HC Deb 06 April 1875 vol 223 cc370-92
MR. JOHN HOLMS

, in rising to move— That, in the opinion of this House, the Brewers' Licence Duty is unjust and unfair in its incidence and ought to he repealed, said, he felt deeply sensible of his inability to do justice to this question, but he would endeavour to place the subject clearly and completely before the House, having due regard to brevity, on the one hand, and the importance of the question on the other. It was essentially necessary at the outset to remove some misapprehensions which existed in the public mind in relation to this question generally. There were some, he understood, who believed that in 1862 the brewers were instrumental in having the hop duty removed, and that they were quite satisfied with the Brewers' Licence Duty as it now existed. The brewers had nothing whatever to do with the removal of the duty on hops, that work being entirely carried out by the hop-growers themselves, under the very able leadership of the right hon. Member for Chester (Mr. Dodson). Another mis- apprehension was that this question was, to some extent, part of the great licensing question which had occupied so much attention for the last two years. It was in no sense connected with that great question; indeed, it might well be discussed from the view of the hon. Member for Carlisle (Sir Wilfrid Lawson), who, he regretted to say, could not be present that evening owing to domestic affliction, as from the commercial and financial point of view from which he himself wished to treat it. Again, it was said that the brewers of this country were large and wealthy traders; but, so far as they were furnished with the facts, that was not the case. Last year the number was 28,968, and of that number 9,000 were so small that their whole annual turn-over did not exceed from £500 to £600. Whilst 18,600 did a business of under £2,000 of a turn-over, no doubt some of the remaining 1,368 did very large businesses indeed. He was perfectly well aware that the interests of the large brewers of the country were well represented in that House, and that probably it would be deemed presumption in him to bring forward such a question. Looking to the position of the small brewers, the course of affairs had been, as in relation to manufactures generally, that the larger gradually absorbed the smaller; but that was a state of affairs which need not be encouraged by unnatural means. Now, this licence duty undoubtedly operated in that direction. The tax was imposed in 1862; but it was essential to look at the Financial Statement of 1860, which was one of the most notable among the many made by the late Prime Minister, when he was Chancellor of the Exchequer. One of its main features was the lowering of the duty on the light wines of Europe. There was a slight reduction in the hop duty, preparing the way for its repeal in 1862. The Revenue at that time was only £150,000 more than the Expenditure, and the question was how to abolish the hop duty and avoid a deficit—in other words, how far it was possible to substitute with equity to all parties some other form of impost which would entirely set free the foreign trade as well as the British trade in hops. To do this the Chancellor of the Exchequer proposed to re-adjust the licence duty as it then existed, so as to take in the whole of the hop duties at that time. It was found that in the smallest quantity of beer that could well be brewed—one barrel—2 lbs. of hops and two bushels of malt would be used, and if 2 1bs. of hops were taxed at the then rate of 14s. per cwt, there would be 3d. a-barrel as the future outcome of the Brewers' Licence Duty. On that basis this tax was imposed. The Chancellor of the Exchequer held out to the brewers and consumers that they would obtain a supply of hops at a lower rate, and that, therefore, this would not really be a tax. In his (Mr. Holms's) opinion the right hon. Gentleman was perfectly justified in the view he then entertained. Before the duties on light foreign wines had been reduced, the importation was 6,000,000 gallons; but in 1862 it had increased to 9,650,000 gallons, and since to a far greater extent. It was calculated that an increase in the importation of hops would also follow the change proposed, and that hope was founded on the fact that whereas the average amount of the import duty was but £30,000 a-year, it amounted in 1862 to £ 110,000. The right hon. Gentleman was therefore justified in believing the price of hops would be lower, but the result was entirely different. In fact, hops were a great deal higher now than they had ever been known in this country before. In re-adjusting the Brewers' Licence Duty the Chancellor of the Exchequer of that day laid it down, as a rule, that the charge should be so taken as to relieve the small brewers, who, in comparison with the larger, were hardly dealt with. This was a matter of very considerable importance; but the fact was that even now the pressure was still the other way, for while the man who only brewed 20 barrels of beer paid at the rate of 7½d. per barrel duty, the brewer of 50 barrels paid only 6½d., the brewer of 100, 5d. per barrel, and the brewer of 1,000, 3¼d. So that the injustice remained till this day. Undoubtedly before the hop duty was removed everybody paid according to the amount of hops consumed; but now the poor man whose beer had only a "nosing" of hops had to pay the same through the licensing duty as the rich man who used 1s. 8d. worth of hops per barrel. The Chancellor of the Exchequer at that time said— It would not be quite just to the regular brewer when called upon to make an equivalent payment in respect of the hop duty, that the private brewer should he allowed to go scot-free."—[3 Hansard, clxvi. 408c.] Again, that it would be extremely hard that the brewer who brewed for sale should pay 3d. a barrel in lieu of duty, and that, at the same time, anyone who brewed for himself should be allowed to brew without doing so: And again, that— We are going to require from brewers for sale a payment in hard cash for every pound of hops they are estimated to use, and we cannot fairly make that demand upon them if we give to persons who choose to brew in private a positive premium by telling them that they shall have their hops free of duty without any payment at all. It may be true that brewers for sale brow more cheaply than private brewers. With that we have nothing to do. Our business is simply not to interfere. We ought not, without grave reasons, to give a premium to private brewers: but we should, as far as we can, leave both parties in the position in which we find them, asking them to bear the same burden of taxation."—[3 Hansard, clxvi. 