If the holder of an office or employment of profit assessed under Schedule E of the Income Tax Act, 1918, is necessarily obliged to incur and defray out of the emoluments thereof amounts by way of subscription to a recognised
society or institution existing for the advancement of learning, science or technology, there may be deducted from the emoluments to be assessed the amounts so necessarily incurred and defrayed.
Provided that the amounts deducted shall not exceed fifteen pounds in the aggregate in any one year.—[Mr. Palmer.]
§ Brought up, and read the First time.
§ Mr. Palmer (Wimbledon)
I beg to move, "That the Clause be read a Second time."
The subject of this Clause has been before the House on a number of occasions. I hope the Committee will now give the matter further and special consideration. The position at the moment is that a doctor, engineer or scientific man, businessman, industrialists or architect in private practice, is allowed a deduction for a subscription to a scientific body or learned society, as expenses under Schedule D. It is called expenses and is a charge against the business. But if he gives up private practice and accepts employment with a corporation or with a company, the subscription is not allowable because his Income Tax comes under Schedule E. In both cases, I suggest, the need for the man concerned to make a subscription is equally great. This discrimination between the man in private practice and an employee is neither fair nor equitable; nor is it in the interests of good public policy. It places the employee in an unenviable position. There is some danger in that, because at the present time the trend is to increase the number of employee engineers, scientists, etc., against those in private practice. For this reason the Clause seeks to remove the anomaly which exists between the position of a man in private practice and the employee.
I hope that my right hon. Friend will not argue that the subscription is a condition of employment, and that the man concerned would he sacked if he did not continue to make the subscription. Generally speaking, an engineer, scientists or architect in employment does not make a subscription to a society because he fears the sack. He makes it because he is anxious to keep his professional and scientific knowledge up to date. In that sense I suggest that he is necessarily obliged to incur this expenditure. There is an additional reason for giving support to this Clause. It is a reason of general 1732 public policy. It is of vital interest to the country and to the Government to encourage young scientific technical and professional men and women, to whom i5 as a subscription to a learned society, scientific body or institution is no peppercorn. Very often the man concerned has to make in any case some other subscription. There are subscriptions to various organisations, trade unions or similar bodies. I know of men and women who are anxious to increase their knowledge and experience by making subscriptions to other bodies, but they dare not do so because they simply cannot afford the subscriptions. This condition of affairs is not desirable at a time when it is important that the country should concentrate upon advancement in technology and scientific methods and efficiency. The cost to the Exchequer, I should imagine, would be comparatively slight.
§ Mr. Glenvil Hall
The object of this new Clause, as my hon. Friend has indicated, is to allow a deduction of ir5 under Rule 9, Schedule E, for any subscription to a recognised society. He does not indicate what a recognised society would be. That, of course, could later on be defined if my right hon. Friend saw his way to accept this proposal that allowances should be given up to £15 for any subscription to a recognised society for the advancement of learning and technology, if such an expenditure has been necessarily incurred or defrayed by the individual concerned. At present this expenditure can be allowed to any taxpayer who is fortunate enough — or unfortunate enough, whichever way you look at it—to be assessed under Schedule D but is not allowed under Schedule E.
The question of the admissibility under Rule 9 of subscriptions to professional societies has been the subject of a case in the High Court. A certain Dr. Tate brought an action against a gentleman named Mr. Simpson connected with the Inland Revenue, and the Judge definitely laid it down—and I quoted from part of his judgment this afternoon on another Clause—that an expenditure of this kind is not to be taken into account. Dr. Tate had a very good case for deducting, as an allowance, all kinds of subscriptions which he was paying, or wanted to pay, to the Royal Society of Medicine, the Society of Medical Officers of Health, the Royal Institute of Public 1733 Health, and the Association of County Medical Officers of Health. The judge said:I think it is desirable to lay down some principle. I think that all subscriptions to professional societies and taking in of professional literature and all that sort of expense, which enables a man to keep himself fit foe what he is doing, are things which can none of them be allowed.That is how the law stands.
Supposing my right hon. Friend were to accede to this request, on the face of it a reasonable one. Here is a man engaged in a profession, and he naturally wants to keep himself abreast of all the latest thought in his profession. One way of doing it is to belong to societies catering for his profession, and taking in—by subscribing for—the literature of his craft. There is no reason on ordinary grounds why that should not be put down as necessary expense. But Income Tax has to be founded on broad principles, not on individual cases. We have had reason to realise that earlier this afternoon, when it was my misfortune to indicate that my right hon. Friend could not accept certain new Clauses, not because individual cases of hardship brought to his notice were not worthy of help, but because Income Tax law has to be anchored to certain principles.
Subscriptions of this kind do assist an individual to do his job better, but the principle is not that of the subscriptions, because you cannot hold it there. If you allowed subscriptions to count, you would have to see, as a general principle, that anything that helped a professional man or woman—or any man or womar—to do their job better should rank for Income Tax allowance. That would mean that a trade unionist would definitely claim that his trade union subscription came: within the same category. I could claim that these glasses, which I have had to buy, assist me to do my job better. Most assuredly they do, just as much as his medical journal helps a doctor in iris job The same applies to a man who has to have an artificial limb or some aid to hearing. All these, looked at from one sine—that is sentimentally—are entitled to rank as expenses, certainly as much as those of the individuals who had their case so well put by the hon. Member who moved this new Clause, in that they help a person to do his job better. I am sorry, therefore, that my right hon. Friend is not able 1734 to accede to this new Clause for the reasons which I hope will commend themselves to all Members of the Committee.
§ Mr. Maclay (Montrose Burghs)
There is one thing I would like to ask the right hon. Gentleman about. He mentioned the case of a man who had an artificial limb. I would like to submit that that i- a very special case—
§ Mr. Maclay
As the right hon. Gentleman used it, I thought that I might have been allowed to ask a question on the point.
§ Mr. Braddock (Mitcham)
I must say that every argument used from the Front Bench was in favour of the new Clause. My right hon. Friend admitted that people under Schedule D were allowed all these expenses. If it is good for the man in private practice to be allowed these subscriptions—these necessary subscriptions —surely the same argument applies to the man who is employed? Certain of these occupations are registered occupations, and, unless a man is registered and pays a subscription, he is prohibited from practising in his profession.
§ Mr. Glenvil Hall
That would count. Whether a man is assessed under Schedule D or Schedule E, if it is part of the terms of his employment; or if he makes his own living in his own way, it would he all right.
§ Mr. Braddock
It is agreed, so far: it a man is registered for his occupation or profession, he has to pay a subscription, and if he does not pay that subscription he is struck off the hooks, and can no longer practise. Let us go a little further. Many of these men, when applying for posts, according to the advertisements about them, must he members of such and such a professional or technical organisation. Therefore, it is just as much a necessity, in order to hold a job, to be registered in accordance with the requirements of that particular profession. That being the case, and in view of the admissions that have been made by my right hon. Friend, I do 1735 ask him not to be adamant about this, but to consider the matter further to see if something can be done to meet the request at a later stage.
§ Question, "That the Clause be read a Second time," put and negatived.