§ Mr. Gillonrose to bring forward the motion, of which he had given notice, for the abolition of the duty on soap. He begged it to be understood that he was induced to take up the subject from no feeling of hostility to his right hon. Friend, the Chancellor of the Exchequer or to the Government, but simply from the conviction that the duty on soap was one of the most oppressive and impolitic that could be imposed. In bringing the subject forward, he calculated confidently upon the support of all the Radical Members, because the measure, if carried, would tend greatly to benefit the poor; and he calculated not less confidently upon the support of the Conservatives, because he remembered that last year they (the Conservatives) brought forward a similar proposition, in opposition to the reduction of the duty upon newspaper stamps. It was his duty in the first place to show that the state of the revenue was such as to admit of the reduction he proposed, and which he admitted was considerable. It appeared, then, that the surplus revenue, on the 6th of January last, amounted to 2,570,957l., and that the duty upon soap in the course of the year produced a gross revenue of 977,067l.; a net revenue, after deducting the drawback the expense of 742 collection and other charges, of 779,067l. So that after deducting the whole clear revenue paid into the Exchequer arising from the duty on soap, there remained a very considerable surplus of revenue available to the right hon. Gentleman for relieving the people from any other particular burthen which might press heavily upon them. Another reason why the duty on soap should be repealed was, that whereas the duty had gone on rapidly increasing with regard to other articles connected with the excise, the duty on, soap was rapidly decreasing. The strongest proof of this was to be found in the fact, that the quantity of soap on which duty had been charged in 1836 was less than 1835; whilst the increase of consumption on other exciseable articles as bricks, glass, malt, paper, spirits, &c— had caused a surplus, even after the reduction of the paper duty, of about 1,200,000l.
During the last year ending in January, 1836, there had been a decrease of the sum paid into the Exchequer for duty collected on soap from one to two per cent, and during the quarter ending the 5th of April following the decrease had been considerably greater. This had occurred whilst the country was in a state of unexampled prosperity. The only way, therefore, to account for it was, that the population had been supplied with soap by the smugglers. The facilities for smuggling were many: 1st, the concentrated nature of the alkali now used, as compared to that formerly employed. 2d, the great temptation held out to smugglers — the cost of materials being 57l. 5s., of labour, (including coals) 7l. 5s., duty 35l.—100l. for common brown soap. 3d, the number of small manufacturers who took out a licence with the sole purpose of smuggling. 4th, the fact that there were three thousand candlemakers, who had all the utensils and materials on whom there was now no excise survey—these could all smuggle if they chose: 5th, the facilities of intercourse with 743 Ireland where there was no duty. The report of the commissioners showed the system of smuggling going on there, and the annoyance thereby created to the owners of vessels, who were obliged to give large bonds, and incur heavy losses, from the fraud of other people. So that to defraud the revenue of 35l. an expenditure of 7l. 10s. only in labour was required. Another objection to the duty on soap was the very obnoxious nature of the excise regulations, which were a serious impediment to all improvement in the manufacture of the article. The absurd nature of the utensils required by law in the manufacture, and the time and labour lost in the process, were beyond belief. The loss by the absurd mode of taking the soap from the frames in one soap manufacture amounted to 600l. per annum for duty alone. No one could venture to make experiments under the excise regulations, as, even if not charged with duty on the quantity spoiled, it was impossible to keep the result of them secret. Candles were now made by machinery. The restrictions that now existed were Originally imposed in the reign of Queen Anne; but many of them were so utterly impracticable that an open and avowed collusion took place between the Excise-office and the manufacturers, which must necessarily, and in no small degree, tend to promote fraud on the revenue. Again, the duty on soap very seriously interfered with our foreign trade in that article. There had been a very material progressive decrease, during the few past years, in the amount of exportation. The export of soap amounted in
lbs. Quantities of soap charged with duty in 1832, before reduction of duty 143,000,000 Ditto, in 1834 152,000,000 11,000,000 Rates of increase per cent, nearly 8, In 1835 the quantity charged with duty was 160,000,000 Being an increase of 4 per cent. on 1834. The drawback on exportation did not cover the excise duty since the withdrawal of the tenths; besides which, there was a customs duty on the raw materials. Together they amounted to nearly 3l per ton. The British manufacturers were met in the market by the Americans, who being totally free from all excise restrictions, and also from all custom duties on the mate- 744 rials imported necessary for the manufacture, completely drove the British manufacturers out of the market. The latter were also successfully competed with by the French, in the manufacture of the finer descriptions of soap. There was another argument which he wished to press upon the attention of the House. Soap formed a very material ingredient in many of our manufactures; the duty, therefore, on that article was a circumstance that essentially affected the interest of those other branches of manufacture. The drawback paid to manufacturers in 1835, was 54,000l.; the amount of duty paid on the soap used was 74,000l. The manufacturers, therefore, paid 20,000l. duty on soap, besides the increased cost of making it under our excise laws. Besides this, the manufacturers were in the habit, in order to avoid the annoyance and trouble of having their books examined by excise officers, of mixing together pure alkali and oil, and thus forming an imperfect soap, the quality of which was very inferior, but which at the same time paid no duty. One house in the paper trade used to pay 600l. for soap, who did