782–3.] Nothing could be more emphatic than that language, yet not a single private brewer had paid any duty since 1862, and some large private establishments were now brewing at least as much as anyone out of nine-tenths of the small brewers for sale. A letter he had received from a small brewer gave an instance of a private establishment which brewed 200 quarters of malt a-year, and it was added that 20,000 brewers who brewed less ale in the year were obliged to pay duty. Many large farmers now brewed beer for their homesteads, and even paid part of the wages in it; undergraduates at the University Colleges were getting their beer duty free; and some large places of business in London were taking advantage of the fact that they could brew without paying more duty than that upon hops. The House accepted the maxim of Adam Smith that the subjects of the Realm ought to contribute to its revenues as nearly as possible in proportion to their ability; but that maxim was violated when the rich nobleman was exempted from a duty paid by the small brewer at his gate. His belief was that had Parliament, in 1862, had the least notion that private brewers were to escape, the measure of that year would not have been passed. It was not so much of the amount of this tax as of the manner in which it was raised that he complained; it was one of those taxes that shackled trade and crippled industry. Had a slight increase been placed on the malt duty in 1862, we should have been rid of the difficulties attending the collection of this tax, and the worry- ing of the small brewer, and the private brewer would have paid his proportionate share of it. The tendency of our legislation in this country had been to encourage free trade, to open our ports to raw materials, and to remove every shackle from industry. In 1830 Mr. Poulett Thompson illustrated the condition of manufactures that were impeded by taxation, and he read a letter describing the hindrances to the manufacture of paper incidental to the collection of the duty upon it. That letter was strikingly analogous in the description it gave to another letter which he held in his hand, which related how brewers were hampered by having to give lengthened notice of the exact quantity they desired to brew, and to place distinctive marks on all their rooms, under a penalty of £200, while they had to pay the duty in advance; so that it was a tax on capital as well as on production. What trade would stand the re-imposition of a duty on what had once been relieved? Would calico printers tolerate a re-imposition of the duty of 3½d a square yard on calico? Yet the Brewers' Licence Duty was practically a repealed tax re-imposed. It was clearly unfair as well as impolitic that any particular trade should be singled out for taxation opposed to the general tendency of our legislation. In 1830, three reasons influenced Parliament in removing the duty—first, it was done to remove a shackle from trade; secondly, it was done to remove the very inequality which was now urged as a grievance, for it was said at the time that the beer duty fell wholly on the lower and middle classes, who did not brew their own beer; and, lastly, it was said that the existence of the beer duty favoured the consumption of ardent spirits, which, he believed, was a sound reason for repealing it. Contrary to the intention of Parliament, however, the condition of the small brewer was worse at the present moment than in 1830, because of the trammels imposed upon his trade. There were 27,000 of these small brewers, many of whom retailed their own beer. They had first to pay the duty on malt; they had then to pay on the malt in their brewery; thirdly, if they were retailers they had to pay a licence duty; and, lastly, they paid income tax. They were, however, in the latter case in a different position from their brother-manufacturers, because the Inland Revenue had before them the returns of the malt they had used, and they corrected one return with the other. He believed that if the beer brewed for the working classes was of a sound and good quality there would be a fair chance of its displacing a portion of the present enormous consumption of ardent spirits. There was considerable misapprehension as to the drinking habits of the working classes and the use they were making of their money, and he had, therefore, prepared two sets of facts which threw some light on the subject. The first showed the home consumption of beer, wine, and spirits in 1860 compared with 1873. In beer the increase had been 35 per cent; but when it was recollected that in England and Wales beer was the beverage of the working classes, while very little was drunk in Scotland and Ireland, and when it was further recollected that the population of England and Wales had increased during that interval by 17 per cent. while taking Ireland and Scotland together, there had been no increase of population at all, it would be found that there had been an excess of 30 per cent in beer over the consumption of 1860. In wine, however, the excess of increase in 1873 as compared with 1860 was not less than 137 per cent. In spirits the increase was 30 per cent; but in brandy, of which the working classes drank least, it amounted to 158 per cent. The rich man now drank three bottles of wine where he used to drink one bottle, although the amount of duty paid into the Exchequer upon our total import of wine was precisely the same. But it was far otherwise in regard to beer. The poor paid precisely in the ratio of their consumption, and they paid an increase of £6,200,000 as compared with 1860. He would not deny that in many places they drank too much beer, but during the last Easter holidays, staying in a country house in a neighbouring county, he was told by his host that the labourers of that part of the country did not get beer more than once a-week. They met a labourer whom they questioned upon the subject, and he told them that he drank cold tea to his dinner every day but Saturday, and he believed that this was true of many other counties. The other set of facts which he had prepared, showed that if more beer were consumed, the consumption of beer was not greater, but less in proportion to other articles of diet. In 1860 the home consumption of butter was at the rate per head of the population of 3.26; in 1873, 4.39. In cheese it was, in 1860, 2.24; in 1873, 4.69. In currants and raisins it was 3.59; in 1873, 4.29. In eggs it was 5.83; in 1873, 20.56. In potatoes, 2.18; in 1873, 26.17. In tea, 2.67; in 1873, 4.11. In malt, however, it was 1.45; in 1873, 1.98. So that the working classes were not spending the whole of their increased earnings on alcoholic liquors. It was an axiom that whatever manufacture was carried on should be left as free as possible to the manufacturer. Let the Government tax the article used in the manufacture of beer if they pleased, or after the manufacturer had made it, but not trammel the man in making the article itself. It ought also to be borne in mind that we had competitors all over the world, and unless we left the manufacture of beer as free as possible, our brewers would find themselves at a disadvantage with their rivals. Our export trade in beer already amounted to £2,500,000 a-year, and we had competitors in Austria, Germany, and elsewhere. The question had been raised whether this was a tax that fell upon the producer or the consumer. He would take it either way; but if the producer had paid it, the present system as the right hon. Gentleman (Mr. Lowe) had pointed out, gave a qualified monopoly to the rich brewer, who more easily paid the duty beforehand. He was, however, quite confident that, as a rule, the consumer paid the duty in the shape of a deteriorated article, and that, therefore, this was a consumer's question, and it was for the House to consider further how far they were by this tax encouraging adulteration, especially in the beer produced for the poorer classes. He could not imagine that the brewers expected that this duty could be entirely repealed without something like a registration licence being substituted for it. He had, however, no doubt that this was one of those duties which ought to be removed at the very earliest date. No one could expect that it would be repealed at the expense of the creation of a new tax; but if it were unjust, and he believed it to be, in addition, most injurious and impolitic, the Executive Government ought to remove the duty at the very earliest moment. The hon. Member concluded by moving his Resolution.

