INCOME AND PROPERTY TAX. (Hansard, 10 March 1845)

HC Deb 10 March 1845 vol 78 cc528-620 528

§ Report on the Property Tax Bill was brought up.

§ On the Question that the Amendments be read a second time,

§ Mr. C. Buller
rose for the purpose of moving the following Amendment:— That the circumstances under which the renewal of the Income Tax is at present proposed, are such as to render it exceedingly improbable that Parliament will have the power of dispensing with its continuance at 529 the end of three years; and that it is therefore the duty of this House to take care that the Tax be imposed in a form in which its operation shall be less unequal and inquisitorial than it now is. He said, that in bringing before the House once more the general question of the circumstances under which it was called upon to pass the Income Tax Bill, he could only say, that he was not attracted to the task by any peculiar interest that the House had shown in the subject—by any vivacity that had animated their discussions, or by any hope that he was to be backed by a vigorous and consistent course of conduct on the part of those who agreed with him in opinion. But there really appeared to have been so much more even than the usual amount of confusion in their debates—the more they had discussed the matter, and the further they had got into the measure, they had advanced so much deeper into a perfect maze of misunderstanding and inconsistency, that he was determined to give the House one opportunity of explaining to the country, and even to itself if it could, for what purpose—under what circumstances—on what principles—and for what period this tax was to be imposed. The expediency of imposing the tax at all—the form in which it is to be assessed—in fact, every question involved in the policy of the present measure—all turned on the one fundamental question of the period during which it is likely to be required; for on this one point depends whether they were to submit, in a moment of national exigency, to all the injustice and injury of a rough levy on each man's means, or whether they were to adopt a tax on property with all that equitable deliberation and nicety, which would be required to adapt so great a change to the feelings of the country and the general system of taxation. And on this most important point, their declarations and explanations reflected on a bewildered and anxious people no light but the pale and flickering gleams of their own general indecision and want of purpose. The right hon. Baronet alone seemed to have the settled purpose of getting his tax without amendment, and without discussion; and to pursue this object with undeviating constancy. All the rest of them appear to be mastered by his energy, and to be ready at his bidding, to vote a tax of which they all declared their disapproval—on grounds which they all declare to be untrue. As far as he could judge, for 530 instance, the great body of the Gentlemen opposite seem to be generally averse to an Income or Property Tax altogether; and had declared, with their usual independence and self-reliance, that they would never consent to the renewal of the tax, if the right hon. Baronet had not assured them that it would not be wanted beyond three years. Never was so much hope hung upon so very faint an assurance; for when the right hon. Baronet was pushed on this point the other night, all they could get from him was, that he did'nt despair of doing without the Income Tax at the end of three years. And such is the touching confidence of his supporters—who have, they say, had great reason to rely on his professions—that on this assurance of an absence of despair, they venture, in the face of facts the most glaring, and probabilities the most startling, to vote for the tax, without really one ray of hope of being relieved from it at the end of three years. On this side they were a little more shrewd than to rely on any human assurances on such a matter; and saw that the financial policy of the right hon. Baronet must necessitate the continuance of the Income Tax beyond the period for which he now asks it. But his Friends were not a bit more consistent. For though enamoured of the Property Tax, they feel the injustice and oppression of the tax on fluctuating incomes; and they declare, that if it is to be permanent, it must be most materially modified. Yet they vote for the Budget, which they see will make the tax permanent, and take no pains to effect any of the necessary modifications. But with all due respect for his noble and right hon. Friends on the front Bench below, he grieved to say he could not but think that when they had so completely demonstrated the vices of the Income Tax, they might just as well have voted against it; and that when they had shown that it must inevitably be permanent, they might just as well have taken some pains to bring it into a less oppressive shape. It would be useless on the present occasion to attempt to disguise that dissent which he had often expressed from the very general opinion in favour of direct taxation. That there is very great justice in many of the abstract arguments in favour of direct taxation, which had been so ably stated by his Friends on this side of the House, he did not at all dispute; and in truth, he might not be altogether disinclined to think that it would be wise and just to take great 531 pains to devise some equitable scheme of direct taxation, did it appear possible by that means to raise a large proportion of our revenue. But it must always be borne in mind, that they are obliged to raise at least fifty millions every year. Now it did not seem that his Friends had ever sufficiently considered what proportion of this total amount it would be possible to raise by direct taxation. It must not be forgotten that any Property Tax which may be imposed, is in truth an addition to a large amount already borne by us. A large proportion of the property of the country is charged with an amount of six or seven millions of direct taxes under the name of rates, and the tax-gatherer comes also for a considerable amount of assessed taxes. Taking all these things together, you may fairly say, that with an income-tax of 10 per cent., the tax-gatherer would come to a large proportion of the proprietary classes, and take directly in hard money not much less than a fourth or fifth of each man's income. This is carrying direct taxation quite as high as would, even in the present improved state of feeling on the subject, be very safe for public credit and the Public Service; and therefore the amount which could be raised by a tax of 10 per cent, and which they could hardly reckon at more than fourteen or fifteen millions, is the largest amount they could calculate on getting from an Income Tax. The great bulk of our revenue must, therefore, after all, be derived from indirect taxation; and such being the case, our first object must always be to ameliorate our system of indirect taxation. And while indirect taxation must be our main reliance, he was strongly inclined to make it our sole reliance in ordinary times; to reserve the fourteen or fifteen millions of possible Income Tax as our resource in great national emergencies; and to abstain from trenching on that fund except in periods of necessity. You can make neither Income nor Property Tax anything but unequal and vexatious; and it seems wise, therefore, not to resort to it except in those exigencies in which the excited feelings of the nation will induce men to submit to much injustice and vexation in order to give the Government the readiest and surest means of bringing a certain large amount of money into the Exchequer. And there is, undoubtedly, a great advantage, as a general rule, in letting the world know that this is a treasure held in reserve for great national exigencies; 532 for that knowledge will be more effectual in deterring aggression even than the fortification of our coast, or the augmentation of our naval force. However, he would not trouble the House with any further discussion of the merits of direct taxation, because he would fairly admit that there were exigencies besides those of war, in which he would have recourse to it. There are great fiscal experiments in the revision of our system of taxation, for the sake of trying which he would cheerfully submit to those evils for three years more, could he feel sure that it was only for that period. He spoke of such a revision of our taxation as all thinking men have long regarded as required by justice, and counselled by expediency; but which, whatever the probability of their ending in no diminution of revenue, no Minister would be justified in trying, without a certain margin of revenue to provide for the consequences of possible failure. Had the right hon. Baronet now come forward, and asked for the maintenance of the Income Tax, with a view to trying the experiment of a large and sound revision of our taxation, he would willingly have consented to subject the country for a while to the mischiefs of that tax, for the purpose of making a great effort to remove the greater mischiefs of our present unjust and impolitic system of taxation. The admirers of the present Budget say that this is precisely what the right hon. Baronet has in view in measures which they are pleased to laud as peculiarly beneficial to the poor, and advancing the freedom of trade. Nor was he at all inclined to deny that these measures are calculated to do great good; or to refuse praise to what was being done, were he not impressed with a strong conviction of their having flung away a great and rare opportunity of doing very much better. He did not complain that the right hon. Baronet had actually misapplied his surplus to bad ends; but that he had not made a sufficient use of the great opportunity which the possession of so very large a surplus afforded; for it is by far the largest surplus which any Minister has had to rely on for effecting a revision of taxation. With so large a surplus we are, for the first time, enabled to deal with the great articles of our taxation. With a surplus of half a million or so you can deal with any of the minor taxes; but it is only when you have a surplus of three or four millions, that you can venture to meddle with the great sources of our Revenue. The Minister, who 533 has the rare good fortune of having such a surplus, is bound to make an effort worthy of the means placed at his disposal, and not to fritter them away in a multiplicity of petty changes, which he may as well effect separately, and which he will have many an opportunity of so effecting. This is what he complained of having been done on the present occasion. The right hon. Baronet had the means of effecting a great, if not a perfect reformation in our fiscal system—of effacing its worst blots, and of permanently augmenting the Revenue by lightening its pressure on the people; and that golden opportunity he had for ever thrown away. The great scandal of our fiscal system is the raising so large a proportion of our Revenue by an undue taxation of the articles consumed by the masses, and which are either necessaries of life, or if luxuries, the luxuries of the poor. By imposing indiscriminate duties on the cheap articles destined for the poor, and the finer articles consumed by the rich, we in fact tax the expenditure of the poor at a far heavier rate than that of the rich; we cruelly curtail the scanty enjoyments of the poor, and we commit, at the same time, the gross financial impolicy of imposing taxes far too high even for purposes of revenue, and of thus checking consumption, and encouraging a fearful extent of smuggling and fraud. With respect to this very tax on sugar, which has of late been so much discussed, it appeared from the discussion on Friday respecting the famous question, which, after all, got no answer, that the average price of British Muscovado in bond is 34s. per cwt., which, with the proposed reduced duty of 14s., would give a price of 48s. the cwt. to the consumer, while the price of Brazilian Muscovado is 21s. the cwt.; so that taking duty and protection, we shall, even with our diminished rate of duty, raise the price of the poor man's sugar to more than double the natural price of the article. The common kinds of tea cost 9d. a pound, the duty is 2s. 1d.; so that here by the tax, we raise the amount of the poor man's luxury to near four times its natural amount. That of his coffee you more than double—that of his soap and malt you nearly double. The duty on tobacco varies from six to sixteen times the prime cost of the article. That on foreign brandy is 22s. 10d. per gallon on an article which without the duty sells for 4s., being a duty which raises the prices of the article more than six-fold. The same duty on foreign gin raises the price twelve-fold. These 534 duties on sugar, tea, coffee, soap, and malt, are heavy taxes on those enjoyments of the poor which we should most encourage. They diminish their limited enjoyments, not merely by depriving them of the power of purchasing, but by causing extensive adulteration, and the substitution of inferior articles. Tobacco and spirits he would not deny to be proper subjects of taxation to the utmost extent to which it can be carried for the real interests of the Revenue. But he looked at the present taxes on these articles to be the very worst that we have, because they are carried preposterously beyond the rational limits of taxation, and consequently produce a fearful amount of evil in extensive smuggling, and wholesale adulteration. All, or almost all, the demoralization, crime, bloodshed, expense, and arbitrary regulations by which the Customs' revenue is protected, may be ascribed to these two taxes. The valuable Report of his hon. Friend the Member for Montrose on the tobacco duties presents a picture of fraud that is perfectly appalling; and it would appear that the result of our heavy duties, after providing due encouragement for a large race of smugglers and fraudulent manufacturers, is to ensure two-thirds of what is smoked as tobacco in the United Kingdom being a compound of deleterious substances, and about one-third only of the real tobacco paying duty at the Custom-house. The diminution of these heavy taxes should always be the first object with every financier of really enlightened views, and real regard for the great mass of the people, partly to put an end to the mischiefs of smuggling and systematic frauds, partly to place some innocent luxuries within the poor man's reach. There is not one practical authority, there is not one economical writer, who has not counselled the reduction of these taxes as those on which it is most probable that greatly diminished duties would, in addition to these advantages, produce as large a revenue as that now collected. Reduce the duties on spirits and tobacco, for instance, so low as to remove the inducement to smuggling and adulteration; and your Exchequer will get a duty on the immense proportion which is now smuggled, and that which will be required when the market is no longer supplied by adulteration; and besides this, you will save half a million per annum in the expenses of your coast guard. But then, the answer always is, that to produce any real effect, we must very greatly reduce all these taxes: and that it is not 535 safe to hazard the public credit on probabilities, however great, of increased consumption, in the case of articles which produce so very large a proportion of our revenue. To produce any good effect by lowering these taxes, we must lower them by one-half or two-thirds; and this is a dangerous experiment to try with taxes, each of which brings in several millions a year. For instance, the taxes on foreign spirits and tobacco, must, to try the experiment fairly, be lowered by at least three millions. This answer is very sound: these experiments ought not perhaps to be tried, except with a surplus of some millions; and it is but rarely that a Minister has such a surplus at his disposal. But the right hon. Baronet has: he is the first Minister that has had the opportunity of putting down the smuggler, and of benefiting the poor by reducing the great items of our taxation. And he has grappled with none of these articles, except sugar; and that he has lowered to the certain loss of the Revenue, and probably with very little benefit to the consumer, because he has sacrificed consumer and revenue alike to the interest of the West India planters. A Budget that had dealt with any of these great articles of taxation, would really have been a boon to the millions, and furthered the soundest views of finance. Had the right hon. Baronet dealt boldly and rightly, in reducing any of the great taxes, the probability is, that at the end of the three years he would have had the same surplus as he has now; that he would have been then enabled to repeal the Income Tax; and that we should have had all the advantage of a great and successful experiment in finance. For that it would have been worth while levying the Income Tax for three years, even to run what risk there would be of its continuation after that. But they offered no such experiment. They offer a reduction of taxes proper enough to be reduced, no doubt, but not so pressing as to interfere with the present application of the large surplus to a great financial experiment, and such a reduction of taxes as can by no possibility restore the revenue. The Government told them very gravely, that they were to leave them the entire liberty of repealing the Income Tax at the end of three years; and the means which they offer is a Budget which sweeps off every farthing of revenue which, even with the aid of five millions of Income Tax, we have beyond our expenditure. They told them to rely on the Revenue recovering of 536 itself; but he found no one sanguine enough to entertain such hopes; and we must, therefore, look upon the present reduction of taxes as the only great experiment we shall ever have to try with the Revenue—the only return we get for rendering the Income Tax permanent. We were to purchase the permanent remission of certain taxes by taking the Income Tax as a permanent substitute. He confessed he saw nothing in the offer at all adequate to the price demanded. It had been said that this was eminently a poor man's Budget. Now, he had always observed that when anybody did not know what to say in support of any measure which he might have happened to propose, he invariably said that it was for the benefit of the poor man: and when some hon. Gentlemen on that side of the House had been determined to be delighted with the hon. Baronet's Budget, and scarcely knew on what ground, they said it was the poor man's Budget; but he declared he did not know how the right hon. Baronet had managed to reduce so many articles with so little direct benefit to the poor man. First, there was the sugar tax. Now, they were all agreed on that (the Opposition) side of the House, that they could not have reduced any tax with so little advantage to the interests of everybody except the West India proprietors. He believed that there was not any body on that side of the House, always except the hon. Member for Dumfries, who was so enamoured of the Income Tax that he would rather see the proceeds thrown into the sea than not have it—with the exception of the hon. Member for Dumfries, there was not one Gentleman on that side of the House who would consent to the continuance of the Income Tax for the sake of the reduction in the Sugar Duty. Was it the abolition of the auction duty, the reduction of which was to benefit the poor man? Was he to gain by the removal of the tax upon exports? He must confess that it seemed to him that the export duty must have been paid by foreigners, and that it was a very good thing to make the foreigner pay part of our taxes. But then there were the 420 articles of the Tariff. Now, he had looked at them all, and he could not conceive what the poor man was to gain. The right hon. Baronet would not give the poor man corn—he would not give him butter; but he would give him alum to adulterate his bread, and lard to adulterate his butter. Now, he did not know, unless it was, 537 perhaps, upon such articles as divi-divi, algandilla, and some other articles which nobody could tell him about, on what it was the poor man was to gain. It was true that he had never before heard of those articles; and he had no very longing desire to hear an explanation as to their qualities. Still, no one could pretend that they were articles much consumed by the poor, or that the poor would be much benefited by a remission of the price of them. Then there was glass. Now, he believed the poor man would not benefit so much by the reduction of the price, as he would by having a better article. It was, however, an important article; though not the most important. Then there was cotton. The Chancellor of the Exchequer, when very hardly pressed, had burst forth eloquently on the advantages which the poor man would derive from cheap fustians; and the First Lord of the Treasury had dilated at length upon the advantages which the poor woman would derive from a cheap cotton gown. Now, he never grappled with either of the right hon. Gentlemen upon any matter which concerned millions. He left such amounts to the First Lord of the Treasury and the Chancellor of the Exchequer; but when they came to pence he could calculate. Let them imagine, then, a poor man dressed from top to toe in fustian—that is to say, with a fustian coat, a fustian waistcoat, and fustian trousers. Now, let them consider this subject scientifically; let them come to weights and measures. He had made numerous inquiries, and had taken great pains to ascertain; and he had come to the conclusion, that at the outside the weight of this dress would be four and a half pounds. He had been told that he must make an allowance of an additional half pound for waste. That would give five pounds as the quantity of raw cotton employed in the manufacture of the suit of fustian. The duty on raw cotton was five-sixteenths of a penny per pound; therefore the poor man could save, on the suit, twenty-five-sixteenths of a penny, or one penny and nine-sixteenths. He then took the case of a woman's gown. In that he had also made inquiry. He made allowance for waste, and he found that it would weigh about two pounds; and the reduction upon each woman's gown would, therefore, be about three farthings. Supposing a woman, therefore, to have two gowns a year, she would save 1½d. per annum. The two—the husband and wife—would have to be grateful to the 538 Chancellor of the Exchequer, therefore, for a saving of 3d. a year. His (Mr. Buller's) own belief was, that they would never get their 3d.; for he believed that the poor consumer would never have a chance of getting this saving of 1½d. on articles which cost altogether 13s. or 14s. But even if the poor man did save 3d. a year, yet it must always be borne in mind that he would have to pay 3d. a month, in the shape of taxes, to the West India proprietors. There could be no doubt that reducing the duty on glass and cotton would be useful to the poor man, as the means of increasing his employment. In the reduction of the duty on glass, the most important effects would be the sweeping away of the restrictive system in the Excise laws. But, upon the whole, considering the present state of the labouring classes, he thought the right hon. Baronet would have done them a greater service by diminishing the taxes that raised the cost of the necessaries of life. It must be recollected that this could not have been done without increasing their employment; for a remission of taxes upon imports was as important in increasing employment as a diminution of the taxes upon exports. He did not believe that they could serve the cotton trade more effectually by sweeping away the tax upon raw cotton, than they would by sweeping away the taxes on tea; as that would enable the merchant to get a return from China. He could point to one or two other duties as most material for such an experiment; and although hon. Gentlemen might not agree with him in saying that the wine duties and the spirit duties were proper subjects for reduction, yet every body would agree with him that it would be well if, by reducing those duties, they could largely increase our trade with France, and establish commercial relations, instead of those of rivalry and hostility. He thought that by reducing those duties, they would do double good to the poor man, by diminishing the cost of the necessaries of life, and also increasing his employment, by facilitating trade with foreign markets. Now, he would turn from the poor man, who was always uppermost in their hearts, but for whose benefit it was a singular thing they never could manage in any way to hit upon a practical measure of relief—he would turn from the poor man to those who had to pay. It was constantly held out by the right hon. Baronet, that the reduction in duties which he was making was so great, that they 539 would make up the Income Tax. Now, that was the oddest delusion that so sensible a Gentleman could well fall into. But the very same thing was said when the right hon. Baronet brought forward the Budget of 1842. He (Mr. Buller) made all kinds of inquiries—he asked every person whom he met what he thought about the reduction caused by the hon. Baronet's Tariff. He said (to those who did not know him) that the right hon. Baronet was the greatest Minister they ever had—that he had lowered the price of everything; but he could never get a single person to agree with him. He could not find out the man who had made up his Income Tax by the Tariff. What could any man gain by the reduction? Provisions had not fallen a bit, except, perhaps, hams, ["Oh, oh."] The hon. Members opposite had not made an articulate sound, but there was much meaning in that inarticulate agricultural sound of wailing over diminished prices. He had no doubt the hon. Gentlemen suffered much by the alterations in the Tariff; but he could assure them that those who resided in towns gained very little. He had gone through a nice calculation upon the subject of sugar. He had taken the instance of a family having 500l. a-year. He found that they would have to pay 14l. 13s. 4d. for Income Tax—that was positive—there never was any mistake about that. If such a family then consumed forty pounds worth of sugar in the year, they might save 25s., taking it for granted that they would save one penny a pound. He would not adopt the right hon. Baronet's calculation of three half-pence, for he thought that in dealing with a Minister's calculations of the benefits likely to result from his measures, it would always be safer to take off than to add a farthing, as the right hon. Baronet had done. He would say, therefore, that perhaps such a family as he had been speaking of might gain a penny per pound; he did not think they would, but if they did gain 25s. a-year, that was to be set off against 14l. 13s. 4d. for Income Tax. Upon what else would they gain? He had gone over the articles of the Budget—he had referred back to see, if he could, anything else by which the taxpayer would benefit. He did once think they must take out the Income Tax in physic. He supposed that made the hon. Member for Finsbury (Mr. Wakley) so enthusiastic about the Budget, in hopes that the poor man was to be drugged with cheap physic. His (Mr. Buller's) belief, however, 540 was, that upon the interesting article of physic the druggist would pocket all the benefit. Well, next as to furniture. He would admit that there would be a great deal of saving upon furniture. If all England were composed of newly-married couples with a thousand a-year and upwards, he had no doubt that for a-year or two they would be able to make up the Income Tax. But, after all, was it not nonsense to call this a free-trade Budget, and to talk of making up the Income Tax when nearly all the great articles of general consumption—all the articles upon which a material saving might be made, were excepted from this free-trade Budget? The right hon. Baronet's free trade put him in mind of the freedom of the press at Madrid, described by Figaro in the play of Beaumarchais,— Provided," he said, "one says nothing of the Government, or religion, or politics, or morals, or of persons in credit, or of the public amusements, one might print what one liked, subject to the revision of two or three censors. So the right hon. Baronet, provided we did not offer to bring in any corn, butter, cheese, provisions, tea, coffee, malt, sugar, tobacco, or spirits, would allow them to bring in what they liked, subject to inspection and registration by two or three Custom-house officers. It was nonsense to call this a free-trade Budget; it was a monopoly Budget. What he always understood by free trade was, that it was the taking off protective duties. Which of the protected interests had the right hon. Baronet touched? He had touched the bristles and the lard of the great predominant interest, and some other twopenny-halfpenny articles; but he had not interfered with the protection of a single really important article. He did not interfere with any great interest; the only interest which he had at all touched was that of the West India proprietors, and he terfered with their protection only to raise it. The right hon. Baronet was doing the work of the monopolists most effectually. He was sweeping away the surplus which might have enabled him to give free trade to a considerable extent. For they could not eat their cake and have it too—they could not lose three or four millions, and keep the necessary surplus for the establishment of free trade. Although free trade would, in many instances, be putting money into the pockets of the Government, by taking it out of the pockets of the monopolists, 541 yet they could not deal with butter, cheese, corn, and other Foreign provisions; they could not hope to obtain free trade in any of the most important articles of general consumption without a surplus of two millions. It was, therefore, not the interest of the advocates of free trade to support a system which would sweep away the means by which any future Minister might be able to give the country the advantage of free trade. And, after all, what would they get? They got the remission of the duties on glass and cotton wool, by abandoning their warfare against (or rather weakening their power of assaulting) the protection system. Far better and wiser would it be for the trading interests to have stood firm to their old ground—to have rejected these immense boons at present, and to have taken advantage of the necessities of the Revenue to extort the removal of the protective system. This was the ground they took in 1841 and 1842; and this was ground for firm and enlightened men, conscious of the importance of the great principle for which they were struggling, and determined to resign the pursuit of it for no secondary gain whatsoever. But what is it they were doing now on their altered principle of bowing to the will of the right hon. Baronet as irresistible, and of tossing up their hats for every boon which he vouchsafed to dole out? Why, while they still talked of free trade as the first of human blessings, and dealt out their total and immediate anathemas on all who differed as to the mode of effecting a common object, they were doing the work of the monopolists, and voting the Income Tax to bolster up the system of protection. For let us, then, for a moment gravely consider the chances of ever again having such a surplus as the present. They could only hope for it from an increase of revenue resulting from a diminution of taxation. The Chancellor of the Exchequer seemed to take this as a matter of course. Now he had had the pleasure of sitting in that House with that right hon. Gentleman for fifteen years, and slowly and with difficulty had the very elements of these truths been forced on his mind. On every Budget which the Whigs had introduced, he had heard him urge the danger of lowering taxation for the purpose of increasing the Revenue. But when the right hon. Gentleman did go into a good principle, he must say he went with a plunge, head over heels; he was now not 542 only lowering taxes to increase the Revenue, but altogether abolishing them. Now he must check his ardour: he must remind him in that there were limits to the application of this principle; that it did not invariably follow that by diminishing taxation they gained much from the increased consumption of articles. Indeed, with a Budget like the present, which did not merely lower, but entirely repealed, so many duties, it seemed to him they might run a risk that the consumption of articles not paying revenue might cause a diminution of the articles which paid revenue. For instance, by sweeping away the glass duty, was there not a probability that part of the money spent in customable commodities before, might be spent in an increased consumption of glass? The present Government had had the advantage of some favourable years, and the duties had been gradually recovering. Although hon. Gentlemen opposite had talked so much of "Whig blunders," and the state of the Exchequer when the Whigs went out of office, the truth was, that the great cause of the decrease of revenue during the Administration of the Whigs was their having had three or four bad harvests. And what had revived the trade of the country now? Not the Tariff. The Revenue had not been raised to any considerable extent upon any of the articles touched by the Tariff, in consequence of increased consumption, but simply by three good harvests, the opening of the China, and the revival of the American trade. But the Budget had been calculated in a reliance on unchecked and increasing prosperity. But how would it operate in adverse circumstances? It might suit very well while the country was blessed with regular and abundant harvests; but he would ask, how was it calculated to meet the exigencies of the State if the harvests failed, and if those disasters to which trade was liable occurred at any time during the next three years? If such deplorable results occurred, in what state would the right hon. Baronet's Budget be in the year 1848? Would he then be prepared to come forward and state that in consequence of the increased productiveness of other branches of the Revenue during the preceding three years, he was prepared to recommend the discontinuance of the Income Tax? On the contrary, it was much more likely that he would be found coming forward, not with a proposition to remove the Income Tax, but with a demand for an increase of that 543 impost, or for some other source of revenue, to meet the deficiency which the Revenue presented. He would therefore say, that it was a fraud—a foolish fraud—for them to tell the country that they renewed the Income Tax with the expectation of being able to take it off at the end of three years. He would not, he firmly said, for such a Budget as this impose an Income Tax in any shape. But they had decided otherwise. Their confidence in the right hon. Baronet, and their admiration of his policy, induced them to accept the remission of the cotton, glass, auction, and miscellaneous duties, and the present scale of Sugar Duties, an an equivalent for a permanent Income Tax. Then they should put the Income Tax into such a shape as they thought it ought to be when made a permanent tax. He need not now recapitulate the objections which were made to the tax in 1842. He would only notice, then, so far as to show that experience had in no respect altered his opinion of it. He still thought the tax a grievously unjust tax, weighing with most unequal severity on the possessors of precarious and those of certain incomes: that this inequality is greatly aggravated by those difficulties in the assessment of the tax, which enable the dishonest to evade it, and which consequently aggravate its comparative pressure on the conscientious portion of the community: and that experience has shown that he had been right in his anticipations of the mischiefs resulting from the inquisitorial nature of the tax, and the arbitrary powers which are vested in a variety of irresponsible authorities. For though in London undoubtedly the tax had been administered with very great moderation and forbearance, yet from all parts of the country, especially from the north of England, he heard loud and general complaints of the abuses which have been practised by the local Commissioners towards rivals in business and obnoxious politicians. And though in all these respects he still thought it impossible to make any direct tax perfectly just, or to levy it without great annoyance, still it was quite clear that by care we might assess the tax much less objectionably. And now that they were making it permanent, this is what he said they were bound to do. He did not specify any particular alterations, though of course the principal one to which he pointed was the making some difference between fixed property and uncertain incomes. He purposely confined his Motion to the assertion 544 of a very plain, very practical, very pregnant principle, without stating it upon any one matter of detail. Every one who thought that justice required any material alteration of the tax ought to vote with him, that the tax might be made just and tolerable. His Motion was the foundation of many Amendments of the tax. He meant it to be so; for this rude measure of primitive taxation required many an Amendment ere it could be rendered decent to appear out in the ninteenth century. The right hon. Baronet objected that if we once begin with these Amendments, we should take a long time, and not have passed the Bill by the 5th of April. And what was the 5th of April, or any other day, compared to a just and reasonable distribution of a burden of five millions of taxes? The work which they had to do requires time: but it is worth it. Then again he said, they might as well pass the Bill as it is, and if they found it must be renewed they might improve it in 1848. But if they felt assured that in 1848 they should have to renew and amend it, why not amend it now when they were renewing it nominally for three years, really for many more? Why bear remediable injustice and oppression for three years? If his shoe pinched him, he might bear the pain for an hour, if at the end of that time he was going to bed: but if he knew that he was to be moving about for the next twelve hours, why should he not change his shoe at once, instead of being in pain for the hour, at the end of which he must take the trouble of putting on another? And lastly, the right hon. Baronet says, that if this Amendment were carried, he might not be able to spare revenue enough for the repeal of some taxes. His answer was, first, that he did not prevent the right hon. Baronet's getting the necessary revenue by other means: and, secondly, that even if he did force him to keep on any one of those taxes, there is none of them of which the oppression and impolicy is half so great as that of the bad parts of the present Income Tax.

