Commons Sitting of 27 March 1848

MINUTES.
NEW WRIT.—For Devonport, v. John Romilly, Esq., Solicitor General.—For Sligo, v. John Patrick Somers, Esq., void Election.
PUBLIC BILLS.—1° Administration of Oaths (Court of Chancery); Parliamentary Electors.
2° Insolvent Debtors (India).
3° and passed; Borough Police Superannuation Fund.
PETITIONS PRESENTED. By Mr. Osborne, from the Parish of Saint Luke, Chelsea, against Increase or Continuance of the Property Tax.—By Mr. Poulett Scrope, from Mayo, for Inclosure of the Commons and Waste Lands (Ireland).—By Mr. Bramston, from Fowlness (Essex), and by Mr. G. S. Duff, from the Presbytery of Strathbogie (Scotland), against Diplomatic Relations with the Court of Rome Bill.—By Sir William Somerville, from Drogheda, against Imprisonment for Debt (Ireland) Bill.

CASE OF MR. C. POLLETT.
On the Order of the Day for the Committee on the Property Tax Bill,
MR. BAILLIE COCHRANErose to call the attention of the right hon. Baronet the Home Secretary to a case of great oppression. It was the case of Mr. Charles Pollett, a clerk to the Brighton railway, who had been summoned in the White-chapel county court for a debt of 2l., and, being unable to pay, was committed under an execution to the House of Correction. In the statement which he had laid before him (Mr. Cochrane) he represented, that on reaching the prison, he was placed in a lock-up and searched—that two hours after the governor came round and asked him what he was there for; he replied that he was sent there, because he had been unable to pay a debt, by the Whitechapel court—that the governor said, "Nonsense, you are here for contempt of court—you are here for correction, and correction you shall have;" that he (Mr. Pollett) was about to speak, when the governor said, "Silence, you are not allowed to speak here;" and he pointed to a board; he (Mr. Pollett) said he was not a felon: but he was locked up, served with a dinner of gruel, like the other prisoners, and at night he was conveyed to a cell, in which was an iron bedstead and a bed of straw, where he was locked up until six o'clock next morning, when he was put with the other prisoners in the yard; that he was then put into a bath, and received a prison dress, and ordered to pick oakum; that he had his hair and whiskers cut close, and his chin shaved, against his will; that he
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underwent the treatment of a felon for three days, when he became ill, and a surgeon was sent to him, to whom he mentioned his case; and on the fifth morning he was taken before the governor and discharged, the governor saying, "Forty-one, you may go"—that he inquired of the governor the reason why he had been treated in so degrading a manner, which had ruined his character: the governor said he had been committed for contempt—that he (Mr. Pollett) had asked for a copy of the commitment, which was promised, but he had not received it. Mr. Pollett was respectably connected; but he had lost his employment, and, with this stigma upon his character, he would have some difficulty in procuring another situation. He had inquired into the case, and into the character of Mr. Pollett, which was excellent; and it was inexplicable to him how a person could have been treated in such a manner for non-payment of a debt of 2l.
SIR G. GREYsaid, he had received no complaint from Mr. Pollett; but having seen the statement which the hon. Member had read, in the Daily News of the 17th of March, he had written to the justices of the prison, directing them to inquire into the allegations contained in that statement. Not having received any reply on Friday, when the hon. Member mentioned to him his intention of bringing the subject before the House, he had written another letter, calling for an immediate report.

THE PROPERTY TAX BILL.
On the question that the Speaker leave the chair,
The CHANCELLOR OF THE EXCHEQUERsaid, the hon. Member for Montrose proposed to refer this Bill to a Select Committee, He thought this was an unusual course; he did not believe there was any instance of such a Bill being referred to a Select Committee. Nor would the hon. Member attain his object by so doing, which was to introduce a graduated scale of taxation; that would he contrary to the forms of the House.
MR. HUMEsaid, there might be difficulties in the way of his attaining the object he had in view; but when the right hon. Baronet said his (Mr. Hume's) proposal was unusual, so was the proceeding in respect to this Bill; and it was on that ground he appealed to the House, and asked it, as this tax was to become perpetual, whether it was not better now to

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endeavour to obtain some modification of it, in order to remove the objections to many of its clauses. It was on that account that he had submitted a proposition to the House that the tax should be continued for one year, and there would be then time for consideration and for inquiry by the Government into the inequalities of the task, for he held it to be the duty of Government to make such inquiry. When the right hon. Baronet the Member for Tam-worth introduced the Bill, he was aware of the inequality of the tax; but as it was for a short and limited time, he had supported the Bill on that ground, and because it was required for certain great objects. The case, however, was different now; and as the Government, with a full knowledge of all the objections to the tax in its present shape, took no step to make any inquiry, it appeared to him that the duty devolved upon the House. He was, however, anxious to give Her Majesty's Government one more opportunity of showing a desire to meet the wishes of the country, for from one end of the country to the other, the complaint was general as to the inequality of the tax. The objection was not to the payment of a direct tax, but to an unjust direct tax; and it was the duty of the Government to make the tax as palatable as possible to the community. But the Bill was not framed like any other Tax Bill. It appeared to him a capital fault in this measure, that the officers by whom it was to be carried out were not officers of the Crown. They were persons over whom the Crown could exercise no power or authority. It was, on the contrary, well known that they were, for the most part, political agents. The majority were what was called Conservatives; for they were, generally speaking, appointed at the instance of county Members. Now, could anything be more intolerable than that they should be entitled to call upon persons belonging to the same rank in life as themselves, and to the same professions, to produce statements of their income and the nature of their business? Let the House imagine one set of merchants and manufacturers asking another what line of business they were engaged in—what were their profits—who were their partners—what shares were held by each partner—what was the amount of borrowed money employed by the firm—and all these questions put by rival, and, in many cases, by hostile persons. He would ask any one who
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knew how those persons were appointed, whether he believed that any had been appointed under the responsibility of the Government—was it not universally admitted that they had long been notorious as political agents? And now, he would ask, was it consistent with the high character for independence borne by the British merchant and manufacturer that he should be subjected to such an inquisitorial examination? He objected to the Bill, first, on account of the mode in which the Commissioners were appointed; secondly, he objected to it on account of its inquisitorial character. Surely the Parliament ought not to allow the continued existence of such a Bill for three years; but if they were determined that it should continue for such a length of time, then ought they to use their best endeavours to remove the main objections to the character and nature of the tax. Amongst the objections to the income-tax, this was most prominent and obvious—a man was to be taxed according to the average amount of his income for the three preceding years. Upon a professional man, and on a man in trade, that operated most severely, because for one of the years he might enjoy a good income, and during the two others he might be losing. Amongst the difficulties that were started in the way of amending this Bill, was the trouble which such amendment would occasion; and he must be allowed to say, it would be impossible to discover a more discreditable ground of objection. He could not conceive anything more injudicious than the refusal of inquiry at a moment like the present, when the general impression seemed to be that it was a tax upon capital, and not upon income. Every one who heard him well knew that in the year 1806 the tax was a novelty, and a novelty which went quite against all previous examples. The principle of the income-tax of 1806, on which the present Bill had been founded, was itself at variance with the Act of 1692, for levying the land-tax, which applied to real property. In 1692, the principle of the laud-tax was this, that for every 100 l. of yearly rent, 4s. in the pound should be paid, or 20 per cent; and with respect to personal property, 4s. in the pound was charged upon the interest at 6 per cent, of every 100 l. employed in trade. By the present Bill, a tax of 7d. per pound on 200 l. income was charged for personal estate or profession, which imposed upon the owner 5l. 16 s. 8d., while if that were charged on 10 l., viz.,