MR. SHERRIFF

, in seconding the Motion, said, he objected to the duty in question because it was saddled on the brewers in consequence of anticipations which had never been realized. At the time when the hop duty was abolished, it was supposed that a large reduction would be made in the price of hops; and as it was thought that the brewers would receive all the advantage, it was deemed right and fair that they should pay to the Exchequer a portion of the benefits they were to receive. What, however, were the facts? In 1862 the price of hops was between £6 and £8 a cwt.; now the same quality of hops could not be bought under £14 to £16. The brewers, therefore, instead of receiving an advantage, had to pay double the price they paid in 1862, and on that account this tax ought to receive great amelioration, if it were not completely removed. He objected to the tax also on account of its inequality. Since the tax was levied, there had been a reduction in the number of small brewers to the extent of over 700 a-year; and he believed, if it were continued, an industry which was of great importance to many towns and country districts would be altogether extinguished, so far as small brewers were concerned, and the manufacture placed in the hands of a few gentlemen who had the command of unbounded capital. He was aware that it had been said that matters affecting taxation ought not to be brought forward before the Chancellor of the Exchequer had made his annual statement, or upon Budget night, or after the financial scheme had been launched. Still, he hoped that the present being no Party question, and one which was founded in reason and justice, Her Majesty's Government would see their way to a reduction, if not to a total abolition of the tax.

Motion made, and Question proposed, That, in the opinion of this House, the Brewers' Licence Duty is unjust and unfair in its incidence and ought to be repealed."—(Mr. John Holms.)

