these lines.

Photo of Mr Woodrow Wyatt Mr Woodrow Wyatt , Birmingham Aston

Surely, when the right hon. Gentleman put down last year, as a Private Member, a new Clause, he must also have had these considerations in mind, namely, that other professions were involved. Nevertheless, he singled out authors, artists, composers, and so forth, and put down a Clause. We have done exactly the same as he did. Why should the situation have changed in this respect in one year?

Photo of Mr R.A. Butler Mr R.A. Butler , Saffron Walden

The hon. Member is saying what I have said myself. I did put down a Clause because I was then convinced in this matter. But one need only read paragraph 85 of the Millard Tucker Report which is a form of education I recommend to the hon. Member. Perhaps if he studies this matter as much as I have been able to do he will become as intelligent on the subject as I am now.

Photo of Mr Woodrow Wyatt Mr Woodrow Wyatt , Birmingham Aston

May I read to the right hon. Gentleman another part of the paragraph he has quoted: One class which is perhaps more exposed than most to fluctuation is that of authors … Then it goes on to say that something ought to be done for authors in particular.

Photo of Mr R.A. Butler Mr R.A. Butler , Saffron Walden

I have not yet done with my case. I observe that in the case of many right hon. Gentlemen opposite the sweets of office have induced a greater education than is apparent in opposition. Since I have had an opportunity of studying this matter more closely I have improved my own knowledge of the difficulties, some of which I suspected.

The hon. Gentleman has not improved his case by references to the Millard Tucker Report. In fact, if anything is to be adduced from that Report it is clear that they regard authors as being in a class which cannot be singled out and that this is a problem which affects many professions of many sorts and which cannot be dealt with on the subject of authors, musicians or artists alone.

Now we come to an even greater difficulty which was referred to by my hon. Friend the Parliamentary Secretary to the Ministry of Civil Aviation, who has given us so much help in our debates. Speaking on Committee stage on a broadly analogous matter, he drew attention to the Millard Tucker Committee's restriction solely to trades and professions and said that they completely omitted all reference to the problem of accruing benefits in the case of employees, or, to put it in more simple language, workpeople.

I do not think it would be equitable to deal with the question of accruing sums coming within one year and susceptible to tax if we confined it either to authors, or to trades and professions as the Millard Tucker Committee suggested, unless we extend it to all types and all classes susceptible to this particular difficulty. That is the weakness of the Millard Tucker Committee Report.

The problem is even more complicated than the Report indicates. I do not believe that right hon. and hon. Gentlemen opposite would wish to restrict any application of legislation to one particular type, or class or profession or section. I therefore reiterate what was said by the Parliamentary Secretary to the Ministry of Civil Aviation. This matter should be dealt with in relation to the general principle, namely, the difficulty of persons whatever their occupation or calling or type of work, who have sums accruing to them in a particular year which suffer from the depredations of the tax collector, and which may in some convenient manner be spread out so that the tax collector may approach them more fairly.

It is part of my duty in my present office to be absolutely fair to all sections. My personal predilection is still in favour of helping authors. I have read letters in the newspapers and from certain hon. Members of this House and from hon. Members who have left this House—A. P. Herbert and others—and I know there is strong feeling on this subject and that authors are having a hard struggle today, as are artists.

I know that there are sections of the population who want to be helped, but I do not think we can deal with this matter by one section alone. The only remaining point in the argument which I must fulfil, to be dialectically complete, is why I did not do it in this Finance Bill. The answer is that I was not satisfied that the case was complete. I am very sorry to draw out again the old war horse of the Royal Commission on Taxation, but we are expecting some advice on the subject. As it extends beyond one section and class it will have to be dealt with in a comprehensive way, and I did purposely not include it in the Finance Bill this year, despite my personal predilection to do so.

I can only ask the House to await a future Finance Bill. In the long and glorious future of this Government, and before the end of its tenure of office, I hope that this matter may be dealt with by myself or my successor in this Government so that we can be fair to all sections. I hope that the delay will not be too great because I am greatly interested, and I regard it as a duty to put it right in a much more homogeneous manner than that suggested by the hon. Gentleman.

Photo of Sir Frank Soskice Sir Frank Soskice , Sheffield Neepsend

With the permission of the House I would like to speak again as I seconded the Clause rather briefly, and as the Chancellor referred to me I would be very glad to do so. The whole House must feel great sympathy with the Chancellor. Last year he did his best, unsuccessfully, to do precisely what he is being asked to do now. In that embarrassing situation he proceeds to try to pick holes in the drafting. Even if it is defective, which I do not accept, except in one minor detail, then, of course, that could be put right. The right hon. Gentleman has frequently said that when moving Clauses in the past.

