§ House in Committee.
§ The CHANCELLOR OF THE EXCHEQUERsaid, he would now, with the permission of the Committee, propose the following Resolution:—
That the Duties granted by the Act 48 Geo. 3, c. 55, and now payable in England, Wales, and Berwick-upon-Tweed, and in Scotland, respectively, upon Dwelling Houses, and levied and assessed according to the number of Windows or Lights therein, as set forth in the Schedule marked (A) to the said Act annexed, shall be levied and assessed upon Inhabited Dwelling Houses in and throughout Great Britain, according to the annual value thereof, in the manner following: that is to say—For every Inhabited Dwelling House, which, with the household and other offices, yards, and gardens therewith occupied and charged, is or shall be worth the rent of twenty pounds or upwards by the year;Where any such Dwelling House shall be occupied by any person in trade, who shall expose to sale, and sell any goods, wares, or merchandise in any shop or warehouse, being part of the same Dwelling House, and in the front, and on the ground or basement story thereof;And also, where any such Dwelling House shall be occupied by any person who shall be duly licensed by the laws in force to sell therein, by retail, beer, ale, wine, or other liquors, although the room or rooms thereof, in which any such liquors shall be exposed to sale, sold, drunk, or consumed, shall not be such shop or warehouse as aforesaid;And also, where any such Dwelling House shall be a farm house, occupied by a tenant, and bonâ fide used for the purposes of husbandry only—There shall be charged for every twenty shillings of the annual value of any such Dwelling House, the sum of Sixpence.And where any such Dwelling House shall not be occupied and used for any such purpose and in 167 manner aforesaid, there shall be charged for every twenty shillings of the annual value thereof, the sum of Ninepence.
§ SIR H. WILLOUGHBY moved that from the passage describing the property on which this tax was to be charged, the words "and gardens" should be omitted. The present proposition was to commute into a house tax such portion of the window tax as was not to be entirely repealed. He contended that it would not be fair to cast any portion of the new tax on property which was not previously subject to window tax. Now the window duty imposed under the 48th George III. fell exclusively on houses and offices. The house duty, which was repealed in 1834, attached itself to houses, offices, and lands. In the schedule "land" was explained to signify "gardens." Now he contended that no portion of the present house tax should be put upon gardens, which had never paid window duty. If the House did so, they, in fact, placed an income tax on gardens. If there was a house and garden, each being worth 10l. a year (or 20l. in all), they would be liable to the house duty. Now, no window duty could have fallen upon the garden, and, therefore, in pretending to relieve parties from the window tax, they were in effect about to impose a now tax upon them. If there was a class upon whom he believed that the House would not wish to impose a new tax, it was the owners of market gardens. It appeared to him, therefore, that the present proposition would impose a now and an unjust burden on a species of property which was not previously subject to the window tax; and unless he heard some sufficient reason from the right hon. Gentleman the Chancellor of the Exchequer for this course, he should divide the Committee on his Amendment.
§ SIR G. PECHELL,in seconding the Motion, said, that he disapproved of the principle of a house tax as a substitute for a window tax. When the hon. Member for Buckinghamshire drew the attention of the House a few nights previously to the agitation upon this subject which had prevailed in the metropolitan districts, he might have added that there were a great many other places which sympathised in that movement. They disapproved of the principle of a house tax; after agitating for so many years with his noble Friend (Viscount Duncan) to get rid of the window tax, and having succeeded in that, they did not contemplate a substitute for that odious impost. Those hon. Members 168 with whom he had the honour to sit were resolved to stick to their guns to the last in resisting the house tax, because they apprehended that it would be the nucleus of further taxation. What guarantee had they that if they now assented to a sixpenny or ninepenny tax, they might not hereafter be called upon to impose a tax of 1s. 6d. or 2s.
