§ Clause 2 (Import duties on tea) agreed to.
§ Clause 3 (Duties and drawback on tobacco).
THE CHAIRMANpointed out to hon. Members who had put on the Paper Notices of Amendments involving an increased charge on the people that their Amendments were irregular.
§ MR. RITCHIE, who had given Notice of an Amendment, in page 2, line 5, to leave out "4d." and insert "6d.," said, it would serve his purpose equally well if he moved to reduce the duty on unmanufactured tobacco by 2d. in the pound; but he hoped that the Chancellor of the Exchequer would render it unnecessary to make any proposal of that kind by acceding to the exceedingly moderate suggestion which he had to make. The cigar manufacturers in this country alleged that they laboured under an immense disadvantage as compared 1293 with the German manufacturer of cigars imported into this country. He did not wish to enter in any detail into this matter; but it must, he thought, be obvious, that in several respects the English manufacturers lay under a considerable disadvantage. In the first place, they were practically shut out from purchasing a kind of tobacco that would answer their purpose remarkably well, in consequence of the degree of moisture it contained when imported, upon which they would have to pay duty. Again, they were practically excluded from exporting their cigars, and had to trust almost entirely to the market which they found in this country for the sale of them. Such, however, was not the case with the foreign manufacturers. There were many other disadvantages under which the English manufacturers lay—such, for instance, as the cost of commission, interest on money, and the various charges for clearance. Well, all these different disadvantages, under which the manufacturers of cigars in this country were labouring, operated greatly to their disadvantage, and so allowed the foreigner to send here what their own manufacturers ought to be able to supply. Further, it was alleged that the basis upon which the right hon. Gentleman the Member for Greenwich (Mr. Gladstone), in 1863, calculated the differential duty, was a fallacious one. At that time, it was estimated that 69 lbs. of cigars could be got out of 100 lbs. of tobacco; but, so far from that being the case, he was informed that, on an average, only something like 52 lbs. or 53 lbs. of cigars could be obtained. It had been represented to him that the effect of all these things had tended almost to drive the manufacture of some kinds of cigars out of this country; and the manufacturers considered that, when it was proposed to alter the duty, they had some ground for asking that these matters should be taken into consideration. They said that they ought to be placed on the same footing as foreign manufacturers, and that something like 8d. or 9d. more should be put upon cigars. He did not go the length of pressing the Chancellor of the Exchequer to do anything of that kind; but he hoped that the right hon. Gentleman would inquire into the matter, and see whether the statements of the English 1294 manufacturers were not well founded. But he did say that, in altering the duty, care ought to be taken not to increase the disadvantages under which their cigar manufacturers at present lay. He would point out how it was that the increased duty of 4d. upon manufactured tobacco and cigars would increase the disadvantages under which their traders lay. The duty upon unmanufactured tobacco was 3s. 2d., and on cigars 5s., being a difference of 1s. 10d. If they now increased the duty by 4d. on unmanufactured tobacco and 4d. on cigars, the existing ratio between the two would be disturbed, and the English manufacturer of cigars would be placed at a further disadvantage of from 1¾d. to 2d. per lb. He entered into minute calculations, showing how this result was attained, and expressed a hope that the Chancellor of the Exchequer might see his way to adding at least 2d. more to the duty on cigars. He desired that the English manufacturer should be on an equality with the importer, not that he should have exceptional advantages. The Tower Hamlets had suffered considerably from the alteration of the sugar duties, and he hoped that the Chancellor of the Exchequer would be able to prevent a similar misfortune in the case of the tobacco manufacturers. He moved, in page 2, line 5, to leave out "4d." and insert "6d."