THE CHANCELLOR OF THE EXCHEQUER

I regret, Sir, very much, for various reasons, the absence from the House of the hon. Baronet the Member for Carlisle (Sir Wilfrid Lawson). We always listen with pleasure to the speeches of the hon. Baronet, and the cause of his absence to-day must enhance our regret that he is not in his place. I regret his absence also because he has placed upon the Paper a Notice which appears to me to indicate the proper mode of dealing with the question which has been submitted to us by the hon. Gentleman opposite, and I will take upon myself the duty the hon. Baronet would have discharged were he present, and conclude by moving the Previous Question upon the Resolution of the hon. Member for Hackney. I do so partly because, as has just been said by the hon. Member for Worcester (Mr. Sherriff), it is not very convenient that the House should come to a Resolution of this character upon the eve of the Budget; but, at the same time, I wish distinctly to say that I do not at all challenge the propriety of discussions of this sort—a fair and full discussion upon the merits of taxes, either before the Budget or when it is laid before the House, or, indeed, at any time that may appear to be desirable for attracting attention to the subject. I will go further, and say that with regard to this particular question, I think it is one which very well deserves some quiet and candid and impartial consideration on the part of Parliament; because, although it has been brought forward from time to time for a good many years, and although it has been more than once adverted to in this House by private Members, by Chancellors of the Exchequer, and by other Ministers, yet unquestionably it has been commonly discussed under circumstances of some disadvantage. I am ready to concede to the hon. Member for Hackney that there is some force in the opening part of his observations with regard to some of the fallacies with which the question has been more than once met. for instance, it is a fallacy to deal with it and seek to set it aside on the ground that brewers are a rich body. It is perfectly true that there are a very large number of brewers who are men of very moderate means, and who are not to be passed over because it is said that they belong to a rich body of persons. I would even go beyond that, and say, Let them be as rich as you please, they are not to be treated unjustly. They have a right to come forward and say—" You are not to treat us unjustly simply because we are rich. We demand justice, and if we can show that we are treated with injustice, we have a right to ask for redress," Again, I would frankly admit that there is no reason why we should say, We will not deal with this manufacture as we deal with other manufactures, because it is capable of being turned to abuse. No doubt, any intoxicating liquor may be, and often is, abused; but as long as men conduct their business fairly and properly, and are engaged in a legitimate calling like this, odium ought not to be attached to it, or fair play withheld from it. Therefore, I say it is quite reasonable and fair that every question should be heard, and temperately and fairly considered. On the other hand, I must be permitted an observation on the other side. I think it would be very unfortunate that anything like what may be called "Party" and "political" feeling should be imported into a question of this sort. It would be greatly to be lamented if in a question like this any political influence which might be supposed to be possessed by a body of men such as the brewers are, should be allowed to enter into the consideration of the subject, as though hon. Members were not to regard it on its own merits and decide it without reference to the influence a particular body of men may exercise in the constituencies. I believe there are circumstances connected with the agitation on this subject which justify me in making that remark, and in warning hon. Members that in a question of this sort they ought to lay aside all considerations except those of abstract justice and expediency. Now, the hon. Member for Hackney asks us to affirm a Resolution of a very serious character. He asks the House to say that the Brewers' Licence Duty is unjust and unfair in its incidence, and that it ought to be repealed. Well, I believe if we were to take any one tax upon our list of taxes, and devote ourselves exclusively to a consideration of that tax in order to see whether we could not find inequalities, or what might be called unfairness in it, there is scarcely any tax that would absolutely stand such a scrutiny. Take, for instance, the duty on tea. It would be perfectly competent for anybody to say that it is unfair because it presses equally on tea of a high quality and on tea of a low quality. I hardly like to refer to the income tax; but who has not heard it said that it was unfair in its incidences? Then, again, you might take local taxation, and many persons would be ready enough to say that it is unfair in its incidence, because it presses unequally on different classes of property. If you take any article in the whole category of taxes, it is probable that you will find in it some kind of unfairness and inequality. But you are not on that account to come forward and ask the House of Commons to pass a solemn Resolution that any tax in which you can find inconveniences or inequalities of that sort is to be condemned as unjust; and still more ought you to be cautious that you do not carry a Motion of that kind to the extent of declaring that the tax is so unfair that it must necessarily be repealed. If there are inequalities, let us consider what these inequalities are; whether they admit of being remedied without the necessity of sweeping away the tax altogether, or whether the tax is such that however you amend it, it still must remain unjust, and therefore ought to be abolished. This is the last position which the Motion asks the House to take, and which the hon. Gentleman in his speech points to. Well, now, where is the essential injustice of this tax? I am not talking at this moment about the particular incidence or the scale of the tax—I will come to that presently—because I am disposed to admit that there is something to be said on the scale of the tax. But let us look at the tax itself, irrespective of the particular pressure of the scale in its present form. The hon. Gentleman who moved the Motion made an admission or statement towards the end of his speech which I was very glad to hear, and in which I think he was perfectly right. I doubt whether everybody promoting this movement, or the brewers out-of-doors, will agree with him. He said it was a consumers' question, and I believe it. I will not take upon me to say what is the precise mode in which this tax is distributed in the prices charged to the consumers of beer; but of this I am sure, that the original burden laid upon the brewers and sellers of beer is