Income Tax and the Basis of Assessment of Insurance Offices

Extract

The first Income Tax proper was the Income Tax Act of 1799 imposed by Pitt as a more or less temporary measure intended to finance the war with France.

Subsequent amending Acts were passed in 1803, 1805 and 1806. In 1816—just after Waterloo—the Tax was abolished and remained in oblivion for 26 years. In 1842 it was resuscitated by Sir Robert Peel, who was responsible for the Income Tax Act of 1842, and the Tax has remained in force ever since as a permanent and increasingly important part of our financial system. Of the Acts subsequent to 1842 the most important is the Act of 1853 when Gladstone left his mark on the Tax in several important particulars.

Up till 1860 the annual Act by which the Tax is imposed was known as the Income Tax Act. From that time onwards—in order to make it more difficult for the House of Lords to exercise their constitutional right to reject money bills—the Tax, along with several others, was incorporated into one Act called the Customs and Inland Revenue Act. In 1894 the title was changed to the Finance Act, by which name it has been known ever since.