§ THE CHANCELLOR OF THE EXCHEQUERI assume this is an Amendment, formally moved for the sake of raising discussion on a question of considerable importance. I promised to look into this matter again. I have done so; and I have been led to the conclusion that the proposal I have made is a right one, and that there is no occasion to disturb it. The basis on which I have proceeded is the same as that on which the right hon. Gentleman the Member for Greenwich (Mr. Gladstone) proceeded in the year 1863. At that time the right hon. Gentleman gave very careful attention to this subject, and brought his proposal forward—not as a part of his Budget, but as a separate proposal for the re-arrangement of the tobacco duties. The re-arrangement of these duties was the subject of prolonged discussion in the House, and also of careful inquiries made by the Government of the day in different parts of the country. The result was, 1295 that a certain difference was established between the rate of charge on the unmanufactured tobacco and that on cigars. My right hon. Friend arrived at the conclusions, which he embodied in the law, by a calculation of this character. He took into consideration the different classes of cigars. He ascertained that, in some cases, so many pounds of cigars might be made out of 100 lbs. of leaf tobacco, while, in other cases, a very different quantity could be made. He took into view the extreme cases on both sides, and came to the conclusion that the difference he proposed to establish in the rate of duty would cover the most unfavourable case. Of course, in the cases where a larger quantity of cigars could be made out of the same quantity of leaf than that which the rate was established to cover, an advantage was obtained; or, if you like to call it so, a slightly protective duty was thus levied in favour of the British manufacturer. Even in the case of the smallest number which could be produced from the 100 lbs. of leaf, there was a slight advantage to the British producer. The foundation of the calculation was this. The right hon. Gentleman took a certain quantity of tobacco, as being capable of being made into cigars. Of the residue, he estimated how much was stalk which could be converted into snuff, and he deducted the marketable value of that snuff. He also took into account a quantity of moisture and inorganic matter, and he arrived, I think, at the conclusion that the inorganic matter was about 18 per cent of the whole. Now, I believe, upon the whole, his calculations have been found to be just. There has been really no complaint made during the 15 years or more that have elapsed since that time; and, in fact, the position of the manufacturers has been improved, because the value of the stalk which is converted into snuff is higher now than it was at the time when my right hon. Friend made his calculations. It was then 2s. 4d., and it is now taken at 2s. 8d. The increased duty, of course, will make it still more. Now, we come to the alteration which it is proposed to make by the present Bill. The points you have to look to seem to be these three. There is, perhaps, an increase of duty on the inorganic matter found in the leaf. The proposed 4d. per lb. is charged on 1296 that excess of unremunerative matter, which is calculated as 2 per cent of the whole weight, upon which the duty is paid; but which cannot, as alleged, be reckoned in the drawback. Therefore, the difference which the proposed increase of duty will make is 2 per cent, or one-fiftieth of 4d. on every 100 lbs. of tobacco. Then, the duty on the leaf, as compared with the duty on the cigar, is increased by one-fifth of a penny. That comes to 1s. 8d. per 100 lbs. Thirdly, there is the increase on the interest lost on the larger outlay, which the manufacturer incurs by having to pay duty, and being out of his money for a certain time. This, it is calculated, comes to 1s. 9d. per 100 lbs. Therefore, upon 100 lbs., you have three disadvantages by the increased duty—a loss of 1s. 9d. increased interest, a loss of 1s. 8d. for the one-fifth of a penny duty, and one-twelfth of a penny the increased disadvantage in respect of the inorganic matter. This makes a total addition of 3s. 5d. and one-twelfth of a penny on 100 lbs., or about two-fifths of a penny per 1b. Therefore, the effect of the increase of the cigar duty by 2d. would be, on the most favourable calculation, to deprive the manufacturer of that fractional amount of protection; but even this will be made up in another way. Then, taking into account that the value of the stalks is taken at 2s. 4d., but is really now 2s. 8d., or, with the additional duty, 3s.—we see that the position of the manufacturer is this much better than the right hon. Member for Greenwich intended, in 1863, that it should be. Under these circumstances, I do not think we should disturb the calculation. It was made to cover the extreme case, and I believe the extreme case is met by the duty as it now stands. If you do anything more than is necessary to meet it, you will be giving considerable protection to those below the extreme case. The cigar manufacturers, undoubtedly, point out that there has been a considerable increase in the importation of foreign cigars since the alteration in 1863; but the alteration was expressly made to allow these cigars to come in. Before that date, they were excluded by what was practically a prohibitive duty, on all but the highest and most valuable qualities. A considerable number of cigars, therefore, come into the country now that would not have come in before; but I have no 1297 reason to think home manufacturers are unfairly treated. The importation of unmanufactured tobacco has also increased since 1863. Under all the circumstances, I think it would be undesirable to make the alteration that I am asked to make.
