INCOME TAX 361 



printed for use in those districts where the local Commissioners 

 were willing to adopt it. 



On several occasions the Local Taxation Committee had 

 protested against the assessment of real property at its gross 

 value under Schedule A, and the justice of their contention 

 was admitted by the inclusion of Section 35 in the Finance 

 Act, 1894, which allowed a deduction of one-eighth from the 

 gross rental in the case of land (including in the case of farms 

 the house and buildings) and of one-sixth in the case of house 

 property. This deduction was, of course, entirely insufficient 

 to meet the case of well-managed estates, where the cost of 

 upkeep approximates more nearly to 40 per cent, of the gross 

 income ; but owners had to wait many years before further 

 relief was given in this direction. 



In its first report 011 the Finance Bill of 1909 the Local 

 Taxation Committee said : 



" That the time has arrived when the income derived from the 

 ownership of agricultural land should be assessed for Income 

 Tax, like that derived from other forms of property and from 

 commercial undertakings, at its net amount, and not, as now, 

 under Schedule A, upon its gross amount less certain statutory 

 deductions, which in no way represent the annual expenditure 

 for purposes necessary to maintain such income." 



Mr. Charles Bathurst was especially active in pressing this 

 point upon the Chancellor of the Exchequer, and, armed with 

 a return from a large number of estates, collected by the 

 Land Agents' Society, he succeeded in inducing Mr. Lloyd 

 George to agree to set aside a sum of 500,000 per annum 

 for the purpose of increasing the allowance made by Section 35 

 of the Finance Act, 1894. The Chancellor of the Exchequer 

 admitted that to place income derived from real property on 

 the same basis as other income would involve a sum of at 

 least three millions per annum, and though he declared his 

 inability to find this sum, he recognised the injustice of the 

 existing basis. When the Bill passed, Section 69 provided 

 that landowners who proved in any year that the cost of 

 maintenance, repairs, insurance, and management, accord- 

 ing to the average of the last five years, had exceeded in the 

 case of land the statutory one -eighth, and in the case of 



