HC Deb 12 March 1845 vol 78 cc729-59

On the Order of the Day for the third reading of the Property Tax Bill being put,

Mr. Wakley

rose and said, that on a former occasion when the Property Tax was discussed, the hon. Member for Lambeth had referred to some injustice which had been done by the Commissioners to the hon. Member for Oldham—he meant Mr. Fielden. Since then he had received a letter from the hon. Member on the subject, and in order to make the case complete, he would read an extract from this letter to the House. The hon. Member stated that this year the same Commissioners, those who had treated him so severely before, had received a return from the firm to which the hon. Member belonged for three years, ending December, 1843, but the Commissioners were not satisfied with assessing them at 12,000l. profit as in the previous two years, for they had now doubled the amount, and sent them in a charge for 24,000l. The hon. Member added,— I appealed against it in November last, and showed them a true statement in writing, which exhibits our loss at 24,000l. on the average of the three years, instead of a profit to that amount. The Commissioners wished the case to stand over until after Easter, to which I assented; but yet they have sent in and demanded the money. Now, really the operation of a tax of that kind was calculated to create in the public mind the greatest possible discontent. Every person must feel the injustice of it, and though the Amendments which had been pressed on the House were rejected, he hoped the Commissioners residing in the country, who acted in this outrageously unjust manner, would receive some intimation from head-quarters which would check them in their course. Nothing could be more monstrous than this proceeding. Mr. Fielden had designated it as a robbery, a robbery under the sanction of the law, but nevertheless a robbery; and if there were any parties who had any general control over those Commissioners, he trusted that some intimation would be given to them which would check them from putting the law in practice in a manner which must produce so much dissatisfaction, because of its great injustice.

General Johnson

said, it was necessary that some alteration should be made in the law, because it was so oppressive that people in trade did not know what they were about. If persons did not know what they were worth, and if they offered to produce their books in case what they said was disputed, and a sum was still levied upon them at the will of the Commissioners, those persons must give up their entire property to the will of the Commissioners. This was a most unjust and iniquitous proceeding towards his Colleague, who was in a large way of business, and who was surcharged to an amount of 24,000l., when he had actually lost that sum. He knew the statement of his hon. Colleague to be perfectly true.

The Chancellor of the Exchequer

had never heard of the circumstances to which the hon. Gentleman the Member for Finsbury had adverted till that moment when he had heard the statement. He did not know how that case arose, and knowing nothing of the circumstances, it was out of his power to satisfy the House with respect to it. But he knew this, that there was a power of bringing the case before the Commissioners of Somerset House, by an appeal, of which Mr. Fielden might have availed himself, to correct the error of the Commissioners in the country. The case was, therefore, not without a remedy; and he begged leave to point out that as the best remedy to which Mr. Fielden could have recourse to rectify the error of which he complained. There was an independent authority in the Commissioners in London to inquire into the circumstances, and to apply a remedy.

Mr. Wakley

, in explanation, said, that Mr. Fielden stated that he had appealed against this 24,000l. surcharge; and, he added, that the Commissioners wished the case to stand over until Easter, to which Mr. Fielden assented, and notwithstanding this they had demanded the amount. He made no general accusation against the Commissioners, as he knew, in the metropolis, that they behaved with great forbearance, and between 70 and 80 per cent. of the appeals had been allowed in his own district.

Mr. Bernal

said, the hon. Member for Finsbury had not complained of the absence of appeal from the local Commissioners; but the case of the hon. Member for Oldham was, that these Commissioners proposed that the case should stand over until after Easter, and, in the mean time, sent another demand for the tax. It was certainly a case which demanded the attention of the superior authorities.

Sir R. Peel

said, that the Lords of the Treasury and the Commissioners of Somerset House were exceedingly desirous to obviate any inconvenience to which those who had to pay this tax might be exposed. If there were sufficient grounds for objection, the party on whom the demand was made might apply to two tribunals—the Special Commissioners and the Commissioners at Somerset House. He trusted that in the case of the hon. Member for Oldham, the Treasury would be able to afford redress. If he understood the hon. Member for Durham, he conceived that the Act gave no option of appeal from the local Commissioners. The Government had appointed the local Commissioners, because they thought that the appointment of Government officers would be less acceptable to the country. At the same time, it was possible that some individuals might have rendered themselves obnoxious in the particular districts in which they resided; but in such cases it was erroneous to suppose that there was no relief, for there was a power of appealing to another authority which could not be influenced by local prejudice, and whose only desire was to do justice.

Bill read a third time.

Mr. Spooner

then rose to complain of an evil in the operation of the tax, to which he thought a remedy might be adapted. The evil of which he complained arose from these words of the Act,— And, whereas, by the said recited Act it is provided, in the first rule of Schedule D, relating to deductions, that no sum shall be set against or deducted from the profits or gains arising under that Schedule for any disbursements or expenses of maintenance of the parties, their families, or establishments. As that clause was constructed (and he believed it was the only legal construction which could be put upon it) it had the effect, where the master of a family carried on a small business, were it a shop or a small manufactory, and employed in it members of his own family, he was not entitled to deduct the profits of that employment or even the value of the labour of those individuals. To a certain extent there was an exemption from this rule; namely, where children were supposed to be of an age to be able to take care of themselves. If they continued to work for their parents, and were really and bonâ fide paid salaries, the amount of their salaries was exempt from the tax. But he complained that where the wife and the younger children were almost entirely occupied in carrying on the business of a shop or manufactory, it was only fair and just that the persons who so employed them should have the same benefit and advantage of deducting the expense and value of their labour from the profit of it, as a man without family had who was obliged to employ this labour and pay for it. It was putting a man without family in a better situation than his neighbour. The remedy which he proposed was this;—that the Commissioners should have a power to make such deductions from the returns of a man's profits as should seem to them just. The present system created very great injury to individuals, and caused increasing objections to the inequalities of this tax. He was aware of the inconvenience of bringing forward the clauses he was about to propose on the third reading of the Bill; but, if he had had the opportunity, he would have brought them forward in Committee. He knew he should be first met with the commonplace objection, that the change he proposed would open the door for fraud? He would meet that with the commonplace answer, what was the use of all their expensive machinery for the collection of the tax if it were not sufficient to enable them to do justice and prevent fraud? He considered that the way in which this clause was construed was contrary to the original intention of the Act. That Act had two objects—one was to lay a tax on the profits arising from the use of capital, and the other was to raise a tax from the produce of the labour of the individual. In the cases to which he was drawing attention the tax upon capital must be pretty nearly out of the question; the profit was made almost entirely by industry and labour. But in these cases the profit was not received from the labour of the individual, but from the aggregate labour of individuals; and if they separated the labour of these individuals, they would find that not any one of them was subject to the tax. It was contrary to the spirit and intention of the Act that they should class into an aggregate the profits of several, and subject that aggregate to the tax. Another objection which might be urged to what he proposed was—"if we once begin to make alterations we shall find it impossible to meet the number of applications that will be made to us." He thought there was nothing in that objection. They must be just; they had no business to be unjust in order to have speedy legislation. If more time were required, why had they not been called together earlier, in order to afford the time before the 5th of April for the necessary legislation? Let them not be told that because the 5th of April was at hand they must hasten through the business of legislation and do injustice. But this objection was gone from under the feet of the Chancellor of the Exchequer, because the applications were numbered; he saw all that could be made on the Paper that night, and he therefore prayed that each might have that deliberate consideration which it required, and which he hoped the House would sanction. There was one more objection which might be made to the clause which he was about to propose. The Chancellor of the Exchequer need not be afraid that this alteration would in any way infringe on his principle of finance. The amount lost to the revenue would be trifling; but the amount was very large to individuals. It made a difference of the whole tax to them, because it applied to them a principle which was erroneous. He hoped the House would give him credit for not bringing forward these objections in order to retard the measure. He felt that he was sent there to represent the interests of a great body of constituents, who ought not to be told that, because their number made them important, and-not their rank or privileges, therefore the House of Commons ought not to notice them. The hon. Gentleman concluded by moving the first Clause of which he had given notice:— Be it Enacted, that from and after the passing of this Act, whenever the person or persons so liable to be charged under the said Schedule shall employ any member or members of his family in carrying on his trade or profession, it shall be lawful to deduct such sum or sums of money as would have been a fair remuneration for such employment if any other person had been so employed.

