Orders of the Day — Finance Bill – in the House of Commons at 12:00 am on 30 June 1964.
Mr Peter Rawlinson
, Epsom
12:00,
30 June 1964
I beg to move, in page 15, line 35, to leave out subsection (5) and to insert:
(5) Where the deduction by way of income tax relief mentioned in subsection (1)(a) of
this section is a deduction in computing profits or gains or losses of a trade, profession or vocation, or arising from woodlands, and any part of the payments made under the lease by the person obtaining the capital sum is a payment in respect of which a deduction is not allowed for the reason that the whole or any part of the period in which the payment would fall to be allowed is not a period on the profits or gains of which income tax falls to be computed in respect of the trade, profession or vocation, for the reference in the proviso to the said subsection (1) to the amount of the capital sum there shall be substituted a reference to that amount after deducting the amount of the payment in respect of which a deduction is not allowed for that reason.
The House will recollect that Clause 16 was a tax avoidance Clause. The original subsection (5) was found on examination to be not wholly equitable. It was designed to deal with the special position of a lease which fell within the ambit of the Clause and was assigned for a capital sum towards the end of a business which was ceasing. The Clause as drafted could lead to charging a taxpayer on a capital sum by reference to a notional tax relief which had never been obtained. The true answer where it is a ceasing business is in each case that the charge on the capital sum should be cut down by the amount of rental payment for which tax relief has not been given.
The Amendment provides that there should be subtracted from the capital sum received any rental payment for which tax relief has not been given because of the cessation provision. This secures the right answer both for the Revenue and the taxpayer. There is a consequential Amendment to Schedule 7.
Mr Peter Rawlinson
, Epsom
I beg to move, in page 15, line 46, after "allowable", to insert "or made".
This and the following Amendment are drafting and correct the scope of subsection (6). They are needed because subsection (2), which is amplified by subsection (6), relates also to a deduction "allowable" and to a deduction "made" and it is necessary that both these words should be inserted.
A parliamentary bill is divided into sections called clauses.
Printed in the margin next to each clause is a brief explanatory `side-note' giving details of what the effect of the clause will be.
During the committee stage of a bill, MPs examine these clauses in detail and may introduce new clauses of their own or table amendments to the existing clauses.
When a bill becomes an Act of Parliament, clauses become known as sections.
As a bill passes through Parliament, MPs and peers may suggest amendments - or changes - which they believe will improve the quality of the legislation.
Many hundreds of amendments are proposed by members to major bills as they pass through committee stage, report stage and third reading in both Houses of Parliament.
In the end only a handful of amendments will be incorporated into any bill.
The Speaker - or the chairman in the case of standing committees - has the power to select which amendments should be debated.