§ The CHANCELLOR OF THE EXCHEQUERsaid, the hon. Baronet (Sir H. Willoughby) was quite right in saying that he had adopted the words of the old House-tax Act; and the same reason which led to the insertion of the word "garden" in that case, had led him (the Chancellor of the Exchequer) now to adopt it. In many cases it was impossible to distinguish between houses in the country and houses with a certain quantity of garden adjacent and appurtenant to the house. He entirely admitted the force of the hon. Baronet's observation, with respect to market gardens, and would take care to obviate the difficulty by the introduction into the Act of words specially exempting from the tax persons who obtained a livelihood by the produce of their gardens. More than this, however, he could not undertake to do. He could not consent to separate country houses from the pleasure grounds and gardens immediately appertaining to them, for if he were to do so, the productiveness of the tax would be injuriously interfered with. He almost doubted the possibility of letting a house in the country without some extent of ground adjacent or appurtenant to it; and the effect of allowing an exception in cases in which the house was let for 18l., and the approach to it for 6l., would be that the tax would fail to produce anything. He admitted that sometimes gardens might be so very extensive (perhaps eleven or twelve acres), that it would be unjust to identify them with the house, as making but one concern; but such cases had been specially provided for by the Window Tax Act, 48 Geo. III., cap. 55, which limited to one acre the extent of the garden, which was to be valued with the house. He had taken the assessment under the property tax, and, with that basis, the house tax would produce only 720,000l., and he hoped the House would not, by introducing exemptions, which formed one of the worst features of any tax, allow the probable amount of the proposed tax to be frittered away. That was a very fair limit with respect to a country house; and, unless there was some reason 169 for deviation, it would be convenient to adhere to words which were well known, and with respect to which the Judges had pronounced decisions. He would, in a future stage of the Bill, introduce words which would exempt market gardens.
§ MR. HUMEsaid, he knew many instances in which the house was let to one person, and the garden to another.
§ The CHANCELLOR OF THE EXCHEQUERsaid, in such cases the garden would not be assessed.
§ MR. HUMEmust confess that the limitation, with respect to the size of the garden, did away with much of the objection which might otherwise be heard against the Resolution, in its present shape. He was one of those who thought there was no necessity whatever for a house tax as a substitute for the window tax. He was not, however, opposed to a house tax as a measure of direct taxation; on the contrary, he thought it possessed many advantages, not the least important of which was, that it afforded an excellent criterion for the extension of the suffrage. He would much rather have seen the window tax repealed unconditionally, and in the case of deficiency a house tax imposed. With regard to the income tax, he would cheerfully vote for its imposition upon a fair principle, in order that other taxes might be removed which pressed injuriously on the industry of the country. He considered it was inexpedient to continue the taxes on soap, paper, and hops, in order to pay off the national debt. We were not obliged to liquidate the debt by the imposition of taxes, although we were compelled to pay the interest. They were now actually laying on a house tax for the purpose of paying off a portion of the national debt, because it appeared that, including the last sum of 640,000l. laid out in the purchase of stock, no less than 2,300,000l. of debt had been paid off within the last year or so. He admitted that a house tax would be a very good tax per se if there was any necessity for raising money, which he denied. He must complain that from the mode in which the question was brought forward, they were prevented from taking a division upon the question, because the Chancellor of the Exchequer had ingeniously proposed to substitute a house tax levied upon value for what he called a house tax previously levied upon windows. He objected to fresh taxes being laid on in order to carry out the financial schemes of the right hon. Gentleman. He was pre- 170 pared, if the proposition was brought fairly before the House, to vote for a gradual extinction of the national debt; but he was not prepared to impose burdens which would press severely upon the springs of industry when there was no necessity for such a tax. He entered his protest against the arrangement for exempting houses under the value of 20l. per annum, while houses in boroughs of the value of 10l. were entitled to a vote.
§ SIR W. JOLLIFFEsaid, it appeared to him that they were now imposing taxes on property which hitherto had not been subject to taxation. A great number of houses would be subject to this tax that were not subject to the window tax; and with respect to the introduction of gardens of an acre in extent, it should be recollected that near a town an acre was a large extent of ground. Then, with regard to farmhouses, there were many farmhouses where the rent was not 200l. a year, and therefore they could not be charged with the window tax; but the house and garden and offices would be of the value of 20l. a year, and, consequently a fresh tax would be levied on the tenant-farmer. He must deprecate the intention of placing the tax upon a new description of property, and protest strongly against it as unjust and deceptive
§ MR. W. WILLIAMSsaid, he was of opinion that the scheme of a house tax was just as objectionable in principle as the window tax. The house tax was to be imposed on 400,000 houses, out of 3,500,000, but of that 400,000, two-thirds were situate in the metropolis, and consequently the tax was to be regarded as a metropolitan tax. He looked upon the tax as unjust in principle, because houses would then be subject to two taxes: the income tax, paid by the landlord, and the house tax, paid by the tenant; no other property being liable to double taxation. He had reason to know that in some neighbourhoods entire streets of houses had been built so as to be exempt from window tax: all this description of property would now be liable to an entirely new tax. He agreed with the hon. Member for Montrose, that there was no necessity for the imposition of a house tax. Why had not the Chancellor of the Exchequer charged real property with the payment of legacy duty, and thus raised a revenue which would have enabled him to abolish the window duty without inflicting a substitute? The operation of the existing law was most unjust, and he feared 171 that the house tax would be liable to the same objections. According to the present system, the tradesman's house at the Westend contributed a larger sum to the revenue than the mansion of the nobleman. He himself knew of a case where one of the largest mansions in the metropolis was rated to the income tax at a few pounds more than the tradesman's house next door, with only a frontage of two windows.
