The Sun.
London, England, 1851-08-13 00:00:00

THE INCOME-TA.X COMMITTEE.
(Evidence of Charles Pressly, Esq., continued from

The Sun of yesterday.)
Mr. J. Weesoe—ls the examination on oath ?--
The Commissioners have the power of administering
on oath, but I believe it is very rarely resorted to.
These questions would be much better answered by
the surveyors, for it so happens that I have never
attended an appeal, but I believe that is the general
course.
CuatetataN—You say that there is another duty ;
what is the duty of the surveyors, as regards ex-
emptions ?—All persons whose incomes are under
1501. a year fill up a claim of exemption ; they state
on the return paper that their total income from every
source does not amount to 1501. a year, and they re-
quire to be furnished with the proper form for pro-
ving the same. This paper, as I stated before, being
in the hands of the Government officer, he gives the
party a form of claim of exemption ; upon that form
the party states a full, just, and true account of the
whole of his income derived from every source for
the year ending the sth of April, 185—, and claims
exemption in respect of such income; if the tax has
been paid by him, he goes on to state that he re-
quests to be repaid. These forms of claims of exemp-
tion are sent to the surveyor ; if he is satisfied that the
party's income is less than 1501. a year, he does not
oblige the partiee in all cases to prove the same before
the Commissioners. I believe in many cases where
the Government officer is satisfied that the party's in-
come is less than 1501. a yell-, he signs the certificate
eit the foot, which states that, " Having examined
the above claim, I do hereby certify that the party
appears to be wholly exempt from the duty charge-
able thereon." He submits the claim to the General
Commissioners at one of their meetings, and they
sign a certificate to that effect, and the name is struck
out of the assessment; if the party has paid the
money, the claim comes up to the office, and the
amount is repaid to him. The law no doubt requires
that each individual should go before the General
Commissioners of the district to prove his exemption,
but in practice it has been found that if the case
of every man whose income was less than 1501.
a year was brought up, it would be quite impos-
sible for the General Commissioners upon the ap-
peals to hear the cases; and I believe if the Com-
mittee examine some
.of the surveyors, they will
find that in some instances (I do not mean to say it
is the general rule) claims to exemption are allowed
without the party being obliged to appeal and appear
personally before the General Commissioner of the
district.
Does the clerk of the Commissioners give him his
discharge ? —lt the party is an assessment under Sche-
dule (D), for the profits of his trade at 1401. a year,
the additions' Commissioners being satisfied that his
income is only 1401. a year, they do not assess him,
and therefore the clerk does not give a discharge;
but in a case where the party has really paid the tax,
for example, if a party is assessed through his tenant,
supposing the amount of his income to be 1401. a
year, and he has money in the funds, which with the
profits of his trade, makes his income more than 1501.
a year, then the clatin of exemption being signed by
two of the Commissioners of the district, is sent up to
the office in London, and repayment of the duty is
granted, being properly voac'ned by the receipts as
regards rents, an examination of the Bank of Eng-
land hooka, as regards stock, a certificate
front railways, or that species of property, as regards
shares (the particular income for which the party
claims to be repaid the duty being. stated), and a
voucher showing that he has paid the particular duty
being annexed to the claim for vehicle a repayment has li
been sought.
C tIA:iC ELLOR of the EXCITEQUEn—That is in a case
in which a person having paid the duty has established
his claim to an exemption before the Commissioners,
on the ground of his whole income being less than
1501. a year ?—Yes.

Mr. hisRALLI—A. drawback?—Yes; a repayment
or dreswback.

CHAIRMAN—Is it not possible., or more than pro-
bable, that frauds are committed upon the revenue by
parties claiming exemption or discharge on the
groand of not having an income to the amount of
150/.?—Ys.