taken into account in the arrangements they make; that it bears upon the rate of profit they make; that it influences the price paid, either the actual price in money, or which is more unsatisfactory, the price paid in deterioration of quality, by the consumer. We must, therefore, approach it as a consumers' question. The hon. Member asked whether there was not an injus- tice in this tax. What are the circumstances? It has long been the policy of Parliament to raise a considerable amount of revenue by taxation imposed upon various intoxicating liquors—spirits, wine, and beer, or the materials that compose beer. A direct duty on beer has long been given up. In the year 1862, the duty upon hops was put an end to; and at that time this surcharge upon brewers' licences was introduced instead. Well, the hon. Gentleman says the reason why the duty on hops was taken off in 1862 was that the duty on light wines had been greatly reduced, and that it was thought fair by the Chancellor of the Exchequer, my right hon. Friend opposite (Mr. Gladstone), at the time to make some reduction in the duties on beer in order to balance the reduction that had been made in the duties on light wines. I confess that is a new view to me. I confess that is not the way in which I heard the speech of my right hon. Friend when he brought forward the Budget in 1862. As far as I recollect, the main point that was made by the Chancellor of the Exchequer was this—that there were inherent objections to the hop duty; that it caused great inconvenience; that it was productive of gambling and uncertainty, and that it was open to a great many objections. Therefore, he proposed to meet those objections by abolishing the duty. The hon. Gentleman curiously enough, without perceiving the tendency of his own argument, quoted the statement of the Chancellor of the Exchequer to the effect that he would endeavour to provide some other means—as he could not spare the revenue—by which he might be able to bring into the Revenue about the same amount as had been obtained from the hop duty. But if the right hon. Gentleman was proposing to take off the hop duty in order to reduce the tax on beer in compensation for the reduction in light wines, I do not quite understand why he should substitute something that would bring in the same amount of Revenue from the same article. I have never been able to discover either in what was said on that occasion or on subsequent occasions by my right hon. Friend, that he held out any idea, such as brewers are apt to suppose existed in his mind, that this was a mere temporary removal of the hop duty, and a temporary placing of it on brewers' licences with the view to get rid of it altogether whenever he had a sufficient surplus. What the Chancellor of the Exchequer proposed to do was to alter the incidence of the tax without diminishing the flow of Revenue into the Exchequer. Now, has he done more than that? I think not. I had a comparison made some time ago as to the amount that came into the Exchequer under the present system, and what would probably have come into it under the old hop and licence duties. The calculation was made for 1873; but it would be applicable more or less to the year which has just passed. The result is, that in 1873 the brewers purchased something like 65,500,0001b of hops, and according to the old duty of 1½d. per pound, this would have produced £409,000. There would have been also the old licence duty, which would have produced about £78,000; and the total result of the maintenance of the old duties in the year 1873 would have been about £487,000. The amount which was actually paid into the Exchequer under the present system was £448,000, or £39,000 less than the Exchequer would have received if the old system had been maintained. That proves this at all events, that the arrangement was one which gave effect to that which the Chancellor of the Exchequer said was his intention in doing away with the hop duty—namely, to substitute for it a tax in the form of an addition to brewers' licences which should produce somewhere about the same amount of revenue as the hop duty had produced. The arrangement has produced rather less. The Exchequer is not a gainer thereby, and the consumer, we may presume, is left in about the same position as before. The hon. Gentleman says that the Chancellor of the Exchequer, when he made this change, held out certain advantages which have not been realized—that he said brewers would not suffer from the additional burdens put on them, because they would get their hops at a lower rate. The hon. Gentleman says that has proved a delusion, and that the price of hops has not fallen but, on the contrary, has risen. I do not intend to enter into the question whether the price of hops has risen or fallen, because I do not think it has anything to do with the question. The point is, what the effect of the removal of the duty upon hops was, and whether if you had not removed that duty hops would not have been higher now than they are. It is true that the price of hops has risen, though the rise has been a good deal exaggerated; but I cannot see how, because the price has advanced after the duty has been taken off, therefore the taking off the duty did no good at all. Some years ago the duty was taken off gloves; yet I know that I pay more for my gloves than I did before; but it does not follow that there has been no relief to the purchasers of gloves by means of taking off the duty. The fact, is that there has been a very large increase in the demand for hops, and the effect has naturally been to raise the price. I suspect, however, that you will find that the price has been steadier than it was before; and, certainly, if the duty had not been removed, the price of hops would have been higher than it now is. The hon. Gentleman points out, as did the hon. Member for Worcester, that the number of small brewers is continually diminishing, and he says you must attribute that to the alteration which was made as to brewers' licences. The licence duty crushes, as I understood him, small brewers. But if the hon. Gentleman had carried out his researches a little further he would have seen that the diminution in the number of small brewers did not commence with the abandonment of the hop duty, but that it has been going on for a great number of years—since 1830 most assuredly. The reduction since 1830 was from 49,228 to 38,000 in 1862. No doubt there has been a further decrease since; but it is a decrease which is due not to this system or any other system, but to natural causes, which would have operated whether you kept up this duty or not. The natural advantages possessed by large capitalists and great brewers have been quickened and advanced of late years by the development of the means of communication, and the consequent case with which beer in large quantities can be transported from extensive manufacturing centres over the whole country. The