But the Clause fact is not open to the criticism which the right hon. Gentleman advanced. The time within which a claim must be made is precisely the same time as is provided in Section 24 of the 1944 Act. A lump sum payment can perfectly well, as a matter of principle, include an accrued sum of royalties. That is precisely what the right hon. Gentleman last year wanted it to include when he tried to draft this Clause unsuccessfully, and the only thing wrong with the Clause is that one subsection in section 24 has not been renumbered. That is a minor difficulty which can easily be put right.

The right hon. Gentleman's answer on that point is entirely specious, and he knows that it is. He is, of course, in a difficult and embarrassing situation. Having referred to the drafting, and given an answer which is easily seen through, he then went to the matter of principle which is more substantial. What he said was that he could not isolate the position of authors. To begin with their position has already been accepted in principle. If it is now impossible to put authors in a separate category why was it that Lord Waverley thought it was possible to do so when the 1944 Act was passed?

Photo of Mr R.A. Butler Mr R.A. Butler , Saffron Walden

The right hon. and learned Gentleman knows perfectly well that Section 24 of the 1944 Act dealt solely with the lump sum in payment of copyright, and did not deal with royalties, and I do not accept his drafting, as followed out in this Clause.

Photo of Sir Frank Soskice Sir Frank Soskice , Sheffield Neepsend

The lump sum payment referred to in Section 24 of the 1944 Act also included royalties. It did not include accrued royalties. It included a sum on account on royalties, and all that this does is to extend that expression in the 1944 Act to include royalties already accrued.

We start with the position that it has been recognised by the noble Lord to whom the right hon. Gentleman refers, and accepted by this House, that we can fairly and properly regard as standing in a separate category the case of authors and artists and other persons included in Section 24 of the 1944 Act. If it was possible and proper then, it is equally possible and proper now. For the right hon. Gentleman to try to ride off on that distinction is hardly worthy of him.

11.15 p.m.

He says that viewed in its broad context this is not a problem which applies only to authors, but for the reasons given by my hon. Friend it does, because of the way in which they are paid, apply in particular to them. When I ventured to move a rather wider new Clause during the Committee stage I pointed out, and I repeat it now, that the question of uneven payments is one which needs a broad review. But let us take one matter at a time and deal with the case of authors who already as a matter of principle are regarded as standing in a separate category.

The right hon. Gentleman says, in effect, "I tried as best I could last year to do what you are trying to do today. I did not succeed in doing it, because I could not find the appropriate wording. I now agree that you have found the appropriate wording, subject to one or two minor defects which are easily put right. The situation is now exactly the same as it was last year but this year, for some peculiar perverse reason known only to myself I refuse to do what I wanted to urge the Government to do last year."

Photo of Mr R.A. Butler Mr R.A. Butler , Saffron Walden

The right hon. and learned Gentleman is falling into a great error. As he was unable to hear my speech last year, he does not know what argument I might have used.

Photo of Sir Frank Soskice Sir Frank Soskice , Sheffield Neepsend

I know perfectly well what the new Clause was that the right hon. Gentleman proposed, and I heard the speech this year in which he said that he tried to do what is now being done. He said that he felt under a sense of injustice because he could not get his Clause passed by the Table, whereas we had succeeded in doing so. That is the whole burden of his case. He admitted frankly that he failed where we have succeeded.

Then he said, in effect, that he had changed his mind for some reason which he would not indicate, and he proceeded to refer to the Millard Tucker Report. It is true that that Report says that this is a broad problem. I can only repeat that it has been accepted, presumably for reasons which commended themselves to the House and, as no change has been made since 1944 continued presumably to commend themselves to the House, that it is fair and just to make an exception in the case of authors and artists.

The reason has been indicated by my hon. Friend. They receive uneven payments. They have to work for a long time to create the work which ultimately may achieve success and, for that reason, they are regarded as standing in a different position from the person who, broadly speaking, year in year out, can expect to make an even income. I should have thought—and I gather that the Chancellor accepts this—that it is obviously unreasonable that if a person receives a large sum in one year he should have to pay much more tax than if he received the same sum in even amounts over a number of years.