VISCOUNT DUNCANthought the House was indebted to the lion. Member for Evesham for raising this question with reference to gardens, and also to the right hon. Gentleman the Chancellor of the Exchequer for the satisfactory explanation he had made. As he understood the right hon. Gentleman, no piece of ground attached to a house would be included in the value if it exceeded one acre in extent. To that arrangement he could see no objection. He was not one who was anxious to raise up unreasonable objections to a proposal of this kind. He would delay stating more fully his opinions of a house tax till the hon. Member for Marylebone brought forward his Motion; but in the meantime he would repeat that, taking the tax as a whole, he could not help thinking that the plan now introduced by the Chancellor of the Exchequer was a great improvement on that which he originally laid before the House.
§ MR. WAKLEYtook leave to assure the Chancellor of the Exchequer, that the only way in which he could give unqualified satisfaction on a subject of this sort was to repeal the tax altogether. No middle course would have the effect of pleasing everybody. He thanked the Government for the unqualified repeal of the window tax, for such he regarded it to be, and complimented them upon the gracious manner in which they had made a concession to a great and popular demand. The hon. Member for Evesham had, he thought, with great propriety, objected to gardens being included in the assessments; but the Chancellor of the Exchequer had defended himself by an appeal to precedent. It was curious to observe, that whenever a precedent was referred to in that House, it was invariably a bad one. The Chancellor of the Exchequer had referred to the precedent established by the Act of George III., but a worse precedent could not have been found. The hon. Member for Montrose had expressed his approval of the Government scheme, the hon. Member for Lambeth (MR. W. Williams)—another great 172 Cocker in his way—was satisfied with it; and the noble Lord the Member for Bath (Viscount Duncan) had declared himself delighted with it. But to his (MR. Wakley's) mind, the proposition was one of the most unjust and oppressive that ever was sanctioned by an unjust Act of Parliament. It was proposed that every person who had a garden of a quarter of an acre, half an acre, or any quantity under one acre, was to have the value added to the assessment of his house; surely nothing could be more unfair than this, when it was borne in mind that the nobleman who had an hundred acres of pleasure-ground round his mansion was not to be assessed for it. Was it possible that the Committee could sanction so monstrous a piece of injustice as this? If they were to have a house tax, let them have it; but gardens and pleasure-grounds ought to be exempt.
§ MR. HENLEYconsidered it would have been better to have deferred the discussion until the Committee was in possession of the Bill which the Chancellor of the Exchequer intended to introduce, more especially as the right hon. Gentleman had promised to introduce words that would exempt market gardens from taxation. The amount in dispute, if gardens were included, would be very small, and he was not disposed to think that injustice would be done by including them.
§ MR. ELLISdid not believe that the scheme of the Chancellor of the Exchequer, when reduced to operation, would be attended with hardship. It appeared to him that the burden of the tax would fall, not upon small owners and occupiers, but upon those who paid large rents. He had visited his constituents twice since the Chancellor of the Exchequer's amended Budget had been before the country, and not one of them had objected to it. The former Budget was one of the clumsiest and worst-digested devices which had ever been concocted; but the amended one was far less objectionable, and was, he thought, rendered necessary in consequence of no reductions having been made in the Army and Navy Estimates.