§ The Chancellor of the Exchequer
said, the hon. Gentleman who had just concluded his address, had commenced by observing that there was, both in the House and out of doors, a degree of doubt and an absence of determination and firmness upon the subject of the Income Tax, for which he could not account; and which he thought in particular unbecoming on the part of 545 the Representatives of the people of that kingdom. The hon. Gentleman, in order to rescue the character of that House from the charge of indecision and dulness, of which he thought he had a right to complain, had brought forward his present Amendment, and supported it, if not by sound argument, at least by a lively and an agreeable statement, to which it was impossible to have listened without, at all events, a certain degree of amusement and pleasure. He was disposed to attribute the apparent negligence of which the hon. Gentleman complained, not to any want of consideration on the part of any hon. Gentleman in that House to a subject of so much importance to their constituents—not, as the hon. Gentleman had stated, to any feeling of blind attachment to his right hon. Friend, by the majority on that (the Ministerial) side of the House; nor to the sluggishness of what the hon. Gentleman had called the sharper and shrewder party by whom they were opposed; but rather to a general conviction entertained by hon. Gentlemen on both sides, that under the circumstances of the country, from a necessity of providing for the exigencies of the State in the ensuing year, or from the equal necessity, or the high expediency, of removing from the people other burdens which pressed heavily upon their energies and industry, it was the opinion of the House that the re-imposition of the Income Tax for a limited period was a measure well deserving of support, without reference to party views or feelings. The question of the propriety of adopting an Income Tax had been debated on former occasions, and had been approved by majorities exceeding what, under ordinary circumstances, would be considered as very great. But if the question were one which was so much calculated to excite the feelings of the country, as the hon. Gentleman supposed, why, he would ask, did the hon. Gentleman withhold his disapprobation of it until the present period? During three or four successive stages of the Bill the merits of the Property Tax had been brought under discussion; and yet, on all those occasions, the hon. Gentleman withheld his note of disapprobation. They heard nothing from him of the inquisitorial nature of the tax—of the amendments which it required—of the improper manner in which it was collected—until after the measure had been approved of by the House, and had passed through Committee—until, in fact, in the ordinary course of 546 proceedings, any Amendment to the Bill was scarcely within his reach. It was at that last stage that the hon. Gentleman had come forward with a Motion, which, if founded upon just principles, ought to have been made at the first moment after the subject had been brought before the House by his right hon. Friend; and even now the hon. Gentleman brought forward an Amendment which had no distinct object—which proposed no distinct alteration consistent with the continuance of the tax; but which, avowedly, went to open the question to every possible Amendment which any hon. Gentleman might think proper to suggest. The hon. Gentleman knew as well as he did that the details which would be thus stirred would present obstacles of the greatest, difficulty, if not of absolute impossibility, to get through. He did not claim for the Property Tax any merit to which no other tax laid claim; but he thought the hon. Gentleman ought to have been prepared to come to the discussion of its provisions—if not intending to reject it altogether—prepared as to the particular modes by which he would propose to amend it; or with some other plan, by which he would suggest that the necessary sum for the exigencies of the Public Service was to be raised. There was, however, one advantage in following the hon. Gentleman, arising from the fact that he had, through a great part of his speech, answered the propositions which he had laid down in other portions of it. The hon. Gentleman commenced by stating that he was not prepared to go the length which some recommended, of preferring direct to indirect taxation. On that point, it was not necessary for him to enter into controversy with the hon. Gentleman, as it was not proposed, in the adoption of the Income Tax, to substitute direct taxation generally for "indirect" taxation. It was merely proposed to substitute direct taxation to a limited extent in a national system of revenue, of which the great bulk consisted of indirect taxation. But the hon. Gentleman objected to all taxation that pressed particularly on the poorer classes; and his main objection to the Budget of his right hon. Friend was, that it afforded no relief to the poor comparatively to that which he would himself be prepared to grant them if he had the management of public affairs. If he understood the hon. Gentleman correctly, he stated that he would be prepared, if he had to conduct the public business, to make great changes in the finances of the 547 country; and when imposing an Income Tax would take care that the relief from taxation in other matters should be regulated more in accordance with the interests of the community than under the system introduced by his right hon. Friend. That part of the hon. Gentleman's case had been brought forward in a manner which he could not well understand. He considered the hon. Gentleman to have stated that he would not require the Income Tax to be any greater in amount than at present; but that he would recommend for reduction other taxes which were more objectionable and obnoxious in their operation than those which his right hon. Friend proposed to lower. The hon. Gentleman went through the taxes which his right hon. Friend proposed to repeal, and then told them that they ought to have rather considered the propriety of reducing taxes that interested more directly the consumption of the lower classes; and he enumerated the taxes on tea, on tobacco, on soap, on spirits, and on wine. The amount of revenue which was derived from those taxes was no less than sixteen or seventeen millions annually; and what rate of a Property Tax, it might be asked, should be imposed, to permit any useful reduction on so enormous a proportion of the taxation of the country as that? But when the hon. Gentleman came to consider which of all those taxes he would select as most fit to be reduced, he mentioned tobacco, from which the revenue was three millions, and spirits, from which the revenue was—[Mr. C. Buller expressed his dissent across the Table.] The hon. Gentleman had, he thought, distinctly stated that tobacco and spirits were the two articles the taxes on which pressed heaviest on the poorer classes; and he expressed his preference of a reduction of the duty on tobacco and spirits, to the reduction of the taxes on sugar, and cotton, and coals, and auctions, which had been proposed by his right hon. Friend. The hon. Gentleman in the course of his speech, after recommending the repeal of the duties upon tobacco and spirits, to which he attached principal importance, proceeded to contrast the benefits which would be derived by the poor from his plan, with those which were likely to follow from the measure of the Government; and he went into a minute detail of the very limited amount of saving to the poor man in the purchase of his dress, and the 548 quantity of glass which he might, in the ordinary exercise of his vocation, make use of in the course of the year. But did not the hon. Gentleman know that if the same line of argument or of calculation was adopted with respect to any tax, it would apply with equal force?—for any impost would appear, on its division among the multitude, of small individual importance, though the total amount of the revenue might be large. The Revenue received 3s. on every pound of tobacco; and if the hon. Gentleman took the trouble to calculate the saving to each individual in the community, by the reduction of one-third of that duty, he would find that the particular sum in each instance would present fractional parts as small as those which had so much excited his contempt in speaking on the repeal of the duties on cotton and glass. Did the hon. Gentleman mean to hold that the saving which might be effected by a reduction of the duty on tobacco would become so important a consideration to the higher classes as to compensate them for the sacrifice they were obliged to make in contributing to the Income Tax? The hon. Gentleman surely could not mean that. But it should be recollected that one thing which the Government did in imposing the Income Tax was to relieve the poor altogether from its payment. No person having an income of less than 150l. a-year contributed at all to the tax, and he would leave it to the hon. Gentleman to explain, if he could, whether the lower orders did not receive double relief; first, from a tax so imposed, from which they were entirely exempt; and, secondly, as it afforded the means of releasing them from other taxes to which they would otherwise be liable, to the amount of not less than five millions a year. He thought that if his right hon. Friend had come down to the House, and had proposed, in conformity with the opinion of the hon. Gentleman, that the whole or the larger part of the surplus left at his disposal should be applied to the reduction of the two particular duties which seemed to occupy so high a place in the favour of the hon. Gentleman—namely, the duties on tobacco and on spirits—

§ Mr. C. Buller
said, he mentioned the duties on malt, soap, sugar, tea, tobacco, and spirits, as all pressing on the great mass of the community; but he did not particularize any of them as being most worthy of attention in the first instance. What he meant to say was, that if the Government 549 had reduced any of those taxes, it would be a greater boon to the public generally than what they had done.

§ The Chancellor of the Exchequer
The right hon. and hon. Gentlemen sitting around him were of opinion with him that the hon. Gentlemen had particularly insisted on the repeal of the duties on tobacco and spirits, as being most severely felt by the poorer classes. The hon. Gentleman had quoted largely from a Report drawn up by the hon. Member for Montrose (Mr. Hume); but that was merely the draft of a Report which had never been considered by the Committee. The Report certainly recommended that in consequence of the pressure upon the particular article referred to, it was most advisable to have the tax repealed whenever the state of the Revenue would allow of such a sacrifice; but on this subject he would only detain the House farther by observing, that if his right hon. Friend had really adopted the course which the hon. Gentleman now recommended, and had proposed to the House the reduction of the duties upon tobacco and spirits, the hon. Gentleman would probably be the very first to stand up and raise an outcry against the cause which he now advocated. He would have told them that these were obnoxious articles, on which the highest amount of duties that could be imposed ought to be levied. He would have complained that they were pandering to the vices of the people, instead of adding to their comforts; and he would then have in favour of his declamation against the Government more of principle than he had displayed in his Motion on that evening. He would admit with the hon. Gentleman, that in selecting between different articles of revenue, it was important carefully to consider the effects which a repeal of the duties would have upon the public, and to reduce the tax on that by which the greatest amount of benefit would be obtained; but he denied that the hon. Gentleman had correctly stated the principle upon which relief was given. It was not wholly by the amount of duty withdrawn that that benefit was conferred. In addition to the actual burden removed, there were other modes by which the public were benefited by repeal of taxation. The hon. Gentleman spoke of the reduction of duty on various articles in the Tariff. In fact, he referred to every reduction that was proposed to be made. But he neglected to take into account the new exertion which 550 those reductions would draw forth, the stimulus which would be given to industry, and the increased sources of employment which would be opened to the poor. This was an important consideration, of which the hon. Gentleman had neglected to take any notice. He seemed to forget that by the impetus which the remission of taxation on particular articles would give to the extension of employment, they would afford to the lower classes of the community the means of procuring comfort, and assistance, and relief, to an extent that would at least fully equal the immediate relief afforded by the release from the amount paid in taxation. But, as he said before, the imposition of the Income Tax did actually relieve the lower orders from a large amount of taxation. The other reductions opened new sources of employment to them. For instance, with respect to the article of glass; it was known that there were already persons preparing to embark their capital in machinery for carrying on the glass trade, which they would not have thought of doing if the duty were continued, and each of these new establishments would of course give employment to a number of persons residing near them. In the same way the repeal of the duty on cotton would be most beneficial. He had before stated that the reduction of the duty would be felt more on the heavier articles of goods, and in that way its benefit would extend directly to the poorer classes, by whom such goods were worn. But was that the only advantage they would derive from the reduction of the duty on cotton wool? Far from it. If the effect of the repeal of that duty would extend, as he believed it would, to the cotton goods exported, so as to enable the British manufacturer to meet the foreigner in his own market, then a increased amount of employment would be afforded to the people, and the most substantial benefit that it was possible for any legislative measure to confer upon them would be secured. The hon. Gentleman said that the advocacy of free-trade principles was a new idea in his (the Chancellor of the Exchequer's) mind; but if the hon. Gentleman had done him the honour to refer to his speeches as far back as 1830, he would find that at that time he had advocated the total repeal of the duty on beer and leather; and had ventured to predict that, from the stimulus which would be given to industry by the repeal of those taxes, the loss to the Revenue would in a short time be compensated. 551 The effect which he had anticipated was not felt in the subsequent year, but in the succeeding year his prediction was realized. He denied altogether what the hon. Gentleman had stated about the collection of the Income Tax being generally complained of throughout the country. The cases of alleged injustice were forwarded to him, and they did not amount to anything like the proportion which might be supposed from what the hon. Gentleman had stated. He believed that the feeling against the continuance, for a limited period, of this tax was not as had been represented. He said this, because he recollected that formerly, when this tax was felt to be oppressive in its operation, petitions from all quarters were presented against it; but now they had hardly a single petition presented against the continuance of this tax for the further limited period of three years. They could find no indications on the Table that this tax was considered oppressive, and, therefore, in absence of all evidence to the contrary, he felt himself justified in inferring that the people were convinced of the advantage of continuing it, and that it was a burden they were not unwilling to bear, in order to be relieved from other taxes which pressed heavily upon them. He knew that there was a general unwillingness to pay any tax directly to the tax-gatherer. But he was bound to say, that as far as regarded the Income Tax, there was less of objection to it, less of dissatisfaction manifested to its collection, than occurred in any other case of direct taxation in this country. As to the hon. and learned Gentleman's argument, that this tax must be permanent, because the taxes which were to be reduced had not been properly selected, he could only say, that the same argument might be used by every hon. Gentleman, who, selecting some particular tax, according as it suited his taste, might object to the reduction of any other. Now, as regarded this proposition of the hon. and learned Gentleman, he did not think that the House would concur in his objections. They must look at the whole arrangement made by his right hon. Friend for the service of the year. They must look to the amount of taxation which his right hon. Friend had to provide, before they could abandon altogether the Property Tax. And then it became a question whether they should re-enact this tax for a limited period, by which they would be enabled to get rid of other burdens which 552 pressed heavily on the industry of the country, and more particularly on the labouring classes. If they now adopted the Amendment which the hon. Gentleman advocated, namely, to exempt particular cases from the operation of the Act, and to attempt by new enactments to make its operation perfectly equal, it would lead to consequences which the House ought well to consider. The result must be, to impose on some classes heavy burdens to the extent to which they afforded relief to others. Such a proceeding might render it impossible on the part of the Government to limit the continuance of this tax to the period for which it was now proposed. He believed that by pursuing the course which the Government had recommended, by remitting and readjusting other articles of taxation, the Revenue would not be deteriorated; but that, on the contrary, it would happen now, as it had before, that the reduction on some taxes would be compensated by the increase on others. On these grounds he should resist the Motion. He could see no reason to suppose that there would be a necessity to continue this tax beyond the period of three years. During this period, to reduce its amount, or to alter the scale under which it was now levied, and which, as far as anything of the kind could do, gave satisfaction, would neither tend to produce the objects which the hon. and learned Gentleman stated, nor would it, considering the short period for which it was proposed, be in other respects desirable. The House should not allow itself to lose sight of the circumstance that the Government only proposed the Property Tax for a limited period—that, by doing so, they were enabled to remove other taxes which bore heavily on the country. He would more especially allude to the modification of the Sugar Duties as a change which must be productive of great advantage to the poor, to the abolition of all duties on glass, and to the removal of the auction duty, which, although not large in amount, was extremely vexatious as regarded the transference of property. In addition to this, he might mention the total repeal of duties on a great number of articles which entered largely into the manufactures of the country—on dyes, drugs, ores, &c. As for the selection of other taxes to be dealt with in preference to those proposed by the Government, he would only again observe, that it was very easy to say that the repeal of one would be better than that of another. 553 He did not, however, fear comparison of the taxes selected by the Government with any others that could be pointed out; and he declared, that in the choice they had made, their object had in all cases been the removal of those duties by which they believed that the industry of the country, and the comforts of the great body of the people, would be best promoted. He believed those objects would be fulfilled, and he, therefore, preferred the plan of Her Majesty's Government to any other that had been pointed out.

