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Hospital Consultants (Expenses)

Volume 526: debated on Thursday 8 April 1954

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27 and 28.

asked the Chancellor of the Exchequer (1) what consultations have taken place between the Treasury and the Ministry of Health with regard to the expenses of hospital consultants employed in the National Health Service which are not deductible for Income Tax purposes; and what steps he proposes to meet this problem;

(2) whether he is aware that hospital consultants employed in the National Health Service incur many expenses for which they can make no Income Tax rebate claim on their Schedule E assessments; and whether he will introduce legislation to remedy this hardship.

Hospital consultants are, like other employees, assessible under Schedule E, and the same rules with respect to expenses apply to them as to other taxpayers so assessed. I see no reason to propose legislation giving them preferential treatment. The general question of what expenses are admissible to such taxpayers is within the terms of reference of the Royal Commission.

Is my right hon. Friend aware that there is a case to be looked into here, because there is a conflict of opinion between the appointing authorities and the Revenue authorities? The appointing authorities will not appoint a consultant unless he has a motor car, a secretary and a telephone and the Revenue will not allow these for expenses. Therefore, a consultant has necessarily to incur expenses which he cannot deduct for tax purposes. Will my right hon. Friend look into the matter?

I have seen the letter which my hon. and gallant Friend sent to my right hon. Friend on this subject. The Revenue authorities are bound to apply the existing law, and it is perfectly clear that these taxpayers are liable to be assessed under Schedule E. On the question of motor cars, consultants get mileage allowances, and Questions on that subject are for my right hon. Friend the Minister of Health.

My right hon. Friend answered my first Question by saying that he would not be prepared to introduce legislation, but does not the latter part of his answer show that new legislation is required? Would he look at it again, because it affects them rather hardly?

The broad question is within the terms of reference of the Royal Commission. I cannot see any justification, pending the issue of its Report, for treating these people for tax purposes in any way different from other taxpayers who are taxed as employees.

Is the right hon. Gentleman aware that consultants are not treated the same as general practitioners for this purpose? Will he not try to make an adjustment as between the consultants and general practitioners?

That is just the sort of question which is for my right hon. Friend the Minister of Health. I am concerned only with the administration of the tax law.

Owing to the unsatisfactory nature of that reply, I beg to give notice I shall raise the matter at the earliest opportunity.