Finance (No. 2) Act 1940
| Jurisdiction | UK Non-devolved |
Finance (No. 2) Act, 1940.
(3 & 4 Geo. 6.) CHAPTER 48.
An Act to increase certain duties of customs and excise; to increase the standard rate of income tax for the year 1940-41 and the higher rates of income tax for the year 1939-40; to make certain amendments in the enactments relating to income tax, national defence contribution and excess profits tax; to increase the rates of estate duty; to impose a purchase tax; and for purposes connected with the matters aforesaid.
[22nd August 1940]
Most Gracious Sovereign,
W E, Your Majesty's most dutiful and loyal subjects the Commons of the United Kingdom in Parliament assembled, towards raising the necessary supplies to defray Your Majesty's public expenses, and making an addition to the public revenue, have freely and voluntarily resolved to give and grant unto Your Majesty the several duties hereinafter mentioned; and do therefore most humbly beseech Your Majesty that it may be enacted, and be it enacted by the King's most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—
Part I.
Customs and Excise.
1 Beer.
(1) Section one of the Finance (No. 2) Act, 1939 ,(which imposes duties of excise and customs in respect of beer) shall have effect as if Parts I, III and IV of the First Schedule to this Act were respectively substituted for Parts I, III and IV of the First Schedule to that Act.
(2) In the case of beer in respect of which it is shown to the satisfaction of the Commissioners that the increased duty chargeable by virtue of this section has been paid, the provisions of the said section one relating to drawback shall have effect as if Parts II, V and VI of the First Schedule to this Act were respectively substituted for Parts II, V and VI of the First Schedule to the Finance (No. 2) Act, 1939.
(3) The proviso to section sixteen of the Inland Revenue Act, 1880 (which provides that the time for payment of the excise duty on beer shall not be later than the fifteenth day of the month succeeding the month in which the duty was charged) shall have effect as if the words ‘twenty-fifth day’ were substituted for the words ‘fifteenth day’.
(4) This section shall be deemed to have had effect as from the twenty-fourth day of July, nineteen hundred and forty.
2 Wines.
(1) Section three of the Finance (No. 2) Act, 1939, (which imposes duties of customs on wines) shall have effect as if Part I and Part II of the Second Schedule to this Act were respectively substituted for Part I and Part II of the Third Schedule to that Act.
(2) This section shall be deemed to have had effect as from the twenty-fourth day of July, nineteen hundred and forty.
3 Sweets.
(1) The duty of excise on sweets charged under section six of the Finance Act, 1927 , shall—
(a ) in the case of sparkling sweets, be at the rate of eleven shillings and sixpence instead of nine shillings and sixpence per gallon; and
(b ) in the case of other sweets, be at the rate of five shillings and sixpence instead of three shillings and sixpence per gallon.
(2) Where duty becomes chargeable on any sweets at the rate applicable to sparkling sweets, and it is shown to the satisfaction of the Commissioners that duty has already been paid thereon at the rate applicable to other sweets, the duty so chargeable shall be reduced by the amount of the duty so paid.
(3) This section shall be deemed to have had effect as from the twenty-fourth day of July, nineteen hundred and forty.
4 Tobacco.
(1) In lieu of the duties of customs charged on tobacco under section three of the Finance Act, 1940 ,there shall, subject to the provisions of section eight of the Finance Act, 1919 , be charged on tobacco imported into the United Kingdom of the descriptions set out in the first column of Part I of the Third Schedule to this Act duties of customs at the rates respectively specified in the second column of that Part of that Schedule.
(2) In lieu of the duties of excise charged on tobacco under the said section three, there shall be charged on tobacco grown in the United Kingdom of the descriptions set out in the first column of Part II of the Third Schedule to this Act duties of excise at the rates respectively specified in the second column of that Part of that Schedule.