§ Viscount Howick
observed, that from the language of the right hon. Gentleman, and from the manner in which Her Majesty's Government dealt with the subject, they held out to the House and the country very little hope of getting rid of the tax at the end of three years. He thought it must have been perfectly obvious to every Gentleman who had listened to the speech of the right hon. Gentleman, that he cautiously avoided going into any detail as to his grounds for supposing that there would be that great increase in the Revenue, on which alone it was obvious that he grounded his hope of being enabled to get rid of this tax. All that the right hon. Gentleman said was, that if they took off one tax it was generally followed by an increase in others; but the illustration on which he chiefly rested for this opinion was very inconclusive. The right hon. Gentleman pointed to the year 1830, and to the reductions which he then made in taxation. Now, if he were not greatly mistaken, the circumstances of that time were entirely different from those of the present time. In the first place, as to the tax on beer, which had been described by the Chancellor of the Exchequer as having been altogether taken off, and not merely reduced from a before excessive amount, he must observe, that although nominally it was an entire removal of taxation from a particular article, it was not so actually. He considered that when the right hon. Gentleman removed the duty on beer, he removed the worst part of the duty on the article. The tax on malt and that on beer were so connected, and the total amount was so great, that it was natural to suppose the removal of the beer duty would lead to an increase of revenue derived from malt; and above all as the duty was partial and unequal, and as it only fell on a portion of the whole quantity of beer brewed, the duty on malt immediately began to 554 rise, and that was one of the many causes of the removal of the beer duty not being attended with loss to the Revenue. There was another cause existing in 1830 which did not operate at the present time. Gentlemen who then had seats in that House must remember that that was a period of great distress throughout the country. There had been two or three consecutive bad harvests, and these led to the unfortunate disturbances which broke out at the end of that year; and no doubt Gentlemen would also recollect that Mr. Huskisson brought the subject before Parliament in one of the most admirable speeches which he (Lord Howick) had ever listened to in that House. In the course of his speech that distinguished statesman, in describing the state of things at that time used the words which have been so often quoted, and said, "That the pressure upon the springs of industry" was too great, and required to be relieved. On that occasion the present Secretary for the Home Department joined his late Colleague in the Cabinet (Sir E. Knatchbull) in support of an Amendment moved by the latter, of which the object was to declare with reference to a statement in the Address in answer to the Speech from the Throne, that the distress was not partial, but general. On that occasion many of his (Lord Howick's) friends, as well as himself, had the honour of supporting the right hon. Baronet the present head of the Government, who was then very nearly being left in a minority by the conduct or defection of some who now sat around him. The right hon. Secretary was one of the warmest supporters of that Amendment; and if it had not been for the support of a considerable portion of the Opposition to the Government on that day, they would have been left in a minority. He referred to these circumstances for the purpose of reminding the House that the remission of taxation in 1830, which the Chancellor of the Exchequer had pointed out as having been followed by a rapid recovery of the Revenue, had taken place at a period of great distress; but after this, for three or four years successively, they had good harvests; the consequence was, that the price of corn fell, and, as is always the case under such circumstances, the manufacturing interest was in a thriving condition. The result was, that consumption of all articles subject to taxation increased, and in particular there was so great an 555 increase of the produce of the malt duty, that they got more by this than they lost by the removal of the beer duty. The recovery of the Revenue under such circumstances was not to be wondered at; but he must remind the right hon. Gentleman that he was about to make the present reduction of taxation, not after a series of bad seasons, but after they had had several good seasons, and when the country was altogether in an unusual state of prosperity, and when every change which they should reasonably look to must be, not for the better, but for the worse. Therefore he thought that the House must not rely upon the recurrence of such an improvement in the Revenue as he had adverted to. The right hon. Gentleman had entirely avoided the arguments of his hon. and learned Friend, that a large reduction of taxation such as was now proposed could not take place with the same prospect of being soon followed by a recovery of the Revenue to its former amount, as there would be if they would deal with the protective duties, and with those duties which were now so high as to encourage smuggling. The right hon. Gentleman went through a list of taxes which he stated his hon. and learned Friend proposed to repeal, and he stated that his hon. and learned Friend proposed to remove 15,000,000l. of taxes, while they had only between 3,000,000l. and 4,000,000l. to deal with. This certainly was a most extraordinary misconception of the argument of his hon. and learned Friend, for he did not say that all those taxes which had been pointed out should be repealed; but he said that among the present taxes there were many the reduction of which would, within a short time, be attended with no loss of revenue; but with regard to those taxes which it was now proposed to deal with, there was no such prospect; there might, and he hoped there would, be much relief to the public, but there must be a great and permanent sacrifice of revenue. His hon. and learned Friend had pointed out several instances where a reduction in the tax would not fall on the Revenue, and at the same time be productive of the greatest advantage to the consumers. The right hon. Gentleman had altogether failed in meeting the arguments of his hon. and learned Friend; but at the same time he (Viscount Howick) must decline giving his vote for the Amendment of his hon. 556 and learned Friend. He should do so on these grounds. He should do so, not that he liked the Income Tax; far from it, as he believed it to be one of the most objectionable modes that could be adopted of raising a Revenue for the Public Service; but because he agreed in what fell from his right hon. Friend the Member for Portsmouth on a former evening, that the finances of the country were not in a state to enable them to take it off, without imposing some tax in its place of another kind. Even if the right hon. Gentleman did not proceed with his proposed remission of certain taxes, the large amount of revenue now derived from the Income Tax could not be spared, without taking into the account the additional expenditure called for by the exigencies of the Public Service. This being the case, as he was not prepared to propose any other new taxes, he did not think that it was consistent with his duty to vote for the repeal of this tax, although he believed it to be one of a most objectionable and oppressive character. This was one of the grounds which would induce him not to resist the further continuance of this tax for a limited period. Nor could he at once agree to the Resolution of his hon. and learned Friend, which pointed to some modification by which the inequality and inquisitorial character of this tax was to be diminished, but did not set forth any explanation as to the mode in which this was to be effected. He strongly objected to deal with the matter in this way. If he believed they could really modify the Income Tax and make it less unequal and oppressive, he should be prepared to vote for an Amendment to that effect in Committee; but as far as he could form an opinion on the subject from reflection, and from all that he had heard in the debate, he was not aware of any modification or change that could be made in the Income Tax which would render it less unequal and unjust. He admitted that this tax was both unequal and unjust; but the question was, whether any alteration which could be made in it would render it less so? Many hon. Gentlemen on his side of the House had repeatedly said that they would not have an Income Tax, but that they were favourable to the imposition of a Property Tax; that was a tax on realised property. Now, he had never heard anything like a satisfactory explanation as to what was meant by realised property. It appeared to him 557 that if such a tax existed, it should be imposed on property of all descriptions. On what principle of justice could they impose this tax on income derived from land, or from the funds, while the capital of the manufacturer, the farmer, or the banker should be exempted from it. It could not be said that it was in consequence of the inferior wealth of the one class; for in that part of the country with which he was connected, there were numbers of farmers who were gentlemen possessed of large capitals embarked in the cultivation of land which they held under lease, while there were also many small freeholders. Would it be just to let the former escape from the payment of the tax, while the small freeholder of 100 or 200 acres was to be liable to it? Again, why was such a tax to be imposed upon a clergyman of moderate income, who, probably, had a family to bring up, and at the same time must live as a gentleman, while the rich merchant was altogether exempted? How could they, with any sense of justice, allow the rich manufacturer or shipowner, with incomes of many thousands a year, to escape; while a half-pay officer who had a small sum in the funds had to pay it? What could be more unjust? Then he might be told that the amount of actual capital in each trade should be taxed. But supposing, as had been suggested, that a line should be drawn between the capital employed and the reward of skill? How could they estimate the amount of capital which a farmer embarked in his trade? Who was to be entrusted with the task of estimating the capital of the shipowner, having vessels in all quarters of the world; or of the banker, who might have his property embarked in a thousand different ways; or of the manufacturer, who was engaged in speculation of the most complicated character? If this was to be attempted, they would get into endless and irremediable confusion, in comparison with which the inequality and injustice of the present tax would be as a trifle. Then it was said, that a distinction should be drawn between the profit on capital and the income which was derived from the exercise of the skill or ingenuity of parties. How, he would ask, could they, in the case of a banker or a merchant, or a manufacturer, determine what portion of the return should be put down to the profit on the capital, and how much was to be given for the exercise of skill or ingenuity. Then, if they took 558 the whole income of a banker or a merchant, why should they let off the surgeon or the professional man, who derived his income from the exercise of his profession? He confessed that he could not see how it was possible to make this distinction. If they attempted to draw a distinction between the income derived from a man's own exertions and the income from capital, they might depend upon it that they never could get over the difficulties in which they would be involved. It had been said that it was very unjust to tax men at the same rate deriving their incomes from different sources. This was the complaint made with regard to a fluctuating income arising from professional exertions, and a fixed income derived from land. He admitted that there did appear something unjust in this; but he did not see how the difficulty could be obviated. Supposing, then, you should say that a professional man should pay a less per centage on his income. His reply would be, that he could point out cases in which professional men were more secure of their income than a landed proprietor. He would put the case of a person deriving an income from an entailed estate, and who did not come into possession of it until he was advanced in life; how much less hold had he of an income to make provision for the younger branches of his family than a professional man in the prime of his life. How, he asked, if they admitted that all different cases were to be provided for, could they estimate all these distinctions; and to whom were they to entrust the duty of determining in what proportion different parties should be taxed? Could they entrust such a power to any set of Commissioners? And see how they opened the door to frauds and oppressions of all kinds, as he believed it would tend to the continued practice of tyrannical acts of the most odious character. After all, did it not come to this, that all taxes on income and property were based on a false principle? The principle of a really good system of taxation should be that of making each man pay as nearly as possible according to what he could afford to spend. This, according to the arguments that were used, ought to be the object of altering the mode of levying the tax; but he believed the best mode of arriving in fact at this result was by adopting a well-considered system of taxation upon expenditure, and upon articles of consumption. He did not believe that they could so well apportion 559 the amount of burden which ought to fall on each member of the community in any other way. Each man knew what he could fairly expend, and if they placed the taxes on expenditure and not upon income, they would be much nearer arriving at a correct result than by any other means. This he conceived to be the proper theory of taxation, and that to impose a tax upon income or property was obviously unjust. He agreed with his hon. and learned Friend, that the Income Tax should be confined to the greatest emergencies—that was to a time of war, or to a state of things equivalent to war in time of peace. It was the duty of that House so to frame the taxation of the country that it should fall on the expenditure, and in such a manner that all classes, from the highest to the lowest, should contribute in just proportions. He included, of course, in this some of those taxes which were direct taxes—such as the assessed taxes, a house tax, or a land tax; and of course the character and nature of each of these should be strictly investigated, if they entered into the consideration of the whole system of taxation of this country. He would put as much as possible taxes on the luxuries of the rich; he would, however, confine such taxes to the point of their greatest productiveness, and not screw them up so as to induce persons to abstain from the enjoyment of luxuries. He knew, however, that if they adopted this mode of proceeding, they could not avoid imposing taxes on several articles of general consumption. To raise such a large revenue as the emergencies of this country required, they must tax articles which were used by large numbers of the people. Therefore, of course, there would be some taxes which would fall on the lower classes. He believed, if they had availed themselves of the opportunity which the present large surplus revenue afforded, and had resorted to the adoption of a system of taxation on sound principles, that they might have raised the whole Revenue by a revision of those duties which pressed so heavily on the lower classes; and that the result would have been, not only a great and immediate reduction of taxation, but that there would have been a tolerable certainty that at the end of three years they would be enabled to get rid of the Property Tax. To do this, they should, in the first place, deal with the protective duties. On Friday, the hon. Member for Stockport put a very 560 apposite question, to which no reply was made by the Government. That hon. Gentleman asked what portion of the amount of the protective duty on sugar would go to the Exchequer, and what portion to those who were protected? He did not wonder that they shrunk from giving any answer, because he believed that it was utterly impossible to have made a calculation of this burden, unless obviously much less than the fact, that would not have occasioned great public dissatisfaction. He believed that they could not make any calculation of this burden which would not have been most revolting to the public. Although the Government did not give an answer, they had a confession from the Gentlemen on the other side. The noble Lord the Member for Liverpool at once admitted that all protective taxes were taxes on the consumer; and the right hon. Member for Newark stated that the maximum amount of the tax which, under the name of protection, fell upon the English consumers of sugar was 2,430,000l. The right hon. Gentleman said, that he was sure that it could not amount to more; but when this large amount might be taken, why did not the Chancellor of the Exchequer and the First Lord of the Treasury state its actual amount? He was satisfied that these right hon. Gentlemen were afraid to state for the information of the public what was the amount of the burden that they calculated thus imposed in addition to the tax levied for revenue. He was satisfied that if the hon. Member for Stockport had greatly exaggerated in his calculation, they would have contradicted it; but they had very good reason for not taking this course. It would not do for the right hon. Gentleman to admit that this tax, levied on the people of England, went into the pockets of the producers of sugar. At the same time, that there were several other taxes which brought little into the Exchequer, and took largely from the pockets of the people, they had enormous protecting duties on other articles of general consumption, such as coffee, timber, cheese, butter, and above all, corn. An enormous amount of taxes was levied on those articles which was not for the public service, but for supposed, not he believed the real, benefit of particular classes. If the Government had been prepared to look into these duties—to deal with them—they might have given a large measure of 561 relief to the consumer, and above all, to the industrious classes of this country, and far more than could ever be hoped to be obtained from the adoption of the proposition of the right hon. Gentleman; and the adoption of this course would have left the finances of the country in such a state that there would have been every reasonable ground of confidence, that at the end of the three years any loss arising in the first instance from reduction would not only be made up, but that the Revenue would have been in such a state as to have enabled them also to get rid of the Income Tax. He was persuaded that this would afford extensive relief, and would afford a sound example for a financial system; he therefore hoped that before the next general election, which would take place before the expiration of the period for which this tax was to last, the electors of England would say, whether it were worth while to continue to pay such an odious and unjust impost as the Income Tax, and whether they were prepared to continue to do this for the sake of maintaining these protective duties for the benefit of any particular class. Disguise the matter as they might, it would come to that at last, and the people would have to say, whether they would continue to retain upon their shoulders the system of protection, which Her Majesty's Government had described as being contrary to the principles of common sense. To these principles of common sense he trusted that they would come at last, instead of entering upon fruitless attempts, in which they must inevitably fail, to improve the working of the Income Tax, which, if retained at all, it was practically impossible to make less unjust or less unequal than it now was. He trusted that the time was not distant that the House would see that the only course of legislation, consistent with wisdom and common sense, was by relieving the country from this cruel burden, which was only kept up for the purpose of upholding protective duties, which brought nothing to the Exchequer, while they were so oppressive to the consumers.

§ Sir R. H. Inglis
acknowledged the ingenuity by which the noble Lord's speeches were always distinguished, whatever he might think of the consistency with which he denounced the tax as most odious and oppressive, and then protested that he would vote for it. Now, the hon. and learned Member for Liskeard asked no 562 man to vote against a Property Tax; he did not wish to entrap the noble Lord into such a vote. But the hon. and learned Member asked them to render that more fair and tolerable which was to be perpetual. If no man had got up to state positively that in three years the tax would be renewed, no one, on the other hand, whether a Member of the Government or not, had got up and stated to the House his personal belief that the tax would, at the end of that period, be removed; and he would ask, did they not all entertain a moral conviction that it would not be removed at the end of three years? He believed there was not a Member in the House who did not feel a moral certainty that at the end of the ensuing three years the Income Tax would not be repealed, but would be renewed and probably continued for ever; and if that were so, he thought that the House ought to do more than merely renew the present Income Tax: they ought so to reform it as to leave little room for improvement before they now agreed to it with a great probability of making it perpetual. The right hon. the Chancellor of the Exchequer complained that the proposition now brought before the House had taken him by surprise. With reference to one proposition, he did not think his right hon. Friend could make that complaint; he meant the proposition which he (Sir R. H. Inglis) had submitted to the House on the first day of the discussion of the Budget, and which, indeed, he had brought forward in 1842, which would have the effect of relieving a large portion of the poorer classes of his fellow subjects from the burden of this tax; and he had anxiously hoped that his right hon. Friends the First Lord of the Treasury and the Chancellor of the Exchequer would have taken that suggestion—which was made in perfect good faith—into their serious, and, he would add, their favourable consideration; for he believed that it was their duty to render that measure which, under the most favourable circumstances, was regarded with aversion by many and with suspicion by others, and which he never understood was regarded with favour by any large class till now, that he heard the statement of the Chancellor of the Exchequer—he believed that it was their duty to cause that measure to press as lightly as possible upon the lower classes of their fellow subjects. The Chancellor of the Exchequer said that it was unfair to make these propositions, reducing 563 the amount of the tax, unless they were prepared to come forward and provide a substitute. Now, he met that statement at once by this, that if the Motion of his hon. and learned Friend the Member for Liskeard were adopted, it would not necessarily deprive the Exchequer of a single sixpence that was expected to be realised. He wished only that there should be such a revision of the principles on which the tax was founded, as would render it bearable. If, indeed, he thought that the Income Tax was to be continued only for three years, he should not only not complain, but he should be unwilling to bring forward the case of those who did, but would endeavour to bear it, and induce others to bear it with what patience they might be able to assume. But the case was very different here. During the four weeks the measure had been under discussion, no hon. Member had stated his personal opinion that this tax would be repealed at the end of three years. All they had obtained from the Ministry, which was less than was obtained from them three years ago—was the assurance that it would probably be in the power of the House to repeal the tax at the end of three years. Why that was a legislative truism, which it did not require the authority of the Treasury Bench to assure the House of. But would any right hon. Gentleman say, that at the end of three years they would be in a condition to repeal that tax? Now, he would content himself with the statement of any one of their supporters, either on this side of the House or on the other, who would pledge his character that the Income Tax would last for three years, and for three years only. But till that statement were made, he held that they were bound so to modify that tax as to render it as little odious as need be. He could not agree with the noble Lord the Member for Sunderland, who argued that it was impossible to make the distinctions between property and income available for the purposes of finance. He was aware there were difficulties in the way; but they were not insurmountable. With regard to annuities, it mattered little to the tax-gatherer, whether they were derived from the funds, from Bank interest, or from land. And with regard to the difficulty of valuing a profession, he would say, let its value be taken according to the probabilities of human existence. He conceded a great deal when he stated that; but in that way their value 564 was easily calculable. Let them go to Mr. Morgan, the eminent Actuary, or let them take the Government tables, and estimate the probable duration of the man's life; in this way let them capitalize his income, which, notwithstanding all that had been said, he was obtuse enough not to see the unreasonableness of doing. Though it might be difficult to apply these principles with perfect accuracy, yet it was far from being impossible; and on such an important subject, it was certainly worth the while of the Government to apply themselves to a solution of the problem. With reference to the proposition he had himself made, he was aware of what had been stated by the First Lord of the Treasury in opening his Budget—that all taxes were in themselves objectionable. They were necessary evils, but still their operation might be so qualified as to reduce their amount of grievance to a degree which was comparatively bearable. His object was to relieve from temptations to fraud, and also from a severe pressure of taxation, persons holding situations not amounting to more than 150l. a-year. It was no unreal case he put, when he said that gentlemen were strongly tempted, and not in vain, either to reduce the nominal amount of their income, or to say that it might be so reduced as to come below the standard for the tax. Had they any right to tempt large numbers of their fellow-subjects in such a way as this? But, said the First Lord of the Treasury, these persons receive back an equal amount in the reduction in the price of articles of consumption which had been caused by the Tariff, Now, he was ready to admit, to many people the reduction in the price of meat and other things was so considerable, as in a great degree to compensate them for the imposition of the Income Tax. But no man would contend that that applied to either extremity of the scale. It did not apply to the higher extremity. Such reductions could never be an equivalent for the tax paid by a nobleman of 50,000l. a-year; and, on the other hand, it would make little or no difference to persons of 150l. a-year. He could assure his right hon. Friend—if, indeed, it needed his authority to assure him, because it was probable that the right hon. Baronet had had more communications on these subjects than he had—that to persons with salaries of 150l. and under, but little relief was afforded by these measures. There were large numbers of that 565 class, who, whether meat were 7½d., or 6½d., or 6d. per lb., could never indulge themselves in that which, to them, was a luxury, as if it were absolutely forbidden. There were many of them who, according to the representations made to him, never tasted tea. He might, if necessary, go through the whole 420 articles of the Tariff that had been reduced, and show that the reduction in the price of these articles was of little or no value to those on behalf of whom he had brought forward his proposition. The noble Lord who had just sat down had made what he might call his Budget speech; because, undoubtedly, it did not bear so much upon the proposition now before the House, as upon the whole financial condition of the country. He, for one, did not regard the Budget either as a poor man's Budget or a rich man's Budget; but he must say, that there were considerations which induced him to desire that considerable alterations had been made in the scheme of the right hon. Baronet with regard to the disposal of the surplus. The right hon. Baronet had a larger surplus than was ever before possessed by any Minister in his situation. He was not aware that, in any period within the present generation, any Minister had come down to the House and declared that he was in possession of a clear surplus of 3,500,000l. He wished that some proportion of that surplus had been disposed of in a way that would benefit other than the materiel interests of the country. He wished that something had been done for the relief of that spiritual destitution which he contended was as directly connected with the ill-being of the country as any proposition that could be brought before the House. With such a surplus at his disposal, it would not have been unbecoming the character of the First Minister of the Crown to have applied a portion of it to the relief of that spiritual destitution. And there was another consideration which he owned did weigh much with him. It was stated thirty or forty years ago, by Sir John Newport, that the Parliament of England was not only systematically opposed to any act of a spiritual character, but also to the exercise of charity altogether. The Parliament interfered, he would not say, to dry up the sources of charity, but certainly to throw impediments in the way of its exercise in the case of persons who were about to leave the world, and which he did think was as uncalled-for as it was contrary to sound 566 policy, and inconsistent with the general good of the country. The House was, perhaps, not aware of the amount which was drawn away from charity by the operation of the legacy duty. The sum was small in its effects upon the Exchequer, but it was large to the particular charities from which it was diverted. The amount diverted by the legacy duty from the funds of the British and Foreign Bible Society in the course of three years, was 2,900l., or about 950l. a-year. The sum lost to the funds of the Church Missionary Society from the same cause amounted to 1,590l., or about 500l. a-year—a sum which would be sufficient to maintain three missionaries. If the nation would not of itself undertake some great scheme of Bible and Missionary work, at least, let not the sum which thus went into the national coffers be allowed to interfere with the benevolent designs of private individuals. But it was not only with regard to these objects, which he certainly regarded as of pre-eminent importance, but in mere worldly objects the same interference occurred. One hospital had lately a legacy of 146,000l. left to its funds, and from that sum they were compelled to pay a legacy duty to the amount of 14,000l. He did not think that any economist would object to the relief of these charities from the burdens which the existing law imposed. The whole amount would not exceed 50,000l., but he was willing, for the sake of argument, to admit that it might be 75,000l. or 100,000l. Now that sum, if distributed over the different sums which charitable donors intended to devise, would do a great deal more good than the House had ever done in this direction. He would not have referred to this subject, which related to the Budget generally, rather than to the proposition now before the House, if the example had not been set him by the noble Lord the Member for Sunderland. He was not aware that he had any other suggestion to make to the House; nor should he have taken the opportunity of calling their attention to these subjects, if he had not thought that the present slack-water-time of the debate was the most favourable for his introducing them. He could not conclude without stating, that unless he heard somewhat different arguments than those that were used by his right hon. Friend the Chancellor of the Exchequer, he should, notwithstanding what had fallen from the noble Lord the Member for Sunderland, 567 vote for the proposition of his hon. Friend the Member for Liskeard.