Mr. Muntz

had great pleasure in seconding the Motion of his hon. Colleague. He trusted that the Government would not consider that the proposed clause involved any principle contrary to the spirit of the original Bill. He could assure the House that though the alteration might not affect any large class in some districts of the country, it was of very considerable importance to a numerous body of small manufacturers among his constituents, who were in the habit of getting much of their work performed by the members of their own family without whose aid their business might be considered as absolutely profitless. He trusted, therefore, that the House and the Government would not press upon the industrious and deserving class to whom he alluded, a tax which was unbearable by them.

Clause read a first time.

On the question that it be read a second time.

The Chancellor of the Exchequer

said, he could assure his hon. Friend (Mr. Spooner), that he gave him full credit for the spirit in which he brought his Amendments before the House. He could also assure his hon. Friend, that he did not resist his Motion on any of the grounds which his hon. Friend had alluded to. He would not say that the House had not time to be just. He agreed with his hon. Friend that they had time, and that they ought to have time, to act justly towards all parties who had claims upon them. But he resisted the Motion, because he believed the law as it already stood could be administered without operating unjustly upon the classes alluded to by his hon. Friend. The proposition of his hon. Friend was, that persons assessed under Schedule D should be allowed to deduct from their profits a certain allowance for the maintenance of the members of their families who laboured for them. It was not allowed to any person assessed under the Income Tax to make deductions on account of the maintenance of his family. His hon. Friend admitted in the early part of his speech, that any person who employed any members of his family, and paid them for the work which they did for him, had a right to claim exemption from the tax to the amount which he so paid away; and in those cases the law made no distinction as to whether the member of the family so paid resided with the head of the family or not. Therefore, when exemptions of this kind were required, all that it was necessary to prove was, that the payment so made was a bonâ fide transaction. His hon. Friend said that there would be nothing easier than for the Government officer to make a just allowance in favour of the owners of families who claimed exemption on account of work done by their wives and younger children. But he would ask, was there anything that could make the tax more oppressive and injurious than giving the Commissioners such an inquisitorial power as that for which his hon. Friend contended? It would be giving authority to the Government officer to interfere with the domestic arrangements of families, and would no doubt be the source of much complaint and annoyance. As he was on his legs, his hon. Friend would perhaps allow him to refer to another clause of which he had given notice. That clause was in these words,— And whereas, it is enacted by the said recited Act, that the rental or parts of rental of premises used for the purpose of trade may be allowed as a deduction from gains and profits; be it enacted, that from and after the passing of this Act, a similar deduction shall be made for sums paid for poor rates and other parochial and local rates. He had no hesitation in saying that under the Act as it originally stood, all rates on premises used for the purpose of trade were among the deductions to be allowed; he therefore thought the second Clause of his hon. Friend quite unnecessary, and that it had been been brought forward under a mistake. With regard to the question immediately before the House, he should again repeat that he did not think the injustice of which his hon. Friend complained, was consistent with the spirit of the Act, and he could not therefore give his support to the clause proposed to be introduced.

Mr. Spooner

said, the right hon. Gentleman had misunderstood him. The right hon. Gentleman said that he (Mr. Spooner) proposed to introduce the tax-gatherer into every man's dwelling to inquire what part of his family was employed by him or not. He (Mr. Spooner) had not made any such proposal. All he said was, that the Government officer had before him, at the time of appeal, the returns from all those engaged in the same trade within the same district, and that he therefore had the power of ascertaining by comparison what it would be just for him to allow in any case. With regard to his 2nd Clause, he would not take up the time of the House with it after the declaration of his right hon. Friend; but he could assure him that it was not a partial or a local, but a general, and he might say an universal mistake, that these local burdens were not to be deducted. He himself had seen instructions from the Board to the Commissioners for general purposes, that they were not to allow for poor rates; that they were burdens not incident to trade; that they belonged to the poor, and varied according to the extent of the demands upon them; and that they were not payments absolutely necessary for the purposes of trade. He (Mr. Spooner) had made inquiries in two or three places out of his own district, and he found that rent was allowed for; but not poor rates or local burdens, because the Act of Parliament, by mentioning rent, was considered to exclude all other burdens which it did not mention.

The House divided:—Ayes 39; Noes 151: Majority 112.

