WAYS AND MEANS—FINANCIAL STATEMENT.—COMMITTEE.

HC Deb 25 March 1872 vol 210 cc603-76

Ways and Means considered in Committee.

(In the Committee.)

THE CHANCELLOR OF THE EXCHEQUER

Mr. Dodson—Sir, the first subject which it will be my duty to bring under the consideration of the Committee is the comparison of the Estimate for the expenditure of the expiring financial year with the actual result; but, before I do so, there are one or two observations that, I think, it may be profitable to make to the Committee, with regard to the principles on which I propose to institute that comparison. The ordinary course which I have hitherto adopted has been to compare the Budget Estimate of expenditure with the actual result. On the present occasion, I cannot tell the Committee exactly to a pound the result, because there is one week of the financial year which has not yet expired; but I can give the expenditure with an accuracy which I am persuaded will be perfectly sufficient for all practical purposes. I imagine, moreover, that I can introduce some improvement into the Estimate with which that actual expenditure is to be compared. It is obvious that, when you compare two things together, the best way is to compare the whole of one thing with the whole of the other, not a part of one thing with a part of another, or a part with the whole of another. The plan I have hitherto gone upon is to compare the expenditure as estimated in the Financial Statement of the Chancellor of the Exchequer with the actual expenditure. That would be quite right if the expenditure, as estimated in the Financial Statement of the Chancellor of the Exchequer were the whole expenditure of the year. But that is not the case; and I wish to draw the attention of the Committee to the fact, in order that they may see the object I have in view. The expenditure of the financial year may be divided into four epochs or portions. The first is, the Financial Statement of the Chancellor of the Exchequer, when he announces what appears to him, as far as he can judge at the time, to be the amount of the expenditure for the coming financial year. The second epoch is the introduction, which almost invariably occurs, of Supplementary Estimates during that time. The third is, the embodiment in the Appropriation Act of the expenditure agreed to by the House in Committee of Supply, together with that agreed to in those Supplementary Estimates, and those are the grants authorized in the Appropriation Act. The fourth is, when in the succeeding Session, before the Chancellor of the Exchequer makes his Financial Statement, there is generally introduced another set of Supplementary Estimates, which also authorize further expenditure in the year; so that, to compare the expenditure of the year with the Financial Statement of the Chancellor of the Exchequer is to compare a whole with a part only, because there is more expenditure authorized than that which the statement of the Chancellor of the Exchequer estimated I think, therefore, it would be preferable to compare the whole expenditure for the year, not primarily or mainly with the Estimates of the Chancellor of the Exchequer in making his Financial Statement, but rather with the whole of the grants made, either by the Appropriation Act or by subsequent Supplementary Estimates for the whole year, and the whole of the Estimates will then be compared with the whole of the expenditure. That is a course which I think must commend itself; and, if not most agreeable to the Chancellor of the Exchequer, is at least the fairest to the House, as giving the fullest and most ample explanation, and preventing tricks being played by the grants of one period being dextrously substituted for the grants of another. But then the plan is liable to this objection—it assumes and is based on the assumption of the permanence of Supplementary Estimates, to which my hon. Friend the Member for Brighton (Mr. White) objects. Of course, if there were no Supplementary Estimates the observations I am making to the Committee would have no place, because there would be only two epochs in the expenditure of the year—the one, the proposal of the Chancellor of the Exchequer; the other, the adoption by the House of so much of that proposal as they thought good in the Appropriation Act. But what I wish to submit to the Committee is, that we must, how over unwillingly, have recourse, under the new state of things, to Supplementary Estimates as a necessary part of our finance. I heartily wish it was not so; but I believe I can show the Committee that it is impossible it should be otherwise. In the old system of finance that existed before the passing of the Exchequer and Audit Act in 1866, and the changes that followed upon it, the Estimates were comparatively loose In the first place, they dealt not with the gross, but with the net expenditure. Departments were allowed to deduct whatever they received back from their Estimates in gross, and only asked Parliament for the difference; and the Treasury, having no means of investigating or testing the amount of the wants of Departments, were obliged to take a good deal on trust; and the consequence was, the Estimates were comparatively loose. The Exchequer and Audit Act, however, made a very important change and improvement in that state of things, and the course now is, that all the money voted—the whole expenditure—is subject to an Appropriation Audit; and the House has not only primarily the merit of securing that the money is devoted to the purposes Parliament intended, but it has a secondary and not inferior merit, which is, that it enables the Treasury to scrutinize the expenditure of the Departments, to see where it is too large, and to adjust the Estimate next year to reasonable requirements. The consequence is, that the Estimates are made much closer than they were before, and there is loss room for the correction of error. Of course, if the Estimates are made loosely, there is room for meeting unforeseen expenses; but if they are made slackly, there is not the same amount of play or room in the working of the system. The result therefore is, that the greater perfection to which we have reduced the system of Estimates—the closer we have made them, the more difficult it has become for us to be sure that the Estimates shall not be exceeded. Of course, there are two things that must necessarily happen. First, there must arise unforeseen contingencies; and, next, the Departments of the Government may be in error in estimating the amount of money they require. It is the desire of Parliament, since the passing of the Exchequer and Audit Act, that the whole expenditure of the year should, if possible, be defrayed in the year. In fact, they require that the balance not expended in the year should be paid back into the Exchequer. If they insist on that, unless they can find public Departments that never make mistakes in the amount they require, and able to foresee all the contingencies that may occur, it will be impossible to do without Supplementary Estimates. In continuing that course there is no doubt that Parliament obtains more complete control over the national expenditure. If it were unable to do so, of course, there are two alternatives. To return to the old system of looser Estimates, or to pay not by Supplementary Estimates, but by advances out of Civil Contingencies; and however often a Chancellor of the Exchequer has chosen to pay out of Civil Contingencies, I have always given the preference to Supplementary Estimates, because they are submitted to Parliament before the money is spent, and if Parliament disapproves of them they can stop the payment. On the other hand, the Civil Contingencies are submitted to Parliament after the money is spent, and therefore the Vote of the money becomes a mere meaningless form. I therefore submit that it is impossible and vain to hope that we can dispense with Supplementary Estimates, so long as we keep to the irregular form of estimating the expenditure of the country which I have described. While I am on this subject I will make one other observation—that is, with reference to Votes on Account, as to which exception has frequently been taken by hon. Members on both sides of the House. Under the present arrangements of finance I hold that they are a necessity that cannot be dispensed with, because in the old time the Department which did not spend the whole of the money authorized by Parliament was at liberty to apply that money to the services of the subsequent year, and the result was, that the Government at the end of the financial year had saved considerable sums, and had those sums in hand. But now, Sir, by the new system, as soon as the financial year has expired, every farthing of those balances must be paid back into the Exchequer, and the Government is without a shilling to carry on the business of the country. And, therefore, it is only by a system of grants on account that we can possibly be enabled to do so, unless a system could be introduced by which the expenditure of a future year could be disposed of without Parliamentary authority, which I fear is a thing we cannot look for. I, therefore, invite the attention of hon. Members interested to that consideration. While I am most anxious that everything shall be criticized with care and minuteness, if they carefully weigh what I have stated, they will see that it is a real waste of acumen and diligence to murmur against those things which are the unavoidable, though, perhaps, disagreeable, results of what cannot but be regarded as a greatly improved system of finance.

With these preliminary observations, I propose to compare the total grants during the year just expiring with the actual expenditure of the year. And, first, I find the total grant for the interest of the Debt during the year was £26,910,000, and that the actual expenditure has been £26,840,000, showing that the expenditure has been less than the grant by £70,000, and that is a gratifying reduction, because it arises from the paying off of Debt, and therefore diminishes the interest to be paid in future. Secondly, coming to the other charges on the Consolidated Fund, the total grant was £1,820,000, and the actual expenditure being £1,797,000, the reduction has been £23,000. For the Army, including the abolition of purchase, the grants within the year were £16,455,000, and the actual expenditure has been £16,200,000, so that the expenditure has been less than the grants by £255,000. For the Navy the grants within the year, in Committee of Supply and on the Supplementary Estimates, amounted to £9,892,000, and the actual expenditure was £9,900,000, showing an expenditure over the grants of £8,000 which is, I am happy to say, the only excess of expenditure over grants in the whole year. For the Civil Service the grants were £10,995,000, and the expenditure has been £10,400,000, showing that the expenditure has been less than the grants by £595,000. The Post Office grant was £2,470,000, and the expenditure has been £2,446,000, showing that the expenditure has been less than the grant by £24,000. The Telegraphs grant was £420,000, and it has been actually balanced by the expenditure. The Packet Service grant was £1,148,000, and the expenditure has been £1,139,000, showing that the expenditure has been less than the grant by £9,000. For the collection of Customs and Inland Revenue the grant amounted to £2,626,000, and the expenditure has been £2,578,000, showing that the expenditure has been less than the grant by £48,000. The net result is, that the grants for the year were £72,736,000, and the actual expenditure was £71,720,000.

I will now compare the actual expenditure with the total grants, then with the total grants under the Appropriation Act, and then with the original Estimate of the Chancellor of the Exchequer, which last test the Committee will most readily adopt in judging of the propriety of the Estimate in the first instance. The actual expenditure is £71,720,000; it is less than the total grants, which, including the Supplementary Estimates just voted, amounted to £72,736,000, by the sum of £1,016,000; it is less than the total grants in the Appropriation Act, which were £72,433,000, by £713,000; it is less than the total original Estimate in the Financial Statement of the Chancellor of the Exchequer, which was £72,308,000, by £588,000; and I hope that that may be taken as a proof that some vigilance has been exercised in keeping the expenditure within bounds.

And now, Sir, to comment upon particular items. The receipts for Telegraphs during the year 1870, after paying the ordinary working expenses of the services and the interest on the stock which was created for purchases and extensions, yielded a surplus of £50,000, which, in accordance with the requirements of the Telegraph Act, was applied towards the reducing the capital of the Debt. That is but a small beginning, and I am sorry to say the capital account is not yet closed; but still it is satisfactory that even that small beginning has been made towards getting rid of it, and we may hope that it may be followed by a much larger amount in future years. The cost of the abolition of purchase was estimated at £600,000; it has turned out to be little more than £400,000, which is satisfactory, not only because of the saving of £200,000, but because it shows the change has been accepted with less panic than was anticipated. I should, however, have mentioned that the Supplementary Estimates during the year have amounted, in the whole, to £550,000, and the Committee will observe that even with that addition the expenditure falls far under the amount. With regard to the very large sum by which the Civil Service expenditure falls short of the Estimates, which is no less a sum than £595,000, I have to observe it is traceable principally to two sources. One of these is the Vote for Education, which, of course, under the circumstances, was necessarily a mere guess, and of which, I believe, there is at present £400,000 unexpended. The rest is chiefly due to Buildings, the expenditure on which is necessarily very uncertain. A number of things prevent us going on with Buildings as fast as we expect; all sorts of obstacles must arise; and on this account a sum of £250,000 more is unexpended. Some of that, however, will probably be expended before the end of the year, and therefore we do not state the total as an ultimate fact. The Science and Art Department has a considerable sum unexpended; the Natural History Museum, the Courts of Justice, and Buildings in Ireland are all headings which go to make up the saving. That is the best account I can give of the matter; but it is often observed that in the case of Votes for Buildings, the expenditure is liable, from unforeseen and unavoidable causes, to fall short of the Estimates.

I now come to the comparison between the Revenue for the year 1871–2, which is just expiring, and the actual Receipts. The Customs were estimated to produce £20,100,000; they have actually produced £20,300,000, showing that the yield was larger than the Estimate by £200,000. The Excise was estimated to produce£22,420,000; it has actually produced £23,300,000; showing a yield above the Estimate of £880,000. The Stamps were estimated to produce £8,750,000; they have produced £9,750,000, which shows an excess over the Estimate of £1,000,000. Taxes were estimated to produce £2,330,000, and they produced exactly that sum. The Income Tax was estimated to produce £8,820,000; it has produced £9,060,000, showing an excess beyond the Estimate of £240,000. The Post Office was estimated to produce £4,670,000, and it appears to have produced that sum. The Telegraph Service was estimated to produce £750,000, and it has produced that sum; that is to say, that is the gross yield. The Crown Lands were estimated to yield, and have yielded, £375,000. Miscellaneous sources were estimated to produce £4,100,000, and they have yielded £4,000,000, or £100,000 less than the Estimate. The result is that the Estimate was£72,315,000.

MR. WHITE

£72,375,000?

THE CHANCELLOR OF THE EXCHEQUER

I beg the hon. Gentleman's pardon. Does he wish to correct me? If he is making his own Budget, he had better wait till I have done.

MR. WHITE

I was merely noting down the figures.

THE CHANCELLOR OF THE EXCHEQUER

The Estimate was £72,315,000, and the yield £74,535,000, showing an excess above the Estimate of £2,320,000 and a falling short of the Estimate by £100,000, so that, upon the whole, the yield has been more than the Estimate by the sum of £2,220,000. We have already ascertained that the expenditure was £71,720,000, and if we deduct that expenditure from the yield of the Revenue, which was £74,535,000, we shall find that for the year that is just coming to a close we have a surplus of Income over Expenditure of £2,815,000, of which it must be remembered that £1,016,000 are due to curtailment of expenditure and the remainder to increase of Revenue.

MR. BOWRING

May I ask whether every item allows for the week unexpired? ["Order!"]

THE CHANCELLOR OF THE EXCHEQUER

That is a very proper Question. We have got the Returns up to last Saturday actually, and we have allowed what will probably be required for the remaining days of the week. This large increase of £2,220,000 has accrued upon the Customs, Excise, Stamps, and Income Tax. The Customs show an excess of £200,000 above the Estimate, but the rise in the Customs has not been simultaneous, for, singular enough, there has been a considerable diminution of the duty on tea, amounting to as much as £130,000 as compared with last year. This may, however, be accounted for by the fact that a great deal of tea which was kept back in the year 1870 under the idea that there would be a change in the duty came in suddenly, and destroyed the balance between the two years. Thus, in reality, there was substantially no falling off. Foreign gin and coffee show a decline. There is a decline in the duty on foreign gin, because it appears Englishmen prefer English gin to foreign gin. Foreign gin shows a decline to the amount of £55,000, and coffee a decline to the amount of £46,000. On the other hand, there is a large increase on tobacco, rum, foreign brandy, and foreign wine. The increase is no less than £458,000 upon these articles alone. The duty on wine has risen to upwards of £1,600,000, and there is no doubt that in another year it will reach the sum of £1,700,000, which was the amount of the duty before the reduction made in 1860. The serious part of the matter is when we come to Excise, because hon. Gentlemen predicted last year that there would be a very large increase in the Excise, and urged me to place my Estimates higher; but I declined to do so, and the results will no doubt give considerable satisfaction to those hon. Gentlemen. But I am bound to say that although I took that course—and I am happy to say the results have borne out their judgment—I do not come here to defend myself as a culprit in the matter, because, as I hold, the duty of the Chancellor of the Exchequer is exceedingly plain. That is, he is bound, if he believes the Estimates are honestly made and prepared by competent people who give their whole time and attention to that duty, to accept the judgment of permanent Departments of the Revenue in preference to his own. There is so much temptation to a Chancellor of the Exchequer to manipulate the figures so as to make things pleasant, and party interests may be so well served by arrangements of this kind, that the House cannot watch with too great jealousy over that which is a matter of integrity—namely, [that the Chancellor of the Exchequer does not take upon himself, in order to gain popularity—or to save himself from great unpopularity—to manipulate the figures to any great extent and to make them substantially different from the figures given to him by persons of high authority. Therefore, I cannot accept the responsibility. I think, however, I can show the House that there really was no error of any importance committed on my part; but that the figures, although not verified by the result, were founded upon good and sound basis, and that it was quite right that the gentleman who gave them should suggest to the Government to act upon them:—The Estimate for Excise this year was £22,420,000, and the actual yield £23,300,000, showing an excess of yield over Estimate of £880,000. The two things which contributed most to that result were—first, British spirits, and, secondly, stamps. The Estimate for British spirits last year was £11,250,000, and the actual yield £12,300,000, showing an excess of yield over Estimate of £1,050,000. Yet I do not think, on looking back upon it, that the Estimate was unreasonably framed, and I will tell the Committee why. It was arrived at by taking the average of the last three years. Now, the average yield of the last three years was £11,000,000; but in the year 1870–1, although it was not taken into the average, the fact was noted that there had been an increase of £494,000 on spirits; and, in order to recognize that fact, the Excise added £250,000 to the average, and made the Estimate £11,250,000. On the whole, I think they acted not imprudently in doing so. They might have had a very strong suspicion that the result would be greater; but in a matter of this sort it is, I think, safer to act upon the averages than to run the risk of greatly over-estimating the yield and of deceiving the House as to the resources likely to be at its disposal. Besides, there are the following circumstances which tend to justify the Estimate they made. The War, no doubt, reduced the importations of foreign spirits, and gave an impulse to the manufacture of home spirits; and it might well have been considered that that manufacture would not have continued, or, at least, would not have increased, after the termination of the War, which event, it will be remembered, occurred just before I brought forward my Financial Statement last year. In 1866 the duty on British spirits rose £418,000 above the year before, but it fell next year £344,000; so that the mere rise of the duty did not appear a safe ground on which to base the Estimate; and, indeed, I should have felt a much heavier responsibility had I insisted upon raising the Estimate on any speculation of my own, instead of acting on the judgment of those experienced gentlemen to whom I have just referred. I now come to the subject of malt, on which I was also urged to take a more sanguine view of the subject. There was a large increase in malt last year, which was one of very great prosperity. The increase was as much as £320,000, and my attention was very naturally turned to the fact, and I was asked by some hon. Gentlemen to base my Estimate next year very much upon that footing, the natural argument being that the prosperity of the country demanded it, The result would have been that had I adopted the increase in malt of last year as the basis of my Estimate—the result would have been a loss this year of not less than that £320,000, notwithstanding the great prosperity of the country. [Colonel BARTELLOT: What is the malt duty this year?] I have not the figures here; but I will tell the hon. Member in the course of the evening.