almost inevitable result of this has been to close many of the small breweries which previously existed in parts of the country placed beyond the reach of the large towns. These brewers have been displaced by the superior energy and the great excellence of production shown by the large brewers whose names are household words among us, and not in any way by the operation of the licensing of brewers. I would also point out, as confirming this view, and as an answer to another objection raised by the hon. Gentleman, that the same process which has resulted in the reduction of the number of small brewers has operated also upon the practice of private brewing, which instead of being a formidable competitor to the business of the public brewers, has become altogether insignificant, in comparison. We cannot say what is the exact amount of private brewing, for we have no Returns; but we can say what is the difference between the quantity of malt charged with duty and the quantity known to be used by the public brewer; and it is fair to infer that the remainder chiefly represents what is used by private persons. Until about the year 1862 the difference between the total quantity of malt charged with duty and that known to have been used by public brewers was about 2,700,000 bushels. This may be taken to represent the quantity used by private brewers and manufacturers of vinegar and yeast. During the last seven years the difference to which I allude, instead of being 2,700,000 bushels, has fallen to 400,000 bushels, about half of which, it is fair to assume, has been used in the manufacture of yeast and vinegar; so that, as will be seen, the consumption of malt in private brewing is less than half per cent of the total consumption. While I admit that in theory an apparent injustice is done by allowing the private brewer to use malt which has not paid duty, I contend that in practice the injustice done is very insignificant; but that is a matter that lies rather apart from this part of the question. I now come to another portion of the question, that is with regard to what the hon. Gentleman said, and said with truth, as to the inequality of the present scale of licences. One of the points strongly insisted upon by my right hon. Friend the Member for Greenwich (Mr. Gladstone) when he made the alteration in 1862 was that, according to the then existing scale of brewers' licences, very great injustice was done to the small brewer, who was called upon to pay a certain fixed sum, while the larger brewer who paid somewhat more was only called upon to do so up to a limited point, beyond which there was no increase whatever in the amount of licence duty which he had to pay. My right hon. Friend therefore proposed the present scale, which was intended to remedy the injustice complained of, and instead of stopping at a certain limit it was so arranged as to carry on the tax up to any amount that the brewer might brew. But if you will look into the details of that scale you will find this unsatisfactory result, that the small brewer pays a great deal more on the malt that he brews—say 20 or 30 quarters—in reference to each barrel, than the brewer who brews his hundreds of thousands of barrels; and, therefore, that is an injustice that is still in existence under the present scale. This matter is one to which I have given consideration, and it is a point upon which I hope to be able to make at the proper time some proposal to the House. I shall do this because I think such a proposal will be entirely consistent with the spirit of the plan adopted by Parliament in 1862 at the instance of my right hon. Friend the Member for Greenwich. Passing to another point mentioned by the hon. Gentleman the Member for Hackney, I must say that I do not think any alteration in the amount of licence duty chargeable would remedy the grievance of which he complains when he says that the charge falls more heavily than it ought upon the brewer who uses but a small quantity of hops in comparison with the malt which he puts into his beer. The inequality arises from the varying principles on which different brewers conduct their manufacture, and cannot be remedied or mitigated by altering the licence duty. Then there is one other point on which the hon. Gentleman has touched, and which I know is one that is very largely complained of, and that is one which I think is worthy of consideration also. It relates to the time at which the duty is collected. What is said is, that under the old system the hop grower paid his duty, but credit was allowed to him, and he frequently had a considerable time before he had to pay the duty; and that, to a certain extent, the brewer got the benefit of that length of time, whilst there is no credit now, but the tax is levied even before the beer is brewed. That is a point that is worthy of consideration, though it is not convenient at the present moment that I should make any positive statement; but it is a matter that I have undoubtedly under consideration, and I should be willing to see whether it would be possible to meet the complaints upon the point. With regard to the actual incidents of the scale and the time that the duty is collected, on these two points I am quite willing to say that the subject is under consideration. I have had frequent communications with practical officers upon the subject, and though I reserve myself from any pledge, I may say that it is one on which I am not indisposed to consider the frequent communications that have been made to me. With regard to the general argument of the hon. Gentleman that this duty is in itself unjust, and that it is one which the House can only deal with by abolishing it, I am sorry to say I can only resist such a proposition, as being unreasonable, unfair, and not capable of being sustained by argument. It is all very well to compare brewing with the manufacture of calico or any other similar process, but we all know that the two things are not similar. The taxes laid in some form or other upon the manufacture of intoxicating drinks are altogether out of the category of taxes laid, or possible of being laid, upon the production of articles such as calico, and I cannot for a moment admit the force of arguments based upon analogies which are no analogies at all, and ought not to determine our course in a matter like the present. In conclusion, therefore, I will only express my hope that the House will not adopt that which is, as a rule, the inconvenient practice of placing upon the Books of the House a Resolution condemnatory of a tax of this character. There is nothing in the circumstances of this tax to warrant any such exceptional course; and I think the House will do wisely by leaving the matter in the hands of the Government, contenting itself with the fact that the question has been fairly brought forward and temperately and dispassionately discussed. The right hon. Gentleman concluded by moving the Previous Question.