Arc you able to lay before the Committee any in-
stances in which the tax has been evaded by parties
claiming to have au income under 150/.?-1. am ; it
may be hater, possibly, to produce particular cases
in which we have proceeded for penalties for this very
fraud, and msdo parties pay penalties; one great diffi-
culty is to ascertain the fact, but having ascertained
the fact, we have no difficulty in prosecuting the
party.
Is it not possible, and probable, that frauds are
co-mmitted upon the revenue by parties claiming ex-
emption or discharge on the ground of not having an
income to the amount of 1501. a year ?—Yes.
Will you state such examples as you can from re-
collection of these evasions P—l will put a case at
once : a man fills up his claim of exemption, and
states that his income is derived from money in the
funds and from the rent of a house, and he leaves out
altogether the sum of 4001. that he has upon mort-
gag9 ; he states that the whole of hi 4 income
cowints of the dividends in the funds, and the rent
of his house, and be gets exemption ; we will suppose
the house to be 151. a year, and the dividend to be 301.
a year; we repay him the tax which has been paid by
his tenant on the rent of his house, and the tax which
has been deducted from him by the bank on his divi-
dends. We find out afterwards that that man has
4001. on mortgage, end that his income is 4451. a year.
How do
you find that out afterwards?—l do not
give this as a particular case, but I said that I would
produce cases in which we had prosecuted parties for
this very evasion. lam only putting a supposed case
how the thing could arise.
Mr. J. WinsoN—But is it not the case that, sup-
posing there is a mortgage upon an estate, the income-
tax is paid in the first instance by the occupier of the
estate ; it is recovered from him in the payment of his
rental from the owner of the estate, and the owner of
the estate in paying the interest of his mortgage re-
covers the portion of the income-tax I)—Yes.

So that there is no fraud committed in that case?
—I beg your pardon, there is very great fraud; the
fraud is in getting from the tax-office the repayment
of money deducted from the dividends, and the repay-
ment of the tax which we have charged upon the
man's house.
CHAIRMAN—WiII you state any other examples?—
I can produce instances in which tenants have stated
their rents to be less than 3001. a year, and we have
ascertained that it is very considerably above 3001. a
year ; they have claimed exemption, and have been
discharged from the assessment, and we have prose-
cuted them for the penalties.
Are these evasions frequent?—They may be fre-
quent, but a great number of cases do not come to
our knowledge. I can give a return, if the Com-
mittee wish it, of the sereral prosecutions that have
been instituted sincethe introduction of the property-
.
tax, against persona making fraudulent claims of ex-
emption, in those cases that have come to our know-
ledge.

Can you state any other way in which the evasion
takes place by which an individual under the clause
of exemption can defraud the revenue ? Ii e can do
so in any case where he has to claim the repayment
of the tax by the suppression, in the return which he
ii
makes of the amount of his income, of any particular
sources of income. That return is not on oath.
e
does not state on his oath that the whole of his income
is derived from these particular sources. If he me
sup-
presSes
or leaves out of the claim ha makes any parti-
cular source of income so as to bring his income
under 1501. a year, he gets exemption, and obtains a
repayment, and nevertheless his income may be more
than 1501. a year; the government officer having no
knowledge of the party's.otlaer income, which may be
in Cornwall, he residing in Kent.
Suppose he has an income of 1651. and claims a de-
duction for an annuity which he pays in another part
of the country of 20/., that would bring his income
to 145/.?—Undoubtedly.
In that case you would admit that he would be
exempt from the tax ?—Undoubtedly.
At present, as the Act is carried out, is there no
mode of ascertaining, when a person makes that claim
for a return of the tax, whether the amount in re.
spect of which he claims is really a bona fide trans.
action ?—lf he states to the General Commissioners
that he does pay the annuity, and they grant the ex-
emption, we have no power to interfere.
public
,11aa the surveyor, whom I look upon as a
officer
, on behalf of the Inland Revenue to take care
that r-- evasionst shall not take place, any power in
"I?e ' He ought, undoubtedly, in the case of
an annuity, to .
the Geuersie require the party, when he is before
an annuity tainissioners, to satisfy them that this is
to pay. which he, the claimant, is bona fide obliged
Suppose the autJ a ,atali : ,
receipt from airs. Harrison,tng to be excused puts in a
or any other person re-
tunity
siding in
or can he Cornwa
, hell' has thethat Commissioner an oppor-
, Whethrperesent state of the matter,
apply and ascertain
whether such an annui such a person exists, or
ty is
paid?--I do not see how
it is possible.
CIIAINCELLOR of the EXCHEquER___The Commis-
sioners
have the power of calling
fur such proof as is
necessary to satisfy them that the annuity is paid ?
of Undoubtedly ; it is with them alone to
grant the
exemption ; the Act Parliament is very clear upon
the subject.
CHA.I7.MAN TO point of fact, is it not the case that
"
where claims for reduction are made on account _r
payments in a distant part of the country, there '
is
seldom, if ever, any inquiry ma to the reality of thou
payments ?--I aporehend if it were a quastion of re.
payment for rent, the surveyor would require the
collector's receipt of the particular payment, the col-
lector's receipt for the tax. In the case of an annuity,
if the party states upon the face of his income that
from his rents of real property he has 165/. a year,
and that he is liable to an annuity of 20/. a year,