VISCOUNT DUNCANunderstood the Chancellor of the Exchequer to have stated that 400,000 houses would in future be chargeable with the house tax, out of the 500,000 which had paid the window duty. He wished to know whether the Chancellor of the Exchequer could state how many of the 400,000 houses had gardens attached?
§ The CHANCELLOR OF THE EXCHEQUERwas unable to answer the question. His calculation had been based upon the property tax assessment, where houses and gardens were assessed together.
§ MR. ALDERMAN SIDNEYthought a house tax was a very fair mode of raising revenue, but objected to the proposed distribution of that under discussion. The Committee had had several instances brought under their notice of the very partial manner in which this tax would operate. The hon. Member for Finsbury (MR. Wakley) had shown that a nobleman with a hundred acres laid out in parks and gardens would come off extremely easy if he were only charged to the house tax in respect of his splendid mansion. The tax would also fall with unjust pressure on the larger and better class of houses in towns, as compared with smaller but still respectable houses. There was no reason why this tax should now be re-imposed in a partial form. He was quite satisfied that the Chancellor of the Exchequer had greatly underrated the produce of this tax. The right hon. Gentleman had stated that only 400,000 houses of the value of 20l. would bear the tax. He (MR. Alderman Sidney) found by a recent return presented to the House that there were at least 486,000 houses paying a rental of 20l. in this country. Independently of that, he believed the right hon. Gentleman had stated that there would be some 20,000 or 30,000 houses, not now chargeable to the window duty, which would be liable to be assessed to the house tax. But he (MR. Alderman Sidney) could not see why that partial legislation of excusing houses below 20l. should be adopted. He knew there were a great number of persons who, having retired from business, lived on their means in the country in respectable houses of less value than 20l., and kept their pony chaise, but paid no duty for it; and he did not know any reason why that class of persons were to be exempted from the proposed house tax. But the tax would fall also with very undue pressure on the class of shopkeepers. If the Chancellor of the Exchequer would take the principal thoroughfares in the metropolis, he would go along whole streets, not one of the houses in which would be of less value than 100l. a year. If those houses were not let as shops, the value of them as dwelling houses would not be more than from 30l. to 50l. Would, then, the Chancellor of the Exchequer not make 174 this tax more tolerable by making it more equitable in its pressure? He was sure that when the owners of house property in towns came to be fully aware that they would be made to bear the chief burdens of this house tax under its present distribution, the same objections would prove fatal to this new and modified tax, as tended to put an end to the old house tax. To his knowledge, houses occupied by noblemen when the old house tax was in existence, paid far less than the dwelling-houses of ordinary shopkeepers; and seeing that shopkeepers were compelled, in a manner, to occupy the same premises in which they carried on their business, he would ask the right hon. Gentleman whether it was fair or equitable in him to exonerate warehouses, manufactories, and banking houses, in which the more lucrative businesses were pursued, and to charge the proposed house tax on the value of the shop and premises which a shopkeeper occupied? He would also ask the right hon. Gentleman whether it was worth while to press a tax on the Committee so partial in its operation, and which, if persisted in, would become extremely unpopular with the class of the community engaged in shopkeeping? He trusted that some method would be devised by which the difficulties he had referred to would be overcome.
§ SIR H. WILLOUGHBYsaid, he should not press his Amendment.
§ MR. PACKEsaid, he had intended to move as an Amendment to the Resolution, that the words "ten pounds" be substituted for "twenty pounds," as the value below which houses were not to be chargeable to the proposed house tax; but since the hon. Member for Marylebone (Sir B. Hall) had intimated his intention to postpone his Motion for the unconditional repeal of the window tax until the Bill for imposing a house tax was before the House, he (MR. Packe) should defer his Amendment until the House went into Committee on the Bill.
§ MR. MACGREGORhad no objection to a house tax, but he should like to see it so distributed as to enable hon. Members to modify the income tax as it was now levied, and to do away with the inquisitorial nature of that tax. He knew, however, the Chancellor of the Exchequer must do the best he could under the exigencies of the times, and not always what he wished to do. The right hon. Gentleman could not have taken any other course, unless he had greatly reduced the expenditure of the 175 country. He (MR. MacGregor) could not believe this would be a permanent measure. Whatever the House did in the way of taxation, then, would be of a transient character; they would, ere long, be called on by the country to revise the whole system of taxation, and if he did not feel certain that that would be the case, he would not consent to support the house tax on the present occasion.