not now purchase a single pound. Beyond this, there was another interest which would be benefitted to a very considerable extent by the abolition of the duty on soap; he meant the agricultural interest. In consequence of the heavy duty, all except the richer classes used an inferior kind of soap. But were the duty repealed, there was no doubt the consumption of the finer qualities of soap, manufactured from tallow, would be greatly increased, and thereby a considerable spur would be given to the agriculturists. But the most important point of view in which to put the case, in advocating the abolition of this tax, in his opinion, was, to show that it was a tax which operated with very unequal pressure on the different portions of the population, and with the greatest severity on the poor. The excise duty on a ton of soap was 14l., and the customs duty on the materials might be stated at 3l. more, making together a duty of 17l. on a ton of soap. Now, the cost of a ton of soap used by the poorer classes, was about 40l., the duty being, as he had said, 17l. The cost of a better kind of soap was 60l. a ton, the duty still being 17l.; while the cost of a ton of perfumed soap, which was consumed by the rich, was about 100l., still bearing a duty of only 17l.; so that the 745 duty of the article consumed by the poor man, amounted to not less than forty-five per cent, of the whole price; while the duty on the article consumed by the rich man, bore only the proportion of from fourteen to twenty per cent, on the whole price. He thought he could not bring forward a stronger reason for the abolition of this duty, than thus to show the inequality of the pressure. Unlike the duty on tobacco or on spirits, which affected only certain portions of the community, the duty on soap was a tax that interested every class. With regard to the duty on tobacco or spirits, the only question with the Chancellor of the Exchequer was, how high ought the duty to be, consistently with the realisation of any revenue at all; but, with respect to soap, there were other considerations to be attended to; for there was not an individual, from the highest to the lowest, who would not derive a benefit from the abolition of the duty on that article. So great would be the competition in the manufacture of it, that the benefit of the abolition would not go into the pockets of the manufacturers, but would go wholly to the public. It would not be difficult to show, that the abolition of the duty was much more preferable than a reduction of it, because if any portion of the duty were retained, the whole of the machinery for collecting that portion, and for protecting the revenue, must be kept up. The expense of repaying the drawbacks was very great, and the present system gave every facility to fraud. By abolishing the duty, this expense would, of course, be saved. In 1835, the gross duty was 977,122l., while the drawbacks on exportation on manufactures in Ireland amounted to 198,009l.; leaving a net revenue of 779,113l. It must be observed that there were two descriptions of drawback—one paid by the customs on soap exported, and the other by the excise to manufacturers, and requiring distinct sets of officers. It had been said, that the soap duty was reduced in 1833, and therefore other trades ought to have a preference over it in 1837. But to this he would answer, that the reduction of the duty in 1833 was made in consequence of the proved existence of smuggling. But the improvements in the manufacture of alkalies, which were then commencing, had placed the trade in a worse situation with respect to the smug- 746 gler than it was at that time. The facilities for fraud were now greater than ever, which was acknowledged by the Commissioners of Inquiry in their seventeenth Report. It was also said, that glass ought to be relieved in preference to soap. But flint glass had been reduced to a great degree, and sufficiently to prevent smuggling. No one complained of fraud in window or plate glass. The expenditure of labour to make either the one or the other was six or seven times greater than that required for soap, and the difficulty and danger in transmitting it was such as to prevent an extensive illicit trade. The duty on the consumption of glass was rapidly increasing. It was in 1832 745,000l., in 1833, 862,000l., in 1834, 922,000l., in 1835, 966,000l. Notwithstanding a reduction of 2s. 3d., the duty on flint glass in 1835 was calculated at 155,000l. The manufacturers of glass did not apply for any reduction. The drawback was a bounty on the export trade, which enabled the manufacturers to compete with foreigners; and the reduction would only benefit the wealthy, and not in the slightest degree the poor. The cost of the materials, labour, and duty on plate and crown glass, and on soap, stood thus:—
1830 to 14,657,666 lbs. During these three years there was a bounty on exportation equal to the customs duties. 1831 to 15,506,561 lbs. 1832 to 22,078,000 lbs. 1833 to 25,650,868 lbs. Year of the reduction of the duty and the abolition of the bounty. 1834 to 23,718,273 lbs. 1835 to 22,946,674 lbs. Therefore, to defraud the revenue of 33l. in the manufacture of glass, required an expenditure of seven times the labour necessary to defraud it of 35l. on soap. The manufacture of glass required a bulky apparatus, and glass could only be made where coals were cheap. Soap, on the contrary, could be made in a few hours. The apparatus and the materials were in the possession of every candle-maker in the kingdom; the process was simple, so that two tons could be easily made by a man and his son or assistant, in a week. He had always considered this to be a most unjust and oppressive tax; and he trusted he had shown that the revenue of the country was in so flourishing a condition as to enable the Chancellor of the Exchequer to dispense with it altogether. No doubt the right hon. Gentleman would be called upon to afford relief by the reduction or abolition of other taxes; but 747 it was his (Mr. Gillon's) conviction that there was no tax which was more urgent or which called more immediately for repeal, than the duty on soap. If his Majesty's Government would consent to this proposition, they would thereby confer a been on all the productive classes of the community, and contribute materially to the health, comfort, and happiness of the population at large. The hon. Gentleman concluded by moving for leave to bring in a Bill for the abolition of the soap tax.