List of the AYES.
Anson, hon. Col. Morris, D.
Barclay, D. Murray, A.
Barnard, E. G. Napier, Sir C.
Benbow, J. O'Brien, A. S.
Bouverie, hon. E. P. Paget, Col.
Bowes, J. Palmer, R.
Cowper, hon. W. F. Pattison, J.
Curteis, H. B. Plumridge, Capt.
Dennistoun, J. Ponsonby, hon. C. F. A.
D'Eyncourt, rt. hn. C. Rice, E. R.
Duke, Sir J. Rumbold, C. E.
Duncan, G. Somerville, Sir W. M.
Duncombe, T. Stanton, W. H.
Entwisle, W. Thornely, T.
Farnham, E. B. Townley, J.
Ferguson, Col. Turner, E.
Hallyburton, Lord J. F. Wakley, T.
Hill, Lord M. Wyse, T.
Johnson, Gen. TELLERS.
Martin, J. Spooner, R.
Mitcalf, H. Muntz, G. F.
List of the NOES.
A'Court, Captain Barrington, Visct.
Aglionby, H. A. Bell, M.
Astell, W. Beresford, Major
Bailey, J. jun. Boldero, H. G.
Baillie, Col. Borthwick, P.
Baillie, H. J. Bowles, Adm.
Baird, W. Bramston, T. W.
Baldwin, B. Broadley, H.
Baring, T. Broadwood, H.
Baring, rt. hn. W. B. Brotherton, J.
Bruce, C. L. C. Jermyn, Earl
Bruges, W. H. L. Jocelyn, Visct.
Buckley, E. Johnstone, Sir J.
Buller, E. Langston, J. H.
Busfeild, W. Lawson, A.
Cardwell, E. Lemon, Sir C.
Charteris, hon. F. Lennox, Lord A.
Chetwode, Sir J. Lincoln, Earl of
Clay, Sir W. Lockhart, W.
Clayton, R. R. Long, W.
Clerk, rt. hon. Sir G. Mackenzie, T.
Clive, Visct. Mackenzie, W. F.
Cochrane, A. Maclean, D.
Codrington, Sir W. M'Neill, D.
Colebrooke, Sir T. E. Manners, Lord J.
Collett, W. R. Marsham, Visct.
Compton, H. C. Marsland, H.
Copeland, Ald. Meynell, Capt.
Courtenay, Lord Morgan, O.
Cripps, W. Neeld, J.
Damer, hon. Col. Neeld, J.
Denison, E. B. Newport, Visct.
Dickinson, F. H. Nicholl, rt. hon. J.
Dodd, G. Norreys, Lord
Duncombe, hon. A. Packe, C. W.
Eastnor, Visct. Pakington, J.S.
Baton, R. J. Palmer, G.
Egerton, W. T. Parker, J.
Escott, B. Patten, J. W.
Estcourt, T. G. B. Peel, rt. hn. Sir R.
Fellowes, E. Peel, J.
Fitzroy, hon. H. Pollington, Visct.
Flower, Sir J. Powell, Col.
Forster, M. Pusey, P.
Fox, S. L. Reid, Sir J. R.
Fremantle, rt. hn. Sir T. Repton, G. W. J.
Fuller, A. E. Rolleston, Col.
Gaskell, J. Milnes Rous, hon. Capt.
Gill, T. Rushbrooke, Col.
Gladstone, Capt. Russell, Lord J.
Gordon, hon. Capt Russell, J. D. W.
Gore, M. Seymour, Sir H. B.
Goring, C. Sheppard, T.
Goulburn, rt. hn. H. Smith, A.
Graham, rt. hon. Sir J. Smith, rt. hon. T. B. C.
Greenall, P. Smythe, hon. G.
Greene, T. Somerset, Lord G.
Grimsditch, T. Stewart, J.
Grimston, Visct. Stuart, H.
Grogan, E. Sturt, H. C.
Halford, Sir H. Sutton, hon. H. M.
Hamilton, W. J. Thesiger, Sir F.
Harris, hon. Capt. Trelawny, J. S.
Hawes, B. Trotter, J.
Hayes, Sir E. Turnor, C.
Heneage, G. H. W. Villiers, Visct.
Hepburn, Sir T. B. Vivian, J. H.
Herbert, rt. hon. S. Waddington, H. S.
Hinde, J. H. Wall, C. B.
Hogg, J. W. Warburton, H.
Holmes, hn. W. A'C. Wood, Col.
Hope, hon. C. Wood, Col. T.
Hope, G. W. Wortley, hon. J. S.
Ingestre, Visct. Yorke, hon. E. T.
Inglis, Sir R. H. TELLERS.
James, W. Young, J.
James, Sir W. C. Baring, H.
Mr. Spooner

then moved the following Clause— That from and after the passing of this Act, it shall be lawful for all persons chargeable under Schedules D and E, who may have effected, or may hereafter effect, any insurance or insurances on their respective life or lives, to claim deduction from the amount of the annual premium paid for such insurance or insurances; and whenever such deduction so claimed shall reduce the net annual income below the sum of 150l., the parties so claiming shall be entitled to exemption from payment of Duty. His object was to allow persons who, for the sake of a protection and provision for their families, were provident enough to insure their lives, the opportunity of deducting the premiums from the amount of their returns. Surely the House could not doubt it was their duty, in every way possible, to promote objects such as that of making provision for families. Those who depended on profits and on labour had no other way of doing that but by insurance. He anticipated it would be made an objection that this clause excluded persons whom it would be highly beneficial to admit within it, but in that he differed from what fell from the right hon. Baronet the other night. The right hon. Baronet asked why should clergymen be excluded? He (Mr. Spooner) denied that the clause did exclude clergymen. Only those clergymen would be excluded who received an income from tithes, whom it was impracticable to include. His object was to obtain that which was practicable; he asked that which he was perfectly sure could easily be done. It might be asked why he took this one way of providing for a family, and what difference there was between an annual insurance and an annual investment of a certain sum in any other way? He answered, that when a man insured his life, he put it practically beyond his control to apply the premiums when once paid to any other object; on the other hand, if an investment were annually made, the money might be taken out, or the mode of investment changed. But another objection might be urged—that persons might insure on a large scale, and by getting large profits by that means, might get off from paying the tax for it under this clause. But when it was considered that the interest obtained by insuring for twenty years, except in one or two offices, was very small, he did not think this objection would go very far. His object was, that persons insuring against risk should be allowed to deduct the amount. He denied that the adoption of the principle he contended for would open a door to fraud; at the same time it would not materially decrease the revenue, inasmuch as the amount so deducted would make a very small difference in the sum total. All he asked was, that those who made their returns under Schedules D and E, and clerical and professional annuitants, might be permitted to deduct the amount of the annual premium paid upon insurances for their lives; and as they already paid a tax upon the insurance, he conceived they had on that ground an increased claim to consideration.

Lord J. Manners

seconded the proposition of the hon. Member for Birmingham, because he was anxious to see an Income Tax made as equitable as possible. He thought it would be most unfair to tax that man to the whole extent of his income who depends for the subsistence of himself and his family upon his physical or mental exertions, and who, if he be a prudent or right-thinking father of a family, would endeavour to provide for that family by an insurance upon his life. Whether they viewed the proposition as an act of mere justice to a large class of deserving individuals, or, as a wise and paternal government ought to look at it—as a measure calculated to encourage life insurance, he thought it could only be considered as a wise and prudent step to effect such a result. He hoped that the House would sanction the principle involved in this clause.

Clause brought up and read a first time.

Upon the question that it be read a second time,

Mr. Warburton

said, he thought the same objections held good against this proposition of the hon. Member for Birmingham as those he had made on a former evening to the proposition of the hon. Member for Oxford. It appeared to him that the principle involved in the proposition of the hon. Member for Oxford and the hon. Member for Birmingham was precisely the same. The principle, no doubt, appeared at first sight to be fair; but when they came to examine it, or carry it into effect, it was really most unfair and complicated. He considered that it was quite impossible to carry such a proposition into effect.