Previous Question moved.—(The Chancellor of the Exchequer.)

MR. SULLIVAN

said, it was his intention to have moved the Previous Question, in the absence of the hon. Baronet the Member for Carlisle, (Sir Wilfrid Lawson) if it had not been done by the Chancellor of the Exchequer. The hon. Member for Hackney (Mr. J. Holms) and the Chancellor of the Exchequer had both looked at this question within a very narrow sphere indeed. The majority of the Irish Members of the House held that, as a class, the brewers, from whom this complaint emanated, had been exceptionally favoured in the matter of legislation. It had been stated that the brewing interest was in a state of decay, but he was unable to find any evidence of it, either in the metropolis or elsewhere in England; and so far from its showing any signs of ruin, decay, or death, beer was king in this land. It might, however, be true that the small brewers were being slain by their greater brethren. The abolition of this tax was urged as a relief to the brewers, and as an encouragement of the manufacture of beer in the interests of sobriety; but it struck him as being a very extraordinary appeal. It was on that ground that the late Prime Minister introduced the sale of light wines in England and Ireland by confectioners; but a more disastrous measure to morality had rarely emanated from that House, for it had increased tippling among the women population of Ireland to an extent previously unknown there. So far from its being in the interest of sobriety, it had established so may fashionable drinking schools and female drunkards. What he wished more particularly to point out, however, was that the beer interest was already unduly favoured. Assuming that alcoholic beverages ought to be taxed according to the amount of spirit they contained, he found that beer paid only 2s. per gallon, German and French wine 4s., Spanish and Portuguese wine 6s., and whiskey no less than 10s. Now he made to the hon. Member for Hackney (Mr. J. Holms) this proposition—that he should equalize the duty upon all alcoholic spirits in the country, whether it was contained in beer, wine, or whisky, and then he should be able to come before the House with a case that was at all events, equitable as between the different branches of the trade. Beer was principally made in England, while whiskey was, for the most part, an Irish and Scotch manufacture; and he trusted that before conferring further advantages on the brewing interest, the right hon. Gentleman (the Chancellor of the Exchequer) would set about redressing the inequality which already existed in regard to this matter between the different parts of the United Kingdom.

MR. HERMON

said, he hoped that after the statement made by the Chancellor of the Exchequer the hon. Member for Hackney would not press his Resolution to a division, and he also hoped that the Chancellor of the Exchequer would, when he addressed himself to this question, consider whether the inconveniences arising from the calls of the Excise officers upon the brewers could not be removed.

MR. GLADSTONE

Having been the person who originally introduced a proposal for the repeal of the Brewers' Licence Duty to the House, I may perhaps be permitted to say a few words on the present motion. It appears to me that the right hon. Gentleman the Chancellor of the Exchequer has taken the right course in this matter, viewing the time and the circumstances under which the Motion has been addressed to the House. Even if he were prepared to deal with the subject, it would be impossible for him at the present moment to agree to a Resolution of this kind, which would impair and cripple his power of dealing with the general finance of the country. At the same time, there is little value, it appears to me, in the argument which is so constantly urged upon the House, that Resolutions directed against particular taxes ought not to be brought forward at this period of the financial year. A Motion for the repeal of a particular tax is commonly said to be too soon if taken before the Budget, and too late if taken after it. Now so far as my experience goes—and I have had a good deal of experience in matters of this kind—that is not an accurate statement of the case. A proposal of this kind made before the Budget is, no doubt, inopportune when it merely asks the House to pledge itself with regard to a particular portion of the finances of the country without keeping the higher financial position of the country in view. In that case the objection would not, I think, be unfair if it were urged that the Motion was made too soon; but undoubtedly no one is in a position after the Budget to urge that then the Motion is too late. If a Member then disapproves of any portion of the financial scheme of the Government, or if he has an alternative plan, there is no reason why he should not bring his Motion forward. I could easily, if necessary, cite cases in which this has been done; when it has been my duty to propose the repeal of a tax, or to suggest an alteration. Motions in opposition have been made to my proposal, and either success has followed the opposition, or else it has met with very formidable support. In any case the proposal in opposition has had a fair trial, and a just comparison has been made between the rival schemes. In this case my right hon. Friend the Chancellor of the Exchequer does not find himself in a condition to offer an actual opposition to the proposal of my hon. Friend the Member for Hackney, and I am very much disposed to concur in his observations as to this duty. It may be amended and mitigated, although not repealed, and I think that the two questions ought to be kept entirely distinct. For total repeal I should decline to vote, or for the repeal of any other tax, until I had the whole finances of the country under review. As a general rule, I think that to vote for the repeal of a tax would be inexpedient, except when we had the power of considering it in connection with the entire finances of the country. There might be some other case not then before me in which the inducement to repeal would be much stronger than in the case of this particular tax. My hon. Friend behind me will not, I think, compromise his title to urge his question on the House, when we know the actual condition of the national finances, and to press for the repeal of this tax, provided there be money disposable by withdrawing his present Motion, and therefore I hope he will cheerfully accept the promises made by the Chancellor of the Exchequer on the part of the Government. The protest that has been made against premature proceeding will not in the slightest degree deprive him of his power to renew his application when the general finances of the country come on for consideration.