Then we come to Stamps. The Estimate for Stamps was £8,750,000 and the yield has been £9,750,000, showing an excess of yield over Estimate of £1,000,000. Now, there were some reasons, no doubt, for expecting an increase on Stamps, because the prosperity of the country, of course, leads to the transfer of property from hand to hand, and anything which leads to that, leads also to the increase of the Revenue from Stamps. But, on the other hand, an Act for the consolidation of the Stamp Laws had been passed, making considerable reductions which, as was estimated on the best authority we could get, would reduce the Stamp Revenue £200,000 a-year. No doubt we have to thank very much the prosperity of the country for the extraordinary rise in Stamps; but, still, we could hardly have expected such results as these. The stamps on deeds were reduced from £1 15s. to 10s., and yet, instead of losing by that, we have realized a profit of £100,000. Again, we did away with the ad valorem duty on bills at sight and substituted a penny stamp. We thought this would entail a loss of £100,000, where as we have actually gained£90,000. I think, also, I am fairly entitled to ascribe some credit for this increase in Stamps not only to the great prosperity of the country, but also to the measure passed two years ago, which makes the law respecting Stamps ascertainable, so that everybody can find out exactly what stamp is necessary. That is an instance to which we can point with some pride of a codification of the law having resulted not only in mere scientific advantages, but in actual solid results in the way of benefit to the Revenue. The increase on successions has been very large—£450,000. That arises very much from the dropping in of several large estates, and such dropping in must not now be regarded, as it was before, as a kind of casual windfall; for though we cannot expect to have it every year, I think the dropping-in of these enormous properties will in future be much more frequent. Some of the increase in the Revenue on stamps is nominal, and not real, because in many cases we have done away with fees formerly paid in money for different services rendered, and have required such payments to be made by stamps. This change, of course, operates as a transfer from one head to another, and, while reducing the Miscellaneous Receipts, swells the Revenue from stamps. I may mention some of the heads of this nominal increase—Fees of The London Gazette, Crown Office, Chancellor's Presentation Office, Great Seal Patent, and the Register House Department in Edinburgh. At those offices all fees are now paid in stamps, and in reality there is neither gain nor loss in the transaction; but I think, on the whole, it cannot be said that it was likely the Inland Revenue would be able to anticipate an extraordinary increase of the Stamp Revenue. Such an increase, therefore, is a matter for congratulation, and a remarkable proof of the industry and prosperity of the country, and I think we may be easily pardoned for our oversight in not anticipating it. The other great rise in the year is that of the Income Tax, and that again is something almost incredible. The history of the Income Tax is singular. I think that when Sir Robert Peel introduced it, he estimated the yield of 1d. in the pound would be £700,000; 10 years ago my right hon. Friend the First Minister of the Crown, who was then Chancellor of the Exchequer, estimated the yield of 1d. in the pound at £1,100,000; and last year we estimated it at £1,525,000. The actual yield for the year has turned out to be £1,560,000; and it is estimated that an Income Tax for the ensuing year at the rate of 6d. in the pound will yield £1,666,000 per 1d. It depends a good deal upon the amount; the lower the tax the greater the penny. Before I pass from this subject I will fortify myself by reference to a great authority to show that I have not been the first person who did not accurately calculate the yield of his Estimates. I will not refer to any living person, for that might be invidious, but I will take a great historical character—Sir Robert Peel. This is the history of his administration of the finances. In 1843 the yield of the Revenue was £2,700,000 more than his Estimate. In 1844 he got more than £2,000,000 above his Estimate; in 1845, £1,600,000; in 1846, £2,823,000; and then he left office. I pass now from the subject of Revenue to that of Balances. Of course, I cannot state the precise balance that will be in the Exchequer on the 31st of this month; but there will not be any difference worth thinking of. I take the three years that have passed since I have had the honour of being Chancellor of the Exchequer, and I find that on the 1st of April, 1869, the Exchequer Balances were £4,700,000; there has been a surplus of Revenue over expenditure in those three years of £9,840,000, and there has also been an excess of repayments of loans for public works over new advances made in the same period of £1,750,000, making together £16,290,000. Out of this amount there has been applied directly in extinction of funded Debt, in the payment of Exchequer Bonds and Bills, and of a special advance of £1,000,000 made in 1869, £7,400,000, leaving an estimated balance on March 31, 1872, of £8,890,000. The total of the Debt on the 1st of April, 1869—still dealing with these years—was £805,480,000. In the three years to the 31st of March, 1872, we added to that Debt £8,933,000, of which £8,670,000 was stock created for the purchase of the telegraphs. Adding this to the former amount, we make the total Debt at some portion of the time £814,413,000. In the same period of three years, however, we have paid off £21,673,000 of the Debt—that is to say, after paying off the amount of £8,933,000, by which the Debt was increased, we have still further reduced the Debt by £12,740,000. The total amount of the Debt, therefore, on the 31st of March will be, in round figures, £792,740,000. The state of this Debt, or, rather, the component items of the Debt, on the 31st of March will be—Funded Debt, £731,787,000; capital value of Terminable Annuities in Three per Cent Stock, £55,737,000; and Unfunded Debt—that is to say, Exchequer Bills, for we have no Exchequer Bonds outstanding—£5,220,000. So that in 1885, when the £55,737,000 Terminable Annuities will have disappeared, the Debt, supposing we make no further reductions than we are making now, will be reduced to £737,000,000. Thus, if I may be allowed to summarize the matter, in the course of these three years we have bought and extended the Telegraphs for £8,670,000, we have expended £720,000 on Fortifications, we have laid out £400,000 under the Act for the abolition of purchase, and we have paid, without imposing any fresh tax on the people, £1,450,000 voted by the House of Commons as an extraordinary credit to meet the emergencies of war in Europe. We have in addition diminished our Debt by £12,700,000, and we have added over £4,000,000 to our balances; or we may state it in another way—our capital expenditure has been £22,800,000, and we have doubled our balances.

I now come to the expenditure for the coming financial year, as compared with the grants for the financial year just expired—the estimated expenditure for 1872–3 compared with the grants of 1871–2. The Estimate of expenditure for the interest of Debt in the coming year is £26,830,000, and the grants for the same purpose in 1871–2 were £26,910,000, showing that the Estimate is less than last year's expenditure by £80,000. For the other charges on the Consolidated Fund the Estimate is £1,780,000, the grants last year were £1,820,000, showing a reduction of £40,000 this year. That reduction arises from the cessation of the payments which this country has been making for many years on part of the Greek Loan. These payments were discharged by instalments of about £40,000, of which, I am happy to say, we have now paid the last. The total amount paid by us has been £1,351,000; the sum paid by the Greeks has been £130,000, so that the claim outstanding against the Greeks is exactly £1,221,000. The Estimate for the Army, not including Purchase, is £14,824,000; the grants in 1871–2, not including Purchase, were £15,852,000, consequently this Estimate shows a reduction on the grants of last year of no less than £1,028,000. The Estimate for the Navy is £9,508,000; last year the grants were £9,892,000; there is accordingly a reduction of £384,000. The Civil Service Estimate is £10,652,000, against grants of £10,995,000 last year, showing a reduction of £343,000. In the Revenue Departments the Estimate is £2,621,000, and the grants were £2,626,000, showing a reduction of £5,000. In the Post Office the Estimate is £2,610,000, and the grants were £2,470,000; there is, therefore, an excess in the Estimate over the grants of £140,000, which is, I believe, to be accounted for by certain extensions and facilities which either have been or are to be given. Telegraphs stand in the Estimate at £500,000; the grants last year were £420,000, and here again there is an increase of £80,000, which, I presume, is to be accounted for in a similar manner. The actual grants for the Packet Service last year were £1,148,000; the Estimates this year were £1,135,000, being a decrease of £13,000. I may as well add at once the item for abolition of purchase in the Army. Last year £603,000 was required; this year the Estimate is £853,000, being an increase of £250,000. The results of the entire calculation show the Estimate for the coming financial year to be £71,313,000, as against £72,736,000, grants of last year. In certain points the Estimate exceeds the grants by £470,000; in others it falls short of them by £1,893,000. The net reduction of the Estimate, therefore, is £1,423,000. This is, of course, only the Chancellor of the Exchequer's Estimate, and there are still to be added, according to what I stated before, two Supplementary Estimates, one in this Session and the other in the next. The whole of the Supplementary Estimates for this year come to about £420,000, and if we allow an equal amount for the coming year, we still shall have a reduction on the Estimate over the grants for the past year of upwards of £1,000,000. The Civil Service Estimates are as nearly as possible the same in amount as last year, after making allowance for the exceptional charge of the Census, incurred last year. The only notable increase is that on Education for England, amounting to £93,000, and making, with the sum voted last year, a total increase since the passing of the Act of 1870 of £650,000, the total now asked being £1,521,000. The Customs show no great difference; but, if anything, a slight decrease. The London establishment has been thoroughly revised; salaries have been improved, and classification also; but, after allowing for the compensations granted on reduction of numbers, these improvements have been effected without increase of charge to the public. The principles adopted in London will be applied as fast as possible to the out-ports. As regards the Army and Navy, I would point out to those who make great complaint of the expenditure upon these services that the Army and Navy have been entirely altered and reconstituted during the last 14 or 15 years. Now, if we take a date precedent to the great changes which have of late been made in the services—say, 1858—we shall find that the net Estimate for that year was £21,257,000. If from the present Estimate we exclude the temporary incident of the abolition of purchase and deduct from it the extra receipts, the net Estimate for the Army and Navy, together will amount to £22,811,000. Now, that is the lowest Estimate since 1858, with the single exception of the Estimate for 1870–1 as originally proposed; and it is the lowest Estimate sine the former date, if we take into consideration that £2,000,000 was added to the Estimate of 1870–1 in the course of the Session. Therefore, if we take the net Estimate between the present year and the year that occurred 14 years ago, without the adventitious circumstance of the abolition of purchase, it will be found that the Estimate only exceeds by £1,554,000 that of 1858, when we had wooden ships, and our men were armed with the old muskets, and our artillery was made for a very small sum indeed; and I cannot think that any candid person, bearing in mind the changes which have since been made, will regard these Estimates as extravagant, if he will only concede that this country should be well defended, and that to do that we must be prepared with the best means of defence. I may add, too, that at the former period there had been no increase in the pay of soldiers.

I now pass to the estimated Revenue for 1872–3 as compared with the actual Revenue for 1871–2. The Customs have yielded £20,300,000, and we believe they will yield the same sum during the ensuing year. From the Excise in the past year we expect to receive £23,300,000, and in 1872–3 we expect £23,320,000—that is to say, we anticipate an increase of £20,000. Our Revenue from Stamps we believe will amount to £9,750,000; during the ensuing 12 months we expect from this source £9,700,000, showing an anticipated decrease of £50,000. Under the head of Taxes our Revenue, we believe, will be found to amount to £2,330,000; in 1872–3 we expect £2,350,000, showing an anticipated increase of £20,000. The Revenue from the Income Tax for the past year we estimate at £9,060,000; in the ensuing year we believe it will amount to £9,950,000, an increase of £890,000. From the Post Office we expect £4,770,000, as against an actual yield for this year of £4,670,000, so that we anticipate an increase of £100,000. The Crown Lands have yielded, and we expect will yield, £375,000. From Telegraphs we expect to receive £750,000, and our Revenue for next year from that source will, we believe, amount to £850,000, showing an anticipated increase of £100,000. Our Miscellaneous Receipts will amount to £4,000,000, and we expect them to yield £3,300,000, showing a loss of £700,000, which arises from the cessation of the repayments for the Abyssinian Expedition. The Estimates for the year 1872–3 will, therefore, amount to £74,915,000, as against a Revenue for 1871–2 of £74,535,000, and under certain heads there is an anticipated increase of Revenue amounting to £1,130,000, and an anticipated decrease of £750,000, showing a net increase in the Revenue of £380,000.

It now only remains for me to compare these two sums together—the Estimate of the Income for the coming year and the Estimate of the Expenditure, and from them to deduce a surplus or a deficit, as the case may be. For succinctness I will state both what the estimated income and expenditure for the year 1872–3 are calculated at. Customs we estimate will produce £20,300,000; Excise, £23,320,000; Stamps,£9,700,000;Taxes, £2,350,000; Income Tax. £9,950,000; Post Office, £4,770,000; Crown Lands, £375,000; Telegraphs, £850,000; Miscellaneous Revenue, £3,300,000. The income derived from the various sources I have just referred to will probably amount to £74,915,000; and under the head of Expenditure we have the following charges:—Debt, £26,830,000; Consolidated Fund Charges, £1,780,000; Army, £14,824,000; Navy, £9,508,000; Civil Services, £10,652,000; Revenue Departments, £2,621,000; Post Office, £2,610,000; Telegraphs, £500,000; and Packet Service, £1,135,000, giving a total of £70,460,000, to which we must add for the abolition of purchase, £853,000, making altogether £71,813,000, showing a surplus of income over expenditure amounting to £3,602,000.

I will now, Sir, state to the Committee in what manner the Government intend to dispose of this large sum, and to this portion of my statement I must specially request the attention of the hon. Alderman the Member for the City of London. He will remember that last year I gave a pledge to him to look into the question of the house tax, and endeavour to meet an anomaly which he pointed out. I have done so, and will now state the result of my lucubrations on the subject. The inhabited house tax has been interpreted to mean a tax on houses which are slept in. It may be that they are frequented all day long; but if they are not slept in they are not subjected to the tax, and this is felt as a kind of hardship by persons who do not sleep in places of business, but have to employ a care-taker to look after them. They say that it is very hard that they should be subjected to the house tax, because they are obliged to pay a man to look after their property. In order to remedy this, a clause was introduced into an Act passed in 1869, which enacted that if a person should occupy any warehouse, shop, or counting-house simply for the purpose of taking care of it, it should be exempt from the tax, provided that the servant should dwell in it simply for purposes of protection. But that gave rise to the question whether the words "a person" must be strictly defined to be a single individual, or whether a more liberal interpretation ought not to be given to them. We have referred the question to counsel very learned in the law, and they have advised us that "a person" may mean a married man, and he can hardly be said to be a married man in the proper sense of the word, unless his wife is living with him, therefore the wife must also be included under the term "a person." But if you include the wife, it is said young children cannot possibly be separated from their mother, and therefore a man, his wife, and all his little children must be included under the definition of "a person." But then a further question was put to the counsel learned in the law—"Suppose a man and his wife had grown-up daughters, ought they to be removed from the care of their mother?" The answer was—"Certainly not." So that, in point of fact, there came to be included in the definition of "a person" a whole family. That gave rise to a good deal of squabbling; but a still larger question arose, and that was whether, in the terms of the Act—counting-houses, warehouses, and shops—offices should be included. As they are excluded, many Gentlemen of influence in this House and in the City felt it to be a great hardship that they should be exempted from the privilege; and the result is that after having looked into the question we see no remedy for it except by extending the Act to offices, and fixing certain limits with respect to the value of the occupation. I shall, therefore, I hope to my hon. Friend's satisfaction, propose a clause to this effect—that where any tenement is occupied for the sole purpose of trade or business, and is inhabited by a servant or other person employed by the occupier, for the protection or care of such tenement, but is not otherwise inhabited as a dwelling-house, it shall be exempt from the duty as an inhabited house, on condition that the value of the part inhabited does not exceed a rent of £20 per year. The effect of that change, which can hardly in fairness be denied, will cost the public £50,000 a-year.