The Chancellor of the Exchequer

was anxious to state the grounds upon which he objected to a proposition that appeared to have a benevolent regard to the interests of a large class of people. The proposal of the hon. Gentleman (Mr. Spooner) was, that a deduction should be allowed to a particular class upon account of insurances on their lives, and he stated it was founded upon a benevolent principle; but the hon. Member did not accurately see the bearing of his own proposition. In the first instance he (Mr. Spooner) limited the advantages he proposed to give to a very small portion of those who paid equally the burden of the Income Tax. He confined them to classes D and E, viz., to persons embarked in trade and professions, or engaged in Government offices, paying a proportion of Income Tax of 1,700,000l., contradistinguished from 3,500,000l. paid by the other classes whom the hon. Member excluded from his proposed benefit. The hon. Member excluded all that part of the clergy who received their incomes from tithe, or the commutation of tithe; and yet if there was one class of society more than another entitled to have a deduction upon account of an arrangement of this sort, it should be that very class. There were many other persons, of other classes, upon whose part an insurance on their lives might equally be a prudent arrangement, to whom, if he were to encourage exemption, he should give it. For instance, the holders of leases for limited periods; for a person of this class, a man of common prudence, would, if he looked for a renewal of his lease, calculate upon a life insurance to secure the fine upon which the renewal could be obtained. There were other modes besides life insurance by which prudent men of this and the several other classes made provision for their families. A man might act an equally prudent part by annually investing a particular amount of money in the funds, or in any other property, which making a larger return than the funds, might be essentially useful to those who were to come after him; yet the hon. Gentleman was obliged, because he could not get at that fact, to exclude this man who, with a very prudent economy, made a provision for his family without having recourse to insurance. He would take another case still harder. A man engaged in any of these professions had an uninsurable life—that was to say, he had some latent disorder which, though not immediately fatal, was of such a nature that the insurance offices would not allow him to make that kind of provision for his family. What was his situation? Why, he was obliged annually to lay by a sum of money, not in the same, but in a greater proportion, as a man who had insured his life in order to guard against the contingency of death, which, in his case, if not immediately probable, was possible in a limited period. That man was certainly without exemption, though sacrificing a great portion of his income; yet, from the necessity of the case, you were obliged to exclude him from the benefit of his virtuous and prudent economy. The hon. Member (Mr. Spooner) laboured under a mistake, if he imagined that the insurance of lives was always a proof of provident care on the part of the man who made the insurance. That was by no means the case. Insurances of this description very frequently were not for the whole life. Very often they were mere securities for money lent, which the individual insuring could not borrow under any other circumstances. An extravagant man, for example, having exhausted every other species of credit, might resort to this as the only mode he could contrive for acquiring the means of supporting his extravagance; and therefore the House could by no means be sure that in agreeing to the proposal of the hon. Gentleman, they would be encouraging what was virtuous and prudent. Another objection would show how easily a fraud might be committed. Insurance offices would allow you to insure your life for a limited number of years. Under this sort of contract, at the end of the period of years, you were to receive the specific sum which was the value of the annual premium, with a certain amount of interest upon it. What was there to prevent a man from insuring his life for three years upon these terms, and at the end of the period receiving back the sacrifice he had made during the time when the Income Tax was in force? The hon. Gentleman said, there was no inducement for fraud in his proposal; but the fact was, it would offer the strongest inducements to the man with 170l. a-year thus to spend 20l. annually, by which he would save 4l. 10s. per annum. It therefore held out a premium to such a man for insuring his life, so as to make an immediate deduction from his income, retaining the whole advantage to himself of its producing a subsequent income exactly equal to the amount of the tax he would be exempt from paying. He believed he had stated enough to show that the Motion of the hon. Member was objectionable, and, upon the whole, he recommended the House not to adopt it.

Mr. Hawes

remarked, that the injustice pointed out by the hon. Member for Kendal (Mr. Warburton) could be overcome in no other way than by rendering the Income Tax permanent. The hon. Member for the University of Oxford said it was not to be regarded as permanent; to which his hon. Friend (Mr. Warburton) very properly replied, "Let us deal with it as a permanent measure, and adjust the different degrees of annuitants to it." Surely the House were not to be deterred from doing justice because the tax was one nominally for three years only. It was nominally for three years in 1842; it was nominally for three years in 1845; and it would be nominally for three years in 1848; so that, in point of fact, it must be regarded as permanent. With regard to insurances for three years, the right hon. Gentleman (the Chancellor of the Exchequer) seemed to apprehend fraud; but he should recollect what powers were given to the Commissioners to enforce this odious and infamous tax—a tax that could only be made just in proportion as power was given to the Commissioners to decide the cases before them according to equity and justice.

Mr. Aglionby

expressed his belief that, whether the Income Tax were permanent or temporary, it would be unjust to make the exemption now sought. The Motion of the hon. Member for Birmingham (Mr. Spooner) had on the face of it something extremely plausible; but it seemed to him that the Chancellor of the Exchequer had completely answered all the points the hon. Member had urged. Whether the tax were temporary or permanent, he thought they ought not to allow a person who made a provision for his family in one way to evade its operation, while a person who made that provision in another way was subject to it. A person who had an income of 250l. or 300l. a-year, might go to an insurance office and insure his life to the whole amount above 150l., and so evade the tax. He believed there was an insurance office which, if you insured bonâ fide for 2,000l. for the whole term of life, would at any time allow the insurer, should he wish to withdraw, nearly the full value of the premiums he had paid. He therefore felt it his duty to oppose the Amendment of the hon. Member for Birmingham.

Mr. Spooner

said, the hon. Member would find on inquiry that a person who so withdrew an insurance would obtain a very poor return for the premiums he had paid.

The House divided—Ayes 26; Noes 87: Majority 61.

List of the AYES.
Anson, hon. Col. Martin, J.
Borthwick, P. Milnes, R. M.
Brotherton, J. Morris, D.
Clay, Sir W. Muntz, G. F.
Cowper, hon. W. F. O'Brien, A. S.
Curteis, H. B. Packe, C. W.
D'Eyncourt, rt. hn. C. T. Plumridge, Capt.
Fox, C. R. Rice, E. R.
Gill, T. Russell, Lord J.
Halford, Sir H. Smythe, hon. G.
Hawes, B. Somerville, Sir W. M.
Hill, Lord M.
Inglis, Sir R. H. TELLERS.
Johnson, Gen. Manners, Lord J.
Leader, J. T. Spooner, R.
List of the NOES.
Acland, Sir T. D. Escott, B.
A'Court, Capt. Fitzroy, hon. H.
Aglionby, H. A. Forbes, W.
Astell, W. Forster, M.
Baillie, Col. Fremantle, rt. hn. Sir T.
Baillie, H. J. Fuller, A. E.
Baldwin, B. Gaskell, J. Milnes
Baring, rt. hn. W. B. Gladstone, Capt.
Barnard, E. G. Gordon, hon. Capt.
Barrington, Visct. Goulburn, rt. hon. H.
Benbow, J. Graham, rt. hn. Sir J.
Bentinck, Lord G. Greene, T.
Boldero, H. G. Gregory, W. H.
Bowles, Admiral Grimsditch, T.
Broadley, H. Grogan, E.
Bruce, Lord E. Hamilton, W. J.
Bruges, W. H. L. Harcourt, G. G.
Buckley, E. Heneage, G. H. W.
Busfeild, W. Herbert, rt. hon. S.
Cardwell, E. Holmes, hn. W. A'C.
Chetwode, Sir J. Hope, hon. C.
Clayton, R. R. Hope, G. W.
Clerk, rt. hon. Sir G. Jermyn, Earl
Courtenay, Lord Jocelyn, Visct.
Damer, hon. Col. Lawson, A.
Darby, G. Lennox, Lord A.
Dickinson, F. H. Lincoln, Earl of
Duncombe, hon. A. Lockhart, W.
Egerton, W. T. Mackenzie, W. F.
Entwisle, W. McGeachy, F. A.
McNeill, D. Sutton, hon. H. M.
Marsland, H. Thesiger, Sir F.
Martin, C. W. Trelawny, J. S.
Morgan, O. Trotter J.
Nicholl, rt. hon. J. Vivian, J. E.
Pakington, J. S. Wakley, T.
Patten, J. W. Wall, C. B.
Peel, rt. hon. Sir R. Warburton, H.
Peel, J. Wood, Col.
Pringle, A. Wood, Col. T.
Repton, G. W. J. Wortley, hon. J. S.
Rushbrooke, Col. Yorke, hon. E. T.
Smith, rt. hon. T.B.C. TELLERS.
Somerset, Lord G. Young, J.
Stewart, J. Baring, H.
Mr. Spooner

said, after this division he would withdraw the 4th Clause of which he had given notice.