MR. FIELDEN

said, he could not support the Motion. The hon. Member for Hackney had made an admirable anti-malt tax speech, but he regretted to say that when he brought forward last Session his Motion for the repeal of the malt tax the hon. Member for Hackney was conspicuous by his absence on the division. He had always urged the repeal of the malt tax on the ground that it was an interference with the farmer in the cultivation of his land, as well as with the maltster in the manufacture of his malt and the brewer in the manufacture of his beer. Whenever they interfered with any industry by public officials, who necessarily laid down stringent rules and regulations, they did an irreparable injury both to the manufacturer and the consumer. In the abolition of the hop duties they took off the duty on the article at the point of production and laid it on at the point of consumption. That was the true principle. The Brewers' Licence produced something like £500,000 a-year, and the malt tax produced over £7,000,000 a-year. He thought the impost unjust; but he objected to repealing the Brewers' Licence until the malt tax was repealed.

MR. BASS

said, he had been instructed and gratified by the able speech of the hon. Member for Hackney (Mr. Holms), and he had listened with the interest that it demanded to the speech of the Chancellor of the Exchequer, which was one of great ability and immense ingenuity; but he did not think that any hon. Member was satisfied by his arguments that it was fair to tax one class of tradesmen whilst all others were free. He saw no good reason why he should be obliged to pay some £10,000, £12,000, or £14,000 a-year for liberty to begin his business, while wine merchants and others were allowed to go scot-free. The injustice thus inflicted was, he contended, one which was unparalleled in any other country. In 1860, when the duty on wine was reduced in many instances from 7s. 6d. to 1s. per gallon, no extra licence duty was imposed. If every manufacturer and trader was bound to take out a licence for carrying on his trade the brewers would not complain; but it was unjust to tax in that way one class of tradesmen alone. The Chancellor of the Exchequer was wrong in thinking that the increase of the price of hops since the repeal of the duty was the natural consequence of a large increase in the business of the country. The reason was that the grower, not being forced into the market with his hops as soon as gathered to raise money with which to pay the duty, was able to hold on and get a better price. The Chancellor of the Exchequer had said that the Brewer's Licence was an injustice in theory and not in practice; but if he had to pay £12,000 or £14,000 a-year for carrying on his trade he would find it was an injustice in practice as well as in theory.

MR. J. G. HUBBARD

recommended the hon. Member for Hackney to withdraw his Motion as premature, until the Chancellor of the Exchequer made his Financial Statement. He deprecated the idea that it was inopportune to discuss important questions of finance at any time when it was done without any intention of embarrassing a Government. He was not concerned for the brewers, and he did not believe that the imposition of this tax was a very serious injury to them, because, as in almost every other case, it was the consumer who, sooner or later, paid the tax, but he objected to it as a tax on a profession. He thought it wrong in principle to tax professions of any kind. He thought it a great advantage that the Chancellor of the Exchequer should have the opinion of the House freely expressed as to those taxes. This tax was unjust and unfair; it was a graduated tax, but graduated in the wrong direction, to the gain of the large brewer and the disadvantage of the small brewer. It was thoroughly vicious in principle, and therefore he would set his face against it.

MR. JOHN HOLMS

, in reply, said, he was glad to find that the Chancellor of the Exchequer intended to examine into a small portion of the tax, but the speech had confirmed him in his intention of going to a division. That speech contained two points—the inequality of the scale, and the time of payment; but, as the main grievance, the vexatious character of the import. He trusted that the House would go to a division, and he rejoiced that the right hon. Gentleman had, in some sense, by moving the Previous Question, challenged one; because any Government which seriously intended to take into consideration a question of that kind would be strengthened in doing so if it knew the mind of the House upon it. It was high time that the opinion of the House should be declared on that subject.

Previous Question put, "That that Question be now put."—(Mr. Chancellor of the Exchequer.)

The House divided:—Ayes 83; Noes 203: Majority 120.