I urge upon the House that the answer to which we have listened is about the most unsatisfactory one given in the course of the whole of the debates on this Bill—and that is saying a lot. The Chancellor knows that this is a fair and reasonable proposal. For some reason or other he feels too lazy to do it and, therefore, he begins by carping at the drafting. That can easily be put right. He then has recourse to the universal haven—the Millard Tucker Report—and then he says that the matter is to be further considered. For those reasons, if they can be so described, he says that he does not propose to do anything. That is a completely unreasonable and stone-walling attitude, and, if it is all the right hon. Gentleman can do in reply to this very reasonable proposal, so obviously fair, I very much hope that the House will divide and register its disapproval by turning the Government out on this Clause.

Photo of Mr Woodrow Wyatt Mr Woodrow Wyatt , Birmingham Aston

May I, by leave of the House——

Hon. Members:

No.

Photo of Mr Woodrow Wyatt Mr Woodrow Wyatt , Birmingham Aston

—add a few words to the brilliant speech of my right hon. and learned Friend——

Photo of Mr R.A. Butler Mr R.A. Butler , Saffron Walden

I do not think it is reasonable that more than one hon. Member of the Opposition should speak twice in the debate.

Mr. Deputy-Speaker:

The right hon. and learned Gentleman spoke by leave of the House, and the present speaker has the right to speak again.

Photo of Mr Woodrow Wyatt Mr Woodrow Wyatt , Birmingham Aston

As we all knew he would, my right hon. and learned Friend has proved to be a better lawyer than the Chancellor of the Exchequer, and I can only ask my hon. Friends, after the speech they have just heard, to take his advice and follow him into the Lobby to do exactly what he said—turn the Government out for this very unsatisfactory answer.

Question put, "That the Clause be read a Second time."

The House divided: Ayes, 198; Noes, 216.