Mr. Wakley

said, this Bill professed to be a measure for levying a tax upon income, and by the Amendment of which he had given notice he wished to relieve parties from a tax upon losses. Some landlords complained that they received no rents for their property, in consequence of the tenants becoming bankrupt or insolvent, or absconding, and that in many cases their property was much injured by such tenants; and they desired that the Commissioners for general purposes should be empowered, on proof of such facts, to relieve the landlords from payment of the Income Tax upon these losses. This was so just a proposal that he thought it could not be objected to; although it had been urged that, because this Bill was to continue in operation only for three years, the tax ought to be endured without modification. But suppose a medical practitioner were to apply a large blister to the Chancellor of the Exchequer, and say, "Oh, never mind it—it will only last for three years,"—would the right hon. Gentleman consider that a sound argument for such an infliction? He could assure the right hon. Baronet at the head of the Government that the people out of doors fully expected that this tax would have ceased at the end of the three years. He was bound to say that no question could have been brought before the House in a more statesmanlike manner than was the proposal of this tax by the right hon. Baronet, and the question was left to the determination of the House. He had supported the general proposition; and if there should be a division on the third reading of the Bill, he would vote in its favour, for he thought the right hon. Baronet's proposal was for the advantage of the country. But he could assure the right hon. Baronet that the fact of his having opposed every amendment that had been brought forward would prevent the continuance of this tax in its present form beyond the next three years; for he believed such strong and general hostility would be manifested to the measure, that it would be utterly impossible to continue it without alteration. He had always stated his approval of a Property Tax upon a sliding-scale, and he would also support an Income Tax upon a sliding-scale; but he considered that in the case he had now brought before the House, where parties sustained severe losses through dishonest tenants, they were justified in requesting that permission and power might be given to the Commissioners for general purposes to remit the tax when proof of loss was given. He therefore moved that the following clause be added to the Bill:— And whereas doubts have arisen whether the landlord for the time being of premises charged under Schedule A is liable to the Duty charged on the said premises under the said last mentioned Schedule, whether the said landlord shall or shall not have received the rent in respect of the said premises; Be it Enacted, and it is hereby Enacted, that it shall and may be lawful for the Commissioners for General Purposes, acting for the district in which the said premises are situated, on appeal to them made for that purpose by the said landlord or his agent, to discharge the said assessment, or such portion thereof, at the rate of 7d. in the pound, on such amount of rent as the said landlord shall prove to their satisfaction he has wholly lost, and has not been able and is not likely to recover in respect of the said premises, and on which he would have been liable to pay the said Duty, by way of deduction, in case the occupier for the time being, or any other person for him, had paid the said rent.

General Johnson

seconded the Motion.

Clause brought up and read a first time.

On the question that it be read a second time,

The Chancellor of the Exchequer

was obliged to the hon. Member for Finsbury for having answered the question of the hon. Member for Lambeth (Mr. Hawes) as to the perpetuity of this tax. The declaration of the hon. Gentleman (Mr. Wakley), that the tax would not last beyond the period of three years could not fail to be satisfactory to the hon. Member for Lambeth. But he must be as hardhearted with regard to the Amendment of the hon. Member for Finsbury as he had been with reference to those proposed by his hon. Friend (Mr. Spooner). He did not mean to say that individual cases of hardship might not occur in consequence of the loss sustained through dishonest tenants; but, on the other hand, the hon. Member for Finsbury must perceive that any general permission to the Commissioners for general purposes to allow deductions in such cases, would lead to a great deal of fraud. It frequently happened, though a tenant might remove from a House without paying rent, it might be recovered subsequently; and the Commissioners would have great difficulty in ascertaining where actual loss had been sustained. By the adoption of the hon. Gentleman's proposal, he conceived, they might prevent the landlords from exercising due vigilance and instituting proper inquiries as to the character of their tenants. The hon. Member for Finsbury had characteristically asked him (the Chancellor of the Exchequer) whether he would like to have a blister upon him for three years. He could assure the hon. Member he would take care not to allow him to keep a blister upon him for three days; and if he were a landlord he would take care that his tenants did not abscond without paying their rent.

Mr. Wakley

said, the right hon. Gentleman seemed disposed to exercise more caution than the people, for they had got the blister fixed upon them, and they must endure it. He (Mr. Wakley) felt it was useless to press the Amendment to a division, and therefore he would not give the House the trouble of dividing.

Motion negatived.

Mr. Forster

moved the Clause of which he had given notice:— And whereas all persons, corporations, and companies, carrying on any mines of lead, tin, coal, copper, iron, or other undertakings of the like nature, are now chargeable under Schedule A; Beit Enacted, That from and after the passing of this Act the said persons, corporations, or companies so chargeable in respect of all such undertakings, shall be assessed for the same under Schedule D, in like manner, and with the same option of privacy, as other persons, corporations, or companies chargeable under that Schedule. He considered that the Property and Income Tax under certain modifications was one of the best systems of taxation that could be adopted; and the Amendment he now proposed would have the effect of removing one objectionable feature in the existing measure. As that Amendment, if adopted, would not lessen the produce of the tax, he could not see on what grounds the Government could oppose it. Trades and manufactures were assessed under Schedule D, and it was provided that persons assessed under that schedule might make a private return to the Commissioners under seal. This provision materially lessened the inquisitorial nature of the tax. But mines and other subsoil undertakings were assessed under Schedule A, and persons assessed under that schedule were deprived of the advantage of making private returns. But why should a favour be extended to one class of traders which was refused to another? If secrecy was necessary in one case, surely it was equally necessary in the other. Indeed, with respect to mines and similar undertakings, secrecy was especially necessary. He was acquainted with the case of some mining establishments where the clerks in those establishments were the assessors under the Income Tax, the tailors and shoemakers in the adjoining villages being the collectors; and to such persons all the affairs of the concerns were necessarily revealed. He thought that, unless the Government wished to render this measure as offensive as possible, they could not object to the Amendment.

Mr. Rice

seconded the Motion.

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 taking the example of the antecedent Act, in 1842, he placed the mines in the same position as they then occupied in the measure now proposed by Her Majesty's Government. And it had been suggested to him by parties connected with mines that they should be placed in Schedule A, because that would give them longer time to calculate the averages. He had not heard a single complaint on the subject.

Motion negatived.