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the interest at 5 per cent, of the 2001. 5s. 10 d. would be charged, as in the year 1692. After 1712, when the legal interest was reduced to 5 per cent, 100 l. of personal estate was assessed at 20 s. by the Land-tax Acts, and there was no instance in the history of English taxation of the yearly product of industry being taxed until Mr. Pitt's Bill of 1796. The tax was proposed in 1701, but rejected. Nothing so unequal as this tax had ever been imposed since the days of the Commonwealth. As he had already said, the objection was not to direct taxation, but to the injustice and inequality of this particular impost; and he could tell them that the discontent upon this subject was not confined to any particular class; even those whose incomes were below 150 l. disapproved of it. Upon a professional man it was most burdensome, for to-day his income might be considerable, and to-morrow it might be nothing. They ought not to strain the cord too tight—they ought not to carry on this aggressive system too long. In many cases land had been greatly improved in value of late years; but not so much through the enterprise and exertions of the landlords as through the efforts made by the mercantile and manufacturing interests. In cases, then, where the value of land had been raised—say 100 l.—the proprietor could afford to pay 40 l. of that, and still retain 60 l. of the increase in hand. The House could not have forgotten that a great number of petitions had been presented upon this subject. Let those petitions be referred to a Committee upstairs, and they, no doubt, would suggest such alterations in the Bill as might eventually render it acceptable to the public. Again, in the case of terminable annuities, it would operate most unjustly, for they were charged alike, though the value of a terminable annuity must depend upon its duration, and that upon the amount of capital invested in it. Another case of frequent occurrence was that of manufacturers employing men at a loss. Mr. Fielden was charged as for an income of 15,000 l. in a year when he had expended 70,000 l. in giving employment to his workpeople. He could put one ease more; a landlord whose estate was worth 3,000 l. derived from it an income of 150 l., and paid 4l 7s. 6d. income-tax. A man in business made 150 l. per annum; it formed his whole capital, and yet he paid the same tax as the landlord. He would ask, whether such a state of things should be allowed to continue? He believed.
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that in no country of Europe did such a tax as this income-tax exist. In France, in Prussia, and in Holland, taxes were imposed on patents for carrying on businesses, which involved a direct tax upon individuals; but no attempt had been made to saddle with taxation precarious professional incomes, or to tax properties of different value at the same rate. The House was told that no modification of the tax could be made; but why was an endeavour to effect a modification objected to? Merely because it would give trouble. Now, he begged to call the attention of the Chancellor of the Exchequer to the manner in which the legacy duty was carried out. The value of every annuity was calculated, and the duty imposed was proportioned to the amount. If, then, this principle was carried out with regard to a tax which yielded 2,500,000 l. to the revenue, he was at a loss to conceive why it might not be applied to a tax which produced 5,000,000 l For his own part, he could not understand why the English farmers should be called upon to pay a larger proportionate amount of income-tax than the Scotch farmers. He considered that, in agreeing to the continuance of this tax in its present form, the House would perpetuate an act of great injustice. If the Chancellor of the Exchequer would consent to refer this Bill to a Select Committee, and if the Committee were unable to suggest such modifications as would render the tax more equal in its operation, he (Mr. Hume) was ready to agree to the continuance of the impost for another year, in the hope that, by the expiration of that time, the Government would be prepared with some remedy for the grievances of which he complained. He begged to move, as an Amendment, that the Bill be referred to a Select Committee.
MR. ROBINSONsaid, that that which the right hon. Gentleman the Chancellor of the Exchequer had said could not be denied—viz., that it was an unusual course in the present stage of proceeding to refer a Bill like the present one to a Select Committee. The necessity, however, for some such inquiry was admitted by the noble Lord, who had the other evening in a spirit of candour stated that the entire system of taxation of this country was anomalous and unequal, and a fit subject for the careful consideration of the Government. The noble Lord also stated, that he should be ready to consider the question with a view to the removal of those inequalities.

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Making that admission, the noble Lord pressed for the income-tax for three years more, and he had objected to it at the time, because, without having any reason to doubt the sincerity of the Government, he felt that, considering the difficulty of their present position, if they got the income-tax for a further period of three years the general system of taxation would undergo no modification during that period. He felt it to be the more unlikely, as it had always been a matter of consideration with the Government of the country which was the most facile method of collecting money; and he thought that, while no difficulty was experienced in raising the tax, that there would be little inducement to them to propose a revision of the system. He had always been in favour of a tax upon the wealth of the country, not merely in the shape of a property-tax, for he thought that incomes should be made to contribute also; but he believed that, considering the difficulty the people had at that moment in obtaining employment, and the low rate of wages they obtained, the greater share of the burden should be imposed on the wealth of the country. He had no disposition to deny that in the present state of the country and Europe the Government ought to be supported. He thought that their hands ought not to be too closely tied, but that powers and means commensurate to the present great crisis should be at their disposal. He believed that the simple inquiry which should take place on this question was, whether any and what means could be devised to render this tax more equal and less oppressive in its operation. If the tax were levied on more just principles, a larger amount than 5,000,000 l. could be raised upon the income of the country. He should give his support to the Motion of the hon. Member for Montrose, for he believed that the time was fast approaching when the gross inequality of our whole system of taxation must be submitted to a revision like that proposed in the case of the income-tax. If no modification could be devised, the better and more satisfactory plan would be to postpone the consideration of this subject to a future time.
SIR R. H. INGLISwas not prepared to support the proposition of the hon. Member for Montrose. If, indeed, the present year were the last of the income-tax, he could not but feel that there would be a great deal in the observations which the hon. Member had urged upon the House.
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The House could not safely leave such a sum as the Government proposed to collect under the present Bill in such a state of uncertainty as the proposition of the hon. Member, if agreed to, would leave it in. He agreed with the hon. Member for Montrose in his objections to the taxation of capital; nor would he object to a graduated scale of property-tax, ascending from a certain point; for he believed that they might, with real advantage, raise the property-tax by an ascending scale; but it would certainly be disadvantageous if they followed the example of their predecessors, and taxed income down to the lowest point at which taxation could be borne, and beyond which it would become intolerable. He wished that the present Government would not consider a person with an income of 150 l. a fit object of taxation, but that the tax should be raised on all beyond that amount. For instance, if a person possessed more than 150 l., he wished to see the tax raised upon so much of his income as was beyond that sum. When he considered the large proportion of persons whose utmost hope and ambition taught them that as to income 150 l. a year was the utmost they could reach—when he recollected the number of persons who were mere articled clerks, or half-pay officers, or gentlemen engaged in professions, whose incomes did not amount to more than 150 l., he contended that the Government themselves had established the principle that such persons ought to be entirely exempted. Why should a man with an income of 151 l. pay 4l. 8s., and the man whose income was 149 l. pay nothing? Again, there might be an alteration in the scale of stamp duties, founded upon a principle of entire equality, which would raise a considerable fund. He was opposed to a graduated increase, but he desired to suggest a perpetuated amount of equal per centage on all stamps whatsoever. At present the stamp duty on a 200 l. bond was 2l., being 1per cent; whilst on a 2,000 l. bond the stamp was only 6l., or 6s. per cent only. Here the inequality was in the wrong direction; it was not for the relief of the rich. He was not disposed to be a radical, certainly—he did not wish to set the poor against the rich, but he wished justice to be done between the parties. It appeared to him that there was no reason why a man who borrowed 2,000 l. should pay a stamp duty of 6l. only, while a man who borrowed the small sum of 200 l. should pay a duty of 21 l. He had on

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a former occasion made a suggestion to the right hon. Gentleman the Chancellor of the Exchequer, which he had not taken any public notice of, as to levying a tax upon gas, which would give a large amount of revenue; and if it was essential to the public service that money should be raised, the question always must be how much money could be raised with the least general injury. He contended that whether the income were derived from land, from trade, from clerical income, or from salary as a clerk, small incomes could not bear taxation. Those who received no more than 150 l. a year were not in a condition, to pay a tax. He hoped that if the public necessity should require that this tax should be renewed at the end of the period for which it was now fixed, the Government would take care to effect some modification in the system, and that they would consider it their duty—whoever might be Chancellor of the Exchequer—to apply the burden of taxation as equally as possible, taking into their serious consideration whether they could not begin at a point much higher than that at present taken.
The CHANCELLOR OF THE EXCHEQUER: I certainly should not do that justice which I always wish to do to my hon. Friend who has just sat down, if I did not allow that any suggestion from him ought always to command my best attention; but, nevertheless, I must decline entering into all those questions of different taxes to which he has adverted. I do not think that I should be furthering the business of this House by going at length into those subjects, when the subject before us is simply the mode of imposing the income-tax. I will only refer very shortly to one of the hon. Gentleman's suggestions—that of a tax on gas. I do not think that a duty upon gas would be a very just tax; it would press greatly upon shopkeepers, and very much upon the lower description of them. Nor do I think it would produce anything approaching to the amount which its advocates suppose. Many such suggestions have been made to me—a tax upon hats, upon bells, upon opera glasses, and fifty other things, and latterly I have been told that, inasmuch as English servants have been driven out of France, I ought to extend the principle of the duty on bachelors' servants, and impose a double tax upon French servants, and a quadruple tax upon French cooks. But really so many impediments have been thrown—I do not say
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unfairly—in the way of the progress of this Bill, and other public business, that I am most anxious not to introduce matters foreign to the question before the House, and I shall therefore confine myself to the proposal of the hon. Gentleman (Mr. Hume). I was in hopes, after the debate on the Motion of the hon. Member for Cockermouth (Mr. Horsman), and the decision to which the House came on a former night, that we should have been spared another discussion on the same subject; but in some respects I am not sorry that the occasion has occurred, because I may avail myself of this opportunity of answering the accusation of the hon. Member (Mr. Hume), that it was utterly impossible that the Government could have considered the subject, and that it is no reasonable excuse for not proposing a modification of this tax that it would give some trouble. I can assure the hon. Member and the House that it has occupied a very great deal of our care and attention. I admit that on the first blush the proposition for a modified scale bears a very plausible appearance; but I must say, that the deeper I went into the subject, and the more consideration that I gave to it, with a view of attempting to remedy the injustice complained of, the more utterly impossible I found it to make any material departure from the present system without maxing the tax much more unjust and inquisitorial than it is at present. The hon. Member (Mr. Hume) seemed to think that the income-tax was first imposed in 1806. The tax was, in fact, imposed by Mr. Pitt towards the close of the last century, continued by Mr. Addington, continued and increased in 1806. Mr. Pitt imposed, in the first instance, a tax upon expenditure, but he found it necessary to substitute the tax upon income; he admitted at first certain partial exemptions in favour of persons insuring their lives, persons having large families, and so forth; but the result of experience was, that the exemptions led to so much fraud and evasion, that they were one after another abolished; and the shape which the tax assumed in Mr. Pitt's time, Mr. Addington's time, Lord Lansdowne's time, and Mr. Perceval's time, is precisely that which it now bears. When the right hon. Baronet (Sir R. Peel) reimposed the tax, it was, I know, most carefully considered, with a view to some modification, and the result arrived at was, that the least objectionable shape in which it could be imposed was that in which it now stands. It is said