The next subject I have to call the attention of the Committee to is that which is said to be the exclusive beverage of 100,000,000 of the human race—coffee. Coffee has great claims upon our attention. It is a stimulant, and to a certain extent may be regarded as a rival, though, I fear, not a very successful rival, of more injurious stimulants—the growing prevalence of the adoption of which I so much dislike, and to which even the enormous amount of the spirit Revenue, I assure the Committee, by no means reconciles me. The Committee will observe that the yield from the tax upon coffee and chicory last year was a decrease of £46,000, and the history of coffee during the last 30 years has been a most melancholy one. In the year 1840 the consumption of coffee was 1.08 lb per head; in 1855, when it reached its most palmy state, it was something like 1.3 lb per head; but in 1869, so far from sharing the general prosperity of the country, it had actually fallen off to 94 of a pound per head. In 1871 it recovered a little and was 1.3lb. In the meantime the consumption of some other articles had risen enormously. The consumption of tea, for instance, had risen nearly four-fold. The consumption of tea and coffee in 1840 was almost the same—namely, exceeding slightly 1 lb per head of the community; but now the consumption of the latter article is nearly 4 lb per head. There are many other reasons why coffee should be dealt with tenderly. It is not an article which can be used at once, it requires to go through a certain manufacturing process; it requires roasting, which is a separate trade in itself, which makes it less able to bear financial treatment. Then, sugar is said to be more of a necessity with coffee than with tea, because being bitter, it requires a larger quantity of sugar to sweeten it. Of course, there is a difficulty in mating it, which I am afraid our people, who are the worst cooks in the world, will never surmount. There is, indeed, altogether a good case for coffee, and if we wanted a special reason for dealing tenderly with it, we have only to remember the itinerant vendors of coffee whom we meet in the streets early in the morning. The duty on coffee is at present 50 per cent on its value. The value of 1 lb of raw coffee is 6d. and the duty 3d., and this must be allowed to be a very severe duty when we consider how other articles have been dealt with. Under that duty, coffee has yielded £368,000 a-year. Chicory, which is sometimes its handmaid and sometimes its rival, yields £127,000, making a total of £495,000. The two articles should be dealt with in the same way, and I propose that we should employ part of our surplus in reducing the duty upon them by one-half. The duty on raw coffee at present is 28s. per cwt; I propose it should in future be 14s. The duty on chicory is 26s. 6d. per cwt; I propose to reduce it to 13s. 3d. The Excise duty on chicory is 24s. 3d.; I propose to reduce it to 12s. 1d. The loss on account of this reduction will be £230,000. Now, there is another item in which I hope we shall be able to give some relief to the taxpayer. The Committee is no doubt aware that in 1863 my right hon. Friend, who was then Chancellor of the Exchequer (Mr. Gladstone), introduced a new principle into the Income Tax—that is, he introduced the principle that below a certain figure—namely, £200, there should be a certain reduction. The Committee is aware that upon incomes under £100 no person pays income tax, and that upon incomes between £100 and £200 a person who is called upon to pay the tax has the privilege of deducting £60 on which no tax is charged, this being done by way of alleviating the pressure of the impost on the poorer class of income tax payers. It seems to me that the principle which was then introduced by my right hon. Friend is an exceedingly sound one. It has nothing to do, in my opinion, with any attempt to graduate the income tax, which might be said against it unless it were carefully examined; but it is founded on this very sensible principle—that it is desirable that men should pay taxes, that in order to pay taxes they must live, and that in order that they may live some portion of their income should be saved from the hands of the tax gatherer. It is also desirable on the ground that there is no class of the community who are so severely pinched by taxation as the lower class of income tax payers. Everything seems to hit them. They pay income tax, they pay house tax, and their principal consumption is the consumption of articles on which taxes are and still will be retained. Their tea, their coffee, their sugar, their spirits, their beer, all contribute to the taxes, and then they are heavily amerced in taxation in the shape of local rates. I do not think that any class pay so much as the poorer part of the income tax payers. I must say, also, that I have been really shocked by the letters which I have received from persons in the position of gentlemen, making piteous appeals to me from time to time to give them time, or to excuse them, because they really knew not where to lay their hands on the money they were called upon to pay. Of course, one must learn to be hardened against such appeals when one cannot tell whether there is any real cause for them, and whether they may possibly arise from extravagance or improvidence. But here is a class of persons who seem to have been singled out for taxation more than any other, and I think the Committee will act wisely, especially if they wish to retain the present system of taxation, in not turning a deaf ear to such complaints. I, therefore—founding myself on the principle laid down by my right hon. Friend that there should be a certain point in the income tax at which you may presume a man's means to be so circumscribed that it is only fair to allow him a certain portion of his income from which no tax shall be taken—propose to extend the limit at which such abatement is allowed, and to extend the amount of the abatement—in other words, what I venture to propose to the Committee is, that we should extend the limits from incomes of £200 to incomes of £300 a-year; and, considering how much dearer the cost of living has become, or, at any rate, how much the value of money has diminished, I propose to extend the amount of the abatement from £60 to £80. The persons who are now affected by the relief which exists are 273,000 in number; the additional persons who will be affected by the proposed extension are 167,000 in number, making the total number of persons relieved 440,000. The loss to the Revenue will be £310,000.

And now I will proceed to the last proposal that I have to make to the Committee, and I will not waste many words upon it, because no doubt the Committee has anticipated it. You are aware that last year I was most unwillingly compelled, having no other resource left to raise the Supplies for the year, to propose an increase of the income tax. We told the House at that time that the expenditure which we asked for was for a temporary purpose. That temporary emergency has, I am happy to say, passed away, and the Committee will gather from the statement which I have made that it is our will, as I am sure it will be theirs, to undo what we did last year, and remit the 2d. The sum sacrificed by this arrangement will amount to £2,720,000.

I should here state that I think the course we have taken—I have abstained from offering any excuse or justification of it previously—in bringing on the Estimates during the last week of the financial year is justified by the nature of our remissions, because an immense deal of trouble is always occasioned by changes of the income tax to those persons who have to deduct that tax. The income tax ceases to exist on the 5th of April, and trustees, bankers, and others, are placed in difficulty and uncertainty as to what they should deduct; and it will be a great advantage, therefore, if before the dropping of the income tax we can secure a Resolution sanctioning the proposal which I have made. I hope, therefore, to take the Resolution tonight. The Report we propose to take on Thursday, the 4th of April; and if the House is pleased to agree to it on that day, it will be in time to obviate the inconvenience I have mentioned.

I have now only to state how the account will stand with the rectifications which I have proposed. Of course, the expenditure will remain the same. The Customs will be£20,080,000; the Excise, £23,310,000: Stamps,£9,700,000; Taxes, £2,300,000; Income Tax, £6,940,000; Post Office, £4,770,000; Telegraphs, £850,000; Crown Lands, £375,000; Miscellaneous, £3,300,000; making altogether, £71,625,000. Deducting from that the amount of the expenditure, namely—£71,313,000, there remains a surplus of income over expenditure of £312,000; and I think that, considering the circumstances of the country at this moment, that will not be thought an exorbitant sum to retain.

It now only remains for me to place in your hands, Sir, the 1st Resolution, which is the one relating to the Income Tax; and I hope the Committee will permit the other Resolutions to be passed through to-night, as they are all in the shape of reductions. The right hon. Gentleman then moved the Resolution relating to the Income Tax in accordance with his proposals.

Motion made, and Question proposed, That, towards raising the Supply granted to Her Majesty, there shall be charged, collected, and paid for one year, commencing on the sixth day of April, one thousand eight hundred and seventy-two, for and in respect of all Property, Profits, and Gains mentioned or described as chargeable in the Act passed in the sixteenth and seventeenth years of Her Majesty's reign, chapter thirty-four, for granting to Her Majesty Duties on Profits arising from Property, Professions, Trades and Offices, the following Rates and Duties (that is to say):

• For every Twenty Shillings of the annual value or amount of all such Property, Profits, and Gains (except those chargeable 627 under Schedule (B) of the said Act), the Rate or Duty of Four Pence;
• And for and in respect of the occupation of Lands, Tenements, Hereditaments, and Heritages chargeable under Schedule (B) of the said Act,
• For every Twenty Shillings of the annual value thereof;
  • In England, the Rate or Duty of Two Pence; and
  • In Scotland and Ireland respectively, the Rate or Duty of One Penny Halfpenny;

Subject to the provisions contained in section three of the Act of twenty-sixth Victoria, chapter twenty-two, for the exemption of persons whose whole Income from every source is under One Hundred Pounds a-year.

MR. WHITE

said, that while he acknowledged the Parliamentary necessity and the fiscal convenience on that occasion of departing from their usual method of having actual results before them, still he thought he might be permitted to say that such a mode of proceeding placed unofficial Members at a great disadvantage, and vitiated the comparison between that and preceding financial years. He might also remark that the data now in their hands were unusually deficient. They had the Civil Service Estimates only on Saturday last, and they did not know until the Chancellor of the Exchequer addressed them what would be the amount of the Vote for the Abolition of Purchase. Neither had he gathered from the right hon. Gentleman's Statement what would be the cost of those Army Depôt centres for the establishment of which a Bill was to be brought in by the Secretary of State for War. Supplementary Estimates—although, with all deference to the Chancellor of the Exchequer, he (Mr. White) thought they were bad things, and that they had of late far too many of them—were still perhaps much better than the rectificatory Budgets familiar to their neighbours on the other side of the Channel. He need not say that the right hon. Gentleman had adopted an apologetic tone as to the wide difference there was between the out-turn of the Revenue and his original Estimate; but certainly last year the right hon. Gentleman had anticipated every element of ill-luck which could beset a Government, except reckoning that very opulent people would obstinately refuse to die, whereby the Revenue would be deprived of its fair amount of legacy and succession duties. Indeed, from the Chancellor of the Exchequer's Estimate for last year, it might have been thought that the Revenue was wholly destitute of elasticity, and that his Budget had been designed to earn the largest possible amount of unpopularity for the Government. Now, however, the right hon. Gentleman had submitted to them a Budget with far more agreeable features. Yet it was not, he confessed, the kind of Budget that he could wish; and he did not accept with overflowing joy and gushing gratitude the remission of 2d. of income tax, which additional 2d. was unnecessarily imposed last year. Even with regard to coffee and chicory, he could not but think it would be better to take the entire duty off those articles instead of only one-half, more especially as the machinery and the cost of collection would be the same whether the duty on coffee was reduced or continued at its present rate. They had a right to complain that the right hon. Gentleman, in framing his Estimates of Revenue last year—a year of peace—framed them at about £1,000,000 less than their amount in a time of war. He would read to the Committee, from the right hon. Gentleman's Budget speech last year, an extract which appeared to him almost a specimen of ludicrous lugubriousness. The Chancellor of the Exchequer said— I am sorry to say that in turning my back on the past, I turn my back also on prosperity, for the prospects of the year before us by no means correspond with the results of its predecessor."—[3 Hansard, ccv. 1400.] The right hon. Gentleman told them he did not accept the responsibility for the Estimates he submitted, or at least that he was quite content to entirely rely on the eminent gentlemen who furnished him with the Estimates he had just presented. He wished, however, that the right hon. Gentleman would consent to think for himself. The right hon. Gentleman had previously devoted his great talents to investigating for himself such subjects as national education, and other matters of public importance; but, unfortunately, in his present position he was content to rely wholly on the judgment of others, and not to exercise on his financial policy that sagacity and intellectual independence which on other questions so eminently distinguished him; otherwise he could not have been so grievously wrong in his Estimates for the last three years. Last year the right hon. Gentleman estimated the following items of decrease:—£91,000 on Customs, £368,000 on Excise, £257,000 on Stamps, £395,000 on Taxes, £100,000 on Post Office, and £10,000 on Crown Lands. These items together made a total decrease of £1,121,000 for 1871–2 as compared with the year preceding. Surely there was such a thing as faith in politics as well as in religion, as the right hon. Gentleman himself once said. That faith was the substance of things hoped for, the evidence of things not seen; and which that eminent political economist, the late Frederick Bastiat, in his works had so admirably illustrated. Last year, following the right hon. Gentleman, he told him that he had taken far too gloomy a view of the future, also pointing out that in 1870 the right hon. Gentleman had under-estimated by £2,000,000 his probable income, and that the result was he had a surplus of £2,311,220. Again, in. 1871, he (Mr. White) unhesitatingly affirmed that the right hon. Gentleman would have a surplus of at least £1,500,000, and the right hon. Gentleman had that evening told them that his surplus amounted to £2,200,000. On the same occasion, the hon. Member for the City of London (Mr. Crawford) also stated that the right hon. Gentleman had adopted too low a tone of our fiscal future; and that opinion was reiterated by every mercantile Member who spoke in that debate; all agreed that the right hon. Gentleman had greatly underestimated the probable out-turn of the Revenue for the then coming year. For himself, he was so staggered by the right hon. Gentleman's figures that he consulted many hon. Members connected with the agricultural, the commercial, the manufacturing, and the railway interests, and he did not find one of them who did not think that the Chancellor of the Exchequer was wrong in the calculation of his income. To give a practical application to that belief, four days after the Budget of last year was introduced, he himself moved in that House this Resolution— That, in the opinion of this House, the additional taxation proposed by Her Majesty's Government will entail burdens upon the people which are not justified by existing circumstances. The tale told by the Chancellor of the Exchequer that evening was the best possible proof that that Resolution was entirely justified, although but 232 voted for it and 259 against it. A few days later the hon. Member for Westminster (Mr. W. H. Smith) moved— That it is inexpedient that the income tax should be increased to the extent contemplated in the Financial proposals of Her Majesty's Government; when the Ayes were 250 and the Noes 335. Again, three days after that, came the hon. Member for Finsbury (Mr. W. M. Torrens) with his Motion, which he (Mr. White) seconded—namely, "That 5d. be inserted instead of 6d," on the Report of the Budget Resolution relating to the income tax, when 248 voted for that proposal and 294 against it. He went into those particulars, because he wished to impress on the right hon. Gentleman and the Government that it was absolute obstinacy on their part, if he might so say, which made them then refuse to hearken to any advice from friend or foe, and hardened their hearts against every favourable impression as to our financial future. A curious part of the matter was this. Although the Chancellor of the Exchequer took then so gloomy a view of the financial year 1871–2, he also said that no one contemplated the tremendous event—the Franco-German War—when his Estimates were made in 1870, yet he thence admitted that the finances of this country never gave stronger evidence of vitality, soundness, and elasticity than had been shown by what had happened since the War commenced, still the right hon. Gentleman persisted in inflicting the extra 2d. of the income tax on the country, although but a few days before he had remarked— If hon. Members had read all the correspondence that has been addressed to me, they would see that there is no tax borne with such impatience as is the income tax. It could not now be contested—what was then obvious to all competent authorities but the Chancellor of the Exchequer—that with the appropriation of a small amount of the redundant balances, the extra 2d. of income tax need not have been imposed last year. Of course, there was a certain class of people to whom it was a matter of indifference whether they paid 6d. or 4d. in the pound; but, as had been pointed out this morning by the leading journal, there was a large class of small tradesmen and annuitants whose whole lives were one continual struggle to make both ends meet, to whom the exaction of this unnecessary 2d. was a cruel, and, as it now turned out, an unnecessary infliction. Touching Exchequer balances, he would remark that on the 31st of March, 1870, the right hon. Gentleman the Chancellor of the Exchequer told the House that £8,606,000 was a larger Exchequer balance than they ought to wish to see, and on the 31st of March, 1871, the Exchequer balance was £7,023,435; but they were now informed that the estimated Exchequer balance on the 31st of March, 1872, would be £8,809,000, and therefore it was obvious that, with but a small deduction from the amount of this unexceptionally large balance, it would have been wholly unnecessary to impose the extra 2d. last year, especially when it was recollected that in 1864 the right hon. Gentleman the Prime Minister informed the House that £7,263,000 was an ample, if not an excessive, Exchequer balance. Under these circumstances, what confidence could the Committee have in the right hon. Gentleman's Estimates for 1872–3, seeing that, despite unexpected and untoward events, during his incumbency of office he had systematically overrated his probable deficiencies, and had underrated the probable increase to the extent of £2,143,000 per annum. Thus, in 1869–70 he had underestimated his Revenue by £1,919,000, in 1870–1 by £2,311,000, and in 1871–2 by £2,200,000, making a total underestimate for the three years of £6,530,000, or, as before stated, £2,143,000 per annum. In April, 1861, the right hon. Gentleman the Member for Buckinghamshire (Mr. Disraeli), in referring to an existing surplus of £1,000,000, said that that was a surplus which no Government ought to ask the House to provide over and above what was necessary to meet the expenditure of the country. He (Mr. White) agreed in that opinion. Although he had been taken to task last year by that right hon. Gentleman (Mr. Disraeli) for presuming to question the accuracy of the Chancellor of the Exchequer's Estimate of his deficit, he must be forgiven if he ventured to question the accuracy of the present Estimates, which, viewing them by the light of the Chancellor of the Exchequer's previous miscalculations, he thought were underrated by £1,000,000 at least. He did not believe in the infallibility and absolute wisdom of any Ministry, and he often ventured to question the correctness of official Estimates, and even the accuracy of Treasury figures. The right hon. Gentleman in the three preceding years appeared altogether to forget, or to ignore, the ordinary annual increment in the national Revenue, although occasionally he seemed to have a glimpse of the fact, he having in April last stated that the increased productiveness of the Revenue between the 31st of March, 1869, and the same date in 1871, upon a reduced system of taxation, was £6,000,000. In 1865, the First Minister of the Crown told the House that the balance of taxes repealed over taxes imposed showed, as nearly as the calculation could be made, that the average increase of the Revenue from the same sources was, in 1840 to 1852, £1,000,000; 1853 to 1859, £1,240,000; and 1859 to 1865, £1,780,000 per annum. Reckoning the same or equivalent fiscal resources, he (Mr. White) should estimate the average yearly growth or normal increment of the national income between 1865 and 1872 at quite £2,000,000 per annum. The average annual Revenue from 1840 to 1852 was £50,000,000; hence the yearly growth was at the rate of 2 per cent during that period. The average annual income from 1862 to 1872 was £71,370,000; hence the yearly growth of £2,000,000 per annum would amount to not quite 2¾ per cent during the last 11 years. Having regard to fiscal reductions and reforms, increased railway, postal, and telegraph facilities, and general social advancement, this rate of annual growth of our Revenue—namely, 2¾ per cent—was, after all, a comparatively slow rate of progress contrasted with our condition 20 or 30 years ago, when the normal increase of the national income was 2 per cent per annum. Indeed, it was a less rate of progress than had been made by Prussia, Austria, France, and Italy; and, therefore, it was not so very rapid a progress to boast of. For these reasons, he ventured to think that it was no unsafe calculation to count on the Revenue annually augmenting—barring unforeseen calamities—from its own proper and inherent vigour—that was to say, from the enterprize and industry of our people and the natural growth of wealth and population. He had gone into these details, because the leading journal of this morning had said— No prudent Chancellor of the Exchequer should be tempted to indulge in those sanguine views which Mr. White annually encourages. He begged to submit to the Committee that every Estimate he had made during the last three years, although largely in excess of that of the Chancellor of the Exchequer, had been below the actual yield of the Revenue. He had said, perhaps, too much; but it was because he knew there was a class of politicians who believed not only in their own infallibility, but were quite convinced of their own omniscience. Such men were sublimely confident of the absolute truth of every proposition they might advance, and also of the profound stupidity of all who ventured to differ from them. In conclusion, he must enter his humble but earnest protest against the magnitude of our expenditure, especially that for military purposes; for what we were then doing was, as had been frankly avowed by the Chancellor of the Exchequer last year, to virtually impose taxes in the nature of war taxes in a time of peace, and at a time, too, when, as the right hon. Gentleman had stated, we were not going to war, and there was no probability of our doing so. With regard to the figures which had been laid before the Committee by the right hon. Gentleman, he submitted that had not the right hon. Gentleman persisted in underrating the incoming Revenue, he might now have abolished the coffee and the chicory duty. Under all circumstances, however, the Budget was a better one than many persons out-of-doors had anticipated it would be. His belief was, that when the next Budget was laid before the House, the estimate he had formed of the Revenue for the ensuing year would be, as heretofore, shown to be more accurate than that of the right hon. Gentleman.