Sir R. H. Inglis

would not have troubled the House on the present occasion, and he would only trouble it for a very few minutes, if he did not feel desirous of calling the attention of Her Majesty's Ministers to the Clause of which he had given notice, not so much with a view to their now conceding its principles, as with the view of their conceding it before they should bring before the House in another Session a proposition for the renewal of the Property and Income Tax. If we were now unhappily engaged in war he would not for one moment endeavour to oppose any obstacle to the complete carrying out of this measure; but happily this country was not at present engaged in war. Again, if the measure were to be temporary only, he would not, under any circumstances, desire a reconsideration of it; but every day's experience unfortunately led them more and more to believe that the operation of the measure was not to be limited to the three years in question, but was likely to be perpetual. Every day's experience satisfied him, and the statements of his right hon. Friend at the head of the Government, and of his right hon. Friend the Chancellor of the Exchequer, led him to the perfect conviction, that the tax was to be a permanent one. Under such circumstances, he was desirous of attempting to make it, even for its professed existence of three years, more tolerable than at present proposed by Her Majesty's Government. The proposition he was about to bring under the notice of the House rested on the same ground of equity on which the great exemption under the existing law was founded. Three years ago his right hon. Friend (Sir R. Peel) said he considered that an income under 150l. a year ought to be exempt from the tax. There were many instances in which persons in receipt of 150l. a year might by fraud evade payment of the present Income Tax; for instance, parties in receipt of an income a little above 150l. might desire that that income should be reduced by their employers in such a way as to cause them to be exempted from the operation of the tax. A person having a nominal salary of 150l. a year might, in order to evade the tax, cause it to be reduced to 149l., and thus save 3l. 10s. a year. He, therefore, wished his countrymen to be relieved from a position which either held out inducements to the perpetration of fraud, or from that distress which, he believed, great numbers in other cases sustained. He could not conceal from himself that the alterations in the prices of the necessaries of life made by the Tariff did not so much affect those having incomes under 150l. a year, or even 300l., 400l., or 500l. a year; it affected more immediately those having incomes of 15,000l. and upwards, who did not care so much for its operation. The Property Tax, therefore, bore heavily on the classes who were not much benefited by the alterations in the Tariff. But it was said the proposition he (Sir R. Inglis) suggested was impracticable, and that, even if practicable, it would be ruinously injurious. But his right hon. Friend (Sir R. Peel) had not stated any specific grounds on which the impracticability of the proposition could be proved. He (Sir R. Inglis) was of opinion that the proposition was one which was perfectly practicable. Supposing a person was assessed for a given sum in 1844, all that would be requisite, in order to carry out his proposition, would be to reduce the assessment of that individual by the sum of 4l. 10s. [Sir R. Peel: The individual is not assessed.] In some cases persons were not assessed, but he knew that in many cases they were. And in cases where persons were assessed it would only be necessary to deduct the sum of 4l. 10s. from the assessment. But it was said that the adoption of the proposition, even if it were practicable, would be ruinously injurious, as a million of money at least would thereby be lost to the revenue. In order to meet that objection, though he conceived the supposed amount of loss was greatly overstated, he intended to modify the proposition of which he had given notice by limiting its operation to those classes who might be considered previously open to the evils of the present system. He had been told that the former proposition would, if carried, have the effect of relieving the Marquesses of Stafford and the Dukes of Buccleuch, as well as the classes he was particularly anxious should be relieved. He (Sir R. Inglis) did not regard the argument as conclusive; but the objection would not apply to the proposition he would now submit to the House. The proposition was, Provided always, that the said rates and duties shall not be assessed or taken upon any income whatever under the amount of 500l., except in respect to the sum by which such income shall exceed the sum of 150l. He believed that there were numbers of clerks and other persons to whom the adoption of this proposition would afford great relief. He believed such persons were ranked by many thousands. They had statistical information which would bear out his statement. With respect to the clergy, the adoption of this clause would give relief to an immense portion of those who held benefices in England. It was a matter of fact, that there were upwards of 5,000 benefices varying in value from 150l. to 500l. But he was told that there were 200,000 persons who paid the tax. Very well; the results of the appeals ought to be considered some criterion as to the number of those who paid. There had been about 82,000 claims for exemption, and of those there were 75,500 claims which were granted. Therefore he thought that 200,000 was not the number that could claim exemption from payment of the tax, supposing the proposition he made was adopted. He knew what would be the result of dividing the House upon it, but he should consider it his duty to do so; for he was of opinion that the clause would be eminently conducive to the welfare and comfort of a great number of Her Majesty's subjects. On these grounds he begged leave to move the insertion of the words which he had mentioned at the end of the first Clause under the consideration of the House.

On the question that these words be inserted,

The Chancellor of the Exchequer

thought that the proposition made by his hon. Friend (Sir R. Inglis) would, if adopted, lead to a greater degree of evasion and fraud than took place at present, and was liable to all the objections that had been urged against his hon. Friend's former Motion. In the first place, the hon. Baronet said, "You know the exact income of every man, and can make a deduction of 4l. 10s. for the sum of 150l." But that was precisely at variance with the principles of this tax. They did not know the income of every man. The principle referred to by his hon. Friend was with one consent abandoned, as leading, not only to evasion and fraud, but to a multiplication of oaths, which was considered objectionable. It would be difficult to deduct 150l. from the income of a man, when they did not know what that income was. His hon. Friend stated that a person having 150l. a year might escape payment of the tax (by causing his income to be reduced by 1l.), while another person having 151l. a year, would have to pay the tax. And his hon. Friend said, "Can anything be so monstrous, or hold out a greater inducement to fraud?" But what was the proposition of his hon. Friend? He said, that the man having an income under 500l. a year should be entitled to deduct 4l. 10s., the sum payable able on 150l. But the man having 500l. a year would be altogether excluded from such an advantage. Therefore, it would be worth his while to give up 3l. or 4l. a year, in order to secure himself in the full benefit of his hon. Friend's proposition. It would be very difficult to ascertain the incomes of individuals in many cases. Persons might derive income from various sources. A might have an income from land under 500l., and he might have an income of a totally different character from another source, for instance, from a railway: but they might have no possibility of bringing these incomes together. His landed estate might be in Yorkshire; and the railway, the other source of his income, might be in Sussex. The adoption of his hon. Friend's proposition would undoubtedly lead to a very general infraction of the Revenue. His hon. Friend said, he was of opinion that the loss that would accrue to the Revenue, if his proposition was carried, had been overstated. But he (the Chancellor of the Exchequer) felt satisfied that the loss to the Revenue, judging from the great number of persons who paid the tax under Schedule D alone, would be very great. If they adopted this proposition, they would find it utterly impossible to guard themselves against fraud of the worst description; they would impair the Revenue, and attempt to do that which would be found impracticable.

The House divided:—Ayes 25; Noes 59: Majority 34.