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that I opposed it on the ground of its being unequal and vexatious. I am not prepared to deny that it is either the one or the other; but I always maintained the opinion that, if imposed at all, it must he imposed in this shape; and I consented to it as a tax for a limited period, in order to enable the Government to relieve the country from the pressure of other and more objectionable taxes. The hon. Member for Poole (Mr. Robinson) has referred to the plan proposed by the hon. Member for Cocker-mouth (Mr. Horsman), and said it was un-unwise in that hon. Member to propose any plan. The hon. Member for Cocker-mouth acted with perfect fairness in suggesting what he considered a better scheme; and it is no light argument in favour of the present tax that in all previous instances the income tax has been imposed in this shape, and that when an hon. Member does come down and propose another plan to the House, very lucidly explaining and very ably advocating it, the objections to it are so great and so obvious that a right hon. Gentleman (Mr. Goulburn), on hearing it for the first time, is enabled to point out several which are altogether fatal to it. There are others, too, which were not stated at the time; and surely it is not an unfair inference, that it is not quite so easy, as my hon. Friend supposes, to suggest another plan less objectionable than the present. I stated the other night that I in another country where an income-tax exists, it is imposed, as here, upon income, from whatever source derived. I referred to one of the States of America, where there are no aristocratical privileges, no prejudices in favour of large landed interests, to induce parties to press unfairly upon trades and professions. I have referred to the words of the law in that State—South Carolina—and I find that an equal rate of tax is imposed upon all profit and income arising from the pursuit of any trade, faculty, profession, occupation, or employment: and, so far as I am aware, there is no country where an income-tax is imposed in which it is not imposed at an; equal rate upon income, from whatever source derived; which, I must say again, I think a strong argument in favour of the plan of the existing tax. And when I find the hon. Member (Mr. Hume) arguing so strenuously against the injustice of imposing the tax in this way, when the renewal of it for a short time is proposed, I am not a little surprised to find that in 1845, when, as now, a renewal of three
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years was asked for, he voted against Mr. Roebuck's proposal to omit professional income from the resolution, in order to subject it to a lower rate of taxation; and when the right hon. Gentleman the Member for Liskeard (Mr. C. Buller) moved a resolution declaring it to be the duty of the House to impose the tax in a form less unequal and inquisitorial, my hen. Friend not only voted but spoke against the Motion, and said—
"He should be happy to render the tax 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? "
My hon. Friend was fascinated, perhaps, like the hon. Member for Finsbury, with the manner of the right hon. Baronet. "He repeated that he was in favour of the proposition of the Government as a whole." Let my hon. Friend do as he then did, and give us the benefit of the same support as he gave to the Government of the right hon. Member for Tamworth. I will now, Sir, state some few of the reasons which induce me to think that it is not possible to modify this tax to any extent, so as to meet the views which have been stated by the hon. Member for Montrose and others to the House. It has been stated, that it is the easiest thing in the world to capitalize income; that the actuary of any insurance office will do it for you at once, and tell you at what rate the tax should be laid upon it. But just let us consider what sort of proceeding we are talking about. A person goes to an insurance office to insure his life, and the first step taken by the company is to send for their physician and surgeon and investigate the state of his health. When you have ascertained a man's income and the probable duration of his life, you may capitalize his income, by multiplying the amount of his income by the number of years which he may probably have to live; then yon may assume a given rate of interest—say four per cent—upon the capital so ascertained, and tax him on this interest as his annual income. This is what is really meant by the proposal. In theory this is exceedingly simple; but I am not very sure that if gentlemen who pay the income-tax are to undergo, in addition to the inquisition into their circumstances, an investigation of the state of their health, and appear before medical officers "to be surveyed,"

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the proposition would be so excessively popular. This inquisition must take place every year, because a man's health and income may vary from year to year. Every year of a taxpayer's life, therefore, he must undergo a double inquisition—first, with respect to his health, and then with respect to his circumstances. It would be necessary also to extend the inquisition to persons having only a life interest in landed property, for the value of such interest must vary according to the state of health of the parties possessing it. I do not think that persons liable to the tax would ever consent to so odious and irritating an investigation as this scheme would entail upon them; and, however simple the theory may be, I am convinced that the attempt to carry it into effect is altogether impracticable. I will now advert to another proposal, also very simple, that of imposing a higher rate per cent on the schedules containing realised property—Schedules A, and C. I will not again refer to the argument, which Mr. Pitt so strongly urged, that it would be a breach of faith with the public creditor to impose a higher tax on money invested in the Funds than on that invested in any other mode. I wish to meet the argument in the fairest way, and I will therefore take what is always put forward as the strongest case of inequality, the alleged injustice of levying the same rate per cent on trades and professions under Schedule D. as upon land under Schedule A. Now when we are called upon to tax incomes arising from land and houses, and property of this description, at a higher rate than other incomes, I must beg the House to bear in mind the heavy burdens to which that description of property is exclusively subjected. I hold in my hand a letter, written by a Suffolk clergyman, which describes in forcible language the inordinate pressure of local taxation upon landed property. The rev. gentleman refers to his own income from tithe rentcharge of 450 l. a year, which pays 104 l. annually in local and general taxation; and he contrasts the case of the possessor of that property with that of several persons deriving their incomes from trades or professions, living in the same parish, who, he contends, do not pay anything like a proportionate amount of taxation. My correspondent calls upon me to exempt the persons in Schedule A. from an amount of income-tax proportionate to the local burdens imposed upon them. I may mention that the whole
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amount of local taxation falls exclusively on Schedule A., and it amounts to no less a sum than 8,250,000 l. annually. Persons paying income-tax under Schedules C and E are not rateable. Occupiers of land under Schedule B, it is well known, in point of fact transfer the burden of their rates to their landlords: and the parties paying income-tax under Schedule D are exempted from rating on their stock-in-trade by an annual Act. The whole, therefore, of this heavy burden falls exclusively on Schedule A; and this ought not to be forgotten when it is proposed to add still further to the taxation upon them. Nor are all persons paying under Schedule A so well off as Gentlemen seem to imagine. A large number of persons in Schedule A are comparatively in a worse position than those in Schedule D. Take the case of a poor widow with three or four children whose income of 150 l. a year is dependant on her life; does not every argument employed by those who object to the present arrangement of the tax, respecting the necessity of insuring her life and of making provision for children, apply with equal force to her case? Would not the widow in these circumstances be in a worse position than a young and healthy shopkeeper making clear profits to the same amount? Now let us compare the situation of two persons paying the same amount of tax. Let us take the case of two gentlemen, one in Schedule A, and the other in Schedule D, each paying income-tax to the amount of 30 l., which implies the possession of an income of 1,000 l. The gentleman in Schedule A derives his income from land, and the tax is taken from his tenants by the collector in the first instance. No deduction is made on account of the expenditure made on the estate—an expenditure which is absolutely necessary to keep up the income. It is immaterial whether the landlord gets his rent or not; the income-tax must be paid. There are many Gentlemen in this House who are able to state what percentage should be put upon an estate for repairs, which is, of course, to be deducted from the amount of rent reserved. The lowest amount at which I ever heard this percentage fixed was ten per cent; other estimates carry it as high as thirty per cent. The result of my own experience, corroborated by the information which I have received, leads me to believe that I shall not overstate the amount of the deductions to be made from rent, under the

