Sir Henry Mildmaysaid, the tax under this bill imposed upon legacies to children, could be considered in its operation only as a tax upon landed property. If a man had 4000l. annual rent from his land, with a numerous family to support, a very small part of it would be apportioned to the younger children in the will of the parent, and those who were protected during the life of the father, under the patrimonial mansion, when they were driven into poverty by the awful event to which he had adverted, were to be rendered subject to this new imposition. Estimating their fortune at 4000l. their income could not exceed 200l. and besides the income Tax to be deducted from this small pittance, they must make a further sacrifice the first year of 40l. Another objection to the tax was, that instead of tending to discourage celibacy, it imposed a tax upon population, and the more numerous the progeny, the weightier the burthen. The house had lately shewn the influence of its humanity towards mules and cart-horses, he hoped it would not be less indulgent towards the children of the state. The tax, in every point of view, was unjust and impolitic, and he should propose an amendment, in order that younger children might be relieved from the pressure of this imposition.
§ The Speakerinformed the hon. member that no amendment could be proposed till after the house had agreed to the third reading of the bill.
§ Lord George Cavendishobserved, that it would operate as a check on persons giving away property, and though there were none that reprobated more than he did the practice of giving away property to the prejudice of those to whom it properly belonged, yet there were instances when such legacies were highly proper and necessary to the discharge of the duties of humanity and gratitude. His lordship appealed to the experience of the mercantile part of the house. There were many foreigners in this country who had either made fortunes by their long industry, or inherited them from the industry of their fathers, and whose long industry here, and the habits they had acquired, had detached them from any relations on the continent. These would very naturally leave their property to the friends they had formed in this country; and it was hard, he 91 thought, to lay such a tax on this expression of friendship. The question had not been sufficiently canvassed. He concluded, therefore, by urging the propriety of postponing the third reading, that they might have farther time to give the subject due consideration.
§ Mr. Spencer Stanhopesaid, he had as large a family to maintain as almost any gentleman in that house, with the exception of the hon. baronet (sir Henry Mildmay,) yet he should oppose the tax, from pure and disinterested motives. On every principle of taxation, to which he had attended, he should object that the younger children should be taxed, and that the elder should on free, who were best able to answer the public demand. It was, however, some satisfaction to him to discover, that there were various ways of avoiding this imposition; and he could assure the hon. gent. that he should not pay one farthing to the tax, from the duty he felt to provide for his family. He would say nothing of the distress of the times, of the calamities during war, of the aggravated system of taxation; he did not wish to oppose the minister, but he flattered himself, in resisting this tax, he did him an essential service. He had formerly read a book, entitled, "Private Vices, Public Benefits," and the advantages of general intoxication were insisted on in that work as a great source of national revenue. The waste and profusion of a general election were likewise contended for as conducive to the public interests, by enlarging the income of the state. It was on some such principles that the present tax could be justified. The inequality of the tax was another objection. It was peculiarly directed against the ill-favoured, and against the ancient maiden, against the diseased, the lame, and the blind. These were more properly objects of pity, than of taxation. If the tax were to be imposed, the two first years of the income of it ought to he laid out in hospitals and nunneries, that the objects of it might be permitted to starve decently. He had said, the tax might be eluded. It does not extend to Irish property; and a father, by investing his money in the Irish funds, would avoid it. Again, fathers seeing the consequence, of this tax, would leave the fortunes of their younger children to the duty, fidelity, and honour of the eldest, who would provide for his brethren according to the wishes of his deceased parent. Further, the father might in his dying hour dispose of his property to his children by gift, and exclude them from his will. He hoped the 92 right hon. gentleman would not persevere in a tax directly opposed to every principle of state policy, justice, and humanity.
The chancellor of the Exchequeradverted with great precision to different arguments that had been urged against the bill; but our limits will not allow us to follow him at great length. As the house had already decided on the general principle of the bill, he did not think it necessary to go into it at so much length as otherwise he should have felt it his duty.—The noble lord opposite, (lord G. Cavendish) had objected to the clause relating to such legacies as were left to absolute strangers; but surely no part of the bill could be considered less obnoxious than that. In this case the advantage was unexpected, and it was natural to suppose that persons under this impression would part, without much reluctance, with such a portion of it as the tax required, and at any rate their claims to it must be considered much less strong than in other cases it would be. The attack which had been made direct legacies, he conceived to have proceeded from misapprehension, or a very partial view of the subject. Much had been said of its falling heavy on the younger children of a family, but when gentlemen used this language they seemed to forget that the tax was very trifling in itself—not more than one for a hundred. Suppose a father should wish to leave to a younger child a legacy of 5000l. it would be easy for him to add 50l. to this sum for the payment of the tax, and so in proportion with any other sum, taking the addition from what would have otherwise belonged to the eldest, so that in this case the younger branches of the family are completely exempted, and the tax comes from a quarter that is best able to bear it. An hon. gentleman had supposed, that in order to evade the tax a father might be induced to leave the provision of the younger part of his family to the generosity of the oldest, but of the two alternatives he thought the one he had just mentioned the most likely to be adopted. It had been objected also to the measure, that it affected the provision made for a family at the death of the father, while any settlement made during his life was exempted. The object of the measure was certainly not to affect transactions, though the propriety of such a measure might open a wide field for discussion, but transactions were in many instances taxed ad valorem. It was urged that it would fall heavy on the landed part of the community, as it might be necessary often to dispose of the legacy, in order to 93 be able to pay the tax; but a landed proprietor might always find some savings from which he could annex to the legacy the sum necessary to pay the duty. The monied man in this respect, could be no loss, and even suppose the landed man had not the means of leaving the ready money for the purpose he had mentioned, the 50l. he still supposes the legacy at the value of 5,000l. could be raised by insurance at not more than 30s. or 40s. a year, according to the age of the person insuring. On the whole the right honourable gentleman did not think that objections that had been stated, ought to make any impression on the house, to the prejudice of the bill.
