56.
30
Extrast from M.K. Hansard Report of 29.8.40.
WAR REVENUE (NO. 2) AMENDMENT BILL, 1940.
THE ATTORNEY GENERAL moved the first reading of a Bill intituled "An Ordinance to amend further the War Revenue Ordinance, 1940." He said: The object of this Bill, in the main, is to restore what is believed to be the intention of the Committee which was responsible for this Bill. There are certain other amendments affecting payments by instalments which have been represented to Government by various bodies.
THE COLONIAL SECRETARY seconded, and the Bill was read a first time.
Objects and Reasons,
The "Objects and Reasons" for the Bill were stated as follows:-
1. The proviso to section 8 of the War Revenue Ordinance, 1940, exempted four classes of income from the Salaries Tax imposed by that section. Experience has shown that the exemptions are insufficiently elastic to cover certain special cases to which exemption may be reasonably extended. Thus exemption (ii), which covers the official emoluments of consuls, vice-consuls, and persons employed on the staff of any consulate, who are subjects or citizens of the States which they represent, is insufficiently elastic to cover the case of the Treasury Representative of a State whom it may be considered desirable or politic to exempt.
2. Consequently clause 2 of this Bill adds a paragraph to cover such cases where exemption has been granted by the Governor in Council.
3. The principal Ordinance, No. 13 of 1940, was drafted by a large Committee as a substitute for Income Tax and as a special measure for raising additional revenue during the War. Necessarily it had to be prepared against time to make it effective for the financial year 1940-1941; but the size of the Committee and the various interests and views they represented as to the nature and incidence of the special new taxes tended to obscure any clear decision on details borrowed in part from the Revenue Laws of other States and Colonies. This obscurity has arisen especially in those portions of the principal Ordinance which use the income or profits of the year preceding the year of assessment as a convenient statutory yard-stick for the computation of the income or profits for the year of assessment. It seems clear that the Committee did not intend the Ordinance to be retrospective in operation so as to raise taxes for the previous year, and it seems equally clear that they did not intend the yard-stick of income or profits to be used also as a yard-stick of residence so as to require a person, who was in the Colony for six months in a year of assessment and for the whole of the year preceding, to pay salaries tax on one year's income or even on one and a half year's income, instead of one-half of a year's income.
4. The amendments effected by clauses 3 and 5 of the Bill are intended to remove obscurities and to restore what is believed to have been the intention of the War Revenue Committee in relation to Salaries Tax and to Profits Tax. A similar obscurity in relation to Property Tax was removed by the Amending Ordinance No. 21 of 1940.
5. Clause 4 of the Bill applies the proportionate rule for allowances in section 11 also to the exemption of incomes under four thousand eight hundred dollars in the proviso to section 8.
6. Clause 6 of the Bill adds a sub-section to section 46 of the principal Ordinance enabling the Commissioner to accept payment by instalments where hardship would result from payment in a single amount.
7. Clause 7 implements clause 2 by conferring on the Governor in Council a general power of exemption.
8. Clause 8 makes the amendments retrospective and provides for refunds.