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head of repairs, and necessary expenditure of one kind or another, borne by the landlord, at twenty per cent on the whole. If that be correct, it is evident that a man who pays 30 l. income-tax for a nominal rental of 1,000 l., puts in his pocket only 770 l. The man who pays under Schedule D, however, deducts for repairs, for charges of management, and for losses in trade; and, before the tax is assessed upon him, he has a clear net income, after all deductions, of 1,000 l., and after paying the tax has 970 l, a year to spend. I think that the 200 l. a year which the taxpayer in Schedule D enjoys beyond him who pays in Schedule A, is a sufficiently liberal allowance for the purpose of providing for children by insurance of life, and those other considerations which are put forward as the ground for a lighter percentage on this schedule. Take another view of the question. I will, for the sake of argument, admit that a higher per centage of income-tax should be paid by incomes derived from realised property than by those arising from trades and professions; but then the possessors of the former class of incomes would be entitled to demand two things—first, that deductions should be made for repairs; and, secondly, that the persons deriving incomes from trades and professions should actually pay whatever amount of tax they are justly liable to pay. It is impossible for any person who looks at the returns moved for by the hon. Member for Dartmouth not to see that the sum collected under Schedule D does not fairly represent the amount of tax that ought to be paid by trades and professions. I never was more astonished in my life than when I looked into that return. It appears from that document that in the whole of Great Britain there are only 111,000 persons who pay income-tax under Schedule D for incomes of 150 l. and upwards. It must be recollected that Schedule D includes not only all professional men, and all persons engaged in trade, but all persons deriving incomes, from property in Ireland, in the colonies, and in foreign countries. But assuming that the schedule included only professional men, and persons engaged in trades, does any man believe that there are only 111,000 of these classes in Great Britain? Does anybody believe that there are not more than that number in this great metropolis alone? I have been told by a gentleman that he knew one establishment in which seventy clerks were employed,
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each of whom received an income above 150 l. a year. If the return be analysed, the results are still more extraordinary. It appears that there are only 9,000 persons in Great Britain who derive incomes exceeding 1,000 l. a year from professions and trades. Can any one believe that? Why, it is notorious that, with the exception of a very few landed proprietors, the great amount of wealth in this country is to be found amongst the manufacturing and commercial classes. Those who can believe that there are only 9,000 persons following professions and trades who possess incomes exceeding 1,000 l., must have a larger share of credulity than I have; and I am sure that every one who hears me will allow that this is perfectly incredible. We are told that the tax presses severely upon the great body of small tradesmen, but that is equally disproved by this return; for I find by this return that whereas the whole amount derived under Schedule D is 1,600,000 l., the sum of 775,000 l., or very nearly one half, is paid by persons having incomes above 1,000 l. It cannot, therefore, press very hardly upon the 102,000 persons who have incomes below that amount. Gentlemen may say that this proves a very considerable amount of fraud and evasion. No doubt it does, and how is that to be remedied? The only remedy is by making the inquisition into every man's circumstances more searching and rigorous than it is, in order to ascertain the real amount of his income. If the parties under Schedule A, whose property cannot escape, are to be saddled with a higher rate, it is only common justice to them that parties under Schedule D shall be fairly assessed on the real amount of their profits, whatever rate per cent be imposed upon them. The same necessity for inquisitorial power exists whatever the rate of taxation may be; and it is obvious that if we are to do justice, it would be necessary to render the investigation much more inquisitorial as regards Schedule D, for no one can believe that a fair return of income is now made under that head. The inquisition which would be necessary in this case would be so rigid, that I believe the country would not bear it. My belief is, that the parties who pay under Schedule D object more to the inquisitorial character of the tax than to its amount; and, therefore, if by any alteration for whatever purpose you render it more inquisitorial, you increase the evil chiefly complained of; and my firm conviction is,

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that if such an attempt were to be made, the feeling throughout the country would be so strong, that it would be perfectly impossible to maintain the tax. It is upon Schedule D that the inquiry into the circumstances of the party presses. I am quite content that the inquisition into men's circumstances should not be rigorously exercised. It evidently is not so at present, if you take the whole class, although there may be individual cases of hardship. This can be no longer permitted, if we are to attempt to attain what the hon. Member for Montrose and others advocate as a more just apportionment. My own belief is, without pretending that there is not some inequality, that the present mode of levying the tax is upon the whole the fairest and least objectionable shape in which it can be imposed; and I have been more and more confirmed in that view, the more I have considered every plan which has been suggested for its alteration. I hope. Sir, that by what I have stated, I have succeeded in convincing the hon. Member for Montrose that whether he may think us right or wrong in upholding the existing apportionment of the tax, we have not come to that determination without due consideration. I opposed the tax when it was originally proposed, because I thought that it ought to be accompanied with alterations in the corn, sugar, and timber duties; but those alterations having now been effected, and there still being a considerable deficiency of income, I am perfectly consistent in supporting the tax now, for the purpose of supplying that deficiency. The Gentlemen who oppose the existing arrangement of the tax, frequently quote Adam Smith in support of their views. I remember the right hon. Baronet the Member for Tamworth once said that the come-tax was more consonant with Adam Smith's canons respecting taxation than any other tax he knew of. Adam Smith laid down four canons on the subject of taxation; and Gentlemen who take the same view of this subject as the hon. Member for Montrose always quote one of the canons for the purpose of showing that every man should be taxed according to his ability to bear taxation, and they interpret ability as being the amount of capital he may possess; but that is not what Adam Smith has laid down. I will read Adam Smith's words, and it will be seen that, instead of supporting the opinions of the hon. Member for Montrose upon this subject, they confirm the view which the present
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and all preceding Governments have taken of it. Adam Smith says—
"The subjects of every State ought to contribute towards the support of the Government as nearly as possible in proportion to their respective abilities."
There Gentlemen are accustomed to stop, but the writer proceeds—
"That is, in proportion to the revenue which they respectively enjoy under the protection of the State."
It will not be asserted that persons engaged in professions and business do not enjoy an equal amount of protection with those who hold landed property. The protection to life is evidently the same; and I am inclined to think that the property of persons in trade requires and receives more expenditure for its protection than is needed for landed and similar property. I will not pursue this argument further; I will only say generally that persons paying under Schedule D do not suffer that injustice which is complained of, whether you compare individuals or classes; and I believe that any attempt to modify the scale of taxation would only render the tax so odious, by augmenting its inquisitorial character, that it would be impossible to maintain it, on account of its extreme unpopularity.
MR. J. CLAYsaid, he would not have broken that silence which he was convined was the most acceptable token of respect which a new Member could pay to the House, but that he was anxious to explain why, on this subject, he had already voted, and why to-night again he should vote in opposition to an Administration with whose general policy he concurred. He had great confidence in the Government—he believed that they were able and willing to uphold the interests and honour of the country, both at home and abroad; but if there was a point on which neither the present nor any former Parliament had inspired him with implicit trust—if there was a point on which a very large party in that House distrusted the present Administration—nay, more than that, if there was a point on which the country distrusted the present House of Commons, it was on matters concerning finance, retrenchment, and economical government. He felt sure that the country was determined on having a severe and serious revision of every item of public expenditure; beginning with those of the most formidable amount, and finishing with the paltry 7,000 l. for the ornamental damp

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in Trafalgar-square. It was not, however, to the amount of income-tax, or to the time for which it was required, to which he made objection. He was in favour of direct taxation, and he believed that a tax of this kind would ultimately be, or ought to be, a permanent tax; for if a system of retrenchment should leave the Exchequer a surplus, he believed it would be a wiser course to lessen still further taxation upon articles of consumption, than to reduce the amount receivable from the present tax. His objection was to the form of the tax now proposed, to its inequalities, and to its injustice. Much had been said as to the difficulty of calculating exactly the different proportions which were to be paid by the different interests which this tax affected; but he could not understand that any such calculation presented an insuperable or even a formidable difficulty. It might be impossible mathematically to distinguish the proportions; but because the right hon. Gentleman had proved that everything could not be done, he had not therefore proved that a great deal might not be done. If the country only saw an honest endeavour on the part of the Government to smooth away the grossest inequalities, and to redress cases of the greatest injustice, he was convinced they would be satisfied. The right hon. Baronet had dwelt particularly on the extra amount for taxation which persons coming under Schedule A had to pay, in consequence of the great burden of local taxation falling exclusively upon them. It might be so; but the answer to that was, that that state of things existed before the imposition of the present tax, and no complaint being made against it, he had a right to assume that it was a just distribution of the taxes at that period; any additional tax, therefore, ought to be distributed in a just proportion to the different sources—varying as they did very greatly in their value—from which the incomes to be taxed were derived, irrespective of any previous charge to which the parties might be subjected. The right hon. Baronet had expressed his astonishment at the small amount of revenue derived from Schedule D; and he threw out an insinuation that the tax falling under that portion of the Act was dishonestly withheld. It might be so, but that was the fault of the machinery. It did not satisfy him to tell him that a tax was so oppressive that the people sought to evade its payment. Subject them only to a fair proportion, and if it were not paid, the country would not
1038
object to any inquisition which was necessary to secure honesty. The inequalities of the tax pressed mostly on the middle classes. He hoped he should not be taken to task by hon. Gentlemen on the Opposition benches, for hinting at the possibility of legislation for or by the middle classes. He well recollected his hon. Friend the Member for Buckinghamshire (Mr. Disraeli) giving to the House certain statistics, the result of which showed that an enormous majority of the dividend warrants issued by the Bank of England was for sums under 5l. and 10 l., and that the income derived from land by its holders was about, on the average, 170. a year. This most satisfactorily proved to him that the whole of this country, so to speak, was the middle class; that with some grievous destitution, on the one hand, and with some overgrown and gigantic fortunes on the other, the great mass of the population of this country was properly to be called the middle class. He confessed that after this statement of his hon. Friend, he was surprised to hear from him an eloquent but indignant protest against legislation by the middle classes. God forbid that he (Mr. J. Clay) should defend class legislation in the sense that one class was to legislate for its own benefit, at the expense of the interests of other classes but, surely, if legislation was to be in the hands of any one class, justice would rather delight to see it in the hands of those who were as thousands to one, than in the hands of those who were as one to the thousand. An argument had proceeded from a quarter entitled to the highest respect, to this effect, that as the income-tax was a substitution for other taxes which pressed equally on all incomes, from whatever source derived, there was no reason why that tax should not do so also. The taxes referred to were those on articles of consumption; but was there a law to oblige a professional man to consume as many taxable articles as a man whose income, of the same amount, was derived from landed property? The right hon. Baronet the Member for Tamworth, whose argument he (Mr. J. Clay) was now quoting, instanced the window-tax, which he said pressed alike upon everybody; but was there any law to compel a professional man to live in as large a house as the man of landed estates? There never had been a tax, except the income-tax, which pressed alike on all incomes, unless, indeed, he went back to the time of Richard II., who