§ Mr. Warburton
said, that the proposition for making 150l. a year the zero of taxation was well entitled to consideration; for you would thereby avoid the inconsistency of making the man with 149l. a year richer than the man with 150l. If the Income Tax could be adjusted without diminishing the receipts, it would be an improvement on the principle. The other proposition of his hon. Friend would lead to an inconsistency, which he was surprised his acute mind did not perceive. If an Income Tax were laid on for three years, and if one man possessed an annuity for three years, and another man possessed a perpetuity, his hon. Friend said, let us take the present value of the terminable annuity, in the one case, and of the perpetuity in the other, and let us capitalise the annuity. In the one case you had little less than the three years' purchase. In the other case you said that the value of the annuity was twenty years' purchase. You taxed the perpetuitant, first for the annuity that he possessed for the three years, and afterwards for the reversion that he would possess after the expiration of the three years. If you taxed the perpetuitant for this reversionary interest after the expiration of the three years, why were you not to tax the person who had no annuity in possession for the three years, but who possessed the reversion? The reversionary interest was 17–20ths of the whole value of the annuity. On what principle was the person who had the reversionary interest to escape payment of a sum to the State during twenty years? You could not carry into effect the Income Tax if you proceeded on the principal of capitalising income. Why? Because the person who possessed the reversion might reasonably answer, "I have no property in possession; I have not wherewithal to pay the Income Tax during the three years, unless you make it a charge on the reversion after I shall come into possession. I have not wherewithal to pay the tax." As to making the Income Tax permanent, if he thought that by so doing he could get rid of such abominable taxes as protective duties to the West Indian interests, or to those Gentlemen who were particularly represented on the Benches opposite, he would willingly do so; but even if these protective duties were got rid of, he would contend 568 that it was far better to meet the exigencies of the State by the imposition of a Property Tax than by taxes on soap and tobacco, and other articles which required separate expensive establishments. He was persuaded that when the matter came to be explained to the great body of the people, the direct mode of taxation would be the most popular. Although in borough towns the other system might be more acceptable, he would rather lose his election than try to mislead the shopkeepers. He knew it was for the interest of the State that we should have recourse to the principle of direct taxation. He certainly could not vote for the proposition of the hon. Member for Liskeard, because he did not tell us in what the inequality of the Property Tax consisted; he had not pointed out any method of rendering it equal. According to his own conception, the principle of an income tax was a correct one. The man who had an annuity for one year, paid the tax for one year; the man who had an annuity for two years, paid it for two years—each man paid his tax as long as his annuity continued. Why should a professional man, a lawyer for instance, who had 12,000l. a year escape? Let him pay as long as his 12,000l. a year lasted. He could not conceive any principle on which the tax could be made more equitable. The noble Lord the Member for London had told us that the tax was vexatious—so were all taxes vexatious. Every shilling you laid on in the shape of an Income Tax, came home to every man's purse, and every man was zealous about its increase. If you laid a tax on timber or tea, it escaped notice, for men calculated on avoiding it; but if you increased the Income Tax by one halfpenny, all men knew it would come home to them; and there could not be a greater security for the maintenance of economy in our expenses.

§ Mr. M. Milnes
was surprised at the statements made by the hon. Member for Kendal. He thought it was an axiom of political economy that, having regard to the circumstances of the country, it was absolutely impossible to raise the necessary amount of revenue by any system of direct taxation. He believed that that point had been fully established; and that the question for them then, or at any other time, to consider was, whether it were possible that all the revenue could be raised by a system of direct taxation, 569 but whether a portion of it might not be raised in that manner. He owned that, after giving the best consideration he could to this matter, he had come to the conclusion, and he hoped he should be able to adhere to it, that to raise a portion of the revenue by direct taxation was the best and most economical way of raising the revenue of the country, because by that system they were able to get the largest sum from the richer classes, as by a system of indirect taxation they were able to get the largest sum from the poorer classes. It was by a skilful combination of these two systems that they were to sustain the revenue of the country. He felt that it might be considered impertinent in him to lay any abstract proposition before the House; and he should never have thought of doing so, if he had not, like the hon. Member for Oxford, been seduced by the example set by the noble Lord the Member for Sunderland, who, he regretted to see, had left his place. That noble Lord had laid down propositions which they might or might not believe; and he for one, did not believe that the large assumption, on which the greater part of the noble Lord's speech was founded, that it would be possible to raise the revenue without the Income Tax, merely by the process of relieving the country from the burden of what he called the protective duties, could be justified. He believed that these assumptions had found many hon. Members, besides himself, incredulous as to the validity of the noble Lord's arguments. That which the noble Lord assumed was the question on which the country had judged at the last election—that was the question which divided those who sat on this side of the House from the noble Lord opposite and his friends beside him—it was the vital question, whether it were better, in the present complicated state of the national interests, to give up the protecting duties in favour of the land in England and in the West Indies. He believed that it was that principle which had placed his right hon. Friend in the position he now occupied; and he believed farther, that to that proposition his right hon. Friend adhered, and would adhere. That proposition was the principle of protection; but how far that principle might be modified, was an entirely different question, on which his right hon. Friend had as good a right to judge as others. 570 But he was satisfied that the principle itself was at the bottom of his commercial policy, and the right hon. Baronet had done nothing to make them suspect that he denied it, and he was happy to take this opportunity of publicly proclaiming his belief. The hon. Member for Oxford had been under the painful necessity of making a speech tinged with rebellion to Her Majesty's Government; and it might be some little consolation to the hon. Member to find how much he agreed with him. However subtilely the question might be put by the hon. Member for Kendal—however the acute mind of the noble Lord might have shown the difficulties of drawing distinctions in the Income Tax—notwithstanding this, he would confidently appeal to the common sense of the country, to which the noble Lord had appealed—whether industry should be taxed in the same proportion with idleness; whether some distinction ought not to be drawn between the most precarious and the most solid sources of income; and whether there should be exacted the same amount of direct taxation from the person who might be deprived of his income in a moment, as the man who rested in repose and security upon the enjoyment of his property, protected as it was by the Government of the country. He believed that there would be no practical difficulty in the matter: he believed that the country would not question some rule of division as applied to it; he believed that 5 per cent. on land and funded property, and 3 or 4 per cent. on trades, professions, and avocations—or some gradation of that kind—would be acceptable to the country; and, moreover, he believed that whatever might be the present opinion of his right hon. Friend at the head of the Government, when it was remembered that on a former occasion, he had declared that an Income Tax should be reserved for a period of the greatest difficulties, and for an emergency of the country—and when it was borne in mind that that emergency had not arisen—he had no doubt that another change in the same direction might follow, and that his right hon. Friend would ultimately adopt a certain amount of direct taxation in conformity with the wishes and necessities of the country. He would, therefore, have suggested to the hon. and learned Member for Liskeard, if he had been in the House, that he should not divide on 571 the Motion. He would suggest it for many reasons, but more especially because of the complexity of the arguments which had been used in the discussion, and the difficulty of deciding who would vote for, and who against it. He (Mr. Milnes') own feeling was, that a Resolution of the kind proposed by his hon. Friend, was perfectly useless at the present moment; inasmuch as the opportunity of carrying it had been suffered to pass by. If Her Majesty's Government had been met directly, when they declared, at the commencement of the Session, that the Income Tax was to be continued, there might have been a chance at that stage of the procedings of doing that which at present, as things stood, was quite impossible. The present debate might be regarded as a preface of the future; but there had been a remarkable silence observed by the House on the subject of the Budget of his right hon. Friend, and very few words were said against it. And he could not help coming to the conclusion, that if the oppressions complained of in regard to the Income Tax had been as frequent as had been stated—and if the majority of the manufacturing and commercial classes of the country had suffered severely, they would, undoubtedly, have complained—he could not help concluding that, if it had been even as obnoxious and as inquisitorial as the assessed taxes, or even as the excise duties, there would have been more petitions presented against it than had as yet been laid on the Table of the House. He could not, under these circumstances, help thinking that the assent of the public had been given to a certain amount of direct taxation. With all its inequalities and occasional injustice, the Income Tax was approved of by the country. Believing that, but believing also that it was not wise to carry the principle of direct taxation too far—to carry it to the point of making every man in the country feel an immediate addition to the general taxation—believing that to adopt that plan would be to peril the safety of the country, and to place its honour in jeopardy, to have to tell every man, that he should pay so much for going to war—believing all this he felt convinced that, by a certain amount of indirect taxation only, could the honour, the credit, and the safety of the country be preserved sacred. It was not for him to criticise the appropriation of the surplus revenue by 572 the Government, nor was it for him to speculate as to the future state of the finances of the country. The right hon. Gentleman at the head of affairs had good reason to be thankful for the watchful interposition of Providence, as shown in the succession of favourable harvests, and the conjunction of fortunate circumstances; but, nevertheless he could have wished that a larger margin had been left by his right hon. Friend, and that some proportion of that surplus had been retained for those purposes recommended by the hon. Member for the University of Oxford, as well as for the promotion of those great national defences which, he believed, were the best preservatives of the country against the jealousies and animosities of other nations. He could not look at the present state of Europe, without perceiving circumstances in its condition calculated at any moment to draw England into a Continental war; and as that flame, which was kindled in a neighbouring nation in 1840, was not as yet subdued, it behoved a Minister to be always in a position to meet its outbreak, without coming directly to Parliament for the means that should have been previously provided.

§ Mr. Hawes
said, that the hon. Gentleman the Member for Pontefract, who had just sat down, seemed to think that the people of England had consented to the Income Tax, because no one rose strongly to oppose it in that House, and because the Table of that House had not been loaded with Petitions in opposition to it; but he would remind the hon. Gentleman of two or three trifling circumstances attending the imposition of that tax, which seemed to have escaped the hon. Gentleman's recollection. In the first place, the tax was to continue only for three years; and next, they were told that it had been introduced to raise the income of the country to a level with its expenditure, and that trade would in the mean time spring up revivified, which would render its renewal at the end of three years unnecessary. Now, he believed there was no man in that House, he believed there were few in the country, who would not give up a great deal to bring the income up to a level with the expenditure of the country. Well, the tax was now again proposed, with a remission of other taxes; again for three years—and again they were told that the trade of the country 573 would, in the mean time, so improve, that they should be able, at its expiration, in consequence of their increased income, to dispense with that tax. There did appear to be in that House Gentlemen who relied upon that statement, and who regarded the Income Tax as a necessary, but only temporary, evil. He did not so look upon it, nor, indeed, did the right hon. Baronet himself much encourage such a belief; for the right hon. Baronet casually had said that he would prefer five years to three years, and had asked besides, "Who can tell what will be the state of trade at the end of that period of time?" He concluded, therefore, that the right hon. Baronet regarded the Income Tax as a wise and prudent system of taxation, and he certainly did not expect to see it abolished quite so soon as some hon. Gentlemen anticipated. There was, however, an inquiry as to the state of the finances of the country at this time, which he thought they were bound to make. If the continuance of the Income Tax should prove to be really necessary to enable the right hon. Baronet to carry into effect the reduction of taxation which he had proposed, even then he was not prepared to say that he should vote for the tax; but he was prepared to say that he believed all those reductions might be made without a continuance of that tax. As he had understood the right hon. Gentleman the other evening, the estimate of the income of the country for the ensuing year, up to the 6th of April, 1846, was 51,100,000l.; and the estimated expenditure was in round numbers 49,690,000l.; therefore on the 5th April, 1846, it was quite clear that the right hon. Gentleman anticipated a balance of something like 1,400,000l. Now he would wish to call the attention of the House to two circumstances. He could not of course suppose that the right hon. Gentleman had suppressed anything which he ought to have stated; but he believed that the right hon. Gentleman attached less importance to some items than he (Mr. Hawes) did. The right hon. Gentleman assumed that there would be a decrease of 300,000l. on Excise and Customs. [Sir R. Peel: Why don't you state the items separately?] He had not got the documents, and could not give them separately. [The Chancellor of the Exchequer: They had estimated a decrease of 500,000l. in the Customs, and an increase 574 of 300,000l. in the Excise receipts.] He would say, then, that there was an anticipated decrease of 200,000l. on Excise and Customs. Now this was described to be a year of great prosperity; on that prosperity the right hon. Gentleman had founded his argument in support of the continuance of the tax, on the ground that trade would increase and flourish; and if it were a good argument for the right hon. Gentleman to apply in that sense, it was also a good one for him (Mr. Hawes) to apply when he assumed, in opposition to what the right hon. Baronet had said, that the Excise and Customs' receipts of the ensuing year would be more productive than in the last year. He said, then, that the right hon. Gentleman had no right to assume that they would be less, and he should add 200,000l. to the income. But that was not all. The right hon. Gentleman had altogether excluded corn, and that on a very peculiar ground. Under the old Corn Law he could understand why—

§ Sir R. Peel
Would it not be better, before you proceed, that I should just state what I did say? I said that the revenue derived from corn last year was rather more (I think) than 1,050,000l.—that is, for the year ending 5th of April, 1845. Of course that constituted a part of the Customs' duty received that year. I calculated on receiving a less amount from corn next year than last year, on account of the abundant harvest. I estimated, therefore, that there might be a reduction in duty received from corn to the amount of 500,000l., and that sum, of course, I estimated that the Customs would be deficient.

§ Mr. Hawes
quite understood that statement; and to take the case in the most unfavourable way for his own argument, he would admit the estimated surplus of 1,400,000l. as the correct one. Now, it was quite clear that with that surplus the right hon. Gentleman might repeal the duties on cotton, coal, and glass. The duty on those articles amounted to 1,400,000l. Of course, in that way a very narrow margin would be left; but with that the right hon. Baronet could hardly quarrel, for he himself preserved a margin of only about 90,000l. He believed, therefore, that the reduction on the main articles of trade might be accomplished with the estimated balance. But, then, there were other things; and if the 575 corn duties and the extra receipts on Excise and Customs were not allowed, he should not recommend the abolition of the auction duty, or of the duty on those other 430 articles that had been alluded to by the right hon. Baronet. He should oppose the abolition of the auction duty, because the Commissioners appointed to inquire into it recommended a commutation rather than the entire repeal of that duty, and he believed that by modifying that duty, and improving the mode of its collection, it would increase the Revenue, instead of proving a total loss to it. With regard to the 430 articles of the Tariff, he did not believe that the Customs' establishment would be reduced in consequence of the abolition of the duty upon them; because the inspection and clearance of ships, and all the serious items of expenditure in that establishment, must be continued as at present. Everything that came in must be subject to examination and inspection, as now; and the very same forms must still be maintained. Many of those articles yielded but a small amount, it was true, to the Revenue; but, little as it was, he saw no reason for losing it, unless trade was to be improved in consequence. But then, supposing that we had all these advantages, it must be remembered that we had the great counterbalancing disadvantage of 5,000,000l. from the Income Tax. Then the would ask the House to look at the way in which sugar was treated. The right hon. Baronet reduced the duty on sugar, and merely to enable him to reduce that duty the Income Tax was continued. According to the right hon. Baronet's own showing, the sensible reduction in the price of sugar to the consumer would be about 1d. a lb., and the total loss to the Revenue would be 1,300,000l.; yet for that was the tax of 5,000,000l. imposed upon the capital and industry of the country But with regard to that sugar no one could deny that at least 1,000,000l. of the sum received from that source went into the pockets of the West India proprietors. So that they had 5,000,000l. of taxation, and 1,000,000l. in the shape of protection; in all 6,000,000l. on the profits and income of the country, in order to reduce the Sugar Duties. He said, then, that he saw nothing in the present state of the country to prevent him voting against the continuance of the Income Tax; nothing that should not place it in the power of the 576 right hon. Gentleman to take the duty off coals, cotton, and glass; and nothing, therefore, that should justify the continuance of a tax so obnoxious, so unequal, and so manifestly unjust as the Income Tax. He was not all convinced that the reduction of duties proposed by the right hon. Gentleman were reductions which would afford a compensation for the imposition of the Income Tax. His hon. Friend the Member for Liskeard (Mr. C. Buller) proposed that the House should endeavour to render this tax more just and less inquisitorial; and the hon. Baronet the Member for the University of Oxford (Sir R. Inglis) said no man in the House could now say it was a terminable tax. The hon. Baronet considered the tax to be perpetual, and he called upon the House to take into consideration, not only his own suggested modifications, but every fair and equitable modification which could be proposed. The tax being perpetual, he did not consider the argument of the hon. Member for Kendal (Mr. Warburton) of much value as against the hon. Member for the University of Oxford; therefore, under all the circumstances, there was every reason for making an effort now to remove the injustice of the tax. As to the other view of the hon. Member for Kendal, he did not consider it would be satisfactory to place any large portion of taxation upon a direct money basis; and on this subject he ventured to think the House was not aware of the amount which the direct taxation of the country bore to the income. The right hon. Gentleman the Chancellor of the Exchequer said we were now beginning to introduce a system of direct taxation, so as to make it bear a rateable proportion to indirect taxation. If this were the case, of course it was only natural to expect that all injustice and inequality should be removed. If to those taxes which were paid directly in the shape of money were added the local taxation (which was also direct), the House would find the amount was very large indeed. Indeed, we were not in a position to say that so very large a proportion of our taxation was indirect, for at this moment taking the average of the years 1842 and 1843, about 20,000,000l. were paid in direct and 35,000,000l. in indirect taxes; but if to the 20,000,000l. we added the local taxation, it would amount to 32,000,000l.; thus demonstrating that nearly one-half of the revenue of 577 the country was imposed in the shape of direct taxes. He warned the House against expecting a much larger income in the shape of direct taxation. He was not convinced of the economy of the direct mode, and the only argument he had heard in favour of it was its justice; but, on the other hand, he believed a heavy direct tax upon capital was very likely to drive a large mass of capital out of the country. On this subject the large investments at present being made in foreign railways should give us warning that any additional tax upon profits would be an increased stimulus to drive capital away. It was quite impossible to say that the Income Tax, as proposed, was part of a system of commutation of what was called the indirect taxation of the country; and, therefore, the hon. Member for Liskeard, with great propriety called upon the House specially to say that they would not renew this tax without removing its injustice. Did any one believe that the present mode of levying the Property Tax would be borne by the people at large in unfavourable periods? You might reconcile them to the burden when plenty prevailed; but let the time come when no more taxes could be taken off, with the Income Tax, and all its inquisitorial powers retained—let a time come when trade failed and profits diminished, there would then be an amount of feeling in that House calling for a repeal of the taxes on trade which could not be resisted. Having this view, the hon. Member for Liskeard had done well in asking the House to consider the nature of this tax. He saw great difficulty in the way of materially altering its injustice, but that would not prevent him from considering the proposition; and avowing that the Income Tax, as imposed, must be attended with great hardships and inequalities, he was at least consistent, so far as discussion had gone on the question, whether in 1842 or 1845, in having stedfastly given his vote against it. In the first instance, he did not believe it was the best mode of meeting the then deficiency—a deficiency he had always considered temporary, and to be accounted for by bad harvests and the necessity for increasing our naval and military expenditure. He could not view the deficiency as of a permanent character. It was for the right hon. Baronet (Sir R. Peel) under these circumstances, to show that at this moment he could not reduce taxation—that 578 the Income Tax was still absolutely necessary, and that no other taxes could be resorted to less odious and less unjust. Unless all this was made out, he (Mr. Hawes) must confess, so mischievous, so unjust, uneven, and inquisitorial was the tax, that nothing should induce him at any time to vote for it short of absolute, imperious, and inevitable necessity.