Division No. 166.]AYES[11.21 p.m.
Acland, Sir RichardFernyhough, EMcLeavy, F.
Albu, A. H.Field, W. J.McNeil, Rt. Hon. H.
Allen, Arthur (Bosworth)Finch, H. J.MacPherson, Malcolm (Stirling)
Allen, Scholefield (Crewe)Foot, M. M.Mallalieu, J. P. W (Huddenfield, E.)
Anderson, Alexander (Motherwell)Forman, J. C.Mann, Mrs. Jean
Attlee, Rt. Hon. C. RFraser, Thomas (Hamilton)Manuel, A. C.
Awbery, S. S.Freeman, John (Watford)Marquand, Rt. Hon. Ft A
Barnes, Rt. Hon. A. J.Freeman, Peter (Newport)Mayhew, C. P.
Bellenger, Rt. Hon. F. J.Gaitskell, Rt. Hon. H. T. NMitchison, G. R.
Bence, C. R.Gibson, C. W.Moody, A. S.
Benn, WedgwoodGordon Walker, Rt. Hon. P. C.Morgan, Dr. H. B. W
Benson, G.Greenwood, Anthony (Rossendale)Morley, R.
Beswick, F.Grey, C. F.Morris, Percy (Swansea, W.)
Bing, G. H. C.Griffiths, David (Rother Valley)Morrison, Rt. Hon H. (Lewisham, S.)
Blackburn, F.Griffiths, Rt. Hon. James (Llanelly)Mort, D. L.
Blenkinsop, A.Hall, Rt. Hon. Glenvil (Colne Valley)Mulley, F. W.
Blyton, W. R.Hall, John (Gateshead, W.)Murray, J. D.
Boardman, H.Hamilton, W. W.Naily, W.
Bottomley, Rt. Hon. A. GHannan, W.Neal, Harold (Bolsover)
Braddock, Mrs. ElizabethHargreaves, A.Orbach, M.
Brockway, A. F.Hayman, F. H.Oswald, T.
Brook, Dryden (Halifax)Healey, Denis (Leeds, S.E)Padley, W. E.
Broughton, Dr. A. D. DHenderson, Rt. Hon. A. (Rowley Regis)Paling, Rt. Hon. W. (Deame Valley)
Burton, Miss F. E.Herbison, Miss MPaling, Will T. (Dewsbury)
Butler, Herbert (Hackney, S.)Hobson, C. R.Pannell, Charles
Callaghan, L. J.Holman, P.Pargiter, G. A
Carmichael, J.Houghton, DouglasPearson, A.
Castle, Mrs. B. A.Hoy, J. H.Peart, T. F.
Champion, A. J.Hudson, James (Ealing, N.)Plummer, Sir Leslie
Chetwynd, G. RHughes, Emrys (S. Ayrshire)Porter, G.
Clunie, J.Hughes, Hector (Aberdeen, N.)Price, Joseph T. (Westhoughton)
Coldrick, WHynd, H. (Accrington)Price, Philips (Gloucestershire, W)
Collick, P. H.Hynd, J. B. (Attercliffe)Proctor, W. T.
Craddock, George (Bradford, S)Irvine, A. J. (Edge Hill)Pursey, Cmdr. H.
Cullen, Mrs. A.Irving, W. J. (Wood Green)Reid, Thomas (Swindon)
Daines, P.Janner, B.Rhodes, H.
Dalton, Rt. Hon. H.Jay, Rt. Hon. D. P. TRoberts, Rt. Hon. A.
Darling, George (Hillsborough)Jeger, George (Goole)Roberts, Albert (Normanton)
Davies, A. Edward (Stoke, N.)Jeger, Dr. Santo (St. Pancras, S.)Roberts, Goronwy (Caernarvonshire)
Davies, Ernest (Enfield, E.)Johnson, James (Rugby)Robinson, Kenneth (St. Pancras, N.)
Davies, Stephen (Merthyr)Johnston, Douglas (Paisley)Rogers, George (Kensington, N.)
de Freitas, GeoffreyJones, David (Hartlepool)Ross, William
Delargy, H. J.Jones, Frederick Elwyn (West Ham, S.)Royle, C.
Dodds, N. N.Jones, T. W. (Merioneth)Schofield, S. (Barnsley)
Donnelly, D. L,Keenan, W.Shinwell, Rt. Hon. E.
Dugdale, Rt. Hon. John (W. Bromwich)Kenyon, C.Short, E. W.
Ede, Rt. Hon. J. C.King, Dr. H. M.Shurmer, P. L. E.
Edelman, M.Lee, Frederick (Newton)Silverman, Julius (Erdington)
Edwards, John (Brighouse)Lever, Leslie (Ardwick)Simmons, C. J. (Brierley Hill)
Edwards, W. J. (Stepney)Lewis, ArthurSlater, J.
Evans, Albert (Islington, S.W.)Logan, D. G.Snow, J. W.
Evans, Edward (Lowestoft)MacColl, J. E.Sorensen, R. W.
Evans, Stanley (Wednesbury)McGhee, H. G.Soskice, Rt. Hon. Sir Frank
Ewart, R.McKay, John (Wallsend)Sparks, J. A.
Stewart, Michael (Fulham, E)Tomney, F.Williams, Rev, Llywelyn (Abertillery)
Stokes, Rt. Hon. R. R.Ungoed-Thomas, Sir LynnWilliams, Ronald (Wigan)
Strachey, Rt. Hon. J.Wallace, H. W.Williams, W. R. (Droylsden)
Strauss, Rt. Hon. George (Vauxhall)Watkins, T. E.Williams, W. T. (Hammersmith, S.J
Summerskill, Rt. Hon. E.Weitzman, D.Wilson, Rt. Hon. Harold (Huyton)
Swingler, S. T.Wells, William (Walsall)Winterbottom, Richard (Brightside)
Sylvester, G. O.West, D. GWoodburn, Rt. Hon. A.
Taylor, Bernard (Mansfield)Wheatley, Rt Hon JohnWyatt, W. L.
Taylor, John (West Lothian)White, Henry (Derbyshire, N.E)Yates, V. F.
Thomas, David (Aberdare)Whiteley, Rt. Hon, WYounger, Rt. Hon. K.
Thomas, George (Cardiff)Wigg, George
Thomas, Iorwerth (Rhondda, W)Wilkins, W. A.TELLERS FOR THE AYES:
Thomas, Ivor Owen (Wrekin)Willey, Octavius (Cleveland)Mr. Bowden and Mr. Popplewell.
NOES
Aitken, W. T.Graham, Sir FergusNicholson, Godfrey (Farnham)
Allan, R. A. (Paddington, S.)Gridley, Sir ArnoldNicolson, Nigel (Bournemouth, E.)
Amery, Julian (Preston, N.)Grimond, J.Nield, Basil (Chester)
Amory, Heathcoat (Tiverton)Grimston, Sir Robert (Westbury)Noble, Cmdr. A. H. P.
Anstruther-Gray, Major W, J.Hare, Hon. J. H.Nugent, G. R. H.