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imposed a poll-tax. He did not recollect who was the Chancellor of the Exchequer at that day; but he did recollect that that tax was the cause of a rebellion. He was far from anticipating any such consequence from the present tax, as he had no fear of seeing a second Wat Tyler in the person of his hon. Friend the Member for Montrose; but his conviction was that this tax must either be abandoned, or its present form must be altered. He, therefore, appealed to the noble Lord at the head of the Government that he would yet again take into consideration whether something might not be done to alter those inequalities, and to redress that injustice of which the country complained.
MR. TRELAWNYwould vote against the Motion of the hon. Gentleman the Member for Montrose. He believed that the pressure of the income-tax, whether just or unjust, was analogous to that of all kinds of taxation. The hon. Member for the West Riding of Yorkshire had shown the House how disproportionately heavy was the share of customs and excise duties which fell upon the poor compared to the rich man, and the income-tax went upon the same principle. If it was a wrong one, then let there be a general revision of taxation. He held, however, that under present circumstances, and in the present state of the public mind, it would not be advisable to remit this tax, but to continue to exact it, at least until a fair trial had been given to the late commercial measures of relaxation.
MR. SHARMAN CRAWFORDsaid, that no opponent of the income-tax had made out so strong a case against it as had the right hon. Gentleman the Chancellor of the Exchequer himself. That right hon. Gentleman had proved that in every way Schedule D was loaded with injustice. He would therefore urge the hon. Member for Montrose not to give even that sanction to the measure which was implied in his Motion, but to divide upon the main question, and to refuse to go into Committee at all.
MR. J. BONHAM CARTERwould oppose the Motion of the hon. Member for Montrose. The country, in opposing the tax, was hardly aware of the difficulties of the Government, and at the same time took an exaggerated view of the injustice and inequality of the impost; but at any rate, whatever might be the opinion of the country, this was not the proper time to refer to a Select Committee a tax which
1040
was absolutely needful for the preservation of the public credit. He thought that reference had been too freely made to extreme cases as showing the injustice and inequality of the tax; and under all the circumstances of the case, he should not consider that he was justified in supporting the Motion of the hon. Gentleman.
MR. URQUHARTsaid, that this was a subject to which he had long devoted his most anxious attention, upon which he had the most settled conclusions, and which he had urged, while as yet the distinction between direct and indirect taxation was unknown in this country. He conceived that mistake upon this subject was the most fatal that a Government could commit, and that sound maxims upon it were necessary for the well-being of any people or the permanency of any system. They were now upon a great experiment. They were making a trial of the two systems; and he must say they were giving to direct taxation a most unfair trial. Would not the wise and proper course have been, in such a matter, to separate such a question from all others—to deal with it on its own merits—and, while excluding that which was extraneous, to take it up in all its parts? The reverse was the course which had been followed. It was introduced as a claptrap urged on the plea of necessity, frittered into discussion on details, and cast as a bone of contention to conflicting interests and prejudices. At one moment it was mixed up with national defences; at another with deficiency of revenue; at another with the peculiar defects of the operation of the income-tax, and with the consequences and expediency of commercial treaties and reductions of customs duties. The result had been an inextricable jumble of all these questions, whence unceasing and profitless debates. The question ought to have been at once boldly faced and absolutely determined, whether they were to continue the old system, or adopt a new one; or rather, he should say, whether they should cling to the aberrations of modern times, or resort to the old rule—the only just and constitutional rule—of laying the burden where alone it could be borne—on the property of the country. By this income-tax, in which they imagined that they were having recourse to direct taxation, they were disqualifying themselves from judging of the system; and the reason for which he had risen on the present occasion was simply, but emphatically, to protest against a scheme like this

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being considered a trial. Such a trial required two conditions: first, that a property-tax should not be super-imposed upon a system of indirect taxation, which served but to combine the objectionable parts of both; secondly, that the tax should be collected, not by a centralised system, and not by Government officers, but by the people themselves, and as they themselves judged fit. It was no theories which he propounded; he spoke from positive knowledge of the countries where such a state of things existed, and where alone that experience could be obtained which might serve England in this moment of chaos, and in the shipwreck of all her systems and all her theories. The Won. Member for Hull had referred to the resistance under Richard II. to the poll-tax; but the hon. Gentleman was little informed on that matter, and he (Mr. Urquhart) begged to assure him that there was no disposition in the people of that day to resist the poll-tax as a form of taxation, nor even indeed the tax because of its amount: but that the rebellion was directed against the new method of Government collection which had been then introduced. He would support the Motion of the hon. Member for Montrose—not that that Motion would effect or accomplish any of the objects which he (Mr. Urquhart) had in view, but merely as calculated to set the question afloat in that House and out of it. Before that House could attempt or at least accomplish the proposed alteration, it would have a grave decision to take of another kind. It would have to make up its mind to sacrifice some portion of its ill-got power, and to distribute back again some of those means of government which it had drawn into its own hands, only to misuse or destroy. They must relieve themselves from this congestion on the brain—this pressure of business which disqualified them alike from act and from judgment. They must restore to the members of the politic body somewhat of the circulation and vitality which were requisite alike for the protection of the members and for the freedom of the head. Then alone could they be intellectually in a condition to reason to a just conclusion, and materially in a condition to put it in execution. If ever there was a moment propitious for such a change, it was the present, alike from the necessities pressing from within, and the example presented from without: he might say warning, rather than example. There were before us the wrecks and the shoals upon
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which they had been broken—the systems of centralisation—that centralisation which had come as a delusion, and vanished as a dream. Built up with care they had been broken without hands—they had fallen without warning in the hour of their strength from the acmé of their power. These events presented facilities of another kind. The income-tax was only required, and an equal amount of other taxation was only kept up, to meet the increase of military expenditure which had taken place since 1835. There could now be no pretext of any kind for such armaments; no one could now say that there was a reason for them; and most unreasonable would it be to deny that a reduction at this moment could have any other effect than that of securing the peaceable disposition of our neighbour by exhibiting and proving our own. He would conclude by repeating the warnings he had already given. They could not super-impose direct taxes as a load on the back of customs and excise, nor could there be any useful or even practical system of direct taxation, except working through the local and municipal bodies.
MR. MITCHELLsaid, it was a most extraordinary argument for the Chancellor of the Exchequer to use, that because the tax was greatly evaded at present, therefore it ought to be continued. He could not believe, any more than the right hon. Gentleman, that the income-tax leviable under Schedule D was paid by all the parties who were liable to it; but what consolation was that to those who did pay the tax, and who felt that it pressed upon them with undue severity? If the right hon. Gentleman believed that the tax was evaded to any great extent, let him take measures to enforce its better collection; but let him not make that an argument for continuing its present injustice. Being connected with trade himself, he had as much reason as any one to dislike the inquisitorial operation of the tax; but he would much rather undergo that inquisition than suppose that a large portion of his fellow-traders evaded the tax who ought to pay it. The right hon. Gentleman had also gone into an extraordinary calculation with reference to the net incomes of two persons, who each derived 1,000 l. a year—the one from land, the other from trade—and had shown that in order to place the two on a footing of perfect equality, the tax, in the case of the former, should be levied on 770 l. only, owing to the expense

