I move: That the Dáil agree with the Committee in Resolution No. 4:
(1) That, where a person has ceased to hold an office or employment and a pension, annuity, or other annual payment is paid to him or to his widow or his child or any of his relatives or dependents by the person or the heirs, executors, administrators, or successors of the person under whom he held such office, or by whom he was so employed, then such pension, annuity, or other annual payment shall, notwithstanding that it is paid voluntarily or is capable of being discontinued, be deemed to be income for the purpose of assessment of income tax and shall be assessed and charged under Schedule D of the Income Tax Act, 1918, or under Schedule E of that Act, as the case may require.
(2) That to remove doubts it shall be declared and enacted that the word "annuity," and the word "pension" in the charging provision of Schedule E of the Income Tax Act, 1918, shall include and be deemed always to have included respectively an annuity which is paid voluntarily or is capable of being discontinued and a pension which is so paid or is so capable.
I do not know whether the House wants me to explain the purpose of this Resolution. It deals with a case that was heard in England recently. The House of Lords recently decided, in the case of an annual pension of £500 paid to a retired headmaster of a college which under the college statutes the warden and council had power to pay in their discretion and which they might if they chose discontinue, was not assessable to income tax. The clause here is designed to remedy this position. The case for it is that the pensions in such cases are paid in respect of past services and the clause merely gives effect to the practice which has been in force for very many years and which up to now has not been challenged in the Saorstát. Sub-clause (1) deals with the case of ordinary pensions payable voluntarily by private employers, commercial concerns, schools, etc. It is not in any way retrospective. Sub-clause (2) deals with pensions and annuities payable out of public funds. While the decision which I have quoted above, which, of course, is not binding here, did not deal expressly with public pensions it raises doubts as to whether pensions payable by the State which, in a technical sense, are capable of being discontinued, might not be held by the Irish courts to be exempt from income tax. The declaratory clause is intended to remove these doubts and is expressly made retrospective to obviate any possibility of claims for repayment being put forward in respect of tax deducted from public pensions in past years. It will be noted that the clause merely declares the law to be what it has always been understood to be in the Saorstát.