INCOME TAX.
[TO THE EDITOR OF THE " SPECTATOR."]
SIR,—Your correspondent " Zetctes " appears to be unaware of the machinery under which Income Tax is collected and returned to those entitled to exemption or abatement, or he would not have raised the imaginary difficulty with regard to tax deducted and returned in the case of income derived from rent and mortgage interest, in your last issue. He forgets that there have always been thousands of persons in the position of landlord or mortgagee who have recovered overpaid tax m-er since the Income Tax was first instituted, and the process is the panic whether the tax be Gd. or 5s. It is as follows : The tenant or mortgagor when he deducts the tax forwards to the landlord in the ease of rent the receipt for the tax paid, or in the case of mortgage interest a certificate of the amount deducted. These are sent by the landlord or mortgagee to the Revenue Authorities as vouchers with the claim for exemption or abatement, and they can be checked as to amount by the Income Tax return of the tenant or mortgagor. The principle is, of course, the same under the new 5s. rate. There will, therefore, be IRO more necessity than before for the landlord (or mortgagee) " to pro- duce details of his income and private affairs to his tenants," &c. The idea that the tax is recovered from the payer of either rent or mortgage interest is erroneous, and obviously such a system would not work in practice. I am entirely at one with your correspondent, however, in deploring the grievous hardship that persons of very small means will suffer through (in the case of exemptions) 25 per cant. of their incomes being retained by the Government for an indefinite period. Before the present Budget claimants were practically confined to persons with incomes below £700 ; but now, as every one assessed up to £2,000 will send in a claim, months and even years will elapse before these unfortu- nate people will recover what is due to them. I cannot help feeling that this point has not received the consideration it merits either by the Government or the House of Commons.—I am, Sir, &c.,
W. R. W.
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