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of repairs, charges of management, and cost of collections, for which, no allowance was made at present. Now, this was rather an extreme case; but he would admit that the tax should he levied only on 770 l., and he would say broadly, that upon the same principle, the tax, in the case of the trader, should he levied upon 500 l. only, and for this reason:—According to the dictum of the right hon. Gentleman the Member for Tamworth the income-tax had been imposed as a substitute for other taxes which had been or were to be taken off from parties having incomes. Now a man who had a net income of 770 l. a year from land was in a position which enabled him to spend all this; and, therefore, as he had formerly paid indirect taxes upon this sum for articles the duties upon which were now removed, he might fairly be called upon to pay the direct tax which had been imposed in their place. But the man who derived 1,000 l. a year from trade was not justified in spending more than one half of his income; and, therefore, upon the principle he had just stated, should not he taxed upon more than 500 l. The case of the professional man was still stronger than that of the trader, because the trader, supposing him to be in bad health, might, from the extent of his connexions, and the amount of his capital, continue to derive an income from his trade, notwithstanding; but when the professional man became ill, his income entirely ceased. He must say that he was exceedingly displeased at the course taken by Government on this question. During all the time he had sat in Parliament he had never given a factious vote on any question; but in this case he considered that a gross injustice was done to all those persons included in Schedule D, and he must oppose it, however reluctantly. The impression which prevailed out of doors with reference to the Government was, that they would not bring forward any measure which they believed would not have the approbation of the right hon. Gentleman the Member for Tamworth. That right hon. Gentleman had brought forward the income-tax in 1842, at a time when he had a large majority in that House; and, that majority being principally composed of the landlord class, the right hon. Gentleman probably supposed that he could not carry any other tax. The right hon. Gentleman had, therefore, pinned himself to this tax, and the impression was that the present Government had agreed to its reimposition because they
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were not strong enough to bring forward any other. There were at present only two parties in that House—the gentlemen on the Treasury bench, and those who were the followers of the right hon. Gentleman the Member for Tamworth. These two parties settled what measures should be brought forward, and no other person had any chance whatever of carrying anything. He believed that the income-tax, in its present unjust form, could not be continued beyond three years; and he feared that by persisting in their present scheme the Government were endangering the system of direct taxation, which he, for one, had always cordially supported, and would continue to Support.
MR. NEWDEGATEproceeded to say that it had not been his intention to speak on the question, but that having listened attentively to the arguments which had been used against the proposition of Government, he thought hon. Members who had spoken in favour of the Amendment had completely contradicted each other. The hon. Member for Montrose objected to the tax because it was under the direction of commissioners appointed by the nation, who might be supposed to have some interest in its operation; but he could not suppose this would have much weight with the House. The Chancellor of the Exchequer admitted that every landlord was taxed on 20 per cent more than he received, on account of the outlay to which he was subject; but the right hon. Gentleman had proposed no feasible plan for remedying this injustice. He wished the House to observe that men of every shade of opinion, and representatives of every interest, with the sole exception of the landlords, had objected to this tax, while they were the most heavily burdened and had to pay the largest share of the tax. He would ask the House what other conclusion indifferent persons could draw from these debates, than that direct taxation was so invidious that they would always find objections to it? He would ask them whether they had ever known a case where indirect taxation had met with such violent opposition, and from such different quarters, as had been excited against the present propositions to which they had been driven by the necessities of their exchequer? He begged to protest against its being supposed that in voting for this tax for three years, he approved of it as a permanent impost; and he warned the Government to look to the discontent which prevailed throughout the

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kingdom on the subject of the tax, and not to entertain the shadow of a belief that they could ever render it permanent.
MR. HORSMANsaid, that he, for one, could see no practical advantage in the Motion of the hon. Member for Montrose. Concurring with that hon. Member in the wishes he had expressed regarding a modification of the tax, he still could not help feeling that that question had, after due deliberation, been already decided by the House, and he had no reason to expect that the House would be induced to change that decision. His views remained the same as he had formerly expressed; but he could not help remembering that both the noble Lord at the head of the Government and the right hon. Gentleman the Chancellor of the Exchequer had distinctly told them that they had given the subject their best attention, and that the decided conviction on their minds was that the injustice and inequality of the tax could not be remedied. He had not in the slightest decree changed his opinion; but at the same time he felt that it would be presumptuous in him to insist upon his view being carried out in opposition to that of a majority of the House. Having trespassed so long upon the House on a former occasion, he had during the subsequent debates refrained from speaking upon this question, feeling as he did that it had been virtually decided by the House, and that it was more becoming in him to consider what was duo to the sense of the House than what was due to himself. As the hon. Member for Liverpool (Mr. Cardwell), however, had published a letter to his constituents in which he stated that he was prepared to show that the plan he (Mr. Horsman) proposed would make the injustice of the tax greater than before—that it would make it more offensive, and would not in any degree remedy the inequality that existed, perhaps he might be allowed to make a single observation on that point. There never was a more unfounded statement than that made by the hon. Gentleman; and he challenged him to produce a single class of cases which would in any degree bear him out in making it. The noble Lord had said that the landed proprietors would oppose the addition to the tax which he proposed, as respected them. But what was that addition? Only a penny in the pound. And he was satisfied that if such a proposal was believed by them to be accompanied with what was beneficial for the country at large, they would not oppose it.
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He was favourable to direct taxation, and therefore he wished to see the income-tax improved, in order that it might be made permanent. But having already submitted a proposition for equalisation to the House, with an unsuccessful result, he was not prepared in the present state of the question, to offer any further opposition to the income-tax. He thought they might do better service to the country by applying themselves to the great subject of the revision of the existing system of taxation—a task for which a great and comprehensive plan was necessary, and which could be undertaken with effect only by the Government. He hoped that Ministers would address themselves to it with a view to accomplish a settlement of the question in the course of the next two or three years; and if they did so, he believed they might reckon with confidence on the co-operation of the House.
MR. CARDWELLthought the House would perhaps expect him to say a few words, after the extraordinary and formal challenge which he had received from the hon. Member who had just sat down. He had on a former evening taken the opportunity to say a few words on the plan of the hon. Gentleman with regard to the income-tax; and if he did not then convince him that there was such a class of cases as the hon. Member had now challenged him to produce, he hoped he might succeed in doing so on the present occasion. He told the hon. Gentleman that they were discussing, not an abstract principle, but a specific plan; and he did not confine himself to general grounds of objection, but stated two special grievances which would arise under that plan, as instances of its practical operation. The hon. Gentleman, in making the distinctions of payment which he proposed, followed the schedules of the Act of Parliament; and according to his scheme the hon. Gentlemen would have taxed an income, not according to the interest the individual might have in it, but according to the source from which it arose. If the source were in its nature permanent, then the individual was to pay the higher rate; and he (Mr. Cardwell) went on to show that the source might he permanent, and the interest of the individual terminable and fleeting. He supposed the case of a widow with a small annuity of 160 l. secured on land or secured in the public funds (both permanent sources), but in which she had

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only a terminable interest, out of which, if she wished to leave anything behind her, she must make an annual saving; and he showed that, according to the scheme of the hon. Gentleman, that widow would have to pay the higher rate. [Mr. HORSMAN: Certainly not.] He would do the hon. Gentleman the credit to believe that such was not his intention; but he was in the judgment of the House if such would not plainly have resulted from the scheme the hon. Member had brought forward; and he would ask if they were to be condemned for refusing to adopt a plan that would have such an effect, merely because the hon. Member who made the suggestion did not himself perceive what would be its consequences? He also would contend, as he had already done, that the only conceivable means by which they could ascertain what that widow ought to pay was to have a public inspector, whose duty it would be to ascertain from the widow personally what particular interest she had in the amount on which she paid; a course that, he observed, would add immeasurably to the disclosure and to the expense. But he did not rest his objection on one case. He stated the case of a trader who was carrying on his business partly with his own and partly with borrowed capital; and he showed that under the proposed plan, by which the borrowed money paid at the rate of 8d., the other portion of the capital paid 6d. in the 1l.; by the present system both paid 7d., and the borrower adjusted his own account with the lender by deducting 7d. from every 1l. of the interest: and there was no disclosure of these facts to the Government official. But if the trader was to return 6d. upon one part of his capital, and 8d. upon another, there must be a full disclosure of all these matters. He apologised to the House for repeating these statements; but having before made them, he must say he was surprised at the boldness of the hon. Gentleman in giving the challenge which he had that night thrown out. With regard to the Motion of the hon. Gentleman, no person could be more desirous than he was to see the tax levied in a manner that would make it fall equally and least offensively upon the community. He was not at all conscious that in anything he had said he could fairly be charged with making unfounded statements; and with regard to the Motion now before the House, he considered the question to be, not whether they should inquire into this subject
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generally, but whether they should delay a measure that they had already declared by repeated and large majorities to be essential to the public credit, in order that such an inquiry should be instituted. With these convictions he should consider himself guilty of pusillanimous conduct, if he hesitated to oppose the further delay of this measure.
MR. HORSMANhad been completely misunderstood in what he had stated to the House on a former occasion. The hon. Gentleman said that he proposed to tax an annuity at the highest rate. Now, that was just one of the cases he had stated that he would tax at the lowest rate; and he had not only stated it so in his scale of duties, but had referred to it in his speech as one that showed the hardship of the present system. He stated that the highest rate of charge was only to be imposed on the classes having realised property, and property descending to their heirs; and that every kind of annuity was to go into the lowest rate of charge. He was, therefore, really at a loss to know why the hon. Gentleman should persist in the statement he had made.
MR. GOULBURNhad not the least doubt, after what the hon. Gentleman had said, that it was not his intention that his plan should operate as had been described; but his hon. Friend and himself had addressed themselves to his statement as they really found it; and certainly there was nothing in his speech that showed that under Schedule A income from land was not to be charged 8d., while in the other schedule the lower duties were to be imposed. If the hon. Gentleman had not read the Act from which he took the schedules, and which showed that a widow's jointure, if derived from land, was put in Schedule A, and paid the highest rate—if he had not acquainted himself with that circumstance—surely it was no fault of those who opposed his plan.
MR. ANSTEYthought that taxes ought no longer to be levied by the Treasury, and collected by a tax-gatherer appointed by the Ministry; but that, in place of that system they should resort to the old policy of their forefathers, and assess taxes in every locality under the residents for the supplies that should be required from that locality.
House divided on the question that the words proposed to be left out stand part of the question:—Ayes 284; Noes 73: Majority 211.

