0 , PANY MEETING
J. COMPTON, SONS AND WEBB
LARGE INCREASE IN BUSINESS URDEN OF 100 PER CENT. EXCESS PROFITS TAX MR. JAMES M. TUCKER'S VIEWS
HE twenty-eighth annual ordinary general meeting of J. Compton, ons and Webb, Limited, was held on July 25th at the Abercorn cams, Great Eastern Hotel, London, E.C.
Mr. James Millard Tucker (the chairman) presided.
The Secretary (Mr. W. A. Passfield) having read the notice con- ening the meeting and the report of the auditors, The Chairman said: Ladies and gentlemen,—I presume you will, usual, take the report and accounts as read. (Agreed.) I must begin by saying that I am now addressing you as the new airman of the company, to which office my colleagues have done e the honour cf appointing me, following upon the death of Mr. C. F. pencer last year.
YEAR'S TRADING PROFIT The profit and loss account shows that the profit for the year to ember 31st, 1940, was £105,983, as compared with £102,946 for 39, an increase of only £3,037, notwithstanding the fact that the lume of business done in 194o was very nearly 5o per cent. greater an that done in 1939. The reason of course, is that E.P.T. has ken practically the whole of the profit which actually resulted from s large increase in business. If you will look at the item of sundry editors in the balance-sheet, which includes the amounts reserved meet our taxation liability, you will see that it amounts to £263,893, against £166,733 for 1939, a difference of approximately £97,000. uch more than half that difference represents an increase in the erve for such taxation as had not been actually paid by December Si, 1940.
After providing for the usual charges, the net profit for the year 1;98,764, as against £97,394 last year. With the carry-forward we .e a disposable profit of £102,404, which the directors recommend all be applied as stated in the report.
TAXATION AND INDUSTRY Since I have had to refer to E.P.T., I should like before I deal nher with the accounts to say a few general words about this tax. do not think industry in general has the slightest quarrel with the 'ernment's decision that no undue profit shall be made by anyone the result of the war. As I understand it, the Government's general nciple is that a taxpayer shall only retain so much of his profit is equivalent to that which he made before the war; together, as ards public companies, with so much of the excess as is equivalent 8 per cent. on any increased capital which has had to be employed the business. I am not forgetting that this year's Finance Act also provide that 20 per cent. of the too per cent. tax is, under am conditions not yet specified, to be returned to the taxpayer er the war.
Unfortunately in our case the provisions for determining the retain- le standard profit do not operate very favourably, the result being t in our case we are in fact being taxed to a greater extent than warranted by the general principle of the tax to which I have erred.
Moreover, the Acts which impose E.P.T. still contain many pro- ons which result in inequities, and this certainly has given rise a feeling of irritation and resentment and left a good many tax- yers with the feeling that they have been the victims of an injustice. Many cases also, I believe it has tended to restrict pRiduction and move. But I entirely agree that this is no time to worry the Govern- la unduly on these matters. Their attention must be left as free as Bible to their task of winning this war, while our attention and our rgies must be devoted to doing whatever work is allotted to us.
And, indeed, I think it would be agreed that it is the duty of every Payer, who is able to earn money by work, to work as hard as Possibly can, however high the rate of tax may be, in order that largest possible amount of tax shall become payable to the Govern- , and so that even thciugh the surplus which is left to him is paratively small, he can, out of it, lend the greatest possible unt to the Government as war savings.
A SUGGESTION WITH RETROSPECTIVE EFFECT
%evertheless, it is an extremely bad thing that there should be, I know there are, so many payers of E.P.T. who feel that, corn- with their fellow-taxpayers, they have not been entirely fairly led. Accordingly I venture to make a suggestion. Nearly all amendments to the provisions imposing E.P.T. which have been de since the tax began have been given retrospective effect over whole period of the tax.
I would suggest, therefore, that the Government should now give assurance to all E.P.T. payers that when the war is over, when e is more time available for that purpose, and when the matter
can be looked at in the light of actual practical results, a careful and impartial examination of the whole position will be made, and that, bearing in mind what the general principle of the tax was intended to be, if this examination discloses that there had in fact been any serious inequities or any really outstanding inequalities of treatment as between taxpayers, or classes of taxpayers, legislation will be introduced which will correct those defects, and which will be given retrospective effect over the whole period of the tax, and provide for the consequential repayment of any tax found to be overpaid on that footing. I am convinced that, with such an assur- ance, taxpayers would not worry themselves any more on any of these matters, even though for the time being they might have had to pay tax to a greater extent than they felt in justice they ought.
STOCK AND WORK IN PROGRESS
To return to the balance-sheet, you will see that the stock and work in progress in December, 1940, was £269,745, as against £168,840 the previous year. This is an increase of over Doo,000, while the cash at bank, at £56,239, shows a decrease of L40,000. Both these differences indicate the very great increase in the amount of business being done, most of which, of course, represents the increased pro- duction of uniforms required by the armed forces and other Govern- ment services. The only other item to which I need refer is that of the lands, buildings, plant and machinery. At £238,293, this shows an increase over last year in respect of additions made during the year of approximately L19,000.
Incidentally, you may be interested to know that, taking this com- pany and its four wholly owned subsidiary companies together, we now have eight factories altogether, seven of which are in various places in this country, the other being in Egypt, and that altogether we employ over 5,000 workpeople.
THANKS TO EXECUTIVE AND STAFF I should like to express the board's grateful thanks to the workpeople and staff of all the companies in the group for the services which they have rendered, and are continuing to render, and I am glad to say that our relations with the various trade unions concerned continue to be most happy and satisfactory.
Speaking now for myself, I desire to express to my colleagues on this board, and to my colleagues on the boards of the subsidiary com- panies, my own thanks to them for their valuable services to the com- pany. All of them are to all intents and purposes full-time working directors, responsible for the day-to-day management of the business. Mr. John Compton is, of course, very well known in the industry itself, and when the Government Advisory Panel for the production of Army clothing was set up he was selected to sit on that panel as the representative of the industry itself. For the time being, however, we are deprived of the services of Mr. Peter Compton, who is now serving with his regiment. If I may, I should like on your behalf to wish him continued safety and good luck.
I am also sorry that next week we shall for the time being be losing the services of Mr. Kenneth England, who has been given a commission in the R.A.F. To him we also wish Godspeed and good luck. To both these serving officers we express our wish that it will not be unduly long before they are again back to give us, and you, the benefit of their valuable services.
The chairman concluded by moving the adoption of the report and accounts and the confirmation of the dividends already paid.
Mr. John Compton seconded the resolution, which was carried unanimously.
A final dividend of 6d. per share, less tax, on the ordinary shares was declared.
The retiring directors (Mr. James Millard Tucker and Mr. George William Harrison) were re-elected ; the auditors (Messrs. Sydenham, Snowden, Nicholson and Co.) were reappointed.
Mr. S. Houldsworth, as representing a large number of shareholders in the North of England, proposed a hearty vote of thanks to the chairman, directors and staff for their services during the past year.
The chairman having acknowledged the compliment, the proceedings terminated.