§ Mr. Spooner
did not agree with what had fallen from the hon. Member for Lambeth, nor could he concur in the course he had taken. It was not, he considered, a wise or a prudent course to make general charges against the tax; and he thought, if any charges were preferred, they should be of a distinct and specific nature. He agreed with the hon. Member for the University of Oxford, that it was unjust to tax a man who had only a life interest at the same rate as a man who had a perpetuity; and he fully concurred in the modification proposed by the hon. Baronet three years previously, for making 150l. the zero of the tax, and rating all above it in proportion to a fixed rise in the scale. He did not however agree with the hon. Member for Kendal in his observations in making capital the subject of taxation; he thought there would be no difficulty in dealing with it, and he believed moreover that it would be a beneficial measure. He confessed however that he had come to a widely different conclusion from the hon. Baronet the Member for the University of Oxford, for he could not give his consent to the Motion of the hon. Member for Liskeard. A proposition could not be justly dealt with disconnected from the argument by which it was supported; and connecting the words of the hon. Member's Motion with the reasons assigned by him for its adoption, he (Mr. Spooner) could not concur in the proposition that it was exceedingly improbable that Parliament would have the power of dispensing with the continuance of the Income Tax at the end of three years. He was not then called on to give any opinion on the general question; but if he were to give one, it would be, that the principle of a Property Tax was the best that could be applied to a people; and he might add, that if complaints were made against it, they were on the ground of its occasional inequality, and not against its principle as a question of justice. He (Mr. Spooner) could not agree either with the hon. Member for Liskeard, that, from the nature of 579 the Budget of the right hon. Baronet, it was impossible to reduce the Income Tax. On the contrary, he believed that the effects of the right hon. Baronet's propositions on large branches of manufactures and industry would be so great as to increase extremely the facilities for taking off the Property Tax at the period suggested. He could not concur in the sweeping condemnations that had been passed on Schedule D, with respect to its unequal and inquisitorial character; if by that term he meant a total abandonment of that schedule, what was the meaning of the words unequal and inquisitorial, so applied, if they did not mean exemption of the merchants and manufacturers from the operation of the Income Tax? He was desirous of making such exemptions as fairness and justice required; but he was not disposed to release from a proper share in the expenses of the State the large incomes produced in trade, especially at a time when the tax under consideration was introduced for the very purpose of a great experiment intended to promote the manufactures of this country. Under such views then as he took, it was impossible that he could agree to the condition proposed by the hon. Member for Liskeard. He would not at that moment state what the reasons were for proposing the Amendment of which he had given notice; but when the proper time came, he thought he could show hon. Members that he had a very plain case, and he could assure them he should take a very short time in stating it.

§ Mr. Hume
said, the propositions advanced by his hon. Friend (Mr. C. Buller) and his hon. Friend the Member for Lambeth, contained two questions, which he considered were distinct, and ought to be kept separate. His hon. Friend the Member for Lambeth had entered a little into the financial statement of the year, which he (Mr. Hume) thought ought not to be meddled with on the present occasion. The time would come when that question would be more properly discussed, because the right hon. Baronet had told the House that he did not want the Income Tax to be reimposed for any financial purposes of the year; and he had shown that, taking into account the arrears of Income Tax which would be due to April, 1846, he would have a surplus of 1,400,000l. The present was not the time to discuss that question; but the question to be considered 580 by the House, he conceived, ought to be, whether they were willing to raise five millions of taxes directly, by a Property and Income Tax, and whether the operation of that measure would be more beneficial to the country than to allow the former system of taxation to continue. In choosing between direct and indirect taxation, he was decidedly of opinion that direct taxation ought to be resorted to, and that relief ought to be given to those interested through the channels of indirect taxation. Was this an additional tax upon the country? If the right hon. Baronet was correct in his calculations it would not be so, but would be only a change. He had already explained that 5,000,000l. of taxation would be only removed from those who were unable to bear it, to those whom their property rendered better able to sustain it. His hon. Friend must have been under a mistake when, in alluding to the amount of direct and indirect taxation, he stated the former at 20,000,000l., and the latter at 30,000,000l. He found the total amount to be 50,000,000., free of all charges. Of that total, the Customs amounted to 19¼—that was an indirect tax; the Excise 13¼—was that, again, direct? Of stamps, a large portion was indirect; Crown lands and other items so small as scarcely to deserve to be taken into the calculation; but on the whole, the direct taxes—land and assessed—were only four and a quarter millions. Leaving the Property Tax out of the question, out of the fifty millions there were only four millions and a quarter of direct taxation. The complaint which he had always made since he had the honour of a seat in that House, was, that taxation was laid upon the poorer classes, and that property was almost exempted. This was unlike the practice of any other country in the world. Look at France, where there were thirty millions of direct taxation. In Belgium, the land tax was 20 per cent. at once, without calculating those imposts which fell partly upon the soil; but England was exempt from direct taxation more than any other country, and thus the mass of the community were obliged to bear those expenses of the State which property ought to sustain. The effect of this system of taxation was, gradually to reduce the different classes in the country into rich and poor; the very rich being those possessed of capital which was not taxed, and the very poor those who were compelled to bear the burdens of the State. In the year 1835, he (Mr. Hume) had 581 made a calculation of the amount of indirect taxation, which he found at that time to be 72 per cent. out of 100. The proportion of taxation which was partly direct and partly indirect, was from 7 to 12 per. cent., and the rest he allowed to be direct. That was not the state in which the finances of the country ought to be, if we wished to relieve labour and industry from their burdens, with a view of regenerating the population of the country, and freeing it from the pressure which weighed upon it. If the Legislature persevered in the course now proposed by the Government, he looked forward with confidence to see the Excise and other indirect sources of taxation abolished. His hon. Friend who had brought forward this Amendment, and the hon. Member for Lambeth, asked what relief would be derived from the removal of the duty on the 430 articles specified; and his hon. Friend had mentioned some of the most trifling of those articles, in order to turn the proposition into ridicule; but let him look to the general sweep upon all articles used in manufacture—all dye-stuff, all drugs, and everything which would tend to relieve the industry of the country from its shackles, and to enable us to cope with the productions of other countries. Why had the industry of England been hitherto fettered, and why had there been so many of the people idle? Because they could not find employment; and the reason why they could not find employment was, because we could not find a vent for our manufactures. There was capital enough to afford employment to every man in the country, if we were in a condition to meet the producers of other nations in the Foreign market. Would any man take any of the articles from which the right hon. Baronet proposed to take off the duty, and say that it would not tend to enable us to compete with other countries, and to remove that character of pauperism which was threatening to destroy the independence and the prospects of the industrious classes in the country? He (Mr. Hume) might be too sanguine—perhaps he was; but it appeared to him that this was the only course by which the industry of the country could be freed from the trammels by which it was bound down. The hon. Baronet the Member for the University of Oxford said, that a portion of the funds derived from taxation ought to be applied to the relief of spiritual destitution. He (Mr. Hume) held that there were ample funds, if properly applied, to remedy any 582 evil that existed of that character. He wanted relief for the physical destitution that prevailed; and he told his hon. Friend that his efforts to relieve spiritual and moral destitution would thrive better when there was physical comfort. The tendency of the measures proposed by the Government was, to remove restrictions from the Customs, and to cause a large reduction of the expenses to which the poorer classes were liable. He was confident that if they persevered in that course, the Excise might be removed, and a saving of from 850,000l. to 900,000l. could be thus effected. The duties on spirits, malt, and licenses from the Government, would be the only three that would remain, and they would merge in the Customs. He considered the relief to be afforded by taking off the duty on cotton to be most essential to the commerce of the country, and well calculated to enable us to recover that station which we ought to hold in the Foreign market. He would just take the instance of twenty ships arriving at Liverpool with cotton. As the law at present stood, they could only begin unloading at nine o'clock, and must stop at four, and it would probably take five or six days to clear the vessel; whereas, under the proposed regulations, they might begin at five o'clock in the morning, and clear the ship before the day was over. There would be no necessity for placing the goods in the Queen's warehouse, but they would go directly to the merchant's warehouse, and the whole process would be thus very much simplified and facilitated. On that ground, he looked upon the proposed change as being most important. He understood the estimate of the amount which these articles produced was 350,000l. Was it to the value of that remission that he looked? No; but he looked to the effect which the example would produce in Europe and throughout the whole world, and which he expected to be attended with the most beneficial consequences. Let us say what we would, it had hitherto been the impression of foreigners that all our policy was directed by the view of enriching ourselves; whereas, God knows, our commercial regulations had tended to fetter industry and check our prosperity; but when once Foreign nations saw this bold and statesmanlike step taken in the direction of free trade, he thought it would have a most salutary influence upon their own policy. It was impossible to maintain that character which this country ought to hold 583 among the nations of the world, without fostering and encouraging our manufactures. The removal of the restrictions upon the articles specified, and upon about one hundred more, from which the duty could be cut off with equal advantage, would enable us to maintain that station and character. His hon. Friend the Member for Lambeth said, if he thought this tax necessary to sustain the honour and credit of the country, he would vote for it. Could anything be more calculated to sustain the honour and credit of the country than to promote the prosperity and the independence of our artizans and our merchants? This appeared to him (Mr. Hume) to be the most effectual means of creating that capital by which taxation ought to be borne. On these grounds, he should support the proposition of the right hon. Baronet as a whole, although he objected to some of the details. As far as the plan went, he considered it a wise and statesmanlike course. He should be happy to render it as little onerous as possible, but the right hon. Baronet had declared that he would not allow of the alterations and improvements which had been suggested. Very well, then; if that was the case, what was the use of their bothering themselves with these discussions? He repeated, that he was in favour of the proposition of the Government as a whole.