List of the AYES.
Barnard, E. G. Packe, C. W.
Borthwick, P. Plumptre, J. P.
Bowring, Dr. Plumridge, Capt.
Brotherton, J. Rice, E. R.
Busfeild, W. Rumbold, C. E.
Curteis, H. B. Sibthorp, Col.
Dick, Q. Somerville, Sir W. M.
Hawes, B. Wakley, T.
Hill, Lord M. Wawn, J. T.
Johnson, Gen. Williams, W.
Martin, J. Wodehouse, E.
Morris, D. TELLERS.
Muntz, G. F. Inglis, Sir R. H.
Napier, Sir C. Spooner, R.
List of the NOES.
Aglionby, H. A. Bowes, J.
Arkwright, G. Bowles, Adm.
Baillie, Col. Broadley, H.
Baldwin, B. Bruges, W. H. L.
Barrington, Visct. Buckley, E.
Bentinck, Lord G. Cardwell, E.
Boldero, H. G. Chetwode, Sir J.
Clay, Sir W. Lennox, Lord A.
Clerk, rt. hn. Sir G. Lincoln, Earl of
Damer, hon. Col. Lockhart, W.
Darby, G. Mackenzie, T.
D'Eyncourt, rt. hon. C. McGeachy, F. A.
Dickinson, F. H. McNeill, D.
Egerton, W. T. Martin, C. W.
Escott, B. Nicholl, rt. hon. J.
Fitzroy, hon. H. Peel, rt. hn. Sir R.
Forster, M. Peel, J.
Fremantle, rt. hn. Sir T. Pringle, A.
Fuller, A. E. Round, J.
Gaskell, J. Milnes Smith, rt. hn. T. B. C.
Gordon, hon. Capt. Somerset, Lord G.
Goulburn, rt. hn. H. Stewart, J.
Graham, rt. hn. Sir J. Sutton, hon. H. M.
Greene, T. Thessiger, Sir F.
Grimsditch, T. Trotter, J.
Herbert, rt. hn. S. Warburton, H.
Hope, hon. C. Wortley, hon. J. S.
Hope, G. W. Yorke, hon. E. T.
Hutt, W. TELLERS.
Jermyn, Earl Young, J.
Jocelyn, Visct. Baring, H.

On the question that the Bill do pass,

Sir W. Clay

could not allow the Bill to pass that stage without again expressing his opinion with respect to it. He thought that any advantages which were offered to the country by the other measures of the right hon. Baronet were purchased at too high a price by the payment of the Income Tax. The objections which were made to the injustice and inequality of this direct taxation in its operation by several hon. Members, had been answered by the right hon. Gentleman opposite in a manner which did not go to prove that the causes of objection were not real and substantial. What was said in reply to the objections to which he alluded? It was, forsooth, said that the hardships which were stated as likely to result from the tax were very severe, but that worse hardships could be pointed to by the Government, and that it was impossible to touch them without super inducing other evils. That was the description of answer which had been given to the statements of hon. Members who objected to the unequal pressure of this tax. Indirect taxation had the advantage of enabling a man to regulate to a certain extent the proportion of the burden to which he should submit himself; for by lessening his consumption of those articles which placed him most directly under the operation of this description of taxation, he could by his own act lessen the amount of it which he was to pay. The assessed taxes on carriages, horses, and such luxuries had rather a tendency to diminish a man's power of expenditure; but the effect of a Property Tax was quite the contrary, for its tendency was to diminish his power of saving; it was, in fact, a tax on prudence. It was a most unjust and unwise principle to lay a tax upon prudence, and there could not be a more vulgar error than to suppose that it was good to tax the miser. The miser was the greatest benefactor to society; he was the man who carried out all our improvements; it was not by the man who kept the best fox-hounds, or the largest number of carriages and horses, that the railroads and canals of this country were made, but by the man who did not spend his income. Another great objection to this tax was not extending it to Ireland. He could not allow this Bill to pass without expressing his objection to it as one dangerous in principle.

Sir R. Peel

said: I am really much obliged to the hon. Gentleman for the manner in which he has expressed his opinion upon this question. The hon. Gentleman must see that his observations cannot result in any great good; yet he has put on record his parting malediction, as it were, of this Bill. I will not now enter into the question whether direct taxation is preferable to indirect taxation. I believe it would be extremely difficult to lay down any positive theory in the abstract, for I think that the question, whether direct taxation is preferable to indirect taxation, very much, and materially indeed, depends upon the circumstances of the country. If a country were heavily taxed, and the taxation pressed very grievously upon the industry of the country, and controlled the spirit of enterprise and commerce, and if in that same country property was entirely untaxed, I should think then that a direct taxation upon property might be preferable to a tax upon income. We must know, however, the exact position of the country, the amount of taxation, the way in which it presses, and how it affects particular classes, before we can properly discuss the question whether direct taxation is preferable to indirect taxation. But I feel that if you are to have a tax at all upon property, it ought to be a tax upon income, and not upon accumulated property. I think nothing could be more mischievous in every way than a tax upon accumulated profits—nothing, I think, could be a more dangerous precedent. What is the great main-spring of industry—what is it that induces men to spend their days and nights in toil but the hope of accumulating property? It may not be a very noble aspiration, or a very worthy object to toil for; but Dr. Johnson said, "Very few men are more innocently employed than in the accumulation of property." If men are to be told that their realized profits are to form the only means of taxation, you do more to paralyze honest industry and honourable exertion — you are holding out greater temptation for men to transfer their capital and their labour to other countries, than you could possibly do by any other means. Then, you will find that a tax on accumulated property will produce very little; that those who can transfer their property to other countries will do so, and you will lose more than can well be imagined by diminishing the great inducement to industry and accumulation of wealth; you will find that your fiscal speculations will not succeed in a pecuniary point of view. You will then go perhaps one step further, and tax the man with a million capital at a higher degree than the man with 3,000l.. or 4,000l., and numerous difficulties must arise from your admission of this dangerous precedent, plausible as it may at first sight appear. When direct taxation is acknowledged, I hope that the House will go to no other principle than that of taxation upon income — not inquiring into the source of that income—but simply distingushing it from realized property. The hon. Gentleman says, that we might have proposed something better than this tax — something that should have been free from all the objections attaching to this. It is all very well to say that something better could have been proposed; but if the hon. Gentleman sat on this Bench, he would perhaps find it more difficult to act than to talk. The hon. Gentleman says, "Why don't you extend the tax to Ireland?" I wish the hon. Gentleman would try what tax it would be advisable to extend to Ireland. Look, for example, at the soap tax. I am not prepared to say that good arguments might not be found for extending that tax to Ireland, and placing it on the same footing as corn; but when we contemplate what would be the consequence of the introduction of the soap tax into that part of the country, where we wish, beyond a doubt, to encourage in a high degree those habits which would lead to a great consumption of soap, I think that we should find good reasons for not for the first time subjecting Ireland to the soap tax. The necessity for the imposition of some tax or other to raise a sufficient sum for the exigencies of the country has not been denied. We have tried this experiment, and the country seems to be of opinion that this is a time when the Income Tax ought to be imposed. The country is not scared by the idea of any difference between realized and realizing profits—it is not scared by the idea of substituting direct for indirect taxation; and I believe that the affluent persons of this Kingdom, whether belonging to the agricultural, manufacturing, or commercial classes, are willing to subject themselves to this continued burden, that they may try this great experiment for improving the condition of the people. I feel that the objections to this tax are of a strong nature; but—and I say it is an honour to this country—but I believe that the reason why the tax is not more generally opposed is, that it is one which may cause a certain commutation of taxation which may favour the interests of those who stand most in need of help. I must again thank the hon. Gentleman for the manner in which he has urged his objections to the Bill; but I do not wish to extend the discussion or to anticipate the debate which may arise upon the expiration of the term for which the tax is now proposed: and upon this point I may say that I am sure the House will agree that nothing could be more unwise in me as a Minister, as a public man, than to pronounce a positive opinion as to what may take place hereafter. One cannot tell what will be the effect of an alteration in various taxes. Look, for example, at glass—see what is going on with respect to that manufacture; suppose you should find this country competing with Belgium and Bohemia in glass, and you should find that hundreds and thousands of persons, before unemployed, should, in consequence, be called into active occupation, how can I say in such a case, that Parliament will not openly declare its conviction at the end of three years that they see the country so improving, trade and commerce so extending, that they believe the country to be so much in favour of direct taxation, as contradistinguished from indirect taxation, that they are willing still further to try this experiment? Nothing would, then, be more unwise than for me to say one word in anticipation of such an event; every public man should leave himself unfettered in such a case. It is not merely from the acquiescence of the country, however, in the continuance of this tax; but it is from the principle on which that acquiescence is granted, that I do derive the greatest satisfaction, for I believe that it exhibits a desire on the part of the affluent of this country to share the burdens of their poorer brethren.