(3) The drawback allowed under section one of the Manufactured Tobacco Act, 1863 , on tobacco exported from the United Kingdom or deposited in a bonded or King's warehouse shall, in cases where it is shown that the duties charged under this section have been paid, be allowed at the rates set out in Part III of the Third Schedule to this Act instead of at the rates set out in Part III of the Third Schedule to the Finance Act, 1940, but subject to the provisions affecting allowance of drawback contained in the Schedule to the Finance Act, 1904 .
(4) This section shall be deemed to have had effect as from the twenty-fourth day of July, nineteen hundred and forty.
5 Entertainments.
5. As respects payments for admission to entertainments held on or after the sixth day of October, nineteen hundred and forty, entertainments duty within the meaning of the Finance (New Duties) Act, 1916,shall be charged—
Part II.
Income Tax.
6 Increase in standard rate.
(1) The standard rate of income tax for the year 1940-41 shall be eight shillings and sixpence in the pound, instead of seven shillings and sixpence in the pound as provided by subsection (1) of section eleven of the Finance Act, 1940.
(2) It is hereby declared that any deductions of tax made before the passing of this Act by reference to a rate of eight shillings and sixpence in the pound are to be treated for all purposes (including all the purposes of any legal proceedings instituted before the passing of this Act) as having been made by reference to the proper rate; but this section shall not invalidate anything done before the passing of this Act or render improper any deduction in respect of income tax made before the first day of September, nineteen hundred and forty, which would have been a proper deduction if this Act had not passed.
(3) The provisions of the Fifth Schedule to this Act shall have effect for the purposes of and in connection with the change of the standard rate of income tax made by this section.
7 Sur-tax \(increased rates).
(1) Income tax for the year 1939-40 in respect of the excess of the total income of an individual over two thousand pounds shall, instead of being charged at the rates mentioned in section twelve of the Finance Act, 1940, be charged at rates in the pound which respectively exceed the standard rate by the amounts specified in the second column of the following Table:—
Table.
For every pound of— |
s. |
d. |
the first five hundred pounds of the excess |
2 |
0 |
the next five hundred pounds of the excess |
2 |
3 |
the next one thousand pounds of the excess |
3 |
3 |
the next one thousand pounds of the excess |
4 |
3 |
the next one thousand pounds of the excess |
5 |
0 |
the next two thousand pounds of the excess |
5 |
9 |
the next two thousand pounds of the excess |
7 |
0 |
the next five thousand pounds of the excess |
8 |
3 |
the next five thousand pounds of the excess |
9 |
0 |
the remainder of the excess |
9 |
6 |
(2) The amount payable by virtue of any assessment in respect of surtax for the year 1939-40 made before the passing of this Act shall, by virtue of this Act and without more, be treated as varied so as to accord with the provisions of subsection (1) of this section.
8 Alteration of certain reliefs.
(1) Subsection (2) of section forty of the Finance Act, 1927 (which, as amended by section nine of the Finance (No. 2) Act, 1939, provides for the reduction of the tax remaining chargeable after the allowance of other reliefs by a sum equal to one half the amount so remaining chargeable or one half the tax on one hundred and sixty-five pounds, whichever is the less) shall have effect as if for the words ‘one half’, in both places where they occur, there were substituted the words ‘seven seventeenths’.
(2) Subsection (2) of section fifteen of the Finance Act, 1925 (which, as amended by the said section nine, provides that where an individual or his wife is of the age of sixty-five years or upwards and his total income exceeds five hundred pounds, the tax payable by him shall not exceed a sum equal to the aggregate of the amount of tax which would have been payable if his total income had amounted to but had not exceeded five hundred pounds and one half of the amount by which his total income exceeds five hundred pounds) shall have effect as if for the words ‘one half’ there were substituted the words ‘three quarters’.
(3) Subsection (2) of section nineteen of the Finance Act, 1935 (which, as amended by the said section nine, provides that the tax payable by an individual whose total income is less than one hundred and forty pounds shall not exceed three...
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