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Capital Gains Tax

Volume 978: debated on Friday 15 February 1980

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asked the Chancellor of the Exchequer if he will seek to amend section 399 of the Income and Corporation Taxes Act 1970, as amended by paragraph 42 of schedule 6, Finance Act 1971, so that the happening of a chargeable event is deemed to be a capital gain and not part of an individual's income for income tax purposes.

Section 399 forms an integral part of provisions designed to prevent abuse of the tax advantages associated with life assurance policies. I do not think it would be right to treat the gains with which it is concerned as capital instead of income; that would greatly detract from its effectiveness.