§ Sir R. Peel
Sir, before I address myself to the particular Motion which the hon. and learned Gentleman the Member for Liskeard has brought under the consideration of the House, I wish to notice a few of the observations that have been made in the course of this evening's discussion upon points not immediately connected with the Motion of the hon. and learned Gentleman. And first, as to the speech of the hon. Member for Lambeth, whom I am sorry not to see in his place. It appears to me from that speech that the hon. Gentleman did not very well understand the financial statement which I made on a former evening. The hon. Gentleman objects to the imposition of the Income Tax, that there is no necessity for it, because he is of opinion that I showed that there would be such a surplus of income over expenditure as would enable us to provide for the service of the year, and dispense with the Income Tax altogether; and the hon. Gentleman says I calculated that on the 5th of April, 1846, there would be a surplus revenue of 1,400,000l. [Mr. Hawes returned to 584 his seat.] Sir, I was noticing the counter-budget which was proposed by the hon. Gentleman; I was going to discuss the hon. Gentleman's propositions, but upon this occasion, as upon all former occasions when I have discussed these questions, I mean to discuss them simply on their merits. I shall abstain from all observations of a party character, and consider the proposition on its intrinsic merits. I was noticing the hon. Gentleman's reasons for opposing the measure of the Government, and attempting to show that I do not think he very well understands the purport of the financial statement which I made. The hon. Gentleman says I showed that on the 5th of April, 1846, there would be a surplus of 1,400,000., and he states that that surplus of 1,400,000l. would enable us to remove the duty upon cotton, to remove the duty upon glass, and the auction duty. [An hon. Member; No; the duty upon coals.] Now, I was not aware that we should have to enter into a discussion on the general question of the Budget, and I must speak, therefore, to a great extent from memory. On the 5th of April, 1846, supposing the Income Tax to be continued by Parliament, I think you would have a net Revenue amounting to 53,700,000l.; but in that 53,700,000l. would be included 600,000l. to be received from China; and supposing Parliament should not continue the Income Tax, you must deduct 2,600,000l. from the revenue on that account. You certainly would be entitled to add to the ordinary permanent revenue in the present year 2,600,000l., because there is one-half year's Property Tax to be received; and consequently on the 5th of April, 1846, you would have a Revenue of 51,100,000l.; that is, supposing the Property Tax not to be continued. Deduct from that 51,100,000l. the amount of the Expenditure, which I think would be 49,600,000l., if the House should approve of the Estimates we lay before it, and in that case you would have on the 5th of April, 1846, 1,400,000l. surplus. But if the Income Tax be discontinued, that surplus almost entirely disappears. The hon. Gentleman cannot calculate upon applying 1,400,000l. to the remission of duties corresponding in amount with that sum, because that surplus will be derived from the half-year's Property Tax yet to be received in the present year. Now the hon. Gentleman seems to 585 be rather bewildered on account of the amount of balance in the Exchequer on the 5th of April, 1845, and says, you admit that there will be a balance of 5,000,000l. in the receipts of the present year as compared with the expenditure, and, surely, that could be carried forward to the expenditure of the next year. [Mr. Hawes: A portion of it.] Well, a portion of it. But I apprehend that surplus will be thus applied—first, 2,000,000l. of it will be applied to the payment of Exchequer Bills issued for opium compensation. Another portion of it will be applied under the Acts of Parliament to the reduction of the national debt. A portion of it, certainly, goes to increase the balance in the Exchequer, and in that respect we are in a more favourable position than in the previous year; but I apprehend that that increased balance in the Exchequer will only relieve you from the necessity of borrowing money from the Bank, and that is not fairly applicable to the diminution of the expenditure for the year. Therefore I must say that the hon. Gentleman's calculations and his reasons for opposing the continuance of the Income Tax are really without foundation. The hon. Member for Montrose says that I declared it was not my intention to propose any alteration of the Property Tax, and that, therefore, it was useless to discuss these Amendments. I tell the hon. Gentleman that I shall feel myself bound to state my reasons for opposing any Amendment; but I think the better course will be to consider and discuss such Amendments when they are brought forward, than to state them upon the Motion of the hon. and learned Member for Liskeard; for the hon. Member, in bringing forward his proposition, studiously abstained from noticing any of them. He merely said "Vote for my proposition," and his speech was directed against the whole of our financial course. The hon. Gentleman ought to have concluded with a Motion condemnatory of the Income Tax, and not with a Motion recommending some small modifications. If the hon. and learned Gentleman had other modifications to suggest, why not state the nature of them? Why should he purposely abstain from any reference to them? Why make a Motion pointing to modifications, and make a speech that had no allusion to them? I hope the House will not commit themselves on the 586 details, until they have heard the particular proposition; because I think that when they come to consider the policy of making Amendments in the existing law, the more these Amendments are discussed, the more will they doubt the expediency of them. I will take that one which appears to be considered by many hon. Gentlemen the most plausible and specious; that is, the Motion of my hon. Friend the Member for the University of Oxford, who proposes that an income of 150l. a year shall, as it has been called, be the zero of taxation. But if the suggestion of the hon. Baronet were adopted, it would go much further than he intended. The proposition of my hon. Friend is, that supposing a person was worth 200l. a-year, he should only pay Income Tax upon 50l. Now, that proposition means practically this, that every man who now contributes to the Income Tax shall deduct from the payment which he makes the sum he now pays for 150l. of his income. That sum, in round numbers, is 4l. 10s. The meaning of my hon. Friend, then, is, that every man, whatever the amount of his income now assessed to the Income Tax, shall be enabled to recover from the Exchequer a deduction of 4l. 10s. from the amount he has actually paid. I have no means of ascertaining the exact number, but I should say that there are not less than 200,000 persons who pay the tax. And under the proposal of my hon. Friend every person who pays would be entitled to deduct 4l. 10s. from his payment for the year. That would amount to nearly 1,000,000l. But, observe, this would not be a deduction, it would be a claim for repayment. The payment must be made in the first instance; to prevent that would be impossible; and he who can show that he is entitled to receive back the 4l. 10s. must state what his income is, and he will then receive the sum. Why that is totally altering the whole plan. In that case every man would be obliged to state what his income is, and a new process must be introduced for the purpose of ascertaining its amount. At present you do not require persons to state what their incomes are in many cases; but if you permit any man not to deduct but to reclaim 4l. 10s. from what he has paid, you must then institute a new species of tribunal for the purpose of recovering the amount. If the suggestion of my hon. Friend were adopted, 587 the total loss would be little short of 1,000,000l., by which you would relieve persons of small incomes, but at the same time you would extend relief also to those who have no claim for relief. Now, I do hope the House will seriously consider before they allow such a deduction as this from the amount of the tax. I now come to the main question, whether or no we shall affirm a Resolution which, in point of fact, is condemnatory of the plan of Her Majesty's Government. Though it does not suggest any modifications, it still requires that the tax shall be conducted upon a less inquisitorial mode. The hon. Gentleman does not point out the nature of the modification he wishes to have adopted; but he asks the House to affirm a general Resolution, leaving it to others to execute that Resolution as best they may. There is no doubt, though this is an advanced stage of the Property Tax Bill, that it is perfectly open to the House to consider whether the general principles of the financial scheme of Her Majesty's Government shall be affirmed or not. The right hon. Gentleman mistook me in supposing that I taunted those who sit opposite with any inconsistency for now supporting an Income Tax to which they stated strong objections when originally proposed. I think it perfectly open to those who may have objected to the tax when we brought it forward in 1842, now to consent to its continuance in preference to any other tax raising even a more limited amount. They find the tax established; and a process devised and in existence for raising it. It raises perhaps a larger sum than may be requisite; but seeing that some additional taxation is necessary for the purpose of providing for the Public Service and maintaining the public credit, it is perfectly open now for consideration whether it be not a lesser evil to continue that tax which is in existence, than to devise some new and possibly, in proportion to the amount, more onerous system of taxation. The imposition of this tax, no doubt, will give more than you require for the purpose of maintaining the public credit, and meeting the exigencies of the country, provided for by annual votes; and it is open to the House to consider whether it be expedient to raise that additional sum for the purpose of effecting a commutation of taxes. The additional sum will be a large one; it will not certainly be less than 3,400,000l. 588 after providing for the increased estimates which will be proposed; and it is possible, certainly, that the amount might be raised by other means. If you choose to impose a tax of twopence instead of a penny on each letter going through the Post Office, you might raise a considerable sum of money by that means. I do not think, certainly, that past experience would lead us to impose any additional duty of 5l. per cent. on imports. Yet sufficient might be raised to meet the increase in your Navy Estimates, and sufficient to prevent any injury to public credit; and the question is quite within your province to decide, "Will you raise this additional sum by means of an Income Tax, and apply the surplus to the reduction of other taxation?" I will not revive to-night the discussion upon the Sugar Duties. The House has by a very large majority affirmed the proposition of the Government. Many hon. Gentlemen contested the policy of a discriminating duty, taking a widely different view from Her Majesty's Government upon the subject. Still the question has been fully discussed; the sense of the House upon it has been made known, and it is in favour of the discriminating duty proposed by the Government. There must of course be some future decision. There must be some act conveying the final determination of the House upon a proposal of that nature; but I consider the sense of the House to be in favour of that proposal, and the subject to be exhausted as far as discussion is concerned, and therefore I will not revive it now. But, supposing there should be a loss of 1,300,000l. next year by the reduction of the Sugar Duties, still there would be a surplus remaining of 2,000,000l., in respect of which no discussion or decision has yet taken place. And it is the proposed appropriation of that surplus of 2,000,000l., against which a portion of the speech of the hon. Gentleman is directed. The hon. Gentleman disclaims that! Why, what was the meaning of all the waggery of the hon. Gentleman? [Mr. C. Buller: I have admitted the reduction on sugar]. What I am stating is, that the hon. Gentleman not only quarrelled with our proposition in respect to sugar, but he distinctly attempted to show that the remaining surplus of 2,000,000l. might be much better applied than in the manner proposed by Her Majesty's Government. We propose to apply that remaining 589 surplus of 2,000,000l. in the following manner:—We propose to remove altogether the duty upon raw cotton. We propose to remove altogether the excise duty on glass, and to abolish those restrictions which are more onerous than the pecuniary imposition itself, and which prevent the application of capital and skill to the manufacture of glass. We propose also to remove the duty upon auctions; and the duty upon 350 or 360 articles, which now enter into the Customs' Tariff; making altogether a reduction of taxation to the amount of 2,000,000l. and upwards. I still remain of opinion that it would be very difficult to apply the remaining surplus of 2,000,000l. in any manner better calculated to revive and encourage the industry of this country, and to confer permanent benefit upon all classes in it, than by the remission of taxation which we propose. Some Gentlemen appeared by their smiles to share in the objections of the hon. Member to the reduction of the cotton duties. But before the intentions of Her Majesty's Government were made known, I had the honour of receiving some of those gentlemen as a deputation from the cotton manufacturers; and nothing then could be more earnest than their recommendations for the removal of the cotton duties- The hon. Gentleman has calculated the advantage which would be derived by the labourer who wears fustian, or the woman who wears two gowns in the course of a year; he said that the repeal of the duty would give them about 3d. a-year; and, therefore, the hon. Gentleman scouts the notion that any public advantage will accrue from the removal of the cotton duty, not positively, but as compared with other taxes which the hon. Gentleman says might be remitted. It is necessary that I should remind the House and the country of the grounds upon which we proposed to remove the duty on cotton. In the first place, no doubt, by the removal of this tax there will be a facility for the introduction of cotton at the place of import greatly superior to that which now exists. But then we were told, and told with truth, when the question was still doubtful what taxes should be remitted—that there was no tax more unequal in its operation than the duty upon raw cotton. We were told that, with respect to muslin, the amount of duty was scarcely appreciable; but that upon those articles which entered into the 590 consumption of the labouring classes the amount of duty was not less than from 18 to 24 per cent on their value. We were told also, and correctly, that in those countries which are our great competitors in cotton manufacturing—the United States, of course, among them—not only is there no duty upon raw cotton, but the greatest facilities are afforded for procuring the law material. In Germany, I apprehend, there is no duty upon raw cotton; in Switzerland, I believe there is no duty upon raw cotton; in France, I believe there is a duty upon that article, but there is a corresponding drawback allowed on manufactured cotton. We were therefore told that our great competitors in the manufacture of cotton have the raw material free of duty; and that therefore in neutral markets they have great advantages over us—that at Valparaiso, Manilla, and China, they do compete with us, and with great advantage, particularly in the manufacture of the heavier classes of cotton goods, on which the duty presses most heavily. Well, I look to the extent of our cotton manufactures. I see that the declared value of the exports from this country last year amounted to 50,000,000l. sterling, and I see that cotton manufactures alone amounted to 25,000,000l. sterling. Thus, taking the declared value we find that one-half of the value of the exports from this country in the year 1844 was of cotton goods manufactured in the country in the same year. That great branch of our manufactures is now in a prosperous state; but when I look to that amount, when I see how closely interwoven the continued prosperity of that branch of manufacture is with the welfare and strength of this country, I must say, notwithstanding the present prosperity, it is, in my opinion, wise to reduce a duty which amounts to eight or twelve per cent. upon the raw material; and thereby enable us to continue with a prospect of greater success our competition in neutral markets with those countries which are now our most formidable rivals. Therefore upon that ground—upon the ground of the importance of the manufacture, and upon that of the admitted impolicy of having a duty upon the raw material—upon the consideration, too, that this duty presses with no severity upon articles worn by the rich, while it presses with peculiar severity upon the coarser 591 articles worn by the poor, we propose, and our sentiments with respect to that policy is not changed, that the sum of 650,000l. surplus revenue shall be applied to the reduction of the duty upon cotton wool. But if you think the remission of that tax unwise, propose that some tax in competition with it shall be removed. Tell us what that tax is. Say whether you think it more wise to reduce the tax upon tobacco, or upon tea, to the extent of 650,000l. than upon raw cotton, and we will enter into a discussion with you upon the subject of their relative merits; but we will do so in the fullest confidence that the ultimate decision of the House would be in favour of our proposition. Well, then, with respect to the duty on glass, I think the hon. Gentleman did admit that the remission of the duty on that article was politic. No doubt there was no great clamour raised in favour of the abolition of that duty. Moreover, I tell the hon. Gentleman I very much doubt whether the chief manufacturers of glass at all rejoice at the removal of the duty on that article. It has, therefore, been said, you have selected articles for the remission of duty about which nobody has clamoured, and you are doing that which you were not called upon to do. Now, so far from the fact of the great manufacturers being quite content at having the duty retained being a reason for retaining the duty, it is, in my opinion, one of the strongest arguments in favour of the abolition of the duty; and I say that by the 5th of April next year you will find that a great competition amongst glass manufacturers will have arisen. It is a great mistake to suppose that great capital and enormous edifices are required to manufacture glass. But if you leave the duty as it now is, the possessors of large capital and the owners of those great edifices now in use will have a manifest advantage over all the rest of the manufacturers of that article; and they have a distinct interest, therefore, in taking no part to promote the reduction of the duty. But I believe that they also will receive great advantage from the change, and that they will be able to compete with smaller capitalists. They will have the advantage of increased demand. But still their ready acquiescence in the existence of the tax is no argument in favour of its retention. But what really is the case with respect to 592 glass? The total average of yearly exports in that article does not amount to 400,000l. Remove the duty altogether, and permit the free manufacture of glass, and I believe you will establish a manufacture, of less importance indeed than that of cotton, but a manufacture which is to be the source of increased industry, increased profit, and increased commerce with other countries. The hon. Gentleman was particularly merry on the subject of fustians. Now, with all respect for his abilities, I think it was hardly worthy of him to select four or five articles with odd names—"divi-divi," and such like—and then to ridicule the supposed advantages which the labouring classes in particular would derive from the remission of the tax upon those articles. It is very easy to say that the poor will derive no advantage from the remission of these taxes; but the former charge against the Government was this: "You complicate your Tariff by retaining upon it some 500 articles, from which you derive no revenue. There is no object in retaining them; it is merely the love of intermeddling with the commerce of the country that induces you to retain those articles in the Tariff." We feel the force of that objection, and we reply, we will strike them out. Then the hon. Gentleman steps in and thinks it worthy of him to say, what is the use of removing those articles? and he makes the House merry by referring to certain articles in the Tariff with hard names, and asks what benefit does the country derive from the removal of the duty upon those articles? My answer to the hon. Gentleman is, that in the 430 articles, the duties on which are remitted, are included many raw materials which are the elements of our manufactures. The hon. Gentleman says you permit alum to be brought in duty free, that bread may be the more readily adulterated. I tell the hon. Gentleman, if he be ignorant of it, that alum is an article which enters into the most important manufactures of this country; and, perhaps, there is no article with respect to which I have received more urgent applications for a reduction of duty than alum. We import alum from China; and we are continually told how desirable it is to extend our commercial relations with that country, and receive in return for our manufactures some other article besides tea. There is in China a manufacture 593 of alum; and there is a chance of opening and extending trade with China in that article. I believe the supply of alum brought from the Roman States and Syria is very limited. Three or four cwt. was all that was received within the last few months. It was of an inferior kind, but still it was a commencement. Under these circumstances we propose to remove the duty on alum, and this is the return which the hon. Gentleman makes—"You remove the duty on alum in order that there may be fresh means of adulterating bread." We propose to remove the duty upon bark, upon skins, upon oils, upon indigo, upon all dyestuffs, and altogether on 430 articles, and not merely upon divi-divi—upon articles which are of great importance to the manufactures of this country. The total amount of loss is 350,000l. which, considering that the reduction is upon the raw materials of manufactures, is, I think, well applied. If the hon. Gentleman thinks differently, let him propose the remission of that tax which he would prefer; and, meeting the hon. Gentleman on that ground, I should not despair of having the sanction of the House to the removal of those articles from the Tariff, and to the simplification which we propose of the Customs. Last year, when we had no surplus, we were asked to reduce the duty upon staves. Nothing would have been more easy than to show that the agricultural labourer would derive very little direct advantage from the remission of the duty upon staves. If the hon. Gentleman calculated the benefit derivable from it to an agricultural family, he will be able to show that it is less than 3d., the amount he says they will receive from the reduction of the duty on cotton wool. But is that the way in which we should estimate the matter? It was said, last year, by retaining the duty on staves, you are injuring an important branch of manufactures. You are destroying the trade of the cooper. You have opened the West Indies to a free competition with him in American staves; you permit them to be brought without payment of duty, but, by your timber duties, imposing a tax on the raw material—namely, staves from the United States and the Baltic, you are destroying the trade of the cooper. Remove the duty upon staves, and your cooperage trade will revive; the coopers will be able, by skill and peculiar advantages, to compete 594 with America and other countries. Well, then, is it any test of the utility of the measure to say that the agricultural labourer will derive only a small benefit from the abolition of the duty on staves? You will enable your coopers to compete with advantage with the coopers of other countries, and you will confer a benefit which, taken in conjunction with other similar benefits, will operate advantageously and tend to improve the condition of the labourer. What did we hear last year with respect to the duty upon wool? For three or four successive years we were urged to take off the duty on sheep's wool, and the right hon. Gentleman may recollect the description which was then given of the woollen manufactures of this country. We felt ourselves that the earliest opportunity should be taken of applying any surplus to take off the duty on wool. Well, you removed the duty when there was scarcely any surplus; the woollen manufacture has improved, and an increase of price in your own domestic produce is the result. Every argument which applied to the reduction of the duty on Foreign wool, applies with equal force to the reduction of the duty on cotton wool. Having removed the duty on foreign sheep's wool, there is an additional argument for the removal of the duty on cotton wool, so that both branches of manufacture may compete with each other. That disposes of 600,000l. of our surplus. The remaining duty which we propose to remove is the auction duty. I admit that there was no clamour for the removal of that duty; but I must say, if ever there was a tax unjust in its operation, it is the tax upon the transfer of property by auction. I ask the hon. Gentleman to look at the exemptions from that tax—that is, what are the cases in which they originate. Let him look to the amount of property charged with respect to which an account is taken. The chief effect of the operation of the duty is to give an opportunity to the seller of an estate to ascertain its value, and, having so ascertained the value of the estate, he disposes of it by private contract. Thus, all your establishments with respect to this tax are kept up not for the purpose of revenue, but to enable parties to ascertain the value of their property. With respect to the sales of Colonial produce, the great importer is free from the operation of the auction duty, but the 595 humbler retail trader is subject to it. Talk of the injustice of the Income Tax! what is it when compared to the injustice of the auction duty? It is a tax which falls upon the humbler classes of the community, when they have no option but to dispose of their goods by auction. But I understand the proposition for the removal of this duty is to be opposed. I understand a proposition is to be made for removing the duty on marine insurances instead. I should be glad to hear the reasons for that from the right hon. Gentleman opposite. [Mr. F. Baring: I said there were other duties which I would prefer removing to the auction duty.] I cannot deny that there are other duties which it might be advisable to remove. It is impossible, looking to the taxes of this country, not to admit that strong reasons may be urged for the repeal of duties which it is not in our power to repeal. I know it is no conclusive argument in favour of those duties to say that the auction duty is an unjust burden; but in preferring their removal to the removal of the auction duty, you ought to show that they are greater burdens. I think the general voice of the country is in favour of the selection we have made; and when you come to discuss them in relation to other duties competing for repeal, I cannot help thinking that the general sense of the House will remain what I understood to be—that, upon the whole, the duties were taken off for the purpose of encouraging industry, and conferring a benefit, not upon one class only, but upon the country at large. I quite admit that if we were to deal with some taxes on articles of consumption, a more immediate benefit might be derived, and might be more sensibly felt by the working classes; but I entreat the House to bear in mind what the effect is of removing taxes that bear on the industry of the country. Look to the amount of your poor, and observe that the poor-rates have of late years been increasing. Find employment for the people in manufactures, and you will be reducing that great burden. If you compare the reduction of the duty upon some great article of consumption with the reduction of the duty upon cotton or glass, you must bear in mind that, though the immediate benefit to the consumer may be less in the case of cotton or glass than in the case of soap or other articles that I might name, yet, if you 596 are insuring a great branch of manufacture against vicissitude, against such distress as visited us in 1840 and 1841—if you are by removing the duty on glass giving a new scope for employment, I say you are taking effectual means for diminishing the risk of increasing the charge on account of the poor. I will not at present enter into the merits of the question of direct taxation. We propose to continue the Income Tax for three years; and the hon. Gentleman seems to take so sanguine a view of the taxes of this country generally, that I think he must contemplate the possibility of its removal at the end of that period. When that period arrives the House may determine whether or not the tax can be dispensed with—whether direct taxation can, in any shape or modification, be continued in preference to indirect taxation. I and my Colleagues have a sanguine impression that it is for the interest of the country to continue the Income Tax for the period mentioned, in order that we may make the proposed experiment respecting those taxes which do press heavily upon the industry, the skill, and the capital of the country. When I look to the amount of our Foreign trade last year, not speaking of the internal consumption, which was stimulated by a good harvest, and compare it with the trade of 1843—when I find that in 1843 it was 46,500,000l., and that in 1844 it rose to 50,000,000l., I do retain the sanguine hope that the removal of those restrictions upon your manufactures will still further extend your internal industry and your external commerce. Although there is an absolute remission of taxes, although we cannot, as in the case of coffee or other articles, expect an immediate benefit therefrom, and although those taxes being absolutely removed, will cease to be a source of revenue, still if their removal should increase the manufacturing prosperity of the country, that removal will, if not directly, at least indirectly, affect the revenue; it will cause an increased consumption; and although in these particular taxes you must relinquish the hope of revenue, yet by the general prosperity bearing upon the general consumption, there is, I think, a rational hope, that your revenue will compensate you for that loss. Sir, when we last proposed this tax, there was a consideration which has not been adverted to in the course of this debate. 597 I think the noble Lord objected to any alteration of detail, being unwilling to impair the effect of this great instrument, which we considered to have been called for by the circumstances of the country; while the hon. Gentleman admits that there has been no petition against it—circumstances which I think show that the measure has upon the whole been less onerous than was expected, and that the inquisition necessary to establish it has been conducted, through the great skill and intelligence of the Executive officers, and in particular those in the Stamp Department, with that valuable public servant, Mr. Presley, at their head—has been conducted with much less of injustice and of oppression than might have been anticipated. It is a matter well worthy of observation, that notwithstanding the continuance of this tax there has been no diminution of the receipts from other sources of direct taxation; for example, the assessed taxes have not been lessened by the operation of the Income Tax. Again, there has not been one petition against the tax. I therefore do hope that the House will still remain of the same favourable opinion which it has hitherto entertained with respect to the Income Tax; and that the House will permit the tax to be continued unaltered and without modification. I say without modification, for I do maintain that any attempt at modification would be attended with the utmost risk. I have called it an Income Tax, because I do not deny that it is an Income Tax; and, looking upon it in that light, I frankly acknowledge that I am not prepared to face the difficulties which must necessarily attend any attempt to estimate the value of different annuities. If we made any attempt of that kind, we must ascertain the liability of every man to disease; we must inquire into the state of his health; we should therefore not get rid of the inquisition which has been made the subject of such loud and earnest complaint; and, moreover, the difficulties of discriminating between permanent sources of income and temporary sources of income would be interminable. On these grounds, then, I do hope the House will approve of the tax as it stands, without alteration or modification.

§ Mr. Sheil
The right hon. Baronet has asked what tax we would recommend him to take off. I venture to suggest a tax 598 which he can most judiciously, safely, and equitably lay on. The great object which he ought to have in view is to alleviate the hardship and injustice of Schedule D. If he will but tax his own ingenuity—if the right hon. Gentleman will only tax his own ingenuity as effectually as he is disposed to tax every profession and every trade, he will find another legitimate source of revenue, by which any deficiency arising from a modification of the Income Tax may be supplied. What tax can be more just and reasonable than a tax upon the hereditary or testamentary devolution of real estate? It is perfectly just—it cannot affect the agricultural interest, in the real sense of that expression—it cannot affect rents or wages, or throw inferior land out of cultivation. Is it not most unreasonable, that if a man bequeaths to me 20,000l., charged on Blackacre, I must pay legacy duty; but if he devises to me Blackacre itself, I should not pay a single farthing to the State? The hon. Baronet the Member for the University of Oxford stated that out of a legacy of 140,000l. left to an hospital, 14,000l. was paid as legacy duty. Now, if an estate worth 140,000l. were left to the hon. Baronet, by a man having no consanguinity with him, he would not have to make the smallest contribution to the State. I know that it may be said, that Mr. Pitt failed in the imposition of this tax; but the House of Commons was then differently constituted; and, besides, the right hon. Baronet has one great advantage which was not enjoyed by Mr. Pitt; for although Mr. Pitt was a man of the most extraordinary abilities, had a lofty and sonorous eloquence, and the stature of his mind was grand and ample, yet he could not with impunity threaten resignation; but in the present Cabinet, over which the right hon. Gentleman towers in solitary elevation, not even an Addington can be found. I do not think that the right hon. Baronet entertains a very confident hope that the Income Tax will not be perpetual. The truth is, that it depends, in a great degree, on the weather-glass. You have hitherto had good harvests; but if the elements which have conjoined in your favour shall resume their proverbial fickleness—if the earth shall yield less than her just return—the home market must be immediately affected—consumption will diminish—a deficit will arise—and the Minister will increase a tax which has a peculiar susceptibility of augmentation. How easy is 599 the transition on the side of per centage! and with what facility and smoothness the Minister will glide from three to six per cent.! The Income Tax has always been considered as essentially a war tax. It was first enacted in an hour of extreme peril—it was repealed at the peace of Amiens—it was renewed when the French Emperor was to be again encountered; and in 1815, in obedience to the unanimous invocation of the country, this odious tax was repealed. So conscious was the right hon. Gentleman that the Income Tax was appropriated to war, that in 1842 he insisted that, although no actual declaration of war had taken place, the country was in a condition equivalent to war. He adverted to China, and to the hostile feeling of France. But all the likelihoods of war have vanished. In the political horizon not a speck can be discerned. In China, not only has peace been established on a secure foundation, but to the great surprise, and to the still greater gratification of the late President of the Board of Trade, and of the Secretary of State for the Home Department, a vast field has been thrown open to the commerce and industry of England. With France we are determined not to quarrel; and have made matter of negotiation that Right of Search which, beyond every other, we once thought that it concerned the honour of England to maintain. In the Peninsula, order—under the auspices of a French protectorate almost as unequivocal as that of Tahiti—has been restored; and in Italy, in the dominions of His Holiness the Pope, conservative institutions have, by a very peculiar instrumentality, been secured. Yet, in the midst of unruffled and unclouded repose, the right hon. Gentleman propounds the tax which ought to have been sacred to emergency—in the midst of profound peace the Palladium is brought forward. But, it may be said, wherefore should not the Prime Minister have recourse to an Income Tax when there is no cry against it? I admit that the right hon. Baronet is not yet molested by what Lord Castlereagh called, I believe, in reference to this very impost, "an ignorant impatience of taxation." But there are two reasons for this temporary acquiescence: in the first place, the country is peculiarly prosperous—the weather-glass is on your side—Fahrenheit is not yet in opposition; in the next place, the right hon. Gentleman has created a privileged order, consisting of two classes—those who are not 600 worth 150l. a year, and those who swear they are not. Within the confines of fiscal immunity, a latitudinarian in morality, who thinks that "lovers' perjuries" are not the only ones at which "Jove laughs," may obtain admission by an oath. Besides, it should be recollected that men in circumstances decent, but straitened, are not disposed to go to public meetings, in order to make an exposure of their embarrassments. The miser affects to be poor, and the pauper to be rich—independence is often simulated; and destitution not unfrequently tries to hide her emaciated features in an embroidered, though it is generally a very thin and transparent, veil. I think that I could mention the names of men whose faces are pale with the midnight lamp, and who leave their beds before the break of a winter morning, who think it better and wiser to submit to privations, than to attend public assemblies convened for the repeal of this most unjust and oppressive impost—for it is the consummation of injustice—its iniquity is in its equality. What can be more inequitable—more repugnant, to common justice, common feeling, and common sense—than to impose the same tax upon the income which is the product of a man's thought, and may be called the sweat of his mind, and upon income which is as stable as the State, if it comes from the funds, and if it comes from land, is as stable as the earth on which we tread? What can be more unjust than to impose the same tax upon a barrister who can scarce pay the expenses of his first circuit, and a Chief Baron and a Chief Justice—upon John Scott in a garret, and upon John Scott on the Woolsack—upon the Prime Minister of England, and the gentleman who reports a speech of the Prime Minister on the Income Tax in the Gallery of the House of Commons? The right hon. Gentleman was heard by men of excellent education, and with minds embellished with literary adornment—who are engaged in that occupation in which some of the first men in England have been employed—and who, with great labour, with great wear and tear of the mind and of the body, obtain a salary which brings them within the reach of the Income Tax; but which is by no means commensurate with their talents and their usefulness. If one of these gentlemen should lose his health, his condition is most calamitous; yet upon him, stretched on a bed of suffering, and compelled, perhaps, to "feel for wants more bitter than 601 his own," you impose the same tax as on the master of Netherby, and the proprietor of Drayton Hall. This tax is not only inquisitorial, but most criminal; it holds out inducements to fraud—leads us into that into which we pray that we may not be led, and teaches men to handle with a desecrating familiarity the word of God. These are not the fantastic suggestions of imagination. If I denounce the Income Tax as unjust, as inquisitorial, and as immoral, it was denounced as unjust—it was denounced as inquisitorial—it was denounced as immoral, by the whole body of the merchants in 1805—by Mr. Baring, the prince of commerce—by Mr. Wilberforce, the religious, the moral, the high-minded, and the good—and though last in enumeration, chief almost in sagacity, by the late Sir Robert Peel; and I trust that I shall be forgiven if I venture to add, but not in any spirit of unkindness, that I fear the time may not be distant when we shall have occasion to exclaim,—"Patris dictum sapiens temeritas filii condemnavit."