List of the AYES.

Abdy, T. N.

Cowan, C.

Acland, Sir T. D.

Cowper, hon. W. F.

Adair, H. E.

Craig, W. G.

Adair, R. A. S.

Cripps, W.

Aglionby, H. A.

Cubitt, W.

Alexander, N.

Currie, H.

Anson, hon. Col.

Damer, hon. Col.

Armstrong, Sir A.

Davie, Sir H. R. F.

Arundel and Surrey, Earl of

Dawson, hon. T. V.

Deedes, W.

Bailey, J.

Disraeli, B.

Baillie, H. J.

Dod, J. W.

Baldock, E. H.

Dodd, G.

Baring, T.

Douglas, Sir C. E.

Barrington, Visct.

Drumlanrig, Visct.

Barron, Sir H. W.

Duff, G. S.

Bateson, T.

Duncan, Visct.

Bellew, R. M.

Duncuft, J.

Bennet, P.

Dundas, Adm.

Beresford, W.

Dundas, Sir D.

Berkeley, hon. Capt.

Dundas, G.

Bernal, R.

Dunne, F. P.

Bernard, Visct.

Du Pre, C. G.

Birch, Sir T. B.

Ebrington, Visct.

Bolling, W.

Edwards, H.

Bourke, R. S.

Egerton, Sir P.

Bowles, Adm.

Egerton, W. T.

Boyle, hon. Col.

Ellice, rt. hon. E.

Brackley, Visct.

Ellice, E.

Brand, T.

Elliot, hon. J. E.

Briscoe, M.

Estcourt, J. B. B.

Broadley, H.

Evans, W.

Brockman, E. D.

Farrer, J.

Brotherton, J.

Fellowes, E.

Browne, R. D.

Ferguson, Col.

Bruce, C. L. C.

Ferguson, Sir R. A.

Bulkeley, Sir R. B. W.

Filmer, Sir E.

Buller, Sir J. Y.

Fitz Patrick, rt. hon. J.

Buller, C.

Foley, J. H. H.

Bunbury, W. M.

Forbes, W.

Bunbury, E. H.

Fortescue, C.

Burghley, Lord

Fortescue, hon. J. W.

Burroughes, H. N.

Fox, R. M.

Busfeild, W.

Freestun, Col.

Campbell, hon. W. F.

French, F.

Cardwell, E.

Frewen, C. H.

Carew, W. H. P.

Fuller, A. E.

Carter, J. B.

Gibson, rt. hon. T. M.

Castlereagh, Visct.

Gladstone, rt. hon. W. E.

Cavendish, hon. C. C.

Glyn, G. C.

Cavendish, hon. G. H.

Gordon, Adm.

Cavendish, W. G.

Goring, C.

Cayley, E. S.

Goulburn, rt. hon. H.

Chaplin, W. J.

Grace, O. D. J.

Charteris, hon. F.

Graham, rt. hon. Sir J.

Chichester, Lord J. L.

Greene, T.

Childers, J. W.

Grenfell, C. P.

Christy, S.

Grey, rt. hon. Sir G.

Clements, hon. C. S.

Grey, R. W.

Clerk, rt. hon. Sir G.

Grosvenor, Lord R.

Cobbold, J. C.

Guest, Sir J.

Cocks, T. S.

Hallyburton, Lord J. F.

Codrington, Sir W.

Hamilton, Lord C.

Coke, hon. E. K.

Hardcastle, J. A.

Cole, hon. H. A.

Harris, hon. Capt.

Colebrooke, Sir T. E.

Hawes, B.

Coles, H. B.

Hay, Lord J.

Colvile, C. R.

Hayter, W. G.

Compton, H. C.

Heald, J.

Copeland, Ald.

Heathcoat, J.

Courtenary, Lord

Heathcote, Sir W.

1050

Heneage, G. H. W.

Palmer, R.

Henley, J. W.

Palmer, R.

Herries, rt. hon. J. C.

Palmerston, Visct.

Heywood, J.

Parker, J.

Hildyard, R. C.

Patten, J. W.

Hildyard, T. B. T.

Pennant, hon. Col.

Hodges, T. L.

Philips, Sir G. R.

Hollond, R.

Pinney, W.

Hood, Sir A.

Plowden, W. H. C.

Hope, Sir, J.

Powell, Col.

Horsman, E.

Power, Dr.

Hotham, Lord

Power, N.

Howard, hon. C. W. G.

Pusey, P.

Hutt, W.

Rawdon, Col.

Ingestre, Visct.

Renton, J. C.

Inglis, Sir R. H.

Repton, G. W. J.

Jervis, J.

Rice, E. R.

Johnstone, Sir J.

Rich, H.

Jolliffe, Sir W. G. H.

Rufford, F.

Jones, Sir W.

Russell, Lord J.

Keppel, hon. G. T.

Russell, F. C. H.

Ker, R.

Rutherfurd, A.

Knox, Col.

Sandars, G.

Labouchere, rt. hon. H.

Scott, hon. F.

Langston, J. H.

Seymer, H. K.

Lascelles, hon. W. S.

Seymour, Sir H.

Lemon, Sir C.

Sheil, rt. hon. R. L.

Lewis, rt. hon. Sir T. F.

Shelburne, Earl of

Lewis, G. C.

Sheridan, R. B.

Lincoln, Earl of

Simeon, J.

Lindsey, hon. Col.

Slaney, R. A.

Littleton, hon. E. R.

Smith, rt. hon. R. V.

Loch, J.

Smith, J. A.

Locke, J.

Smyth, J. G.

Lockhart, W.

Smollett, A.

Lygon, hon. Gen.

Somerville, rt. hn. Sir W.

Mackenzie, W. F.

Spearman, H. J.

Macnamara, Major

Stafford, A.

M'Cullagh, W. T.

Stanley, hon. E. J.

M'Gregor, J.

Stansfield, W. R. C.

M'Naghten, Sir E.

Stanton, W. H.

M'Neill, D.

Strickland, Sir G.

M'Taggart, Sir J.

Stuart, H.

Mahon, The O'Gorman

Sturt, H. G.

Mangles, R. D.

Tenison, E. K.

March, Earl of

Tennent, R. J.

Marshall, W.

Tollemache, hon. F. J.

Masterman, J.

Townshend, Capt.

Matheson, A.

Traill, G.

Matheson, J.

Trelawny, J. S.

Matheson, Col.

Tynte, Col. C. J. K.

Maxwell, hon. J. P.

Tyrell, Sir J. T.

Melgund, Visct.

Vane, Lord H.

Moffatt, G.

Verner, Sir W.

Monsell, W.

Verney, Sir H.

Moore, G. H.

Vivian, J. H.

Morpeth, Visct.

Vyse, R. H. R. H.

Morison, Gen.

Waddington, H. S.

Mulgrave, Earl of

Walpole, S. H.

Mundy, E. M.

Ward, H. G.

Mure, Col.

Watkins, Col. L.

Napier, J.

Wellesley, Lord C.

Newdegate, C. N.

West, F. R.

Norreys, Lord

Westhead, J. P.

Nugent, Sir P.

Willcox, B. M.

O'Brien, Sir L.

Williamson, Sir H.

O'Connell, M. J.

Wilson, J.

Ogle, S. C. H.

Wood, rt hon. Sir C.

Ord, W.

Wyld, J.

Oswald, A.

Wyvill, M.

Packe, C. W.

TELLERS.

Paget, Lord A.

Tufnell, H.

Paget, Lord G.

Hill, Lord M.

1051

List of the NOES.

Alcock, T.

Humphery, Ald.

Anstey, T. C.

Kershaw, J.

Barkly, H.

King, hon. P. J. L.

Barnard, E. G.

Lushington, C.

Berkeley, hon. H. F.

Martin, J.

Berkeley, hon. G. F.

Mitchell, T. A.

Blewitt, R. J.

Morris, D.

Bowring, Dr.

Mowatt, F.

Bremridge, R.

O'Connor, F.

Bright, J.

Pearson, C.

Brown, H.

Pechell, Capt.

Cabbell, B. B.

Perfect, R.

Clay, J.

Pigott, F.

Clay, Sir W.

Pilkington, J.

Clifford, H. M.

Raphael, A.

Cobden, R.

Ricardo, O.

Crawford, W. S.

Robartes, T. J. A.

Dashwood, G. H.

Roche, E. B.

D'Eyncourt, rt. hon. C.

Sal way. Col.

Duke, Sir J.

Scholefield, W.

Duncan, G.

Smith, J. B.

Evans, Sir De L.

Spooner, R.

Ewart, W.

Stuart, Lord D.

Fagan, W.

Sullivan, M.

Fergus, J.

Tancred, H. W.

Fordyce, A. D.

Thicknesse, R. A.

Forster, M.

Thompson, Col.

Fox, W. J.

Thornely, T.

Gooch, E. S.

Turner, G. J.

Granger, T. C.

Urquhart, D.

Greene, J.

Wakley, T.

Gwyn, H.

Walmsley, Sir J.

Hall, Sir B.

Wawn, J. T.

Hastie, A.

Williams, J.