§ SIR B. HALLwished to state exactly to the Committee the course he intended to take with regard to the house tax. His right hon Friend the Chancellor of the Exchequer had told him candidly that if he (Sir B. Hall) succeeded in carrying his Motion for the non-imposition of a house tax, he (the Chancellor of the Exchequer) would withdraw his proposal for repealing the window tax; or, in other words, that he would have either the window tax or a house tax. Under these circumstances he (MR. B. Hall) had no other alternative but to withdraw his Motion. But he would as frankly tell his right hon. Friend, that when he found the repeal of the window tax was carried, he (Sir B. Hall) would, if not in the present Session, at some future time, bring on a Motion for the repeal of the house tax.
§ The CHANCELLOR OF THE EXCHEQUERwould do the hon. Baronet the justice to say that he had been candid in his declaration; but he (the Chancellor of the Exchequer) must remind the Committee that when he proposed to repeal the window tax altogether, he had stated that it was absolutely necessary to propose a substitute for at least a portion of that tax. When his hon. Friend talked about bringing on a Motion for the repeal of the house tax, should that tax be adopted, he (the Chancellor of the Exchequer) might state his belief that there were other taxes which it would be more desirable to repeal than the contemplated house tax.
§ SIR DE LACY EVANSfelt, with his hon. Friend the Member for Marylebone (Sir B. Hall), that he was placed in a dilemma in having to choose between the window tax and a house tax. He certainly must abide by the alternative of a house tax, though at the same time he protested against it on its own merits. He felt it necessary, therefore, to forego his opposition to a house tax at present; but whenever a Motion for its repeal should be brought forward by his hon. Friend (Sir B. Hall), or any other Member, he should certainly support it.
VISCOUNT DUNCANthought his hon. Friend (Sir. B. Hall) had exercised a wise discretion, under the circumstances, in postponing his opposition to the house tax.
§ MR. HUMEsaid, the Chancellor of the Exchequer had stated that if the house tax was carried, the loss to the revenue by the substitution of a house tax for the window tax would only be 1,100,000l. He was of opinion that a portion of the surplus revenue might be applied with much more benefit to the country in the reduction of the duties on hops, stamps, advertisements, paper, and soap, than in the foolish attempt to reduce the national debt.
§ SIR G. PECHELLwished to enter his protest against the imposition of a house tax. He would remind the Committee that in Lord Althorp's time it was always understood that the principal reasons for repealing the house tax were the difficulties experienced in collecting it, and the partial manner in which it was imposed. On getting rid of the window tax he thought the country would only have the parish officers to contend with, but, instead of that, the Chancellor of the Exchequer interposed his house tax.
§ MR. MOWATTsaid, he had been associated with the hon. Member for Marylebone (Sir B. Hall) in endeavouring to produce the unconditional repeal of the window tax. He did so in the full conviction that the expenditure of the country must be reduced. He sought to obtain the repeal of the window tax under the impression that the Government, in giving up that tax, would not feel themselves called on to provide for a smaller sum of money by way of substitute. It being decided otherwise, he (MR. Mowatt), for one, had no objection whatever to raise by the proposed house tax some portion of the money lost to the revenue by the relinquishment of the window tax. On the contrary, he preferred a house tax to every other description of tax. No doubt houses were already chargeable with property tax, but, notwithstanding that, he had no hesitation in declaring his most hearty concurrence in the principle there laid down of direct taxation so far as it went. He concurred with the hon. Member for Leominster (MR. F. Peel), who said, in the speech he addressed to the House a few nights ago, that taxation was not to be measured by the amount paid into the Exchequer, but by the injuries which it 177 inflicted on the industrial pursuits and the commerce of the country. He (Mr. Mowatt), for one, regretted that this measure was far from being an extension of that admirable system first introduced by the immortal financier, Sir Robert Peel. The House had retrograded, for instead of raising 1,800,000l. by direct taxation, they now proposed to raise only 700,000l., thereby going back to the extent of 1,100,000l. While he objected to the house tax altogether as unnecessary on the grounds he had stated, still, if they were to have it, he thought it should be more generally applied. He did not see why a man occupying a house of 10l. a year should not contribute his quota towards the house tax. Every person knew that in many parts of the country people who occupied houses of 10l. or 18l. a-year were perfectly competent to contribute to a tax of that description.