Arbuthnot, JohnHarris, Frederic (Croydon, N.)Oakshott, H. D.
Ashton, H. (Chelmsford)Harris, Reader (Heston)Odey, G. W
Assheton, Rt. Hon. R. (Blackburn, W.)Harrison, Col. J. H. (Eye)Ormsby-Gore, Hon. W. D
Astor, Hon. J. J. (Plymouth, Sutton)Harvey, Air Cdre A. V. (Macclesfield)Orr, Capt. L. P. S.
Baldwin, A. E.Harvey, Ian (Harrow, E.)Orr-Ewing, Charles Ian (Hendon, N.)
Banks, Col. C.Hay, JohnOsborne, C-
Barber, A. P. L.Heald, Sir LionelPartridge, E.
Barlow, Sir JohnHeath, EdwardPeto, Brig. C. H. M
Baxter, A. B.Henderson, John (Cathcart)Peyton, J. W. W.
Beach, Maj. HicksHiggs, J. M. C.Pickthorn, K. W. M.
Beamish, Maj. TuftonHill, Dr. Charles (Luton)Pilkington, Capt. R. A.
Bell, Philip (Bolton, E.)Hill, Mrs. E. (Wythenshawe)Pitman, I. J.
Bennett, F. M. (Reading, N.)Hinchingbrooke, ViscountPowell, J. Enoch
Bennett, William (Woodside)Hirst, GeoffreyPrice, Henry (Lewisham, W.)
Birch, NigelHolland-Martin, C. J.Prior-Palmer, Brig. O. L.
Bishop, F. P.Hope, Lord JohnProfumo, J. D.
Black, C. W.Hornsby-Smith, Miss M. P.Raikes, H. V.
Bossom, A. C.Horobin, I. M.Redmayne, M.
Bowen, E. R.Horsbrugh, Rt. Hon. FlorenceRemnant, Hon. P.
Boyd-Carpenter, J. A.Howard, Greville (St. Ives)Renton, D. L. M.
Boyle, Sir EdwardHudson, Sir Austin (Lewisham, N)Roberts, Peter (Heeley)
Bromley-Davenport, Lt.-Col. W. H.Hudson, W. R. A. (Hull, N.)Robertson, Sir David
Brooke, Henry (Hampstead)Hurd, A. R.Roper, Sir Harold
Brooman-White, R. C.Hutchinson, Sir Geoffrey (Ilford, N.)Ropner, Col. Sir Leonard
Buchan-Hepburn, Rt. Hon. P. G. THutchison, Lt.-Com. Clark (E'b'rgh W.)Russell, R. S.
Billiard, D. G.Hyde, Lt.-Col. H. M.Ryder, Capt. R. E. D.
Bullock, Capt. M.Hylton-Foster, H. B. H.Salter, Rt. Hon. Sir Arthur
Bullus, Wing Commander E. EJohnson, Eric (Blackley)Schofield, Lt.-Col. W. (Rochdale)
Burden, F. F. A.Jones, A. (Hall Green)Scott, R. Donald
Butler, Rt. Hon. R. A. (Saffron Walden)Kaberry, D.Scott-Miller, Cmdr. R.
Carson, Hon. E.Kerr, H. W. (Cambridge)Shepherd, William
Cary, Sir RobertLambert, Hon. G.Simon, J. E. S. (Middlesbrough, W)
Channon, H.Lambton, ViscountSmithers, Peter (Winchester)
Churchill, Rt. Hon. W. S.Langford-Holt, J. A.Soames, Capt. C.
Clarke, Col. Ralph (East Grinstead)Legge-Bourke, Maj. E. A. H.Spearman, A. C. M.
Cole, NormanLegh, P. R. (Petersfield)Speir, R. M.
Cooper, Sqn. Ldr. AlbertLindsay, MartinSpence, H. R. (Aberdeenshire, W.)
Craddock, Beresford (Spelthome)Linstead, H. N.Stevens, G. P.
Cranborne, ViscountLloyd, Maj. Guy (Renfrew, E.)Storey, S
Crookshank, Capt. Rt. Hon. H. F. CLockwood, Lt.-Col. J. C.Strauss, Henry (Norwich, S.)
Crosthwaite-Eyre, Col. O. E.Lucas, Sir Jocelyn (Portsmouth, S.)Stuart, Rt. Hon. James (Moray)
Crowder, Petre (Ruislip—Northwood)Lucas, P. B. (Brentford)Studholme, H. G.
Darling, Sir William (Edinburgh, S.)Lucas-Tooth, Sir HughSummers, G. S.
Deedes, W. F.McAdden, S. J.Sutcliffe, H.
Dodds-Parker, A. D.Macdonald, Sir Peter (I. of Wight)Taylor, Charles (Eastbourne)
Doughty, C. J. A.Mackeson, Brig, H. R.Taylor, William (Bradford, N.)
Drewe, C.McKibbin, A. J.Teeling, W
Duncan, Capt. J. A. L.McKie, J. H. (Galloway)Thomas, P. J. M. (Conway)
Duthie, W. S.Maclean, FitzroyThompson, Kenneth (Walton)
Eccles, Rt. Hon. D. M.Macmillan, Rt. Hon. Harold (Bromley)Thompson, Lt.-Cdr. R. (Croydon, W.)
Erroll, F. J.Macpherson, Maj. Niall (Dumfries)Thorneycroft, Rt. Hn. Peter (Monmouth)
Fell, A.Maitland, Patrick (Lanark)Thornton-Kemsley, Col. C. N.
Finlay, GraemeManningham-Bulter, Sir R. E.Tilney, John
Fisher, NigelMarshall, Douglas (Bodmin)Turner, H. F. L
Fleetwood-Hesketh, R. F.Marshall, Sir Sidney (Sutton)Turton, R. H.
Fletcher-Cooke, C.Maudling, R.Tweedsmuir, Lady
Fort, R.Maydon, Lt.-Cmdr. S. L. C.Vane, W, M. F.
Fraser, Hon. Hugh (Stone)Medlicott, Brig. F.Vaughan-Morgan, J. K
Fraser, Sir Ian (Morecambe & Lonsdale)Mellor, Sir JohnVosper, D. F.
Galbraith, T. G D. (Hillhead)Molson, A. H. E.Wakefield, Edward (Derbyshire, W)
Gammans, L. D.Morrison, John (Salisbury)Wakefield, Sir Wavell (Marylebone)
George, Rt. Hon. Maj. G. LloydMott-Radclyffe, C. E.Walker-Smith, D. C.
Gomme-Duncan, Col. A.Nabarro, G. D. N.Ward, Hon. George (Worcester)
Gower, H. R.Nicholls, HarmarWard, Miss I. (Tynemouth)
Waterhouse, Capt. Rt. Hon. CWilliams, Sir Herbert (Croydon, E.)Wood, Hon. R
Wellwood, W.Williams, R. Dudley (Exeter)
White, Baker (Canterbury)Wills, G.TELLERS FOR THE NOES:
Williams, Rt. Hon Charles (Torquay)Wilson, Geoffrey (Truro)Mr. Butcher and Major Conant.