Glass. Soap. Materials 14l. per cwt 57l. 5s. For Common brown soap at 40l per tone. Labour, including coals 53 7 5 Duty 33 35 0 £100 £100 0
§ The Chancellor of the Exchequerwas not inclined altogether to discountenance such discussions as the present. It was quite right that hon. Members who had turned their attention to particular subjects connected with the taxation of the country should lay their views and plans before the House, in order that when the general financial statement was proposed, the different claims to relief might be fully, fairly, and deliberately considered. He hoped, however, that the hon. Member, having made his statement, would follow the example of his hon. Friend, the Member for Worcester, when he brought forward his motion on the subject of marine insurances, and not call for an immediate decision on the case which he had made out. Indeed, if he were to call for an immediate decision, on the ground, for instance, of the present state of income and expenditure as he had stated it, the House would necessarily be led astray, as they must proceed not only on wholly inadequate grounds, but on grounds which were delusive and fallacious. Undoubtedly the revenue of the quarter showed a given amount of surplus, but that was anything but a fair criterion to go by as to the state of the whole financial year. The tea duties had been paid by anticipation last year, and there would therefore be a deduction in that respect. Nor did the receipts of the malt-tax last year afford any ratio of the receipt for the present. That item would be considerably less. much less, than the corresponding one last year. He thought this would be enough to induce the hon. Gentleman and the House, without prejudice, to postpone the decision of this question, and, as they would in their own private affairs, not decide what they would do with their revenue till they knew exactly what income they had to deal with, and what expenditure they had to provide for. He was ready to 748 agree in many observations that had been made, particularly with respect to the excise regulations. They were arbitrary and complicated, and subjected the manufacturer to great and unnecessary inconveniences. The customs regulations had already been much improved, and it was his intention, if he continued in the office he now held, to bring in a Bill to consolidate and simplify the whole of the excise law. The expenses of collection, too, might in his opinion very well be reduced; but, without entering upon these points at present, and leaving intentionally the argument of the question altogether untouched, he called upon his hon. Friend not to press this matter to a division until the general financial statement had been submitted to the House.
§ Mr. Humeagreed with the arguments brought forward by the hon. Member in favour of the reduction of the duty. The tax upon soap formed a great impediment to the extension of the manufacture; and though the materials from which soap was made were cheaper in this country than in the United States, Canada, and many parts of the Continent, the increase in our exports of this article had borne no proportion to the increase in the trade of countries possessing far inferior facilities. We were precluded from carrying on a valuable trade to all parts of the world by a set of duties which prevented the application of science and industry to the processes of the manufacture. It was well known, that under the present system, the manufacturers sustained the most ruinous losses, and that failures occurred in consequence every clay. No article of domestic consumption, except food, was more important than soap; and it formed a serious item in the expenditure of a poor family. He thought that the Chancellor of the Exchequer, whatever might be the available surplus, should take off this duty, as being one which would give relief, not only to the fair trader, but to the whole of the community. If there should be a deficiency in the revenue from its repeal, there were fifty other ways of raising money with much less injustice to the public, and much less injury to property.
§ Mr. Haweswould have been better pleased with the statement of the Chancellor of the Exchequer if the right hon. Gentleman had discovered a disposition to place greater reliance on the statements 749 of the Commissioners of Excise Inquiry, who recommended the reduction of this duty. It was at present utterly impossible to levy it equitably, and to make each of the manufacturers contribute his fair share to the revenue. The means of effectually evading the tax were in the power of every one, and the Chancellor of the Exchequer was bound to abandon it, unless he could point out a method by which its collection could be insured. This country was better situated for carrying on this branch of manufacture than any other; it was one which could not be carried on without materially benefiting every class of the community, and, at the same time, greatly augmenting the general commerce of the country; yet, although population and wealth had rapidly increased, this branch of the revenue had been considerably diminished, which, to him, was a most satisfactory proof that the tax was impolitic and pernicious.
§ Mr. Gillonregretted that the Chancellor of the Exchequer had not given an explicit promise to abolish the duty. As he saw no chance of carrying his motion, he would not press it to a division.
§ Motion withdrawn.