§ Mr. Cobden
said, that there was a very good reason why there had been no petitions and no public meetings against the Income Tax. It was because the Income Tax had been mixed up with various commercial projects. There was, for instance, the Sugar Duty; and up to this time the people did not know what Ministers were doing with the Sugar Duty. The people, however, would soon find out what was their plan of a Sugar Duty. They would soon learn that it was as bad and bitter as the Income Tax. When the country understood that, their feelings would be very different from what they were at present. They did not understand it now, and they would not understand it this week or the next. At the end of the year the public would be able to calculate what was the cost of their monopoly sugar. He could say that a very great misapprehension existed as to the feeling about the Income Tax. There was a very quiet and a very honest indignation as to Schedule D. He was not one who thought that there was generally an evasion of the Income Tax. As far as the north of England was concerned, he believed that there was a great deal more paid than ought to be paid. He alluded particularly to Birmingham, and for the edification of the hon. Member for that town, he would read an extract of a letter he had received from it. In this letter the writer stated 602 that he knew of four individuals who were made to pay the Income Tax who were all insolvent at the time. They went from time to time and endeavoured to get it off. The answer they always got was that it must be paid. The same writer stated that he believed there were thousands who had paid rather than expose their affairs, and that not more than one in five dared stand the test of an examination of his books, for fear of his credit being ruined. He ventured to say this, that if the Members of this and the other House had to go through the scrutiny to which traders were exposed, the Income Tax would not last a month. At the same time that he said this, he also said that if they modified the tax upon trades and professions to something like a fair proportion, it was not the middle classes who would object to bear their share of taxation; but then they in that House totally deceived themselves if they supposed the sense of the people of this country was with them in their present proposition, or that they would quietly submit to this imposition. Let them go into any house in the City, let a messenger go there with the authority of the right hon. Baronet, and call upon any wholesale dealer or banker to submit to scrutiny his last year's balance-sheet. Why the dealer would hardly let his wife know what it was. He would scarcely let his son know it. Then, if the messenger said to the trader, if he did not submit his books to inspection, he must pay a fine. Then the trader would reply, he would pay the fine cheerfully. They thus forced the trader to submit to a double penalty. They might depend upon it—and he called upon them to mark his words—that though there was now no great outcry against the Income Tax, still he could assure the noble Lord the Member for Sunderland, that he would find at the hustings, that for neither Whig nor Tory would the people submit to the Income Tax. But why did they not now hear an outcry about it? For this very reason, the tax was so obnoxious that it prevented people from consulting respecting it. The tradesman did not like to consult his neighbour about it; he did not like to expose his affairs; but, he could assure the House, they fell the oppression, nevertheless. In London, he believed, there had been few surcharges. They had heard what occurred in Birmingham. He knew that in 603 the north of England surcharges were almost invariably the rule. The collectors too had the habit of bullying honest and respectable men. He knew the case of a surgeon who had been surcharged, and amongst other questions he was asked how much was his profit on rhubarb? He had also two gigs, for professional purposes, and he was asked if his wife did not sometimes ride in one of the gigs?—had he not also a saddle-horse, and did not his wife occasionally use a saddle-horse? Amongst other cases, was that of a hair dresser [Laughter.] Hon. Gentlemen might laugh, but hair-dressers had influence; hair-dressers had votes. The hair-dresser called for an exemption for a room used for the purposes of business. This man was asked how many persons' hair he cut, what he was paid for each, that if it were a shilling, he must have 10d. profit from it. He was then asked if the females of his family did not sometimes use it as a sitting-room. These were the questions that were put to persons called upon to pay the Income Tax. Then if a man were surcharged, and he was going to appeal, an intimation was sent to him from the Commissioners, that he should state what was the trade or profession in which he was engaged; where it was carried on; who were his partners; to state the capital which was employed in each concern, with the distinct amount of the burdens to which each was subject; the amount of interest on his banker's account; the profits for the last three years. This was a bludgeon held up in the face of the trader. It was telling him not to come and appeal at all. In this way, men who were in a large business staid away, and did not appeal at all. He knew the case of a Gentleman, who was surcharged 5,000l. profit. He consulted a Member of that House, and finding he must bring all his books and papers, his friend advised him to pay the Income Tax on the 5,000l. That, he said, was not an extraordinary case. He really believed that in Lancashire they paid more than what they honestly ought to be called on to return on the Income Tax. This was not a matter to make a joke of. It was not for the right hon. Gentleman to make a mockery of it, and to say that the people would be so enamoured of it, that they would insist on retaining it. If hon. Gentlemen would mix with their constituents before the election came on, 604 they would find how strong was the feeling against the Income Tax. The free traders did not think it necessary for the measures that were proposed; and, as far the right hon. Gentleman's measures went, he utterly repudiated them. As a free trader he repudiated them. The free traders did not think the Income Tax necessary to carry out the other measures. It might be necessary for the purposes of delusion—for the purposes which hon. Gentlemen opposite had to carry out. The free traders did not want it, though it might do for the work of monopoly. The right hon. Gentleman opposite professed to act sometimes on the opinions of Mr. Deacon Hume. The other night the right hon. Gentleman had grounded himself on the authority of Mr. Deacon Hume. He was surprised to find his hon. Friend (Mr. Hume) so far forget his own Committee as to praise the right hon. Gentleman's measures. Mr. Deacon Hume laid it down as a rule that the way to serve the country was to abolish these restrictions on trade—not restrictions on divi-divi, but their restrictions on corn. He was quoting Mr. Deacon Hume's authority, and it was to be observed that Mr. Deacon Hume did not mention direct taxation; but he said that they ought to remove the duties that protected these monopolies, and then there would be such an increase to their wealth, and such an expansion to their commerce, that the result would be a full and sufficient revenue; but that if these monopolies remain, then they must look forward to a fall in the revenue. Mr. M'Gregor said in his evidence, that if they wanted more revenue they could get it from sugar. Since Friday last, he had asked one well acquainted with the subject how much would be the revenue from sugar, if the duty proposed were put upon all sugars. He was told six millions sterling. He believed that, if they put a duty on Foreign and Colonial sugar of 23s. per cwt., they would get more than six millions, and the people would have the sugar as cheap as the Government now proposed to give it to them. But indirectly they would by such a plan gain more, by opening channels for their trade, the value of which it would be impossible to calculate. As a good deal had been said about the right hon. Gentleman's measures having a tendency to free trade, he said of them that, so far from their opening new markets to this 605 country, they were shutting it out from the two greatest markets—North and South America. The right hon. Gentleman had imposed a duty upon the corn of the one, which was equal to a prohibition against it; and as to the other, he shut them out in the most unstatesmanlike manner from Brazil. How the Government had done that, hampered as they were with those who sat behind them, and how, at the same time, they set themselves up for having a character as free traders, passed his comprehension.

§ Lord John Russell
wished to say a few words, to satisfy the House as to the vote he was about to give; and he felt himself especially called upon to do so, in consequence of the right hon. Gentleman's allusion to what had been said by him in the debate on the Income Tax. This tax might, he conceived, be properly imposed upon various occasions, and for various reasons; in the case, for instance, of its being required in the exigencies of war, and when the country was in great danger. He admitted that that would be a fair occasion for the imposition of the tax, and a fair reason why they should not make an attempt at any modification of it. It would be as reasonable then to decline doing that, as to take a farmer's horses when it was necessary to supply an army on its march through the country. It might then be said, "we cannot now in such an exigency as this, stop to see whose horses ought to be taken." In another case, and for other reasons, the Income Tax might be proposed, as it had been proposed by the right hon. Gentleman in 1842, when he said that there were other taxes pressing very much upon the industry of the country; but that it was hoped, by trying the Income Tax for three years, the industry of the country might be so far recovered, that the Revenue would equal at least that amount which it had reached in former years. But neither of these cases were now made out, when the Income Tax was again proposed. The Income Tax was now proposed as a means of enabling the right hon. Baronet to commute other taxes. If they once took that ground, then he said they were bound to see and consider whether the tax could not be made as just, equal, and as little vexatious, as it was possible to make it. They had no longer to plead a great public exigency. They could not say that they were imposing it 606 for a short time, and that, therefore, it might be taken with all its inconveniences. They were now imposing it upon grounds on which it was almost impossible that they could take it off at the end of three years; for they might be sure that similar reasons to those on which it was now based, would again and again occur to justify reimposing it. He said then, after the statement of the hon. Gentleman the Member for Stockport—after the very plausible statement which had been made with regard to the inequality and theinquisitorial operation of this tax, it would be but fair for that House, before finally disposing of the question, to examine it in all its bearings and in all its conditions, and attempt to remove some of the objections to which it was now liable. He could not understand the objection of his hon. Friend the Member for Kendal (Mr. Warburton), who said, that when the income ceased, the inequality of the tax ceased also. No doubt when a man whose income arose from professional labour was disabled by disease from following his profession, and was thus deprived altogether of his income—no doubt, when the income ceased, the tax would no longer be levied. But then they would have already taxed the man on the income he had received, and taxed him, too, at the same rate that they taxed the man whose income was permanent, and who would receive the same amount, even if confined to a sick bed. It was impossible by any ingenuity, or by any sophistry, to show that there was equality in the mode of assessing the tax. His hon. Friend the Member for Montrose (Mr. Hume) had given what was certainly a strange reason why they should not now attempt to enter into the investigation; for he said, "I have asked the right hon. Baronet the First Lord of the Treasury if he would consent to modify the tax—I think modification necessary; but as the right hon. Baronet said no, what is the use of bothering any more about it?" Now, really he had not expected to find his hon. Friend (Mr. Hume) so servile a supporter of the right hon. Gentleman as it appeared he was. He had heard from the other side of the House that the right hon. Gentleman was the Petruchio of liberalism. If so, his hon. Friend the Member for Montrose must certainly be the Katharine; for he had shown to-night that he was completely tamed by the discipline administered to 607 him by the right hon. Gentleman. He (Lord J. Russell) concurred with the hon. Gentleman the Member for Stockport as to what had fallen from him that evening on the subject of free trade; and admitting the correctness of the figures stated by him in the speech he had just made, as well as those stated by him on a previous evening, he could not conceive—admitting all the benefits the right hon. Gentleman calculated would result from the tax—agreeing with the right hon. Gentleman as to the importance of removing the duties from cotton, wool, and glass—he said, admitting all the benefits of the removal of those taxes, still they had the means, by placing the Sugar Duties on a good foundation, by which the people would be benefited, and the tax paid to the West India interest diminished—they had the means of so modifying the Income Tax as to make it press with less injustice and less severity on those whose precarious incomes enabled them to pay it with great difficulty. The hon. Gentleman the Member for Stockport had said, that 6,000,000l. might be obtained from sugar for the purposes of revenue, without increasing the price to the consumer beyond what it would be under the plan of the Government. Now they had given 750,000l. a year in perpetuity to the West India interest, by the 20,000,000l. grant; and if they gave them only one of those six millions for a time, they would still have more than 5,000,000l. as the amount of the present tax on sugar. They were therefore sacrificing 1,300,000l. quite uselessly as far as the benefit of the people was concerned, in order to give 2,000,000l. more to the West India planters. He said, then, that those who suffered from the Income Tax, those (and there were many of them) who suffered silently and to those who complained of the grievance they endured, that the reason why they were required to endure it was because monopoly and restriction were kept at their present height. If the right hon. Gentleman would propose measures with regard to those great articles—timber, sugar, and corn, more to relieve the people, and give a still greater impetus to our commerce and manufactures than he now proposed to give, he might at the same time make just and fair modification in the Income Tax. He did not think the House was at all insensible of the benefits of freeing the various departments of our manufactures which would be affected by the 608 removal of the Customs' Duties from the 430 articles contained in the schedule of the right hon. Baronet; but he wondered, seeing how clear the principles and reasoning of the right hon. Gentleman were as to the benefit that would result to the manufactures and commerce of the country by the removal of the Customs' Duties from these small articles, that the same principles and the same reasoning did not lead the right hon. Gentleman to make just and fair proposals to Parliament with regard to those great articles which formed the chief part of the food of the people, and the substance of their dwellings. The hon. Gentleman the Member for Stockport had referred to the opinion of Mr. Deacon Hume, who said he thought there were two modes of proceeding in dealing with restrictions on commerce. One way was that mentioned by the hon. Gentleman; that was, for the Minister to come forward with a great plan, and place all import duties on a solid foundation, and establish free trade, by which the country would flourish, and the revenue increase. But another way Mr. Deacon Hume suggested, was to place all the Customs' Duties in three separate schedules, the last comprising the 430 articles the right hon. Gentleman dealt with in his Budget; the second, articles of a more important character; and, in the first, those great articles, corn, sugar, and timber, and all other great articles of consumption. And he said, one way would be to take those small articles first, and proceed gradually with the others, until at last you established free trade as to the greater and more important articles also. Now that might possibly be the course of the right hon. Gentleman (Sir Robert Peel), and perhaps, therefore, his hon. Friend (Mr. Hume) was in the right. But if that was the course to be pursued by the Government, it had better be declared, and they would then have none of the difficulty in debating the project that they had hitherto had. For his part, he was prepared, on the ground stated by the right hon. Gentleman more than once, to say that he was ready to vote for a Property and Income Tax for three years more, seeing the great benefit that would result in the removal of those duties which now oppressed the trade and industry of the country; but at the same time, while he voted for the tax on this ground, he thought the House should consider what 609 modification should be properly made in its application, and even if those modifications should lead to a great reduction in the amount of the duty, if it should lessen the total revenue arising from this source by one million out of the five, he was convinced they would find ample, compensation by adopting those principles of which the right hon. Gentleman was the advocate, and placing the whole trade of the country on a sound basis.

§ Mr. C. Villiers
would shortly state the grounds which would induce him to give his vote in favour of the Motion of his hon. and learned Friend the Member for Liskeard—that ground being one which had not been much referred to in the course of the present debate—certainly not touched on by the right hon. Baronet (Sir R. Peel)—and not contemplated, he believed, by his hon. Friend the Member for London—viz., that this Income Tax was likely to remain and be permanent. He (Mr. C. Villiers) confidently expected that the tax would be permanent, and for that reason, and chiefly for that reason, he thought the House ought to bind themselves, as his hon. Friend the Member for Liskeard proposed, to see that it should be just and equal in its operation, and at the same time as little odious to the people as possible. He did not object to the tax because it was a direct tax; on the contrary, he thought one of its chief recommendations was, that it was to be imposed for other taxes that were indirect. He preferred direct to indirect taxation; for so far he agreed with his hon. Friend the Member for Kendal, that direct taxation, by taking the money directly from the pockets of the people made them more jealous of taxation, while it interfered less with the commerce, industry, and enterprise of the country. He, then, did not object to the Income Tax, because it was a direct tax, but he agreed with what he believed to be the opinion out of doors. The people of this country were not opposed to the imposition of necessary taxes; they were not averse to bearing their fair share of the national burdens, nor were they anxious to risk the national credit; but what they desired to be satisfied of was, that the taxes imposed upon them were necessary and just; and they were disposed to be satisfied with the continuance of the Property Tax, because they believed it was a tax imposed as a substitute for others which affected commerce 610 and manufactures, and fettered the industry of the country. The people, however, required to know that the surplus obtained from this tax was properly applied, and that they derived all the advantage possible from it. That was not, as he thought, now she case. The recent discussion on the Sugar Duties showed that it was not, and that the people were submitting to an inconvenient and odious tax, while they had to share the advantage with others whom they did not know, and who had no claim to it. If the surplus were properly applied in removing other duties that bore upon commerce and manufactures, there would no longer be any objection to the Income Tax. The decline of the Revenue during the latter years of the official existence of the late Government, was no doubt owing to the bad harvests and the Corn Laws. That, he believed, was a settled conviction on the public mind; and no greater imposition had ever been attempted than when it was said that the deficiency arose from the policy of the late Ministry, and that the present Government were entitled to the credit of having by their acts restored the Revenue to a healthy state. This could not too frequently be impressed upon the attention of hon. Members opposite—they must be reminded that they were the cause of this additional taxation. This Income Tax, it should be remembered, had been imposed in the first instance, in addition to all others. Those who supported the Corn Laws, as they were responsible for the imposition, so they were responsible for the continuance of this tax. This would be proved in 1848, by which time it was probable we should have a recurrence of bad harvests, and then they would have to answer to the country for continuing this Income Tax. His hon. Friend (Mr. Cobden) had referred to the evidence of Mr. Deacon Hume, who said that the best way to increase the Revenue was to increase the power of consumption. He would trouble the House with a few figures, to show what was really the cause of their difficulties in bad harvest, and of the improvement in the Revenue when the people's power of consumption was restored by low prices. The net produce of the Customs and Excise duties, which formed 75 per cent. of the whole Revenue, was, in 1836, 36,392,472l.; in 1840, it was 35,536,469l.; being a reduction of more 611 than a million from 1836 to 1840, though the population during that same period had increased from 26,158,524 to 27,599,968, a difference of 1,400,000; and an increase of 5 per cent. had been imposed on all those duties. Now, what was the difference of the amount paid for food during those several years? Cost of wheat, calculating the consumption at 16,000,000 of quarters annually, at the average price of each year, was—

The cheap years. The dear years.

£ £

1834 36,933,333 1837 44,666,666

1835 31,400,000 1838 51,666,666

1836 31,800,000 1839 56,533,333

£107,133,333 £152,266,465

Here was nearly 50,000,000l. more paid in the three years of scarcity for the chief necessary of life than in the three preceeding years, when the harvests were good and prices moderate. Then had the people not a right to ask what was the reason that they were taxed first on the necessaries of life, and then when the effect of this tax upon the Revenue was seen, that they were to be further taxed to make up the deficiency so occasioned? And certainly after the speech of the right hon. Baronet, they would be right in asking what he meant by persevering in those unjust laws? He could understand if the hon. Members for Somerset and Dorsetshire were at the head of affairs, looking at their speeches at the Agricultural Protection Society, that they would persevere in the system; but when he heard such a speech as that of the right hon. Baronet, almost like Mr. Cobden's own free-trade speeches—what excuse, the right hon. Baronet could have for not dealing with those other more important articles, which in his present scheme he did not touch, he was at a loss to conceive. He could scarcely believe his ears when the right hon. Gentleman talked of the effect of the repeal of the wool duty, and he really thought the right hon. Baronet would have gone on and said, that we might expect the same results from the abolition of the duty on corn. The same results would follow from the same course in regard to corn as in regard to wool, though to a much greater extent. Yet when he brought forward his Motion to repeal the Corn Duties this year, which he should do on the earliest opportunity, he 612 should be met by the right hon. Gentleman with the statement that there were special reasons, or something or other, which would prevent his adopting the same principles in regard to corn which he had so extolled in reference to wool. He hoped the people would read the speech of the right hon. Baronet, which was as good an argument in favour of free trade as he had ever heard. Seeing no possibility of getting rid of the Corn Laws at present, and being quite aware that the Income Tax must be perpetual as long as those laws existed, he thought it was their duty to make it as little odious and as just as possible in its application, therefore he should vote for the Amendment.

§ Mr. Muntz
said, the hon. Gentleman the Member for Stockport had referred to him to confirm a letter he had received from Birmingham, complaining of the operation of the Income Tax. He could not confirm that letter, as he only knew that the writer of it lived at Birmingham; but he was, nevertheless, in the condition fully to corroborate all that had been said by the hon. Member as to the proceedings in respect to that tax, and he might, at the same time, take occasion to inform his (Mr. Muntz's) hon. Colleague, that at a future time he would not find the Income Tax so popular with the people of Birmingham as he seemed to suppose it was. Had he left the House when half of the speech of the right hon. Baronet (Sir R. Peel) was spoken, he should have gone away with the impression that the right hon. Baronet intended to vote for the hon. Member for Liskeard's Motion, for he gave the House what he considered the most convincing proof that the tax was to last—if not to eternity, certainly for a very long time; for the right hon. Baronet said if that tax were not continued, they must raise three millions of taxes in other ways. If that was not a convincing proof that the tax was intended to be permanent, he did not know what would convince. When the right hon. Gentleman first introduced the subject this year, he said he hoped at the end of three years they would be able to do without the tax—that the elasticity of the resources of the country was such that he had no doubt that the Revenue would recover itself within that time, and that we might then dispense with the further continuance of the Income Tax. Now, he confessed that whenever he heard a Prime Minister or a Chancellor of the Exchequer 613 talk of the elasticity of the resources of the country, he was in a fright. From the time of Prosperity Robinson down to the present moment, that had always been the word of every Chancellor of the Exchequer when there was behind that which it was not convenient for him to explain. The right hon. Gentleman the late Chancellor of the Exchequer, when lamenting the unfortunate position of the Revenue during the latter years of the late Government, had hopes in the elasticity of the country; and the present Chancellor of the Exchequer relied upon the same thing; but until the right hon. Gentleman (Sir R. Peel) imposed the Income Tax and altered the Corn Laws and the Import Duties, there was no elasticity. Every effect had a cause—and the right hon. Baronet had been the cause of the present state of things. It was true a series of good harvests had done something; but with those good harvests, if it had not been for the right hon. Baronet, we should not only have been in very great difficulties, but the Revenue would have been in a state of very great pressure. The question was not whether the right hon. Baronet had produced the present state of things, but whether they were to be allowed to continue? He doubted whether he would be able to persuade a great interest to give up more than they had done. The House would here, perhaps, allow him to allude to a misrepresentation, a wilful misrepresentation, of what he had said on a former occasion on this subject, which had appeared in an evening paper. He was there represented to have said that the right hon. Baronet had improved the condition of one class at the expense of another—that, he had taken from the rich to give to the poor. Now, he had never said anything of the kind. What he said was, that the right hon. Baronet had taken from the agricultural to give to the manufacturing classes. He was as well aware as the right hon. Baronet that to take from the rich in order to give to the poor, was the soundest way of proceeding; but what he had said was, that it was the agriculturists from which that which was given to another class was taken; and when he said agriculturists, he did not mean landowners; but he alluded to the tenant-farmers, the labourers, and the working men in the agricultural districts. He confessed that he did not see how it was possible to continue their present policy and benefit the Revenue, except by improving the condition of 614 one class at the expense of another. He would not detain the House long, but it was necessary for him to say something. He meant necessary in consequence of the remark of the hon. Member for Stockport. He did not at all intend to imply that it was necessary for him (Mr. Muntz) to say something to the House of Commons. But since they thought that the debate was too long, the first consideration was who in reality was the cause of the debate? Why, the cause was the extraordinary ideas, called-free trade ideas, with which some hon. Gentlemen were so deeply inoculated also deeply, indeed, that were the right hon. Baronet opposite to pronounce the word "free," even if it were to tell them that they were free to go and hang themselves, they would unanimously pronounce it a step in the right direction. When the right hon. Gentleman at the head of the Government made his Financial Statement, hon. Members on the Opposition side of the House, enraptured with the free-trade aspect of the concern—without one moment's consideration—without one moment's thought of how the changes proposed would operate upon the condition of the people, all at once rose to express their approval of the plan, although when they came to consider the real merits of the proposal they were as averse to it as he (Mr. Muntz) was. This showed how improper it was for hon. Members to make up their minds instantaneously. Had they taken a little time to consider, there would have been a good, sound, solid debate, and every hon. Gentleman, without having pledged himself by a hasty declaration, would have been enabled deliberately to express his opinion upon this all-important subject. He himself was in favour of a Property Tax. He did not see why there could not be a tax on property imposed, and an end put to that upon income. He saw no impossibility in obliging a man to state the amount of his capital; indeed, he believed the process would not be so inquisitorial or injurious as the present system. He believed that a fair and equitable Property Tax would be one of the greatest blessings which could be bestowed upon the country. As respected the Income Tax he had always been, and always should be, ready to vote against it.