§ Mr. Greyobserved, that if he was disposed to enter at large into the bill before the house, the speech of the right honourable gentleman furnished him. argument enough to prove the injustice of the tax. The general heir of landed property was exempt from its operation, whilst personal property was subject to it. He did not disapprove of the exemption, but he must say, that a direct tax on capital (as this was) would necessarily discourage that enterprising spirit in commerce which was so essential to its extension. He considered the tax also objectionable in a mixed monarchy like ours, in which the Aristocracy constituted one of the branches; but this must be sustained by property, for without it there would be little importance attached to rank. But, said the right honourable gentleman, (Mr. Pitt) landed property is not chargeable 'with this ditty; he agreed that it was not chargeable in words; but was it not so in substance? The right honourable gentleman referred to the prudence and tenderness of fathers, and argued that they would leave the legacies to younger children free from this tax. If they did so, how was it to be done? By charging the amount of this tax on the legacies granted, to the estate of the eldest son. Thus it was evident from the words of the chancellor of the exchequer, that the operation of the tax would be eventually on landed property. He contended, therefore, that the house ought to pause and reflect seriously before it acceded to a measure, which, by indirect wording, would have the effect of a positive duty on the land throughout the kingdom. He begged to remind the right honourable gentleman, that taxes of this description had been always censured by those who had written and thought most upon subjects of this kind; it should not be forgotten that they ascribed the imposing of them to evident symptoms 94 of a decline; this is was not only true in the abstract, but confirmed by the experiences of ages, and the history of those countries Which fell to rise no more. But if he objected to the bill on this ground, he was still more averse to it in a political view. In a mixed government, like this, the credit of an hereditary aristocracy could only be kept up by great possessions and extensive influence. These possessions and this influence were both attacked by the bill, which, for the first time, attached to legacies of land, as well as to personal property. Such taxes had ever been condemned by the wisest political economists. They had always been considered as evidences, when resorted to, of a declining state. He hoped and trusted that such was not yet the situation of this country; but it was impossible for any considerate man to see such taxes introduced without a considerable degree of anxiety. The tax was one of the most glaring inequality. It was indeed a direct tax on misfortune, and calculated to aggravate affliction. Every fresh death called forth its operation; and it was impossible to say how often or to what amount it might be paid. The right honourable gentleman's argument, therefore, of the smallness of the sum to be paid, was altogether nugatory. He fully entered into all that had been said about the hardships to which it would subject a younger brother. The right honourable gentleman had said, that if their portion was in land they would not be called on to pay. This was mere evasion; for every one knew that small divisions of land were not nearly so valuable, and therefore the younger brothers would have a strong temptation to sell their shares, even at a very disadvantageous price. But the right honourable gentleman had further contended, that a small additional sum would cover the tax, and remove the difficulty complained of. What was this but in other words to say, that the land was to pay the tax, and if so, why did not the right honourable gentleman propose the tax in this direct form? He strongly condemned the bill, as establishing a monstrous difference between heirs by settlement, and heirs by birth and consanguinity. This was an objection which had great weight in his mind. It was contrary to every principle of justice to place those on a worse footing, who derived their rights from nature, than those which arose out of positive appointment. The honourable member then replied to the defence of the right honourable gentleman, grounded on the smallness of the imposition. He said, with much artifice the principle of 95 this tax had been enforced upon the house, and the intention seemed evidently to be, to carry its operation much farther, so that neither the monied, nor the landed interest, could be able to ascertain what new sacrifices would be required under the pretence of supplying the demands of the state.
§ Dr. Laurenceasked, whether those sums which were to be distributed among the next of kin, when there was a will, should not be liable to the tax, as well as legacies mentioned in the will?
The Chancellor of the Exchequerreplied, that that would, be a subject for future consideration.
The question was then put on the motion, that the bill be read a third time, which was carried in the affirmative.
Sir H. Mildmaythen proposed an amendment, that all the clauses in the bill directly affecting legacies to younger children should be left out. On this a division took place; for the original motion 164—Against it 72—Majority for the bill 92.