diff --git a/Tag.cpp b/Tag.cpp
index 316e781..600b274 100644
--- a/Tag.cpp
+++ b/Tag.cpp
@@ -145,7 +145,7 @@ namespace jet {
 	       __ifrow _ifrow(in, out, global, this);
 	       continue;
 	    } else if(ifTagName(in, "include")) {
-	       __include _include(in, out, global, this);
+	       __include _include(in, out, global, parent);
 	       continue;
 	    } else if(ifTagName(in, "jet")) {
 	       __jet _jet(in, out, global, this);
@@ -157,7 +157,7 @@ namespace jet {
 	       __write _write(in, out, global, this);
 	       continue;
 	    } else if(ifTagName(in, "set")) {
-	       __set _set(in, out, global, this);
+	       __set _set(in, out, global, parent);
 	       continue;
 	    } else if(ifTagName(in, "call")) {
 	       __call _call(in, out, global, this);
diff --git a/__include.cpp b/__include.cpp
index 234bb61..1eb1302 100644
--- a/__include.cpp
+++ b/__include.cpp
@@ -5,6 +5,7 @@
 namespace jet {
    
    __include::__include(coreutils::ZString &in, coreutils::MString &parentOut, Global &global, Tag *parent) : Tag(in, parentOut, global, parent) {
+      resolveContainerParent = true;
       if(!variableDefined("file"))
 	throw coreutils::Exception("file keyword must be specified.");
       if(hasContainer)
diff --git a/__set.cpp b/__set.cpp
index 78cbea1..c7e2114 100644
--- a/__set.cpp
+++ b/__set.cpp
@@ -8,7 +8,6 @@ namespace jet {
    
    __set::__set(coreutils::ZString &in, coreutils::MString &parentOut, Global &global, Tag *parent) : Tag(in, parentOut, global, parent) {
       output = false;
-      resolveContainerParent = true;
       if(!variableDefined("name"))
 	throw coreutils::Exception("set tag must have name defined.");
       if(!variableDefined("expr") && variableDefined("value") && hasContainer)
diff --git a/tests/testinclude.jet b/tests/testinclude.jet
index c1a12cc..c4f8a09 100644
--- a/tests/testinclude.jet
+++ b/tests/testinclude.jet
@@ -1,2 +1,6 @@
+<set name="localvar" scope="local">This is a container set with '#[name1]'</set>
 This is from an include tag.
+localname='#[name1]'
 <set name="include" value="yes" />
+<set name="testinclude" value="x#[localvar]x" />
+test='$[testinclude]'
diff --git a/tests/testjet.jet b/tests/testjet.jet
index e16fcdd..7cdd5a6 100755
--- a/tests/testjet.jet
+++ b/tests/testjet.jet
@@ -39,6 +39,7 @@
  <set name="newname" scope="global">another container value</set>
  <include file="./testinclude.jet" />
  include: $[include]
+ localvar='#[localvar]'
  >>>$[noeval]<<<
  >>>$[thename]<<<
  <set name="iz" value="data" />
diff --git a/tests/testscope.jet b/tests/testscope.jet
index 3dcf55b..ffc6a51 100755
--- a/tests/testscope.jet
+++ b/tests/testscope.jet
@@ -1,5 +1,8 @@
 #!../jet-2.0
 <jet cgi="true" name1="localname" filterblanklines="true" trimlines="true">
+ <set name="name2" value="localname2" scope="local" />
  <set name="x" value="#[name1]" />
- $[x] $[x] 
+ localname=#[name1] 
+ localname2=#[name2]
+ localname through x=$[x]
 </jet>