MR. F. S. POWELL

said, he wished to make a few remarks respecting omissions in the statement of the right hon. Gentleman. There was one tax which pressed with severity upon brewers, namely—the brewers' licence. Notwithstanding the admissions which had been made to the earnest solicitations of an influential deputation which had waited upon him, the right hon. Gentleman instead of recommending the total abolition of the tax, did not even mention it, and the representatives of an important branch of industry would experience deep disappointment at its omission. The impost pressed severely upon that branch of industry, and he hoped it would be remitted at an early period. He wished also to call attention to the hardship experienced by farmers in being charged duty for horses which, being virtually employed in husbandry, they used occasionally for riding to market, and other purposes incident to their vocation, though not strictly agricultural. At present only horses employed in husbandry, or brood mares, were exempt from duty. Another matter affecting farmers, in the North of England especially, had reference to the tax at present imposed upon the collie dog. If horses used in husbandry were exempt, he could not see any reason why this dog, used by sheep farmers, should continue to be liable to taxation. The loss to the Revenue by these remissions would be infinitesimal, and the vexation and annoyance caused by these charges were quite out of proportion to the fiscal results. He congratulated the Chancellor of the Exchequer on the sensible progress which was being made in the reduction of the National Debt; for though he would not continue any grievous tax or weigh down any branch of industry for the sake of such a reduction, it was satisfactory to observe some advance in that direction. The United States were making great strides in this respect, and were thereby increasing their resources.

MR. MONK

said, he must congratulate his right hon. Friend on the satisfactory nature of his Statement, and would thank him, on behalf of persons with incomes under £300 a-year for the great boon which he had conceded them ay the drawback of £80. That might not satisfy the objectors to Schedule D who lately waited upon him; but the reduction of the income tax by 2d. in the pound, coupled with, this abatement, encouraged a hope that further relief would be given in future years to the class charged under that schedule. The increase of £1,000,000 under Stamps, in lieu of the expected diminution of £180,000—partly owing to the reduction of the stamp on conveyances from 35s. to 10s.—was also very satisfactory; but his purpose in rising was to throw out a suggestion for the consideration of his right hon. Friend. He would, therefore, suggest to him a reduction of the ad valorem duty of 10s. per cent on the transfer of railway, bank, and other joint-stock shares. The duty on the transfer of real property was the same amount, but there was this difference-that such shares were constantly changing hands, and the heaviness of the duty had an immoral tendency, for it led to gambling transactions on the Stock Exchange—namely, to time bargains, and buying for the account. It also deterred persons from purchasing such shares who wished to invest for six months or a year, and induced them to purchase foreign bonds instead; he hardly imagined the Government could wish to encourage investments in foreign instead of in home securities, and there was no transfer duty in the case of Government stocks. He believed a reduction of the duty to 5s. or 2s. 6d. per cent would soon bring in as large an amount as at present.

MR. SCLATER-BOOTH

said, he could not allow the observations of the right hon. Gentleman, made at the commencement of his Statement, to pass unnoticed, with respect to Supplementary Estimates. Although the right hon. Gentleman estimated his surplus at little over £300,000, he gave the Committee to understand, with some complacency, that it would probably be his duty to propose later on in the year a Supplementary Estimate of £400,000, and that sum he proposed to meet by the growth of Revenue, of which he had taken no account in the Estimates of the present year. It was no doubt frequently necessary at the close of the Session to have Supplementary Estimates, to which no reasonable person could object. But the same remark would not apply to cases like the recent one, in which it was proposed to take Supplementary Estimates at the close of the financial year for services that either might or ought to have been foreseen at the time the Annual Statement was made; or, on the other hand, for services the commencement of which might very well be postponed. Having raised the question the other day, he thought the Committee would admit he had shown to demonstration that evidence existed at the Treasury to show that the Vote for the Stationery Office was probably underestimated; but he did not suppose the right hon. Gentleman was aware of it when he made his Financial Statement. The second point he had touched on was illustrated by this fact—it was proposed in the Supplementary Estimates laid on the Table of the House a fortnight ago, to take the sum of £20,000 for the payment of clerks in the Custom House by the month instead of by the quarter—a very proper alteration to make, and one he, for one, was glad to see proposed; but the system of monthly payments was not a new one, and a few months sooner or later would not have been a serious matter to the Custom House. That was a charge which ought not to have been the subject of Supplementary Estimates at all. Supplementary Estimates at the end of March were of an illusory character, in his opinion, for they amounted to little more than asking for a Vote in excess. He, however, did not wish to lay down the position that Supplementary Estimates should never be resorted to, for it often happened that they were absolutely necessary. The great part of the benefit of the arrangement with regard to the inhabited house duty would fall upon the metropolis; but he thought it would have been more advisable to extend, for the purpose of the duty, the meaning of inhabited houses to premises occupied by persons for business purposes, such as a company, or any number of persons, for the purpose of making profit.

MR. PEASE

said, he must congratulate the right hon. Gentleman on what he had done, but he wished to make a few remarks on what he had left undone. He thought the Committee and the country would have reason to be very well satisfied with the manner in which the surplus was proposed to be expended, as the reductions of taxation would benefit chiefly those by whom the pressure was most felt; but, at the same time, he was disappointed to find that the Army and Navy Estimates had been practically expended to the full; and he could not understand why the 20,000 additional men voted last year for the Army were still wanted. Last year the right hon. Gentleman at the head of Her Majesty's Government intimated that if there was an improvement in the condition of affairs in the course of the year, there would he a proportionate saving upon the Army and Navy Estimates, and it seemed to him (Mr. Pease) that there had been a material improvement in the condition of affairs since those Estimates were voted. He had never heard any satisfactory reason from the Government for those large Estimates, and he was afraid that it was only by perseveringly calling the attention of the Government to the subject that any reduction would be made in them. He had hoped that a large amount of the surplus, which everyone foresaw would have been applied to the remission of taxation, would be shared by two small items to which he called attention last year. One of them was the horse duty. The right hon. Gentleman at the head of the Government had called the horse "the farmer's steam engine," and he (Mr. Pease) believed it was, and that it would be a great boon if that duty, which amounted comparatively to a very small sum, were taken off. The other matter to which he alluded was the duty on dogs employed in sheep walks and for agricultural purposes. That duty was felt heavily by small freeholders and small tenant-farmers.

COLONEL BERESFORD

, considering the injurious consequences arising from the use of chicory, suggested that, with the view of preventing the adulteration of coffee, it would be better to make a larger reduction in the coffee duty and a less reduction in the chicory duty.

MR. CRAWFORD

said, he did not like the discussion to close, without expressing satisfaction on the part of those whom he represented, with the Financial Statement just made. He would not at present enter into a discussion of any particular points which had been noticed by some hon. Members; but he wished to thank the right hon. Gentleman very warmly for the course he had taken with regard to the duty on coffee. He could not quite agree with the observations made by the hon. and gallant Gentleman opposite (Colonel Beresford) as to chicory, which, at all events, was very harmless. His hon. and gallant Friend seemed to wish to remit the use of chicory to the pleasant uses of former times. Me pascunt oliyæ Me cichorea levesque malvæ. The more they reduced the price of coffee to the consumer, the less would be the inducement to any person to substitute chicory for coffee. He wished to know from the Chancellor of the Exchequer, with regard to the income tax, whether it was £60 or £80 which was to be deducted from an income of £300? [The CHANCELLOR of the EXCHEQUER: £80.] With regard to the relief granted to certain householders in respect of care-takers within their buildings, an hon. Friend of his had said that it was City people who would receive the principal part of the relief. But the reason of that was, because they were the principal sufferers. He would content himself, without making any further remarks, with offering his congratulations to the right hon. Gentleman.

MR. KINNAIRD

said, he must also congratulate the Chancellor of the Exchequer on a Budget which he was sure would be received by the House and the country with the greatest satisfaction. He was glad to find that the hon. Member (Mr. F. S. Powell), who had lately come from a severe contest in the West Riding, which was generally supposed to be the leading constituency of the kingdom, had reminded the right hon. Gentleman of some small grievances—such as the tax upon horses merely employed in taking the family to church on Sunday, and the tax upon shepherds' dogs. He rejoiced that the feeling on that subject in Scotland was extending over the Border. Such taxes were perfectly unworthy of a great country like this.

LORD JOHN MANNERS

said, his hon. Friend (Mr. Sclater-Booth) had called attention to the fact that the right hon. Gentleman seemed to have omitted from the estimated expenditure a sum of £400,000, which would probably have to be met by Supplementary Estimates.

THE CHANCELLOR OF THE EXCHEQUER

That is quite true. But, on the other hand, I have taken no credit for the corresponding increase on the other side, which will make up the deficiency, and more than make it up.

LORD JOHN MANNERS

There was another point. The right hon. Gentleman had told the Committee of various items of reduction of income in consequence of the proposals of the Budget; for instance, £50,000 on account of the remission in the house tax, £200,000 for coffee and chicory, and £320,000 in abatement of income tax. The right hon. Gentleman then added that he was going to strike off 2d. from the income tax; but he did not give any figures to show that he would be justified in doing so. The right hon. Gentleman stated that each 1d. of income tax yielded £1,600,000; therefore, by striking off 2d. there would be a loss of £3,200,000. [The CHANCELLOR of the EXCHEQUER: The loss on the present year will be £2,750,000.] But that might land us in a deficit. He hoped, now that the right hon. Gentleman's attention had been called to the matter, he would be able to show that there was a bonâ fide surplus.