Question put, and agreed to.

11.30 p.m.

Photo of Mr Hugh Gaitskell Mr Hugh Gaitskell , Leeds South

I would suggest to the House that we have now reached the stage when we might well adjourn. We have dealt with a number of topics, ranging over many subjects, from pool betting, Purchase Tax, and amateur dramatic societies, to, finally, the plight of authors. We have listened to a most brilliant performance by my right hon. and learned Friend the Member for Sheffield, Neepsend (Sir F. Soskice) and, no doubt, the Chancellor would feel that this is the moment to retire hurt, forget the Finance Bill, and come back to fight another day. I hope, therefore, that he will agree that we might now adjourn.

Photo of Mr R.A. Butler Mr R.A. Butler , Saffron Walden

I had hoped that the right hon. Gentleman's glowing references were to myself, and that would certainly have helped in persuading me to have agreed to his suggestion. But I am in a double difficulty; I am deeply wounded by the observations which have been made, but glowing with pride over the success due to the right hon. and learned Gentleman the Member for Sheffield, Neepsend (Sir F. Soskice); in the circumstances, however, perhaps it would be better for me to swallow my hurt pride, and agree to make further progress tomorrow.

We have one new Clause left, and then we shall be on the Bill itself again, and I must warn the House that it is essential, for the transaction of business, that we should finish the Report stage tomorrow. Therefore, in rising at this hour, which is reasonable, I ask hon. Members to come forward and finish the Bill—which is quite within our power.

Further consideration of the Bill, as amended, adjourned.—[Mr. Gaitskell]

Bill, as amended (in Committee and on re-committal,) to be further considered Tomorrow.