asked the Chancellor of the Exchequer why the management of the State traffic in liquor in Carlisle, Gretna, and Cromarty pay no Income Tax; and how much the profits for 1935 would have been reduced if Income Tax had been paid?

Income Tax is not chargeable on profits which accrue to the State. As regards the schemes to which my hon. Friend refers, the Income Tax for 1935–36, if chargeable, would, it is estimated, have been approximately £14,800.

Is the right hon. Gentleman aware that the attempts from time to time to bring discredit upon the State management schemes are resented by those who know the position, and that the position now is not only a vast improvement on the pre-control period, but is probably the best in the country?

I did not understand my hon. Friend's question in that sense.

How can there be any profits from a Socialist experiment?

asked the Home Secretary whether, in view of the report of the Select Committee on Estimates, he approves of the State traffic in liquor in Gretna and Cromarty being managed from Glasgow, which is about 90 miles from Gretna and 300 miles from Cromarty; and, if not, whether he proposes to take any action?

I would refer my hon. Friend to the replies given to his questions on Thursday last. As was then stated by my hon. Friend the Under-Secretary of State, I am satisfied that the existing management, which comprises local superintendents in the two Scottish districts under the control of a general manager in Glasgow is efficient and economical. In the circumstances the last part of the question does not arise.

Is the right hon. Gentleman aware that the Carlisle experiment, to which the hon. Member for Linlithgow (Mr. Mathers) referred a few moments ago, is regarded by people who know a great deal more about it than he does as little short of a scandal?