MR. W. FOWLER

said, a year ago he stated that the Budget then was rather a melancholy one, being the fruit of unreasonable panic. A proof of the correctness of what he then advanced, was shown by the fact that in this Budget they had to pay £2,000,000 for 20,000 men they did not want. They were still suffering from the effects of that panic, and but for it they would now have a surplus of £5,000,000 instead of £3,000,000. What were 20,000 men in the face of the vast Armies at the other side of the water? If the speech of the noble Lord (Lord Henry Lennox) the other night had any truth in it, it was high time that this money should be spent, not on their Army, but on their Navy. Last year the Chancellor of the Exchequer told the Committee that it was extremely dangerous to make a couleur de rose Estimate. But if he understood rightly the figures of the right hon. Gentleman, he had taken substantially the results of the present year as the basis of his calculations for the year to come. He was not saying that was wrong. But if what the right hon. Gentleman was doing now was right, that which he did last year was wrong; for both plans could hardly be right, and if he was to take an average one year, he ought to do it another. With all deference to the Chancellor of the Exchequer, the plan he had adopted three years ago of collecting the income tax and the assessed taxes in one lump was still a cause of great inconvenience. There was a great waste of money in consequence of the large amount that was accumulated in the Bank of England in the first quarter of the year, producing no interest to the Government; while in the two last quarters of the year the Government had to borrow and pay interest. He found from the Bank Returns that the Government deposits had increased from January to March in 1870, £5,000,000; in 1871, £8,000,000; and in 1872, £9,000,000. He, therefore, apprehended that at this moment there was something like £4,000,000 or £5,000,000 in the hands of the Bank which the Government did not want, which were taken out of the pockets of the people, and were actually producing nothing. That he considered to be a very bad system of finance. It no doubt might be said there was a saving as regarded collection. So there was; but the interest of the money would more than cover the saving, especially when this point was taken into account—that everyone who borrowed in the money-market had to pay higher interest, because of the mass of money heaped up in the Bank of England. He wished again to refer to a tax to which he had referred once or twice before, which merited the serious attention of the Committee, and that was the passenger duty on railway companies. It was the custom of newspapers to sneer at the idea of taking any burden off railway companies, and juries always leant heavily upon them. But what did the Chancellor of the Exchequer do to them? He made them pay as carriers £500,000 a-year, and with regard to Imperial taxation to pay probate and legacy duty as personal estate, and local taxation as real estate. The local taxation of the railway companies in this country was enormous. Three years ago, he (Mr. Fowler) cited the case of the North-Eastern Company; he would now mention the case of the Great Western Company. The local taxation on that company last year was £75,000, equivalent to a tax of 13s. 4d. per cent on its share capital. Yet these very shareholders had to pay probate and legacy duty also. Their case was one of great hardship, and it must be remembered that many of them were possessed only of small incomes. Another class of persons at present aggrieved were inventors, who paid £180,000 a-year for stamps on patents. Now, they gave a patent to a man, not because they were going to give him a monopoly, but in order to encourage other men to make inventions; yet they taxed him at a time when he had not tested his invention, and did not know whether it would pay or not. One practical suggestion he would submit to the Chancellor of the Exchequer. In the case of a coupon payable on the 1st of July, if there was a change in the income tax in April, they had to calculate the amount of the tax for a quarter of a year on one scale, and for another quarter upon another scale. It would be better, he thought, that the coupon should bear the tax at the rate which was current when the coupon was payable. That change would save immense trouble to those who had to pay the tax; the Revenue would gain at one time, and at another time would lose; but on the whole no one would be injured. Regarding the Budget as a whole, the country would receive with great satisfaction the reduction in the income tax; but it was a taking-off of that which, in his opinion, ought never to have been put on. He regretted that much more could not be done in the way of remission; but it would be long before any large remissions of taxation could be made in the face of a military expenditure, the increase of which seemed to be boundless.

MR. BOWRING

said, that he did not rise merely to congratulate the Chancellor of the Exchequer on what he believed would prove to be a very popular and acceptable Budget—one as popular in the manufacturing county of Lancashire as in the agricultural county of Devonshire, with which he was connected. Whilst highly approving of it, however, he must express his regret that only one-half, instead of the whole, of the duty on coffee was to be remitted, as a further step to that "free breakfast table," the appeal for which had made a deep and lasting impression on the public mind. The only criticism he would offer upon the figures of receipt and expenditure submitted by the right hon. Gentleman for the year now about to expire, was that the actual returns for the yet unexpired week, and which were only estimated by him, might possibly considerably modify those figures. In the case of expenditure the right hon. Gentleman had himself last year reminded the House that Public Departments often made violent rushes upon the Exchequer at the extreme end of the financial year; and in the case of receipts an impression had got abroad that the tea duties might probably be reduced, thus inducing importers not to take their stocks out of bond, and diminishing the Customs receipts, until after the production of the Budget. He (Mr. Bowring) did not, moreover, rise to congratulate himself on the entire fulfilment of the prophecy which he ventured to make last year that his right hon. Friend had greatly under-estimated the probable receipts of the country during the year 1871–2, owing to its growing prosperity, the termination of the European war, and other circumstances. Prudence was doubtless a commendable virtue in a Chancellor of the Exchequer; but there was a point where prudence degenerated into timidity, and if the right hon. Gentleman had shown his accustomed boldness in matters of finance, he might have obtained all the money he required by means of a 5d. income tax, and the tax upon lucifers might have remained a profound secret to all except the powers below, whilst he might have equally refrained from asking for that increase to the succession duty which led so many people to inquire during the Recess who stood next in succession to the right hon. Gentleman as Chancellor of the Exchequer. But his special object in rising was to say a few words on the subject of the income tax, not on his own account, but on behalf of his constituents. He was sure that they would be grateful for the reduction of 2d. in that tax, and they would much appreciate the proposed further remission in the case of incomes under £300 a-year. But that would not meet all their complaints. He much regretted that the Government had last year opposed the Motion of the hon. Member for Macclesfield (Mr. Chadwick), made on behalf of the Associated Chambers of Commerce of the country, for a Committee of Inquiry into the incidence and mode of assessment of Schedule D of the income tax, and considering that that Motion was only defeated by a majority of 9, it would have been a graceful act on the part of the Government to have granted the Committee. Had they done so, a great deal of the ill-feeling which had lately been manifested against the tax throughout the country would not have arisen. Now, when he (Mr. Bowring) visited his constituents during November, he found the city of Exeter in a state of great excitement, owing to the surcharges under Schedule D, which had been made in all directions. It appeared that a new body of Commissioners had lately been elected, as well as new additional or secret Commissioners, whilst a new Surveyor had also been appointed, and the opinion was general that these surcharges were either the act of the Government Surveyor, or that the Government had themselves sent down special orders to raise the assessments all round so as to swell the Budget receipts, both of which impressions he did his best to remove. The result of the agitation was that a special Inspector was despatched to Exeter by the Board of Inland Revenue to investigate and report upon the matter, and the particulars thus obtained were so remarkable that he would venture to read them to the Committee. There were in Exeter 1,098 persons liable to be assessed under Schedule D. Of these persons 305—or nearly 30 per cent-made no return, and were legally liable to penalties. Of the remaining 793 only 222 made returns satisfactory to the Commissioners, and were assessed at£77,057; 571 made returns deemed unsatisfactory; so that 876 either made no returns, or were surcharged for making untrue returns. Of these persons 289 appealed, of whom only 45 fully established their cases; and 587 did not appeal, but submitted to the surcharges. The comment of the Inland Revenue on this state of things contained in a letter addressed by them to the Mayor of Exeter on the 9th of February was as follows:— These results appear to the Board to show conclusively that the assessments in Exeter have been generally made with due regard on the one hand to the requirements of the public service, and on the other to individual interests. Now, he (Mr. Bowring) ventured to submit that they showed the direct contrary, and disclosed a condition of matters which was intolerable, and which, if not redressed, would lead to an universal outcry, not for reform, not for reduction, but for the entire abolition of the tax. An association for that purpose had, indeed, been established in Exeter, and he had that evening presented a Petition signed by nearly 700 of the leading professional men, merchants, and traders of Exeter—including a clear majority of those liable to pay under Schedule D—practically representing the whole of the middle classes, irrespective of politics, praying for the absolute repeal of the income tax. In the meantime, constant distraints were being made upon the goods of those who refused to pay the surcharges, leading to scenes, some laughable, some discreditable, but all painful. Exeter was proud of the title of "ancient and loyal city," and loyalty was supposed to be best shown by a readiness to pay the Queen's taxes when demanded; but a continuance of these proceedings would, he feared, much diminish the loyalty of the citizens in that sense of the word. Lawyers complained to him of being surcharged and having to submit because they would not disclose their client's affairs. Struggling tradesmen who had over-assessed their own profits in order that competitors in trade—who might possibly be Income Tax Commissioners—might not know of their condition, were equally surcharged. Engine-drivers represented to him the hardship of having to pay the tax when their wages amounted to £2 a-week or upwards. But the strongest feeling which pervaded the community was a sense that a slur was cast upon their honour when the Commissioners in the majority of cases refused to accept the declarations made by income taxpayers as to their profits in business. He (Mr. Bowring) had lately accompanied two influential deputations to the Chancellor of the Exchequer on the subject; but although the right hon. Gentleman showed no want of courtesy, nor of that placidity of spirit on which he appeared to pride himself, the arguments addressed to him made no more impression than water on a duck's back. The right hon. Gentleman expressed a willingness last year to consider any suggestion for an improved assessment of the tax; but he knew from official experience that the fate of written suggestions was to be read, or partly read, by the subordinate, to be sent with an endorsement by him to the head of the Department, and after, or without, being read by him to be put in a pigeon-hole, a formal acknowledgment being sent to the letter. Suggestions offered in this House might have more effect. He would suggest, therefore, that the returns should be made less complicated, their complexity being one cause of so many incorrect returns, and one of his constituents recommended that they should be open to the inspection of any residents in the district. He should like proper consideration given to this plan, for the present system encouraged untruth and fraud. He thought, too, that the Government, if dissatisfied with a return, should require the person to make a declaration on oath, which should be conclusive. But he believed the proper solution would be to change the present system altogether, and, instead of making each individual give a return of his profits, to bear in mind the fact that on the average of the whole country, the house-rent paid by each person amounted to a certain proportion of his income—say one-fifth or one-sixth—and by a rough and ready calculation to assess his income as being, say, five or six times the amount of his house-rent. Under this plan, some might pay more and some less than they do at present; but at any rate the Exchequer would receive as much as under the existing system, and an end would be put to the present inquisitorial basis of assessment. On the other hand, if nothing were done, the present agitation was likely to spread, and result in a general demand for the entire abolition of the income tax.

MR. GREENE

said, he could see no reason for congratulating the Chancellor of the Exchequer on account of the surplus, or on account of what had emanated from it—namely, the remission of 2d. in the pound of the income tax, for it was unnecessarily imposed last year; and its remission was not due to the good management or foresight of the Government, but to the prosperity of the country. He did not blame them for putting their armaments in an efficient state—which could not be done without money; but he had to complain that some of their Members preached economy during a political exigency, and on coming into office found the country could not be governed without a large expenditure. They were no more entitled to congratulation than an accountant who found that a man of business had had a prosperous year. He regretted that the late Speaker—who once sacrificed his Whitsun holidays in order to prevent a duty on brood-mares, which would have discouraged breeders—was not still a Member of the House. Farmers were exposed to hardship in being saddled with the horse-dealer's licence by too liberal an interpretation of the law. The Chancellor of the Exchequer—who, unfortunately, was no horseman, nor, indeed, were any of his Colleagues—insisted, he believed, that a horse to be exempt from duty, must not have been ridden. A hunter, however, bred by a farmer was ulmost useless unless it was ridden with hounds. Every hon. Member of that House might be charged with the horse-dealer's duty for simply selling a horse; though instead of thus discouraging breeding, especially when they had to pay such a price for troopers, the Government ought to give a medal to everyone who embarked in that unprofitable business. A "bonâ fide traveller" had been defined, and horse-dealing should be so defined as to exclude the farmer who bred a horse, rode it to market, and sold it. He would next refer to the brewers' licence. In 1862 the Prime Minister, after a struggle with the growers, abolished the hop duty, and he declared that it would be most unjust to transfer the charge to the public brewers unless the private brewers paid it also. He accordingly proposed a licence for private brewers, but it met with so much opposition that he abandoned it. The right hon. Gentleman said he only required £300,000 as a substitute, including what he expected from private brewers; but he had got £380,000 entirely from the public brewers, though he expected only £290,000 from them. In order to gild the Bill, he pledged his authority as a financier that the brewers would be recouped by a lower price of hops, but the average price of English hops had been 20 per cent higher during the 10 years succeeding the abolition of the duty as compared with the seven previous years, and with the exception of the year 1860, foreign hops had also been dearer. In point of fact, the public brewers had been taxed during 10 years to the extent of £3,800,000; while they had paid more for their hops, and had had no return, the price of beer remaining stationary. He challenged any hon. Member to show why a similar impost should not be placed on the cotton-spinner, for they had been relieved of the cotton duty, and had been subjected to no equivalent. The brewers paid £7,000,000 annually on malt, and yet had to pay this licence duty. There might not be much sympathy for the large brewers, but there were a very great number of small men on whom the duty pressed very hardly. He had no desire to see the charge transferred to malt, as proposed by the deputation who had waited upon the right hon. Gentleman the Chancellor of the Exchequer; but the right hon. Gentleman's (Mr. Gladstone's) prophecy that hops would be cheaper in consequence of the abolition of the duty having proved fallacious, he contended that the impost ought to be remitted altogether. As to thanks being due to the Government, they had brought us into the greatest muddle ever known by their conduct with regard to the American Claims.

MR. VERNON HARCOURT

said, he would have joined in the congratulations offered to the Chancellor of the Exchequer for the taxes he had taken off; but, recollecting what had occurred, it appeared to him that the last two years of the financial campaign had been thoroughly wasted, and that they somewhat resembled the celebrated campaign when the King of Prance, with 20,000 men, "marched up the hill and then marched down again." They certainly were all glad to see the King of France march down again in reference to the income tax. He wished, however, to contrast the result of the last two financial years—namely, the present and the last—with the result of the first two financial years of the present Government. During the first two years there were large remissions of taxation, amounting to £8,000,000 in round numbers; but in the last two years the finances had been simply wasted in putting on an obnoxious tax and taking it off again, for he could not consider the wretched reduction of £230,000 on coffee and chicory, and the taking off £50,000 from the house duty, as matters material. He asked the Committee to consider what might have been the Budget in the present year if the Government had adhered to the principles on which they took office. In 1870 the estimated expenditure was £67,113,000, and in the present year the estimated expenditure was £71,311,000. They had been told that last year was a year of exceptional expenditure; but he for one did not believe it at the time, and the Budget now under notice proved the correctness of that belief; and, in his opinion, expenditure was never exceptional except in this sense—that when once it had risen it never went back. If the Chancellor of the Exchequer was at any time able to add to the expenditure, the increased amount became the starting point for a further increase—unless, indeed, a General Election should be held in the meantime, and it became expedient to raise the cry of "economy." If the rate of expenditure proposed in 1870 had been maintained, there would now have been a surplus of £7,500,000. There was, however, one little item of which the Committee had heard nothing, and he should, therefore, like to know what had become of the £3,500,000 to be expended on barracks. The eyes of the country could not be shut to the fact that £3,500,000 had been added to the public expenditure. He had always been willing to make allowance for an increase of expenditure on education; but, amid all the wanton extravagance which was now indulged in, that was the very matter on which all the money granted had not been spent. The hon. Member for Exeter (Mr. Bowring) spoke of the complaints made respecting the income tax. Within the last year or two the screw had been put on tighter, and he for one was glad of it, because the more the people of this country became conscious of the intolerable injustice and inequality of the income tax, the day would all the sooner come when they would refuse to pay the income tax in time of peace. He believed the lever which would apply the necessary force to secure economy was the discontent occasioned by the operation of the income tax. He joined with the hon. Member for Brighton (Mr. White), who had expressed regret that the Chancellor of the Exchequer did not consider himself personally responsible for the accuracy of the Estimates. When the Chancellor of the Exchequer said that if the Estimates proved wrong, it was, after all, the fault of the permanent servants of the Government, he called that a repudiation of responsibility, and in such case it appeared to him that, as far as the finances were concerned, the responsibility of Parliament was very nearly at an end.

MR. M'LAREN

wished to call the attention of the Chancellor of the Exchequer to a matter which he supposed had been left unnoticed by reason of its small-ness—he alluded to the tax levied on horses employed in agriculture. If these horses were used in agriculture only on the six days of the week they were exempt; but if they took the family to church on the seventh day, by some peculiar construction of the hon. Gentleman's own, they were liable to the tax of 10s. 6d. This was a subject which excited a good deal of discussion last year, and he had divided the House upon it two or three times. As to the Budget itself, he rejoiced at it on the whole; but he should have preferred that only a penny should be taken off the income tax, and a large remission of the taxation on those articles which were paid by the poor, such as the duties on tea and sugar; and he should have liked to see the duty on coffee knocked off altogether. As to the deduction from the income tax on incomes less than £300 a-year, he begged to call the right hon. Gentleman's attention to the fact that, in fixing the amount at £300 a-year, he included, in fact, nearly all the farmers in the kingdom; because the farmers were rated at an imaginary rate of income. The farmers who paid a rent of £600 were assessed upon an income of £300 to the income tax, and by the new rule of remitting £80 from their chargeable income they would be relieved from the payment of £1 6s. 8d., so that two small Highland cotters were made to pay nearly as much for taking their children to kirk in a cart as the gentleman farmer was relieved by the Budget of to-night. It was a harsh and cruel tax, and it was in evidence that in Scotland it prevented families from attending public worship. He entreated the right hon. Gentleman, either by a Treasury Order, or by a clause in the Bill, to take off an impost which could not bring in more than £5,000 or £10,000 a-year. Complaints were frequently made by hon. Gentlemen opposite that those who farmed the land were unduly taxed; but that he thought was not the fact. If they looked to what they paid during the French war, it would be found that Schedule B, instead of having increased had fallen off in amount, and that the farmers paid less then they paid 60 years ago. This remission, then, would benefit the whole class, while no other class as a whole would receive the same benefit. But this tax of 10s. 6d. fell entirely on the small class of farmers called crofters, and was out of all proportion to their income. He trusted the right hon. Gentleman would see his way to repealing this oppressive impost.