Headlam, T. E.

Wood, W. P.

Henry, A.

TELLERS.

Hindley, C.

Hume, J.

Hobhouse, T. B.

Robinson, G. R.

The House again divided, on the question "that the Speaker do now leave the chair:"—Ayes 323; Noes 12: Majority 311.

List of the AYES.

Acland, Sir T. D.

Bourke, R. S.

Adair, H. E.

Bowles, Adm.

Adair, R. A. S.

Bowring, Dr.

Aglionby, H. A.

Boyle, hon. Col.

Alcock, T.

Brackley, Visct.

Anson, hon. Col.

Brand, T.

Anstey, T. C.

Bremridge, R.

Armstrong, Sir A.

Briscoe, M.

Arundel and Surrey, Earl of

Broadley, H.

Brockman, E. D.

Bailey, J.

Brotherton, J.

Baldock E. H.

Brown, H.

Barkly, H.

Browne, R. D.

Baring, T.

Bruce, C. L. C.

Barnard, E. G.

Bulkeley, Sir R. B. W.

Barrington, Visct.

Buller, Sir J. Y.

Barron, Sir H. W.

Buller, C.

Bateson, T.

Bunbury, W. M.

Bellow, R. M.

Bunbury, E. H.

Bennet, P.

Burghley, Lord

Beresford, W.

Burroughes, H. N.

Berkeley, hon. Capt.

Busfeild, W.

Bernal, R.

Cabbell, B. B.

Birch, Sir T. B.

Campbell, hon. W. F.

Boiling, W.

Cardwell, E.

1052

Carew, W. H. P.

Freestun, Col.

Carter, J. B.

French, F.

Castlereagh, Visct.

Frewen, C. H.

Cavendish, hon. C. C.

Fuller, A. E.

Cavendish, hon. G. H.

Gibson, rt. hon. T. M.

Cavendish, W. G.

Gladstone, rt. hn. W. E.

Cayley, E. S.

Glyn, G. C.

Chaplin, W. J.

Gooch, E. S.

Charteris, hon. F.

Gordon, Adm.

Chichester, Lord J. L.

Goulburn, rt. hon. H.

Childers, J. W.

Grace, O. D. J.

Christy, S.

Graham, rt. hon. Sir J.

Clay, J.

Granger, T. C.

Clements, hon. C. S.

Greene, J.

Clerk, rt. hon. Sir G.

Greene, T.

Clifford, H. M.

Grenfell, C. P.

Clive, H. B.

Grey, rt. hon. Sir G.

Cobbold, J. C.

Grey, R. W.

Cobden, R.

Grosvenor, Lord R.

Cocks, T. S.

Guest, Sir J.

Codrington, Sir W.

Gwyn, H.

Coke, hon. E. K.

Hall, Sir B.

Cole, hon. H. A.

Hallyburton, Lord J. F.

Coles, H. B.

Hamilton, Lord C.

Colvile, C. R.

Hardcastle, J. A.

Compton, H. C.

Harris, hon. Capt.

Courtenay, Lord

Hastie, A.

Cowan, C.

Hawes, B.

Cowper, hon. W. F.

Hay, Lord J.

Craig, W. G.

Hayter, W. G.

Cripps, W.

Headlam, T. E.

Cubitt, W.

Heald, J.

Currie, H.

Heathcoat, J.

Damer, hon. Col.

Heathcote, Sir W.

Davie, Sir H. R. F.

Heneage, G. H. W.

Dawson, hon. T. V.

Henley, J. W.

Deedes, W.

Henry, A.

Dod, J. W.

Herries, rt. hon. J. C.

Douglas, Sir C. E.

Heywood, J.

Drumlanrig, Visct.

Hildyard, R. C.

Duff, G. S.

Hildyard, T. B. T.

Duncan, Visct.

Hindley, C.

Duncan, G.

Hobhouse, T. B.

Duncuft, J.

Hodges, T. L.

Dundas, Adm.

Hollond, R.

Dundas, Sir D.

Hood, Sir A.

Dundas, G.

Hope, Sir J.

Dunne, F. P.

Horsman, E.

Du Pre, C. G.

Hotham, Lord

Ebrington, Visct.

Howard, hon. C. W. G.

Edwards, H.

Hume, J.

Egerton, Sir P.

Humphery, Ald.

Egerton, W. T.

Hutt, W.

Ellice, E.

Ingestre, Visct.

Elliot, hon. J. E.

Inglis, Sir R. H.

Estcourt, J. B. B.

Jervis, Sir J.

Evans, Sir D. L.

Jolliffe, Sir W. G. H.

Evans, W.

Jones, Sir W.

Ewart, W.

Keppel, hon. G. T.

Farrer, J.

Ker, R.

Fellowes, E.

Kershaw, J.

Ferguson, Col.

King, hon. P. J. L.

Ferguson, Sir R. A.

Knox, Col.

Filmer, Sir E.

Labouchere, rt. hon. H.

FitzPatrick, rt. hon. J.

Lascelles, hon. W. S.

Foley, J. H. H.

Law, hon. C. E.

Forbes, W.

Lemon, Sir C.

Fordyce, A. D.

Lewis, rt. hon. Sir T. F.

Forster, M.

Lewis, G. C.

Fortescue, C.

Lincoln, Earl of

Fortescue, hon. J. W.

Lindsay, hon. Col.

Fox, R. M.

Littleton, hon. E. R.

Fox, W. J.

Loch, J.

1053

Locke, J.

Rutherfurd, A.

Lockhart, W.

Sandars, G.

Lushington, C.

Scott, hon. F.

Mackenzie, W. F.

Seymer, H. K.

Macnamara, Maj.

Seymour, Sir H.

M'Cullagh, W. T.

Seil, rt. hon. R. L.

M'Gregor, J.

Shelburne, Earl of

M'Naghten, Sir E.

Sheridan, R. B.

M'Neill, D.

Sibthorp, Col.

M'Taggart, Sir J.

Simeon, J.

Mahon, The O'Gorman

Slaney, R. A.

Mangles, R. D.

Smith, rt. hon. R. V.

March, Earl of

Smith, J. A.

Marshall, W.

Smith, J. B.

Masterman, J.

Smyth, J. G.

Matheson, A.

Smollett, A.

Matheson, J.

Somerville, rt. hn. Sir W.

Matheson, Col.

Spearman, H. J.

Maxwell, hon. J. P.

Spooner, R.

Melgund, Visct.

Stafford, A.

Mitchell, T. A.

Stanley, hon. E. J.

Moffatt, G.

Stansfield, W. R. C.

Monsell, W.

Stanton, W. H.

Moore, G. H.

Strickland, Sir G.

Morpeth, Visct.

Stuart, Lord D.

Morison, Gen.

Stuart, H.

Mowatt, F.

Sturt, H. G.

Mulgrave, Earl of

Sullivan, M.

Mundy, E. M.

Tancred, H. W.

Mure, Col.

Tenison, E. K.

Napier, J.

Tennent, R. J.

Norreys, Lord

Thicknesse, R. A.

Nugent, Sir P.

Thompson, Col.

O'Brien, Sir L.

Thornely, T.

O'Connell, M. J.

Tollemache, hon. J. F.

Ogle, S. C. H.

Townshend, Capt.

Ord, W.

Trelawny, J. S.

Oswald, A.

Turner, G. J.

Packe, C. W.

Tynte, Col. C. J. K.

Paget, Lord A.

Tyrell, Sir, T. T.

Paget, Lord G.

Urquhart, D.

Palmer, R.

Vane, Lord H.

Palmer, R.

Verner, Sir W.

Palmerston, Visct.

Verney, Sir H.

Parker, J.

Vivian, J. H.

Patten, J. W.

Vyse, R. H. R. H.

Pennant, hon. Col.

Waddington, H. S.

Peto, S. M.

Walmsley, Sir J.

Philips, Sir G. R.

Walpole, S. H.

Pigott, F.

Ward, H. G.

Pilkington, J.

Watkins, Col. L.

Plowden, W. H. C.

Wellesley, Lord C.

Powell, Col.

West, F. R.

Power, Dr.

Westhead, J. P.

Power, N.

Willcox, B. M.

Raphael, A.

Williams, J.

Rawdon, Col.

Williamson, Sir H.

Renton, J. C.

Wilson, J.

Repton, G. W. J.

Wood, rt. hon. Sir C.

Ricardo, O.

Wood, W. P.

Rice, E. R.

Wyld, J.

Rich, H.

Wyvill, M.

Robartes, T. J. A.

Rufford, F.

TELLERS.

Russell, Lord J.

Tufnell, H.

Russell, F. C. H.

Hill, Lord M.

List of the NOES.

Blewitt, R. J.

Martin, J.

Dashwood, G. H.

Morris, D.

D'Eyncourt, rt, hon. C.

O'Connor, F.

Duke, Sir J.

Pearson, C.

1054

Pechell, Capt.

Wakley, T.

Scholefield, W.

Wawn, J. T.

TELLERS.

Crawford, W. S.

Roche, E. B.

House in Committee.
Bill passed through Committee.
House resumed. Report to be received.
House adjourned at One o'clock.