Mr. Hawes

must oppose the Income Tax, notwithstanding what had fallen from the right hon. Baronet; and he should pursue that course because that tax gave an independent revenue to the Minister without reference to the general articles of consumption, and because, but for it, the Minister must resort to sugar or to other articles of consumption, to raise the sum necessary for carrying on the engagements of the country. It was all very well to talk of a judicious mixture of direct and indirect taxation; but in his opinion it was altogether impolitic and improper to think of introducing direct taxation until they had placed their indirect taxation upon a fair and honest basis. Until direct taxation was placed upon a fair basis, the proposed commutation could never advantageously be brought about. All the opposition which he had offered to the measure proceeded upon that ground. He could not help observing, that while improvement was sought in one direction, other cases of really great importance were left untouched. The right hon. Gentleman had stated, fairly enough, that he did anticipate the continuance of the tax beyond the period of three years; he said so formerly, and he now said the same. Well, if the country be so charmed with the tax at the end of the next three years, nothing would be so easy for them as to declare their wish to continue it; but that could scarcely form a reason why all fair representations made on the subject should now be so much discouraged as they were. After having on more than one occasion stated the hardships of the measure, and the numerous objections to it, he could not now conclude without giving it his parting malediction, as a tax in itself most unjust, and as one which stood in the way of that wholesome reform of taxation which was so much needed, and which he felt it his duty to urge upon the adoption of Parliament at every suitable opportunity. Until he should see that reform effected, he had resolved to continue an unflinching opponent of the Income Tax.

Mr. Stuart Wortley

observed, that if the Minister were not allowed to avail himself of that tax, he must lay on some other of equal amount. His right hon. Friend at the head of the Government had given the House a full explanation of the subject then before them, and, for one, be derived great satisfaction from the manner in which that explanation was given. It had very truly been said, that in laying on a tax of this nature, the peculiar circumstances of this country must be taken into account. The circumstances of America were quite different from those of this country. The disposition of the people to bear such a tax should also be taken into account; and though indirect taxation might have its advantages, yet the considerations in favour of direct taxation were of great weight. No doubt if the feeling of the country were adverse to direct taxes, they ought to be given up. He had opposed all the Amendments brought forward on the present occasion, because he thought that improvements in a measure of this kind could only be effected by the Government, and not by the propositions of individual Members.

Mr. Ward

could not refrain from noticing the fact, that after all the strong opinions expressed against the Income Tax, hon. Members did not seem to like voting against it. For his part, he never expected to see the Income Tax removed; and he fully believed that whenever his hon. Friends near him came into power, they would find themselves under the necessity of laying on such a tax. He looked in vain for the elements of an Administration that could do without an Income Tax. The party to which he more immediately belonged, the free-trade party, supported views which the other Members of the Opposition did not seem at all inclined to espouse. He saw no disposition to take up those principles. As to the question before the House, it was entirely a question of degree. But this was a very important consideration, that whereas his hon. Friends near him talked a great deal about what they would do, the right hon. Baronet did what he said. It was only justice to the present head of the Government to state, that when he said a thing it was done. But his hon. Friends on the Opposition Benches had brought forward a great many very pretty propositions, which never went beyond mere schemes; whereas the right hon. Baronet carried whatever he proposed. That certainly was fortunate for the country; and it was not fair to estimate the importance of his measures by what the poor man would save in the price of his fustian jacket, or in his weekly consumption of sugar. The matter to be looked at was the Ministerial measures abolishing a duty varying from 9 to 12 per cent. on the raw material of a manufacture, which already led to the increased employment which would be occasioned by the export trade, amounting nearly to 25,000,000l. The abolition of the duties on glass would have similar effects. It was not merely therefore the reduction of price, but the increase of employment which would be beneficial. A great change, and he hoped a great improvement, would result from the removal of taxes on the raw materials used in manufactures. He had seen the Notice of Motion given by his hon. Friend, and he came down that night for the express purpose of recording his vote in favour of the Property Tax; but, as often happened in those cases, the proposition of his hon. Friend was withdrawn.

Mr. Curteis

said, that he felt when the question was put that the Bill be read a third time, that he ought not to abstain from moving that it be read a third time that day six months; finding, however, that so few hon. Members supported him, he wished to avoid giving the House the trouble of dividing. He was against the tax on account of its inquisitorial nature. It would be, he thought, a great advantage if the inquisitorial character of the impost could be avoided. He admitted that he entertained something of a party feeling in this matter, and he thought that a good rally had been made on the Motion of his hon. Friend the Member for Liskeard. On that occasion his noble leader, the Member for London, voted with the Government. He had always been proud and happy to fight as a humble follower of that noble Lord; and he had hoped that the noble Lord would have recorded his vote, if it were only once, against the measure in its present form, so that the people at large might jumble that vote and confound it with his other votes, under the general impression that the noble Lord wished to relieve them from the unequal pressure of that tax. He heartily regretted that the noble Lord had not taken a bolder stand.

Sir C. Napier

said, that all the officers engaged in the Civil Service and stationed in Ireland, were free from the Income Tax; but that officers of the Army and Navy stationed in that part of the United Kingdom were obliged to pay the Income Tax. Now, he wanted to have that explained.

Mr. Trelawny

thanked the right hon. Baronet for his free-trade measures, and observed that had he gone much further in that direction he would gladly have supported him. He gave the right hon. Baronet credit for his abolition of the auction duty, which was a very severe tax upon persons disposing of their property under circumstances of distress. Had the right hon. Baronet adapted the Income Tax more to the circumstances of the various classes upon whom it pressed, he would have had a much better chance of perpetuating a system of direct taxation, than under the unequal pressure of the present tax he now had.

The Chancellor of the Exchequer

observed that the hon. and gallant Member opposite had asked how it was that civil officers in Her Majesty's service stationed in Ireland were altogether released from payment of the Income Tax, whilst naval and military officers employed in the routine of their duties there were obliged to pay it. The reason was, that the Government having determined to exempt Ireland from the tax, it was manifestly unjust to compel those to pay it who were permanently stationed there, and whose duties, no less than their salaries, were exclusively referable to that country; whereas, with respect to naval and military officers, they were not attached in any especial manner to the soil of Ireland, but their duties might lead them at one moment to be resident there, and in the next they might be called into any other part of the United Kingdom.

Bill passed.