MR. SCOURFIELD

said, he could not agree with the hon. and learned Member (Mr. V. Harcourt) in lamenting the absence of any great financial achievement from the present Budget. For himself, he was not ashamed to confess that he preferred something ordinary, common-place, and level to the capacity of every-day mortals, and he was therefore glad the Chancellor of the Exchequer had condescended to be common-place. The only piece of sensationalism that he could detect was the remission of houses tenanted by "caretakers," which had been conceded to the eloquence of the hon. Member for the City of London (Mr. Crawford). The people of the City were not, however, as a rule, sentimental paupers, and he did not feel much sympathy with their claims. The only suggestion he had to make was of an administrative nature, and he warned the Government that if the finances of the country were in so prosperous a state, of the unpopularity they would incur if they enforced the income tax, now it was reduced, with undue severity. He also urged them not to indulge in unnecessary parsimony upon matters such as legal appointments and prosecutions, as evinced in the Public Prosecutors' Bill.

MR. MACFIE

said, he would beg leave to remind the House that in the Session before last it passed a Motion, which he had seconded and the Chancellor of the Exchequer had amended, declaring that, in the opinion of the House, it was expedient that the National Debt should be substantially and gradually reduced. He now begged to record his opinion that such reductions as had been described by the Chancellor of the Exchequer could not be characterized as substantial. The Americans had put us to shame in this matter; for after their Civil War they set to work in earnest to reduce their Debt, while we had shown nothing but feebleness of purpose. When could there be so good a time to reduce the Debt as when the country and its Revenue were so remarkably prosperous? What the people disliked was extravagance, jobbery, and superfluous establishments. They did not, however, object to pay off the Debt, and they wished to see a greater effort made to reduce it. He (Mr. Macfie) was glad the Chancellor of the Exchequer had introduced the phrase "capital account" into his Statement, and was distinguishing in national affairs, as men did in business, between expenditure on capital and expenditure on Revenue account. He did not share the dislike which some hon. Members had expressed to the income tax, nor their gratification at its reduction. On the contrary, he was of opinion that an income tax of 6d. in the pound all round would be a very reasonable tax. The right hon. Gentleman also was to be commended for the vigour with which he had caused the income tax to be levied this year; because it had afforded ample proof of the laxity that had heretofore existed, and it was the duty of the Government to rigorously enforce equitable returns of the amount chargeable with income tax. The way to do that with the least objection would be to have a ballot for one out of every 50 of the income tax payers of a district, and then to call upon the ballottees to subject their ledgers to an accountant resident in their own neighbourhood or in London for inspection. Secresy would thereby be preserved, and the gross amount of the income tax increased by 10 to 15 percent. He further thought it was unjust that the commercial community should still be burdened with bonds and debenture stamps. With his large surplus also the Chancellor of the Exchequer might have solved the patent law question by providing a public fund, say £100,000, or £120,000, for the reward of deserving inventors. The sugar trade also was suffering great injustice from the Convention contracted a few years ago, and he hoped negotiations would be entered into with foreign Governments to remove the injustice; indeed, he was quite surprised that the Chancellor of the Exchequer had in his Statement taken no notice of the question. As part of our Debt had been incurred in acquiring and retaining the colonies, and as part of our expenditure was involved in their defence, let us recognize them in a constituent Assembly of the whole Empire, and then the colonists would gladly bear, as they were well able to do, some small part of the £10,000,000 or £12,000,000 of the Imperial expenditure, which might fairly be reckoned as appertaining to them.

MR. GORDON

said, he rose for the purpose of expressing his concurrence in the views stated by the hon. Member for Edinburgh with reference to the very obnoxious tax imposed by the Chancellor of the Exchequer on those small farmers who, having used their horses and carts for agricultural purposes, used them for taking their wives and families to church on Sundays. This had caused very great dissatisfaction in Scotland, and particularly in the Highland districts, where the distances they had to travel to church were very great. He felt so strongly upon this point that in 1870 he placed a Notice of Motion on the Paper calling the attention of the Chancellor of the Exchequer to the matter. In the meantime the right hon. Gentleman gave an answer to a Question put by the hon. Member for Derby (Mr. Bass), which was considered quite satisfactory, as reported in the usual channels of information. He (Mr. Gordon) happened to be out of town when that answer was given; but the hon. Member for Derby assured him that it was quite sufficient and satisfactory. In consequence of that he did not proceed with his Motion. But when he found last year that the matter was proceeded with, and attempts made to exact the tax, he then called the attention of the House to the matter on a Friday—when he had no right of reply—and the answer he received when he quoted the promise of the preceding year from Hansard, was, that the Chancellor of the Exchequer was incorrectly reported. He could not help thinking that the right hon. Gentleman's memory was at fault, for, after that statement was made he (Mr. Gordon) had an opportunity of testing it. He looked through the usual sources of information both in England and in Scotland, and found that the reports of the Chancellor of the Exchequer's statement were entirely in accordance with that in Hansard. As the answer of the Chancellor of the Exchequer was not satisfactory last year, he stated that he should put the Motion on the Paper as an Amendment to a Revenue Bill then before the House. Unfortunately, owing to circumstances beyond his control—the illness of a member of his family—he was unable to wait until the Bill was brought forward. It was not brought forward until the 4th August, and on the first division only a majority of 4 was unfavourable to the exemption from the tax. Another division took place on 15th August, and the majority dwindled down to 1; and a strong opinion was given by the Chairman, Mr. Dodson, with reference to the matter. They could not criticize the conduct of the right hon. Gentleman in pressing the matter too strongly, and he thought that it fell very little short of obstinacy on his part. A third division was taken on the 16th August, and it resulted in a majority of 16 for Government in a House of 79. The exemption was not a new one. It was authorized by a former Act—16 & 17 Vict.; but the exemption was missed out of one of the Revenue Bills introduced by the Chancellor of the Exchequer, and therefore it was that the endeavour was made by the Chancellor of the Exchequer to enforce the tax. It brought in but a miserable sum to the Exchequer, and the Committee were not to calculate the evil by the amount exacted merely, but should take into account the misery caused by the withdrawal of the right of which these poor people had been deprived, for they valued very highly indeed the privilege of going to church on Sunday. Rather than forego a tax of £1 they were obliged to give up going to church. This was a serious matter, and after the general expression of opinion on both sides of the House, it appeared to him that this was not a tax which should be retained; and he hoped the Chancellor of the Exchequer would give them an assurance that he would introduce into any Bill which he might bring forward in connection with the Revenue a clause which should recognize this exemption. He believed that the withdrawal of this exemption had arisen from the right hon. Gentleman's objections to any exemptions from taxation. Yet the right hon. Gentleman had been compelled to make a number of exemptions, not by the will of the House, but by his own will. He (Mr. Gordon) thought it desirable that the right hon. Gentleman should make known what these were for the guidance of the parties interested. [The CHANCELLOR of the EXCHEQUER: I know of none.] He had made an exemption in regard to horses which were occasionally used on hire for agricultural purposes. It might have been made by the officers of his department without his knowledge.

MR. MUNTZ

said, he did not see how the Chancellor of the Exchequer was liable for the increase of the taxation of the country, for he was simply placed in the unenviable position of having to find the money that was voted by the House, and all he had to do was to say how the money so voted was to be raised. There wore plenty of taxes that he was sure the right hon. Gentleman would be delighted to take off, and if he did not do so the fault was upon the House and those hon. Members who voted away the money, and did not like to pay it. It was especially the fault of those elastic politicians who came into the House with economy on their lips whilst their hearts were far from it. The right hon. Gentleman had mentioned that hon. Members below the gangway had opposed Votes on Account. That was quite true; but they did so, not on the ground that Votes on Account wore unnecessary—for, indeed, it was generally admitted that they were absolutely indispensable, but because they were taken one after another until the actual Estimates drifted into July and August. The Chancellor of the Exchequer had asked the Committee to look at the Army and Navy Estimates for 1858; but why did he select that year, for it should be borne in mind that in that year the Estimates had been raised in consquence of the Crimean War? They had increased from 1854 to 1858 some £5,000,000 a-year; and if they took that as a precedent, and now increased the amount in time of peace £2,000,000 or £3,000,000, the gross amount would never be decreased. Now, it was a well-known fact that if an Estimate was once raised, it hardly ever went down again to a lower figure. It resembled a machine with a cogwheel—there was always a catch to prevent its going back. If the right hon. Gentleman wanted economy, let him refer to the time when the Duke of Wellington was Prime Minister. In 1835 the Votes for the Army and Navy amounted together to £11,000,000, whereas this year they were something like £30,000,000. It was this constantly increasing expenditure which the hon. Members below the gangway wished to check. After three years of wondrous promises the country was now landed in an Estimate of £72,000,000 annually drawn up by the very Gentlemen who had declared that the £70,000,000 in the Budget of the right hon. Gentleman opposite (Mr. Disraeli) was unstates-manlike, uncalled-for, and wasteful. He thanked the right hon. Gentleman the Chancellor of Exchequer for the allowance he had made to persons who paid income tax on less than £300 a-year, for he (Mr. Muntz) thought the tax was specially hard upon those who had small incomes, such as £130 or £150 a-year. When a clerk or shopkeeper with a small income was suddenly called upon to pay £4 or £4 10s., it was frequently impossible for him to raise the money, and the result was a number of abject applications for relief from the tax, and borrowing from the usurer. There was another matter which had brought great unpopularity upon the Government, and it was this—in country places the collectors were also assessors of the income tax, and they frequently assessed persons without having any real knowledge of their incomes, and the result was that persons were often overcharged—men with £100 a-year being assessed at £200, and so on. They first of all sent a paper to the taxpayer; and if, from ignorance, he did not return it, he received a notice that he was assessed, but that he might appeal against the assessment on a given day. When he had stated his case to the Commissioners, which he often did through nervousness in a very clumsy way, the assessor would say—"Oh, it's all nonsense, he has got the money," whereupon, without further ado, the poor man was ordered to pay it. ["No, no!"] He himself knew of cases were men who earned only £1 10s. a-week had been made to pay on £100 a-year.

THE CHANCELLOR OF THE EXCHEQUER

said, the assessors were not the servants of the Government.

MR. MUNTZ

was aware of that fact; but he wished they were, because then they would be looked after better. He hoped the right hon. Gentleman would take the matter in hand, for he would, no doubt, be able to ameliorate it. While expressing his satisfaction at 2d. being taken off the income tax, he could not refrain from stating his opinion that it ought never to have been put on. With regard to coffee, if the people of this country really knew what coffee was, they would drink ten times more coffee than they did tea. The most miserable stuff was vended under the name of coffee, and if the tax on coffee was reduced still further, coffee would not be drunk much more extensively until the people knew how to make it. For his own part he should like to see many taxes abolished, including the malt tax. It was a tax from which the State received about £5,550,000, while it cost the taxpayers about double that amount. When the present Prime Minister was Chancellor of the Exchequer they spent £62,000,000 a-year, whereas they were now spending £72,000,000. It would not only be possible, but it would not be difficult to get rid of this additional £10,000,000; and, at all events, there was no reason why the Estimates should notbereduced£5,000,000 or £6,000,000. If the Government wished to become popular, they would take this matter in hand, and reduce the taxes which pressed so heavily upon the people.

MR. C. S. READ

joined in the appeal which had been made by the hon. Member for Edinburgh (Mr. M'Laren) and the right hon. and learned Member for the University of Glasgow (Mr. Gordon), as to the tax not being levied in respect of agricultural horses which were employed in Scotland in conveying the families of farmers to church on Sunday. But he could not join with the hon. Member for Edinburgh when he said that the farmer who paid upon half his rent did not pay full income tax. In his (Mr. Bead's) opinion the farmers paid their full share of income tax, and so far as the years 1868, 1869, and 1870 were concerned, if the farmers had been assessed upon their profits they would have paid no income tax at all. If the Chancellor of the Exchequer would only guarantee him for the next 10 years half the amount of his rent for profit, he should be very glad to pay double income tax. He was pleased that a deduction of £80 was to be allowed in respect of paying income tax from incomes under £300 a-year, which would, of course, extend to Schedule B. The right hon. and learned Member for the University of Glasgow he thought, however, was not quite correct in what he said as to agricultural horses which were employed in other work being exempt from duty, for the exemption only applied to horses employed in carting materials for the repair of the parish roads. The Chancellor of the Exchequer had made an important concession in the case of houses or offices left at night in the care of hired individuals; he wished that the right hon. Gentleman would extend the same leniency to cases in which farmers had two farms, and were obliged to leave one of the farm houses in care of a farm servant. He also wished to call attention to the heavy tax upon agricultural leases and agreements. That tax was so heavy that all kinds of expedients were resorted to in order to evade it. If the impost were reduced to a more moderate amount he believed it would be universally and cheerfully paid. The Chancellor of the Exchequer had referred to the large revenues arising from the duties on wine, notwithstanding all the reduction that had been made in that duty. But why did not the right hon. Gentleman apply the same principle to malt? The present duty had the effect of inducing people to drink gin instead of good beer, for the malt tax produced £300,000 less than last year, while the duty on English gin had increased £1,000,000 sterling.

MR. GRIEVE

joined with most hon. Members in thanking the right hon. Gentleman for the Budget which he had placed before the Committee. Its shortness and simplicity were its great charms. The reduction of the income tax was inevitable, and he (Mr. Grieve) could have wished the entire duty on coffee had been swept away, as a step towards a free breakfast table. Had the right hon. Gentleman the Member for Birmingham (Mr. Bright) been able to take an active part in public affairs, the question of the abolition of the sugar duties would have received a larger amount of attention. The refining interest was by no means an unimportant one, for there were no less than 64 refineries in the United Kingdom, employing in round numbers 30,000 persons. A statement had been attributed to the right hon. Gentleman the Chancellor of the Exchequer that he did not care what became of particular industries, as long as commodities were made cheap for the multitude; but it ought to be the duty of a paternal Government to secure fair play for an interest of this magnitude. [The CHANCELLOR of the EXCHEQUER: Ours is not a paternal Government.] He hoped the right hon. Gentleman would, at all events, see the propriety of reconsidering the question, and would respectfully ask him if he would be good enough to inform the House whether he would accede to the request of the sugar refiners of London, Greenock, Liverpool, Bristol, Plymouth, and Manchester, and invite the Governments of France, Holland, and Belgium to a Conference in order to a revision of the International Convention of 1864, these Governments having signified their willingness to meet if asked by Great Britain. The refining interest wanted no protection, but they wanted fair play, and in view of this, and to do away with all bounties, our own Government, France, Holland, and Belgium entered into a Convention, which served the purpose for which it was intended for some years; but the unfortunate position of France, arising out of the dreadful war, compelled her to resort to high duties, and while the duty on sugar went up five times higher than in this country, it rendered the drawback quite unequal. The refineries of this country, alive to their own interests, sent a deputation to France, Holland, and Belgium, and represented the unfair working of the Convention, and they all agreed to a revision of the Convention if Great Britain would ask them to a Conference. This was the more readily agreed to, as the difference of drawback was going into the pocket of the refiners of France, and not to the Government. He (Mr. Grieve) trusted that the right hon. Gentleman would yet consent to a Conference, or the refining industry of this country would be transferred to France, and such a monopoly would soon raise the price of sugar on the general consumer in this country. It had been said the right hon. Gentleman was afraid that, if he had a Conference on the Convention of 1864, this country would get a concession, and when the Cobden Treaty of 1860 came to be considered, we should have to concede something also. He trusted the right hon. Gentleman would see the unfairness of this. Before sitting down, he must join with the hon. Member for Edinburgh in denouncing in the strongest terms the duty on shepherds' dogs and on farm horses used in taking families great distances to church. He warned the Government that if they did not find some mode of getting quit of these taxes, they would peril the election of many Liberal Members for Scotland at the next General Election.