§ MR. HEYWORTHwas of opinion that if a house tax were not imposed, the Chancellor of the Exchequer would not be able to reduce the duties on coffee and timber. He complimented the right hon. Gentleman on the course he had taken. There was no tax whatever levied on a large class of the community but was very soon shared by the rest of the community; and so it would be with the house tax. Justice would never be done to the labouring men of this country so long as heavy duties were imposed on the articles which they consumed; and to make this a wealthy nation, all its Customs and Excise duties should be abolished.
MR. MOFFATTproposed, as an Amendment, to insert the words "manufacturer or" after the word "shall" in the Resolution, the effect of which would be to exempt places in which manufactures were carried on from the operation of the tax.
§ The CHANCELLOR OF THE EXCHEQUERsaid, he did not see why an old woman engaged in knitting a pair of stockings, or in making matches, should not be exempted under the proposition of his hon. Friend (Mr. Moffatt). He (the Chancellor of the Exchequer) extended the exemption from the tax to all houses which were at present entitled to exemption from the window tax in respect of a shop window; but if he adopted the suggestion of his hon. Friend, he might as well give up the tax altogether.
§ MR. SPOONERsaid, he believed, at present, windows of manufactories were totally exempted from window duty, but it 178 very often happened that there was a dwelling-house connected with those manufactories, forming one building, and that the assessment was made on the whole premises.
§ The CHANCELLOR OF THE EXCHEQUERsaid, if a shop or warehouse was attached to a dwelling-house, and formed part thereof, it was liable; but if it was detached, it was not. If the warehouse was part of the house, or not separate from the dwelling-house, it would be calculated in the value. If, on the contrary, it was separated, it would not be calculated in the value.
§ SIR J. DUKEsaid, the result would be that many houses which had been partly exempted from the window duty would pay the house tax; and he thought no one was to pay the latter who did not pay the former.
§ The CHANCELLOR OF THE EXCHEQUERdeclared he had explained, on the contrary, that many persons would pay who did not pay now, or would pay more than they paid at present.
VISCOUNT DUNCANsaid, that at present, although the occupier of a house with a shop or warehouse did not pay the window tax for the shop or warehouse windows, he did pay for all the other windows in the house.
MR. MOFFATTsaid, he would not press his Amendment, but he hoped the Chancellor of the Exchequer would consider the matter.
§ The CHANCELLOR OF THE EXCHEQUERI thought my hon. Friend was anxious that the house tax and the elective franchise should go together.
§ MR. Alderman SIDNEYthought boarding houses and houses occupied as schools should be exempt from the tax.
§ The CHANCELLOR OF THE EXCHEQUERreplied, that the same exemptions which existed in former Acts would be continued. Boarding houses would be charged to the full amount, unless licensed as victualling houses.
§ MR. SCHOLEFIELDBut with regard to those large old-fashioned houses which are occupied as schools, I think they have a peculiar claim for exemption.
The CHANCELLOR OF THE EXCHE- QUERI have applications for exemption from the proprietors of every class of houses, all urged on peculiar grounds. But with regard to the large old-fashioned houses alluded to, I believe they will be at least as much benefited by the alteration as any other, and of course those occupied as schools will come in for their full share of the advantage.
MR. MOFFATTwished to know whether there would be any distinction made between occupiers and those small owners in the country who occupied their own holdings, but who were often in great distress.
§ MR. AGLIONBYcould state that in many cases owners of the class referred to were under mortgages to the full value of their property, and were in far worse circumstances than an occupying tenant.
§ The CHANCELLOR OF THE EXCHEQUERsaid, that the old Act made no distinction between the owner and occupier. It appeared to him that no person could occupy a house of his own, of 20l. a-year, without being a man of substance and property to some extent.
§ MR. FREWENhad many constituents who were owners of small freeholds, which they occupied, but were in a much more depressed condition in many cases than the tenants.
§ MR. Alderman SIDNEYinquired how the annual value was to be ascertained?
§ The CHANCELLOR OF THE EXCHEQUERcould add nothing to what he had already stated. He took a very low sum in the pound, and rated the house at the highest annual value, to be ascertained by the assessment to the property tax.
§ Resolution agreed to; House resumed; Resolution to be reported To-morrow.