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Income-Tax And Sewers

Volume 178: debated on Tuesday 16 July 1907

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I beg to ask Mr. Chancellor of the Exchequer if his attention has been called to a decision given by the House of Lords on Wednesday, 26th June, in the case of the Ystradyfodwg and Pontypridd Board and Benstead, to the effect that sewers vested in local authorities and maintained by them pursuant to duties imposed upon them by the Public Health Acts are assessable to the income-tax; if he can give some idea as to the total annual value of all sewers in the United Kingdom and of the burden which will now be placed on all ratepayers in respect of the income-tax assessed upon their public sewers, irrespective of the amount of the incomes of such ratepayers; and whether he will consider the advisability of introducing legislation to relieve the ratepayers of this income-tax burden now placed upon them for the first time since the income-tax has existed in this country.

It would not be possible to give any estimate of the annual value of all sewers in the United Kingdom. There is, however, no reason to apprehend that the decision referred to will seriously affect the liability of sewers to assessment to income-tax. The sewer in question was not wholly an underground sewer. It was in part carried above ground, or along specially constructed embankments, and it had attached to it certain appurtenances in the shape of an outfall, with sluices and other apparatus. It had been held by a judgment of the Court of Appeal to be assessable to rates, and thereupon the Inland Revenue claimed that it was assessable also to income-tax on the principle that whatever is a proper subject of rates is also a proper subject of taxes. So far as sewers are concerned, the Board of Inland Revenue will be satisfied to treat the judgment of the House of Lords, as no more than an affirmation of that principle, and will not regard it as requiring them to depart from existing practice under which sewage works, pumping stations, and so on are assessed both to rates and to income-tax, but purely underground sewers to neither.