MR. HUNT

said, he did not think the Financial Statement of the right hon. Gentleman the Chancellor of the Exchequer called for any special observations from him. He, however, wished to refer to one or two matters alluded to by the right hon. Gentleman. The right hon. Gentleman had dwelt at considerable length on the necessity of having Supplementary Estimates. But on this point he was quite at variance with the right hon. Gentleman at the head of the Government, who had poured out innumerable homilies, and was never more severe upon any practice than that of bringing forward Supplementary Estimates. Apparently with the consent of the House, the right hon. Gentleman had insisted again and again that the practice of bringing forward Supplementary Estimates was a frittering away of the control of Parliament. Whether the right hon. Gentleman had been convinced by the arguments of his own Chancellor of the Exchequer, who, in his (Mr. Hunt's) opinion, had been trying to bring the right hon. Gentleman round to his own opinions, he did not know, but, apparently, they had such an effect upon him as to drive him away from the House. Both right hon. Gentlemen, as it seemed to him (Mr. Hunt), however, carried their conflicting doctrines doctrines too far; and the distinction by which it was attempted to reconcile those opposite doctrines as to the passing of a particular Act in 1866 was beside the question, for it was in 1867–8 that the right hon. Gentleman at the head of the Government declared himself with much severity against a Supplementary Estimate brought forward by his hon. Friend the Member for Hampshire and himself. The right hon. Gentleman the Chancellor of the Exchequer and his Secretary to the Treasury had latterly been the great offenders in this respect. Which of these might be responsible he did not know. According to the old rule, it used to be the Secretary to the Treasury; but in the present Government the right hon. Gentleman appeared to be both Chancellor of the Exchequer and Secretary to the Treasury rolled into one. However, that was a matter to be settled between themselves. The right hon. Gentleman now spoke with the greatest coolness of having a Supplementary Estimate of £400,000 still to bring forward, being the same amount as last year. In his (Mr. Hunt's) Parliamentary experience, however, that sum covered by a Supplementary Estimate had never been equalled. He accordingly gave the right hon. Gentleman fair notice that if it were brought forward in the shape suggested, he should be inclined to scrutinize the Estimate with great minuteness. There were occasions, no doubt, when Supplementary Estimates, to meet unforeseen contingencies, were perfectly justifiable, and could not be dispensed with—such, for instance, as the Thanksgiving Service at St. Paul's, or Supplementary Estimates necessitated by the legislation of the year which could not be foretold. But the Supplementary Estimates brought forward by the present Government to a large extent resulted from their own improvidence and recklessness. The right hon. Gentleman had defended himself from an anticipated attack of the hon. Member for Brighton (Mr. White), by saying that he had based his calculations on the data for the calculation of Revenue with which he was supplied by the heads of the responsible Departments—data which he did not like to alter. If the right hon. Gentleman really did take his figures as to Revenue from the hands of the responsible Departments, why did he not also take their estimates as to expenditure? When a subordinate department proposed to erect some building or to execute some work which, in the opinion of the Treasury, could be dispensed with, they had a perfect right to strike it out. But where the service was one over which the Treasury had no control, and the estimate of the subordinate Department was just, the Treasury was not acting within its functions in altering the figures or lowering the amount merely with a view of presenting a good appearance to Parliament. Last year a gentleman of great experience and ability sent in his estimate connected with the Stationery Vote. The Treasury had no possible control over that, but they chose to distrust the estimate, and to cut down the figures, haying afterwards, at the very end of the year, to bring in a Supplementary Vote to make good the amount. Something like the same thing happened as to the National Gallery. Purchases of land were being made, and the amounts were to be paid as the titles were made out, and the vendors were in a position to complete. But no money was actually provided by the Government, and the right hon. Gentleman had to come with a Supplementary Estimate for the purpose. For a state of things like that, which clearly ought to have been foreseen and provided for when the Estimates were originally placed before the House, the Government must be held responsible. The right hon. Gentleman plumed himself upon having produced a codification of the stamp laws. He (Mr. Hunt), however, recollected that he gave instructions to the Inland Revenue Office for a codification of the stamp laws, and when he heard the observations of the right hon. Gentleman he thus soliloquised—"Sic vos non vobis codificatis." At all events, he thought the right hon. Gentleman would have given him that small amount of credit. The right hon. Gentleman compared the balances at the Exchequer under the old system with the balance there was now, just after he had got in the income tax for the whole year, the assessed taxes for the whole year, and the land tax and the house duties; in other words, the right hon. Gentleman compared the balances under the old normal state of things with what he (Mr. Hunt) might call the factitious balance he happened to have in hand at this particular moment. It might so happen that if the right hon. Gentleman had compared his balance a few weeks ago with the corresponding period of the financial year in which he took office, he would have found it reduced by about £4,500,000 or £4,000,000. He thought the right hon. Gentleman's scheme, by which he had got in the whole of a great proportion of the taxes for the year, was contrary to sound principles. It had been the aim of Chancellors of the Exchequer for many years to endeavour to equalize our payments and our receipts in the several quarters, and that had been a work of difficulty and of time. That operation, he thought, was nearly completed by his right hon. Friend the Member for Buckinghamshire (Mr. Disraeli) in his last year of office as Chancellor of the Exchequer, when he made an alteration in the time of paying Terminable Annuities in order to equalize those payments. The result of the Chancellor of the Exchequer's scheme had been to reduce his balance in January to about £600,000, and he had been borrowing for three-quarters of a year in order to meet the charges on the Consolidated Fund. Now, the right hon. Gentleman told them he had a balance of about £9,000,000, on which not a farthing of interest was being paid. If we were to pay interest to the Bank for advances in consequence of the extraordinary financial operation of the right hon. Gentleman, he wished to know why we were not to receive interest from the Bank on so large a balance as they had now? [Mr. CRAWFORD: The Bank does not want the money.] If the Bank did not want it, there were plenty of people who did, and who would be exceedingly glad to pay interest for it. But as the Bank did not want the money, that was an additional argument in his (Mr. Hunt's) favour; because the right hon. Gentleman had been extracting money from the pockets of taxpayers who wanted it, and had been lodging it with those who did not want to have it. He confessed that he did not feel very great elation at having got rid of 2d. on income tax. He thought the gracious-ness with which the right hon. Gentleman had taken off the 2d. by no means compensated for his wantonness in having put it on. He wished to know how much would be lost if the 2d. on income tax were taken off? [The CHANCELLOR of the EXCHEQUER: £2,700,000.] Then he was at issue with the right hon. Gentleman as to the amount of his surplus, because if the figures given by the right hon. Gentleman were correct, he calculated that there would be a deficit of more than £2,000,000. The right hon. Gentleman had not told them whether he intended to re-impose the tea duty. Unless it was re-imposed, there would be a deficit of £2,300,000. Last year the right hon. Gentleman forgot to mention in his Financial Statement that the tea duty dropped that year, and it was not until the Customs and Excise Duties Bill was in Committee that the omission of the right hon. Gentleman to re-impose that duty was remedied. Would the same thing happen again this year? With reference to the expenditure on barracks, the right hon. Gentleman the Secretary of State for War, on the consideration of the Army Estimates, announced that it would be provided for by Terminable Annuities. If that was the case, he apprehended that there would he a Terminable Annuity payable during the present year. He should like to know how the right hon. Gentleman proposed to provide for the expenditure.

MR. ALDERMAN W. LAWRENCE

said, he was sure that it must be highly satisfactory to the country at large to learn that the surplus permitted the Chancellor of the Exchequer to remit the extra 2d. income tax which was imposed last year. He did not agree with those who thought that because there happened to be a surplus almost equal to the amount levied by that addition to the income tax, there was no necessity last year for additional taxation. A large portion of the surplus had arisen from the increase on the Excise, and he maintained that that increase would not have occurred if it had not been for the extraordinary rise in wages caused by the prosperity of the country. He rejoiced that the right hon. Gentleman had relaxed those principles which he announced on former occasions, when he held that no exemption ought to be permitted on any pretence whatever, and had fallen into the milder view that there should be a line below which the tax should not reach. He (Mr. Alderman Lawrence) thought it would be well to revert to the £150 a-year placed as the exemption when the tax was first proposed in 1842; and if that were done, and the £80 were deducted from incomes above £150 a-year and not exceeding £300 a-year, a great boon would be conferred. He hoped, therefore, that the Chancellor of the Exchequer would shift the bar from £100 to £150. In referring to the house tax, the hon. Member said that the right hon. Gentleman the Chancellor of the Exchequer had observed last year that it was impossible the tax could remain in the state it then was, so great were the anomalies in connection with it, and he had now proposed to make an alteration which was estimated to cause a loss to the Revenue of £50,000; but he (Mr. Alderman Lawrence) was not prepared to say that the proposition of the Chancellor of the Exchequer would meet the difficulty it was intended to remedy. There were no means of making the tax just, and equitable, and fair. It was the only tax which interfered with the manner of the construction of the article taxed. While they saw the castles and the mansions surrounded by conservatories and everything else conducive to the comfort and the luxury of those who resided in them, they at the same time saw that these mansions were assessed at only a nominal sum. He knew mansions which cost very large sums of money, and yet were assessed at only £60 or £70 a-year, while rooms occupied by the humbler classes were assessed at 9d. in the pound to their full value. In London, Edinburgh, Glasgow, Manchester, and other great cities, there was an enormous amount of house accommodation in the upper rooms of large buildings used for offices and warehouses; but the rooms were not occupied lest they should cause these large buildings to become liable to the house duty, and the tax had in that way also acted in a prejudicial manner to the working classes. The Chancellor of the Exchequer had in a small way diminished the pressure of the income tax; and he hoped that next year he would be prepared to say that the house tax should be a thing of the past. It was re-imposed in 1851, having been abolished in 1834, and he (Mr. Alderman Lawrence) hoped that it might be again abolished in 1873. With regard to the income tax, it seemed to be a fixed belief at Somerset House that nobody made a return in excess of his actual income; but the disclosures as to the public companies and other disastrous undertakings had shown that the tax was often paid in cases where there had been no profits, and small tradesmen and others were afraid of returning their incomes at the actual amount. He, therefore, deprecated unnecessary severity in the collection of the tax.

COLONEL BARTTELOT

thought that the worthy Alderman the Member for the City of London, having ridden his hobby so hard, ought to be satisfied with the Chancellor of the Exchequer's concession as to the house duty. The hon. Member for Leith (Mr. Macfie) had made a proposal the most extraordinary he had ever heard in this House—that £12,000,000 or £14,000,000 might be raised by taxing the colonies. Now, the Government had deprived the colonies of the military protection to which he believed they were entitled, and on what plea could they be asked to subscribe towards the maintenance of the mother country? He congratulated the Chancellor of the Exchequer on having given the House a plain common-sense Budget, for his last year's scheme was a disgrace to the common sense which usually prevailed in Parliament. It contained nothing, indeed, which commended it to the country. The succession and legacy duties were not acceptable, nor was the trans-Atlantic device of a match tax. The right hon. Gentleman, on the failure of these proposals, had thought it necessary to raise the income tax to 6d. The right hon. Gentleman had, moreover, stated at a meeting which he had attended that the House of Commons was in favour of the extra 2d. being added to the income tax. He denied that that statement was accurate, because he believed that no tax that had ever been proposed in that House had ever met with such general disapprobation both in and out of that House, and it was only because it was felt that the Ministry had already eaten so much dirt last year that the proposal for the imposition of the 2d. was accepted. In answer to a request that he (Colonel Barttelot) should attend the meeting to which he referred for the purpose of endeavouring to persuade the right hon. Gentleman to abrogate Schedule D of the income tax, he had expressed his conviction that as long as the tax existed all ought to pay their share under it. There could be no doubt that the income tax pressed very severely upon the lower and the lower middle classes of this country, and the right hon. Gentleman ought to do his best, as far as possible, to relieve those classes from its pressure and alleviate their burdens, which, chiefly owing to his screwing up the taxation to the highest possible pitch, had become almost intolerable during the last two or three years. He might suggest to the right hon. Gentleman that it would be of the greatest service to the small traders in the country towns in England if the income tax were to be collected twice instead of once a-year. He was, however, forced to admit that under this Schedule D, which was so grinding upon the ratepayers, there was more evasion than under any other schedule. Turning from that point, he was very glad that the right hon. Gentleman had not listened too much to the voice of the many charmers—of whom his hon. Friend on the right hon. Gentleman's right was one —the great brewers of this country, who had endeavoured to persuade him that the commuted licence duty upon hops ought to be taken off and placed upon malt. He regretted that the hon. Member for Derby was not in his place, because he would perhaps have been enabled to explain to the Committee how it was that he, the very prince of brewers, should have been found on the recent occasion advocating an extension of the malt duty, when he had always professed that he was in favour of the reduction of the tax. The conduct of the hon. Member would teach those who desired to see a reduction of the malt duty not to put their trust in princes. They had at one time believed in him as a great and a true man, but since then he had thrown them over. The right hon. Gentleman the Chancellor of the Exchequer had said that the malt duty had not come up to its usual amount, and what was the reason of its having fallen short? The reason was to be found in the enormous amount of the tax, which had resulted in a large quantity of barley being used for making beer without its paying the duty at all. The right hon. Gentleman doubtless looked pretty sharp after the brewers; but if he were to reduce the duty on malt, he would find that the aggregate Revenue from that source of taxation would not be less than it was at the present time, and he should be exceedingly glad if the right hon. Gentleman would take the subject into his consideration at a future time. He had made this statement to-night, because he had been asked by several influential people to bring the malt tax again under the notice of the House. To that request he had replied that he would consider the question, and having considered it, he had come to the conclusion that he should be acting a wise and a prudent part by abstaining from bringing the matter forward upon the present occasion, believing, as he did, in the present disposition of the House, the proposal to reduce or to abolish the tax would not meet with such support as would justify him in introducing the question. Under these circumstances he had determined not to stir in the matter at present; but he looked forward to the time when the right hon. Gentleman, having a superabundance of cash in his pocket, would be pleased to come down to the House and propose the reduction of this tax. He also wished to draw the attention of the right hon. Gentleman to the horse-dealers' licence duty paid by farmers who bred their own horses and sold their surplus stock, which he regarded as being a most unjust exaction; on the whole, however, he must congratulate the right hon. Gentleman upon having brought forward on this occasion a common-sense Budget which was likely to meet with general approval.

MR. M'MAHON

drew attention to the admission of the Chancellor of the Exchequer that during the past few years £12,000,000 of surplus had been devoted towards the payment of the National Debt. He maintained that this surplus was the product of the income tax, and protested against poor clerks and others assessed under Schedule D having cast upon them the burden of paying off the National Debt, instead of its being thrown upon the new land tax to be imposed with the object of providing for the extinction of that Debt.

MR. GREGORY

enforced the remarks of the hon. and gallant Member for West Sussex (Colonel Barttelot) by reminding the Chancellor of the Exchequer that, under the horse-dealers' tax as at present construed, any person casually selling a horse might be required to take out a licence.

THE CHANCELLOR OF THE EXCHEQUER

said, he had already taken steps to meet that objection.

MR. GREGORY

thought that the right hon. Gentleman had not provided against that possibility to the fullest extent. If the right hon. Gentleman declined to deal with the matter, he himself should take the liberty of proposing to insert a clause in the right hon. Gentleman's Bill to meet the difficulty. He also trusted that the right hon. Gentleman would deal with stamps on deeds, and make such arrangements as would permit the Commissioners to remit penalties which might be incurred in consequence of deeds not having been stamped within the limited time without fault on the part of the parties.