§ The House divided on the Question that the words proposed to be left out stand part of the Question:—Ayes 240; Noes 112: Majority 128.

List of the AYES.
Acland, Sir T. D.	Deedes, W.
Acland, T. D.	Denison, E. B.
A'Court, Capt.	Dickinson, F. H.
Adderley, C. B.	Dodd, G.
Aglionby, H. A.	Douglas, Sir H.
Alford, Visct.	Douglas, J. D. S.
Allix, J. P.	Dugdale, W. S.
Antrobus, E.	Duncombe, hon. A.
Arkwright, G.	Du Pre, C. G.
Arundel and Surrey, Earl of	Eastnor, Visct.
	Eaton, R. J.
Ashley, Lord	Egerton, W. T.
Bagot, hon. W.	Egerton, Lord F.
Bailey, J. jun.	Entwisle, W.
Baillie, Col.	Escott, B.
Baillie, H. J.	Estcourt, T. G. B.
Baird, W.	Farnham, E. B.
Baring, T.	Fellowes, E.
Baring, rt. hon. W. B.	Filmer, Sir E.
Barneby, J.	Fitzmaurice, hon. W.
Barrington, Visct.	Fitzroy, hon. H.
Baskerville, T. B. M.	Flower, Sir J.
Beckett, W.	Forbes, W.
Bell, M.	Forman, T. S.
Benbow, J.	Forster, M.
Bentinck, Lord G.	Fox, S. L.
Beresford, Major	Fremantle, rt. hn. Sir T.
Bernal, R.	Fuller, A. E.
Bodkin, W. H.	Gaskell, J. Milnes
Boldero, H. G.	Gladstone, rt. hn. W. E.
Borthwick, P.	Gladstone, Capt.
Botfield, B.	Gordon, hon. Capt
Bowles, Adm.	Gore, M.
Bramston, T. W.	Goring, C.
Brisco, M.	Goulburn, rt. hn. H.
Broadwood, H.	Graham, rt. hon. Sir J.
Browne, hon. W.	Granby, Marquess of
Bruce, Lord E.	Greenall, P.
Bruce, C. L. C.	Greene, T.
Buck, L. W.	Grimsditch, T.
Buckley, E.	Grimston, Visct.
Buller, Sir J. Y.	Grogan, E.
Bunbury, T.	Hale, R. B.
Campbell, J. H.	Hamilton, W. J.
Cardwell, E.	Hanmer, Sir J.
Carew, W. H. P.	Harcourt, G. G.
Carnegie, hon. Capt.	Harris, hon. Capt.
Chelsea, Visct.	Hayes, Sir E.
Chetwode, Sir J.	Heathcote, Sir W.
Childers, J. W.	Heneage, G. H. W.
Clayton, R. R.	Henley, J. W.
Clerk, rt. hon. Sir G.	Henniker, Lord
Clifton, J. T.	Hepburn, Sir T. B.
Cochrane, A.	Herbert, rt. hon. S.
Cockburn, rt. hn. Sir G.	Hinde, J. H.
Codrington, Sir W.	Hogg, J. W.
Collett, J.	Holmes, hn. W. A'C.
Colquhoun, J. C.	Hope, hon. C.
Compton, H. C.	Hope, G. W.
Corry, rt. hon. H.	Houldsworth, T.
Courtenay, Lord	Hughes, W. B.
Cripps, W.	Hume, J.
Damer, hon. Col.	Hussey, A.
Darby, G.	Hussey, T.
Dawnay, hon. W. H.	Ingestre, Visct.

616

Irton, S.	Powell, Col.
James, W.	Praed, W. T.
James, Sir W. C.	Pringle, A.
Jermyn, Earl	Pusey, P.
Jocelyn, Visct.	Reid, Sir J. R.
Johnstone, Sir J.	Repton, G. W. J.
Johnstone, H.	Richards, R.
Jolliffe, Sir W. G. H.	Rolleston, Col.
Kemble, H.	Round, C. G.
Knight, F. W.	Round, J.
Knightley, Sir C.	Rous, hon. Capt.
Lawson, A.	Rushbrooke, Col.
Legh, G. C.	Russell, C.
Lemon, Sir C.	Russell, J. D. W.
Lennox, Lord A.	Ryder, hon. G. D.
Liddell, hon. H. T.	Sanderson, R.
Lincoln, Earl of	Seymour, Sir H. B.
Lockhart, W.	Shaw, rt. hon. F.
Long, W.	Sheppard, T.
Lopes, Sir R.	Shirley, E. J.
Lowther, hon. Col.	Shirley, E. P.
Lygon, hon. Gen.	Smith, A.
Mackenzie, T.	Smith, rt. hon. T. B. C.
Mackenzie, W. F.	Smyth, Sir H.
Mackinnon, W. A.	Smythe, hon. G.
Maclean, D.	Smollett, A.
Macnamara, Major	Somerset, Lord G.
M'Neill, D.	Somerton, Visct.
Mahon, Visct.	Somes, J.
Manners, Lord C.	Sotheron, T. H. S.
Manners, Lord J.	Spooner, R.
Marsham, Visct.	Stewart, J.
Martin, C. W.	Stuart, H.
Maunsell, T. P.	Sturt, H. C.
Meynell, Capt.	Sutton, hon. H. M.
Miles, P. W. S.	Tennent, J. E.
Miles, W.	Thesiger, Sir F.
Morgan, O.	Tower, C.
Morgan, C.	Trevor, hon. G. R.
Mundy, E. M.	Trollope, Sir J.
Neeld, J.	Trotter, J.
Neville, R.	Turnor, C.
Newport, Visct.	Tyrell, Sir J. T.
Newry, Visct.	Vernon, G. H.
Nicholl, rt. hon. J.	Villiers, Visct.
Norreys, Lord	Wall, C. B.
O'Brien, A. S.	Walsh, Sir J. B.
Owen, Sir J.	Wellesley, Lord C.
Pakington, J. S.	Wodehouse, E.
Patten, J. W.	Wood, Col.
Peel, rt. hn. Sir R.	Wood, Col. T.
Peel, J.	Wortley, hon. J. S.
Pennant, hon. Col.	Wyndham, Col. C.
Philips, M.	Yorke, hon. E. T.
Plumptre, J. P.	TELLERS.
Polhill, F.	Young, J.
Pollington, Visct.	Baring, H. B.

List of the NOES.
Aldam, W.	Berkeley, hon. H. F.
Anson, hon. Col.	Blackstone, W. S.
Bannerman, A.	Blake, M. J.
Baring, rt. hn. F. T.	Blewitt, R. J.
Barnard, E. G.	Bowring, Dr.
Bellew, R. M.	Bright, J.
Berkeley, hon. C.	Brocklehurst, J.

617

Brotherton, J.	Matheson, J.
Buller, E.	Mitcalfe, H.
Busfeild, W.	Mitchell, T. A.
Byng, rt. hn. G. S.	Morris, D.
Clay, Sir W.	Morison, Gen.
Cobden, R.	Muntz, G. F.
Colborne, hn. W. N. R.	Murray, A.
Cowper, hon. W. F.	Napier, Sir C.
Craig, W. G.	Osborne, R.
Crawford, W. S.	Paget, Col.
Curteis, H. B.	Paget, Lord A.
Dawson, hon. T. V.	Parker, J.
Denison, W. J.	Pattison, J.
Dennistoun, J.	Pechell, Capt.
D'Eyncourt, rt. hn. C. T.	Plumridge, Capt.
Duff, J.	Rawdon, Col.
Duke, Sir J.	Ricardo, J. L.
Duncan, G.	Rice, E. R.
Duncannon, Visct.	Roche, E. B.
Dundas, Adm.	Russell, Lord J.
Dundas, F.	Russell, Lord E.
Easthope, Sir J.	Sheil, rt. hon. R. L.
Ebrington, Visct.	Sheridan, R. B.
Ellice, rt. hon. E.	Somerville, Sir W. M.
Ellis, W.	Stansfield, W. R. C.
Evans, W.	Stanton, W. H.
Ewart, W.	Staunton, Sir G. T.
Ferguson, Col.	Stewart, P. M.
Fitzroy, Lord C.	Stuart, Lord J.
Fox, C. R.	Strutt, E.
Gibson, T. M.	Talbot, C. R. M.
Gill, T.	Tancred, H. W.
Gore, hon. R.	Thornely, T.
Hallyburton, Lord J. F.	Towneley, J.
Hastie, A.	Trelawny, J. S.
Heneage, E.	Tufnell, H.
Hill, Lord M.	Turner, E.
Hindley, C.	Villiers, hon. C.
Hobhouse, rt. hn. Sir J.	Vivian, J. H.
Hollond, R.	Wakley, T.
Howard, hn. C. W. G.	Walker, R.
Howard, hon. H.	Wawn, J. T.
Howard, Sir R.	Williams, W.
Humphery, Ald.	Wilshere, W.
Hutt, W.	Winnington, Sir T. E.
Inglis, Sir R. H.	Wrightson, W. B.
Langston, J. H.	Yorke, H. R.
Leader, J. T.
McTaggart, Sir J.	TELLERS.
Mangles, R. D.	Buller, C.
Martin, J.	Hawes, B.

615

§ Amendments read a second time and agreed to.

§ Mr. W. Miles
, according to notice, moved to add the following clause:— And be it Enacted, That from, and after the passing of this Act, it shall be lawful for all persons assessed under Schedule B, should they feel themselves aggrieved by such assessment, to appeal to the Commissioners for General Purposes, ten days' notice thereof in writing being given to the Assessor or Surveyor of the district in which the Property upon which he is assessed is situate; and the said Commissioners are hereby empowered to hear and determine such appeal, under the like rules and 618 regulations as are enacted for hearing and determining the appeals under Schedule D, in the aforesaid recited Act of the 5th and 6th years of Her present Majesty: Provided that no person so appealing shall be charged by the aforesaid Commissioners more than the sum of threepence-halfpenny in England, and twopence-halfpenny in Scotland, for every twenty shillings of the property he occupies. The hon. Gentleman commenced by alluding to the present depressed state of the agricultural interest, to the absence of confidence prevailing among them, and to the depreciation in the price of agricultural produce. The hon. Member for Liskeard had urged that the right hon. Gentleman at the head of the Government had deceived the country by holding out confident expectations that the public would not suffer from the Income Tax, as their disbursements to satisfy that impost would be amply made up by the cheapness of the great necessaries of life. The hon. Member for Liskeard denied that the effect of the right hon. Gentleman's measures had justified the anticipations he then held out. He (Mr. Miles), however, believed that the right hon. Gentleman had been in his prognostications a most true prophet. Agricultural distress existed now to a great extent, and he would wish for the same modification of the tax, as respected farmers, which, in a similar state of things, Lord Bexley wished to effect in 1816. The object of the present Motion, however, was to place the tenant farmer in the same situation as persons under the Schedule D, and he hoped and trusted that this small boon would be extended to them. Whether the Act was intended to last for three or five years, they were bound to consider the merits of every clause of it, and to make each enactment as little grievous as possible to their constituents. This they were bound to do, whether the tax was proposed to be continued only for a short time or for a perpetuity. He believed that he was simply asking for that which the justice of the case demanded, and that to which he thought the farmers had a right at the hands of the Government. He would beg the House to remember the statements of the agricultural deputation which had waited upon the right hon. Gentleman at the head of the Government. One of the gentlemen who formed that imputation, one of the best farmers in Berkshire cultivating six or seven hundred acres, stated that he had laid out 1,000l. of 619 capital upon every one hundred of these acres. Until within the last two years he had been doing well. This gentleman had laid up money in the funds, which he had hoped to have been enabled to leave to his children; but last year he had been obliged to draw out 500l. for farming purposes, and this year he would have to draw out 600l. more. Considering the present state of the agricultural interest, and that the farmers were not represented by members of their own class in that House, they expected those who were sent there to represent them to speak out and claim that justice should be done them. It was most unjust that an arbitrary rule should be applied to the farmers, and that they should be assessed at half their rent for each of the three years during which the Property Tax was to be continued, without taking into consideration that in the first year they may have no profits whatever, and they might find it necessary to expend large sums on their land. The hon. Gentleman concluded by proposing his Amendment.

§ Clause brought up and read a first time.

§ On the Question that it be read a second time,

§ The Chancellor of the Exchequer
said, that he should feel it his duty very briefly to state the reasons which induced him to consider that it would not be consistent with justice on his part to accede to the proposal of his hon. Friend. That proposal was, that farm-tenants should be permitted, in years in which their profits might not have amounted to the proportion of rent to which they were assessed, to make an appeal to the Commissioners, and to obtain an abatement of the tax. Now it appeared to him that that arrangement would be essentially unjust. The House would bear in mind the circumstances under which the assessment of tenants to the Income Tax had been fixed. It had been stated when that tax had been originally imposed, and it had been generally acknowledged, that those persons who were engaged in the fanning of land were generally a class who would find it extremely difficult to keep such books of accounts as would be necessary, if their incomes were to be tested in the same manner as the incomes of persons engaged in trade; and it had, therefore, been thought advisable to fix a specific amount of rent as the basis of the assessment 620 in their case. In the first Property Tax that amount had been taken at three-fourths of the rent. But when the Property Tax had been introduced in the year 1842 the assessment was reduced to one-half of the rent. His hon. Friend wished that in years in which a tenant had made no profit he should be relieved from the payment of the Income Tax; but his hon. Friend did not propose that in cases in which a tenant had made a larger profit than that on which he was assessed he should pay an additional amount under that tax. Now he should say that the one-sided appeal proposed by his hon. Friend would be unjust in itself, and at variance with the state of the law as applied to other classes. The abandonment of profits by a farmer in one year might lead to the doubling of his profits in the following year; for he might find that by laying out a large capital in draining and in mannre he would afterwards be amply repaid for the outlay. The result, therefore, of the proposal of his hon. Friend would be that in the first year the tenant would be exempted from the tax, and that in the second year he would not repay the public for the advantage which he had previously gained. Under these circumstances he felt it his duty to oppose the Clause.

§ The House divided:—Ayes 92; Noes 196: Majority 104.

List of the AYES.
Allix, J. P.	Duncannon, Visct.
Archdall, Capt. M.	Dundas, Adm.
Bailey, J. jun.	Dundas, F.
Bankes, G.	Du Pre, C. G.
Barrington, Visct.	Eaton, R. J.
Baskerville, T. B. M.	Farnham, E. B.
Beresford, Major	Fellowes, E.
Berkeley, hon. C.	Fitzmaurice, hon. W.
Blackstone, W. S.	Fuller, A. E.
Blewitt, R. J.	Goring, C.
Borthwick, P.	Granby, Marq. of
Brocklehurst, J.	Halford, Sir H.
Buck, L. W.	Hallyburton, Lord J. F.
Burrell, Sir C. M.	Harris, hon. Capt.
Byng, rt. hon. G. S.	Heneage, E.
Chetwode, Sir J.	Henley, J. W.
Codrington, Sir W.	Henniker, Lord
Colborne, H. W. N. R.	Hill, Lord M.
Cowper, hon. W. F.	Hinde, J. H.
Curteis, H. B.	Houldsworth, T.
Darby, G.	Howard, hon. H.
Dawnay, hon. W. H.	Hussey, A.
Denison, W. J.	Knight, F. W.
Douglas, J. D. S.	Knightley, Sir C.
Duff, J.	Long, W.
Duke, Sir J.	Lygon, hon. Gen.
Duncan, G.	Manners, Lord C. S.

621

Manners, Lord J.	Round, C. G.
Maunsell, T. P.	Round, J.
Miles, P. W. S.	Rushbrook, Col.
Mitcalfe, H.	Russell, Lord E.
Morris, D.	Shaw, rt. hn. F.
Muntz, G. F.	Sibthorp, Col.
Murray, A.	Smythe, Sir H.
Newry, Visct.	Sotheron, T. H. S.
Norreys, Lord	Spooner, R.
O'Brien, A. S.	Talbot, C. R. M.
O'Connell, M. J.	Tower, C.
Osborne, R.	Turner, E.
Ossulston, Lord	Turnor, C.
Packe, C. W.	Tyrell, Sir J. T.
Paget, Col.	Wakley, T.
Paget, Lord A.	Wawn, J. T.
Palmer, R.	Wodehouse, E.
Pechell, Capt.
Plumptre, J. P.	TELLERS.
Rendlesham, Lord	Miles, W.
Rolleston, Col.	Trollope, Sir J.

List of the NOES.
Acland, Sir T. D.	Chelsea, Visct.
Acland, T. D.	Childers, J. W.
A'Court, Capt.	Cholmondeley, hon. H.
Adderley, C. B.	Clayton, R. R.
Aglionby, H. A.	Clerk, rt. hn. Sir G.
Alford, Visct.	Clifton, J. T.
Antrobus, E.	Cockburn, rt. hn. Sir G.
Arkwright, G.	Collett, J.
Arundel and Surrey, Earl of	Compton, H. C.
	Corry, rt. hn. H.
Bagot, hon. W.	Courtenay, Lord
Baillie, Col.	Craig, W. G.
Baillie, H. J.	Cripps, W.
Baird, W.	Damer, hon. Col.
Baring, rt. hn. F. T.	Deedes, W.
Baring, T.	Denison, E. B.
Baring, rt. hon. W. B.	Dickinson, F. H.
Barnard, E. G.	Dodd, G.
Barneby, J.	Douro, Marq. of
Beckett, W.	Dugdale, W. S.
Bell, M.	Duncombe, hon. A.
Bentinck, Lord G.	Eastnor, Visct.
Berkeley, hon. H. F.	Egerton, W. T.
Blake, M. J.	Egerton, Lord F.
Bodkin, W. H.	Entwisle, W.
Boldero, H. G.	Escott, B.
Bowles, Adm.	Estcourt, T. G. B.
Bowring, Dr.	Evans, W.
Bramston, T. W.	Filmer, Sir E.
Bright, J.	Fitzroy, hon. H.
Brisco, M.	Flower, Sir J.
Broadwood, H.	Forbes, W.
Brotherton, J.	Forster, M.
Bruce, Lord E.	Fox, C. R.
Bruce, C. L. C.	Fox, S. L.
Buckley, E.	Fremantle, rt. hn. Sir T.
Buller, C.	Gaskell, J. Milnes
Buller, E.	Gibson, T. M.
Buller, Sir J. Y.	Gill, T.
Busfeild, W.	Gladstone, rt. hn. W. E.
Campbell, J. H.	Gladstone, Capt.
Cardwell, E.	Gordon, hon. Capt.
Carew, W. H. P.	Gore, M.
Carnegie, hon. Capt.	Goulburn, rt. hn. H.

622

Graham, rt. hn. Sir J.	Newport, Visct.
Greenall, P.	Nicholl, rt. hn. J.
Greene, T.	O'Conor Don
Grimston, Visct.	Pakington, J. S.
Grogan, E.	Patten, J. W.
Hale, R. B.	Peel, rt. hn. Sir R.
Hamilton, W. J.	Peel, J.
Harcourt, G. G.	Pennant, hon. Col.
Hayes, Sir E.	Plumridge, Capt.
Heathcote, Sir W.	Polhill, F.
Hepburn, Sir T. B.	Pringle, A.
Herbert, rt. hn. S.	Pusey, P.
Hindley, C.	Rawdon, Col.
Hobhouse, rt. hn. Sir J.	Reid, Sir. J. R.
Hollond, R.	Repton, G. W. J.
Holmes, hon. W. A.	Richards, R.
Hope, hon. C.	Russell, Lord J.
Hope, G. W.	Russell, C.
Howard, Sir R.	Ryder, hon. G. D.
Howick, Visct.	Sanderson, R.
Hughes, W. B.	Seymour, Sir H. B.
Hume, J.	Smith, A.
Hutt, W.	Smith, rt. hn. T. B. C.
Inglis, Sir R. H.	Smythe, hon. G.
Irton, S.	Smollett, A.
James, Sir W. C.	Somerset, Lord G.
Jermyn, Earl	Somes, J.
Jocelyn, Visct.	Stanton, W. H.
Johnstone, Sir J.	Stuart, Lord J.
Johnstone, H.	Stuart, H.
Jolliffe, Sir W. G. H.	Strutt, E.
Kemble, H.	Sturt, H. C.
Langston, J. H.	Sutton, hon. H. M.
Leader, J. T.	Tancred, H. W.
Legh, G. C.	Tennent, J. E.
Lennox, Lord A.	Thesiger, Sir F.
Liddell, hon. H. T.	Thornely, T.
Lincoln, Earl of	Towneley, J.
Lockhart, W.	Trelawny, J. S.
Lopes, Sir R.	Trevor, hon. G. R.
Lowther, J. H.	Trotter, J.
Lowther, hon. C.	Tuffnell, H.
Mackenzie, W. F.	Vane, Lord H.
Maclean, D.	Vernon, G. H.
McGeaohy, F. A.	Villiers, Visct.
McNeill, D.	Wall, C. B.
Marsham, Visct.	Warburton, H.
Martin, J.	Wellesley, Lord C.
Martin, C. W.	Williams, W.
Meynell, Capt.	Wood, Col.
Mitchell, T. A.	Wood, Col. T.
Morgan, O.	Wortley, hon. J. S.
Morgan, C.	Yorke, hon. E. T.
Mundy, E. M.	TELLERS.
Napier, Sir C.	Young, J.
Neville, R.	Baring, H.

§ Bill to be read a third time.

The cheap years.	The dear years.
	£		£
1834	36,933,333	1837	44,666,666
1835	31,400,000	1838	51,666,666
1836	31,800,000	1839	56,533,333
	£107,133,333		£152,266,465