SIR TOLLEMACHE SINCLAIR

thought the present Budget had the essential vice of being a rich man's Budget. The balance of authority was in favour of the opinion that the working classes of this country—a large proportion of whom were not represented in Parliament—paid much more than their fair share of taxation, and, in saying that, he took into account not only Imperial, but also local taxation. He therefore thought the working classes would be equally astonished and disappointed when they found that while £3,000,000 was taken off the payers of income tax the manual labour class only received a doubtful benefit in the shape of a peddling reduction in the coffee duties; and that they were bound in honour, in the face of the country and the world, to do justice to that large and unrepresented portion. In the case of the income tax payers, they now made a deduction of £60 from all incomes of less than £200 a-year; and, on the same principle, in taxing the working classes, they ought to take off a reasonable sum for what was required to furnish those classes with the strict necessaries of life. In the opinion of M. Thiers, expressed in the French Chamber, the English working classes were taxed even at a higher rate than their brethren in France, which furnished an additional claim for consideration in their treatment of the question. When, last year, the Chancellor of the Exchequer imposed an additional 2d. on the income taxpayers, he tacitly admitted that the working classes were paying more than their fair share of taxation, and this year, when the right hon. Gentleman was able to make a considerable remission, the working classes were fairly entitled to at least one-half of that remission. Moreover, when they considered that America was about to grant the free breakfast table, he was of opinion that aristocratic and Plutocratic House of Commons ought to be ashamed to be less liberal to the poor than the Democratic House of Representatives of the United States; more especially when they considered that tea, sugar, and coffee were undubitably necessaries because they were given in workhouses and gaols; that it was contrary to the Constitution to tax those who were not represented for necessaries; and that a large proportion of the poor were even excused the payment of local rates—all these things proved the injustice of the course pursued. In the time of Mr. Pitt income tax was levied on incomes as low as £50 a-year, and house tax on houses as low as £5 rent; he did not desire to see the incidence of either of those taxes reduced as far as that; he only said that if it could be proved that the working classes did not pay their fair share of taxation, then there was that alternative open to them. A remission of 2d. on an income of £200 a-year would be worth only £1 3s. 4d. to a man, whereas a remission of the duties on tea, coffee, and sugar would be worth 30s. The taxes on the breakfast table produced £6,500,000, but their incidence made them not less than £10,000,000, and if these were removed past experience showed that at least half the sum that would be sacrificed by the remission would be recouped to the Revenue by the increased income from spirits and tobacco, and their remission would not cost more than the surplus the Government now had in hand. Steps ought also to be taken to induce the Chinese Government to remit their export and transit duties on tea, amounting to 4d. per pound, although by treaty they should only be 1½d. per lb., and by adding 2d. of profit on those dues, a 6d. per lb of additional duty, the whole of which might be saved by compelling the Chinese to observe the treaty, while we remitted our import duty as an equivalent. Supposing that effected, tea might be sold retail at from 6d. to 8d. per lb. which now cost 2s., and the saving to the people of England by buying tea at 6d. instead of 2s. would amount to £9,000,000, and if the consumption doubled, as it probably would, to £18,000,000; while, on the other hand, that as the Chinese numbered about 460,000,000, and as they drank about 10 lbs. per head of population, if we doubled our consumption it would only reach about 2¾ per cent on the production, and would not materially enhance the price required by the grower; but that if the Chinese Government required any other taxation in lieu of those duties it might be supplied in the shape of an additional tax on opium. At present the poor man paid a tax equal to 100 per cent on the inferior kind of tea he consumed, while Assam tea, which was consumed by the rich man, paid one of only 10 per cent. Moreover, the repeal of the duties on tea, coffee, and sugar would, he believed, effect a saving of at least £500,000 on the total cost of collection for the Customs and Excise—namely, £2,600,000. If the tobacco duty were raised to 4s. and cigars to 6s.—and that tax was now much higher in France, and it was formerly higher in England—£1,500,000 would be provided in that way; while wine, a luxury of the rich, too lightly taxed now, should be made to bear the burden more proportionately to spirits, which was the beverage of the poor. At all events the duties should be graduated according to alcoholic strength. He (Sir Tollemache Sinclair) should propose that clubs should also be compelled to take out licences, and that public-houses should pay a licence duty on a graduated scale based on the present lowest unit; so that the publican whose premises were rated at £500 a-year should pay 10 times as much as the man who was rated at £50, instead of the same licence duty as at present. He also proposed that grocers should be allowed to sell wines and spirits at the same rate of licence as publicans, instead of paying £28 as against £5, by which means another £1,000,000 might be raised. Again, he claimed that Ireland should be put on the same footing with respect to Imperial taxation and grants from the Consolidated Fund, as both England and Scotland. Ireland now received £1,600,000 more than its fair share from the Consolidated Fund for the constabulary, &c., and if the house tax and the assessed taxes were levied in that country as well as in England and Scotland, and the contributions from the Consolidated Fund reduced to the same scale as in England, £2,000,000 more might be secured. As for the house tax, it ought to be reconsidered, for its basis was fallacious and absurd; and, recognizing the discrepancies between urban and rural tenements, it would be more just to tax on a scale determined by their cubical contents. He also thought the income tax should be remitted to the extent of £99 19s. 11¾d.—under £100—on all incomes up to £300, and not merely to the extent of £80, for those in receipt of £99 19s. 11¾d. were exempt as the tax at present stood; and, in conclusion, he must say that he thought it astonishing and distressing to hear rich Members of that House of all parties, when discussing their turtle and champagne, cordially sanction the confiscation of the entire surplus for the benefit of their class, and doubt whether it would not be a violation of the Constitution to allow the wretched out-door pauper, the helpless widow, or the poor seamstress of Spitalfields a cup of untaxed tea with their crust of dry bread. For these reasons, he considered that this was an unfair Budget and a rich man's Budget, and the Committee ought to consider whether it was right and constitutional to tax unfairly a class not represented in that House.

THE CHANCELLOR OF THE EXCHEQUER

said, he must return his grateful acknowledgments to the Committee for the kindness with which they had received the proposals of the Government. Of course, there must be a vast divergence of opinion on these subjects, and he was surprised at the unanimity of the Committee in reference to the main proposals laid before them. The debate had been discursive, but he should not be so, and would confine himself to one or two points bearing directly on the Budget, promising that any points which he did not mention should still have his consideration. To say, as the hon. Baronet had said who spoke last, that this was a rich man's Budget, because of the reduction of the income tax, was an unjust way of looking at the matter, because the reduction of the income tax was a sort of debt due to the payers of income tax. He took it off this year because he put it on last year, when he found it was the only tax the House would approve. This relief being a debt, he was bound to undo what he did last year, and he did this with pleasure. What had become of the remainder of the surplus? It was divided, £230,000 being taken off an article of general consumption by all classes, and the rest went in relief of the class just raised above the working classes, which class was admitted on all hands to be severely taxed. Those also who said this was a rich man's Budget forgot that the Estimates included £650,000 more than before for education, which was entirely for the benefit of the working classes. He would now answer one or two Questions which had been put to him. He had been asked the amount of the duty on malt. It was £6,500,000. The hon. Member for South Norfolk (Mr. C. S. Read) had asked if a farmer occupied two farm-houses, living in only one, and merely having care taken of the other, would come within the meaning of the proposition. He believed that such a person would do so. In answer to the hon. and gallant Member for "West Sussex (Colonel Barttelot), he had to repeat that, as a sort of boon to the people at large, they had in their own hands the collection of the income tax; he was not responsible for it, and had no control over the Commissioners; but, if the House was willing, he was ready to undertake the collection of it, and then he would be answerable and responsible for its proper collection. Until it was, he protested against the accusations made against the Government. The right hon. Member for Northamptonshire (Mr. Hunt) had been rather severe upon him, and had made a discovery which was made last year that he (the Chancellor of the Exchequer) was about to plunge into a deficiency of £1,500,000 because he had not mentioned the duty on tea which was levied for a particular purpose, but there was a Resolution on the subject of tea which he had in his hand, and which would have to be proposed at another time. The right hon. Gentleman had stated that he could understand why the Chancellor of the Exchequer submitted very much to the opinions of those persons who estimated the Revenue, but not of those who estimated the expenditure. Now, with regard to those who had the practical working of the Revenue, he did not wish to divest himself of any responsibility, and if he did, the House would not allow him to do so. All he could say was that the responsibility for the Estimates was his, and the way he preferred to exercise that responsibility was to follow the experience of those who had a practical knowledge of the subject. As to the expenditure, he could venture to take liberties with that. The reason was this. In matters of Revenue he had no test to refer to with respect to the amount; but in matters of expenditure he had, by means of the appropriation audit; for when a Department asked him for more than it had spent, there was room to exercise discretion in cutting down its demand. The right hon. Gentleman (Mr. Hunt) was very unhappy because he (the Chancellor of the Exchequer) had tried to filch from him the honour of the codification of the Stamp Act. Nothing could be more uninteresting to the House than to be squabbling about the honour of such a proceeding, but he could assure the right hon. Gentleman that he would most cheerfully have given him the credit if he had known that he had anything to do with the matter. With regard to Militia barracks, a measure would be brought forward by the Secretary at War for the purpose of raising a sum by Terminable Annuities, and that was the reason why he had not said anything about it. The terms had not yet been settled; but when they were, a Bill would be brought in on the subject. He believed the amount required would not exceed £50,000, and could be easily procured. There were a great many other things he might say, but as the hour was so late he would conclude. He thanked the House again for their manner of receiving the Budget, and assured hon. Gentlemen whose suggestions he had not noticed that he would give them the best consideration he could.

MR. G. BENTINCK

said, he quite agreed with what had been said by the hon. Member for Birmingham (Mr. Muntz) with respect to Votes on Account, which led to a practice of putting off the Estimates until a late period of the Session, when they were no longer under the control of the House; at the same time, he must remind economists opposite that our expenditure must increase with the general rise in prices, and with the necessary increase of military and naval armaments. The Chancellor of the Exchequer had made an appeal on behalf of those who possessed small incomes. It was impossible not to feel the force of that appeal; but he wished to remind the right hon. Gentleman that if that principle were fully carried out it would simply mean Communism. An appeal had been made to the right hon. Gentleman on the subject of the taxation of cart-horses and of the malt tax. He fully concurred in that appeal; but he thought it was a waste of time and energy to make it, for no such appeal would be listened to until the county Members understood that it was their duty here to act as the representatives of their constituents rather than as the adherents of a party; so long as they maintained a contrary view the rural districts would continue to be over-taxed. The hon. Member for the City of London (Mr. Alderman Lawrence) had referred to the inequality of the taxation upon houses; but it should be borne in mind that the rental of a house was the fair test of its value, and that no description of property ought to be taxed beyond the value of what it would fetch. ["No, no!"] Then the hon. Gentleman did not agree with Hudibras, who said— …The value of a thing Is just as much as it will bring. He thanked the hon. Member for Birmingham for having uttered one of the happiest expressions it was ever his good fortune to hear in that House. That hon. Gentleman had, as he understood, very properly described as elastic politicians such hon. Members as voted in support of principles which they had formerly denounced.

MR. CRUM-EWING

regretted that the Government had not entered into the Conference with the Governments of France and some other countries in reference to the Convention entered into some years ago on the sugar duties. The advantage to France under that Convention was no less than £3 10s. a-ton. The refiners of this country were feeling the effects of that Convention very severely in their trade, and he was sorry the Chancellor of the Exchequer had not referred to the matter, as be (Mr. Crum-Ewing) was afraid, if the present unjust state of things continued, their sugar-refining trade would be annihilated.

SIR GEORGE JENKINSON

said, several hon. Members had expressed their thanks because the Chancellor of the Exchequer proposed to remit the extra 2d. which was put on the income tax last year; but the remission of that 2d. was simply taking off what had been improperly put on, and therefore the right hon. Gentleman could not be entitled to any thanks for what was only a debt due to the country and a duty. The hon. Member for the City of London (Mr. Alderman Lawrence) had complained of the small taxation put on palatial residences in rural districts; but he seemed to forget the great benefit which was conferred on the people who resided in the neighbourhood of those palatial mansions by their occupants. But were those palatial buildings that were occupied by merchants in the City of London rated at all in proportion to the immense incomes they gained? Certainly not. The right hon. Gentleman the Chancellor of the Exchequer proposed that an income of £50,000 should be lost for the sake of the occupants of City offices, while no advantage whatever was proposed to be conferred on the agricultural classes. The right hon. Gentleman was also about to take off £230,000 in the case of coffee, £50,000 of house tax, and some £2,300,000 in the case of income tax. He maintained that these remissions would scarcely benefit people in the country; more especially in the case of coffee, for it was well known that agricultural people did not all drink it, they, as a rule, preferring tea. Then there was the malt tax, the pressure of which might have been greatly alleviated by being changed into a brewer's licence, or into some other tax which the Chancellor of the Exchequer's ingenuity might devise; but the right hon. Gentleman had done nothing in that way. The right hon. Gentleman might also have given back to the agricultural classes for the repair of the turnpike roads the £900,000 which he took from them a couple of years ago, by the repeal of the 1s. corn duty; but that also he failed to do. He felt, therefore, bound to record his protest against a Budget which had not the slightest tendency to relieve the agricultural interest from the oppressive burdens it laboured under. (1.) Resolved, That, towards raising the Supply granted to Her Majesty, there shall be charged, collected, and paid for one year, commencing on the sixth day of April, one thousand eight hundred and seventy-two, for and in respect of all Property, Profits, and Gains mentioned or described as chargeable in the Act passed in the sixteenth and seventeenth years of Her Majesty's reign, chapter thirty-four, for granting to Her Majesty Duties on Profits arising from Property, Professions, Trades, and Offices, the following Rates and Duties (that is to say):

• For every Twenty Shillings of the annual value or amount of all such Property, Profits, and Gains (except those chargeable under Schedule (B) of the said Act), the Rate or Duty of Four Pence;
• And for and in respect of the occupation of Lands, Tenements, Hereditaments, and Heritages chargeable under Schedule (B) of the said Act,
• For every Twenty Shillings of the annual value thereof;
  • In England, the Rate or Duty of Two Pence; and
  • In Scotland and Ireland respectively, the Rate or Duty of One Penny Halfpenny;

Subject to the provisions contained in section three of the Act of twenty-sixth Victoria, chapter twenty-two, for the exemption of Persons whose whole Income from every source is under One Hundred Pounds a-year. (2.) Resolved, That in lieu of the relief granted by section three of the said Act passed in the twenty-sixth year of Her Majesty's Reign, chapter twenty-two, to persons whose respective incomes, although amounting to One Hundred Pounds or upwards, are less respectively than Two Hundred Pounds a-year, the following relief or abatement shall be given or made to persons whose incomes are less respectively than Three Hundred Pounds a-year (that is to say): any person who shall be assessed or charged to any of the Duties of Income Tax granted by this Act, or who shall have paid the same either by deduction or otherwise, and who shall claim and prove in the manner prescribed by the Acts relative to Income Tax that his total income from every source, although amounting to One Hundred Pounds or upwards is less than Three Hundred Pounds for the year of assessment of his profits or gains, shall be entitled to be relieved from so much of the said Duties assessed upon or paid by him as an assessment or charge of the said Duties upon Eighty Pounds of his income would amount unto, and such relief shall be given either by reduction or abatement of the assessment upon such persons, or by the repayment to him of so much of the excess as he shall have paid, or by both of those means, as the case may require. (3.) Resolved, That, in lieu of the Duties of Customs now chargeable on the articles undermentioned imported into Great Britain or Ireland, the following Duties shall be charged, viz.:—

	£	s.	d.
Coffee	the cwt.	0	14	0
Coffee kiln-dried, roasted, or ground	the lb.	0	0	2
Chicory or any other vegetable matter applicable to the uses of Chicory or Coffee:
Raw or kiln-dried	the cwt.	0	13	3
Roasted or ground	the lb.	0	0	2

(4.) Resolved, That, towards raising the Supply granted to Her Majesty, there shall be charged and paid, for and upon all Chicory, or any other vegetable matter applicable to the uses of Chicory or Coffee, grown in the United Kingdom,—

• For every hundredweight thereof, raw or kiln-dried, the Excise Duty of Twelve Shillings and One Penny, and so in proportion for any greater or less quantity than a hundredweight.

(5.) Resolved, That in lieu of any provision in force giving relief or exemption in this behalf, where a tenement occupied for the sole purpose of any trade or business, or of any profession, vocation, or calling, is inhabited as to part thereof by a servant or other person employed by the occupier for the protection or care of such tenement, but is not otherwise an inhabited dwelling house, it shall be exempt from the Duties on Inhabited Houses, provided that the part thereof so inhabited is not worth the rent of twenty pounds or upwards by the year. (6.) Resolved, That, towards raising the Supply granted to Her Majesty, the Duties of Customs now charged on Tea shall continue to be levied and charged on and after the first day of August, one thousand eight hundred and seventy-two, until the first day of August, one thousand eight hundred and seventy-three, on importation into Great Britain or Ireland (that is to say):

	s.	d.
Tea	the lb.	0	6

House resumed.

Resolutions to be reported upon Thursday 4th April.

Committee to sit again upon Thursday 4th April,