§ SIR ANDREW LUSKsaid, there should be no doubt in the mind of the home manufacturer as to the position he held, and that position ought to be as good as that of the foreigner who sent cigars into the country. The increase in the duties ought to be proportionate.
MR. GORSThoped the Chancellor of the Exchequer would continue to give his attention to this subject, notwithstanding the speech he had just made. The question was one of great importance. It was a question of the survival or the extinction of a manufacture. The persons engaged in the cigar manufacture had two distinct complaints. First, they said the existing state of things was not fair; secondly, they said that the change contemplated by the Chancellor of the Exchequer would make matters worse. The Chancellor of the Exchequer produced a number of plausible figures—no doubt, supplied by the Taxing Department of the country—which appeared to show that the English manufacturer was on an equal footing with the foreign manufacturer. But, in a case like this, it must be clear to the Committee that there were numerous conditions of manufacture which could not be made matter of calculation. The German manufacturer commenced operations on a comparatively worthless material; but the English manufacturer's raw material was made, by taxation, of an artificially high value, and if, in dealing with this valuable material, there was any waste or loss through accident, the loss of the manufacturer was serious. He was astonished to hear from the Chancellor of the Exchequer that the stalks had now become more valuable than in 1863. He was told that this was not the case, and the reason given why it was not the case seemed plausible. In 1863, the stalk was manufactured into snuff; but, since 1863, the manufacture of cigars had increased, and that of snuff diminished. Therefore, it was said, there were now more stalks to be made into snuff, and less demand for the snuff when it was made. The Committee would be astonished to hear how the drawback was 1298 paid on the refuse—"offal," he thought, it was technically called. The manufacturer had to grind what he did not use in his manufacture into powder, and before he could realize the drawback, he had to export the powder, which he (Mr. Gorst), was told was perfectly worthless. A large quantity of this powder was now lying at Jersey and Bremen, and was perfectly unsaleable. Now, while it was unsaleable at Jersey it, of course, became worth 3s. 6d. a-lb., if it could be re-imported into England, and this was an obvious temptation to smugglers. It was hardly credible that the manufacturer should not be allowed to destroy this powder, instead of having to export it. The whole question between Members of the House who agreed with him and the Chancellor of the Exchequer was, whether the difference in the rates of duty imposed on manufactured and unmanufactured tobacco was a constant difference? The Chancellor of the Exchequer allowed an expression to escape him, which seemed to confirm the view that it was a ratio rather than a constant difference. He stated that a certain ratio was fixed in 1873, although he immediately corrected himself, and said a certain difference was maintained. All he asked the Chancellor of the Exchequer to do was to stick to the ratio—to keep the ratio the same, while altering the duty. There was no difference of opinion as to the desirability of placing the home and foreign manufacturer on an equal footing, and it was a matter of calculation how that equality was to be maintained. If there were two views of that question of calculation, the English manufacturer and the English workman should be heard on the subject as well as the taxing authorities.
§ MR. FAWCETTsaid, he would be the last man to advocate protection of home industry against foreign competition; but since maintaining, on a previous discussion, that to raise the duty on manufactured and unmanufactured tobacco by the same amount would put the British manufacturer in a worse position with regard to his foreign competitors than he now occupied, he had had the opportunity of consulting people engaged in the trade. Having carefully tested the accuracy of the facts they laid before him, and having also given his careful attention to what the Chancellor of the Exchequer had said that evening, 1299 he was bound to say he did not think the right hon. Baronet (the Chancellor of the Exchequer) had made out his case. Without going into complicated details, the Committee could look at the matter from the simple point of view already taken by the hon. and learned Member for Chatham (Mr. Gorst). He would assume that, in 1863, by the scale of duties then framed, the home and foreign manufacturers were put on a position of equality. If that were so, to raise the duty on unmanufactured tobacco by 4d., and to raise it only 4d. on imported cigars, must place the home manufacturers, protanto, in an unfavourable position. It appeared to him to be beyond the possibility of dispute, that what should be done was to adjust the duties according to their ratio, and that what should not be done was to add the same amount to each duty. The duty was formerly on unmanufactured tobacco 3s. 2d., and on manufactured tobacco 5s. It would now be on unmanufactured tobacco 3s. 6d. Making here a rule-of-three sum, the Committee would see that as 3s. 2d. was to 5s., so was 3s. 6d.—not to 5s. 4d., as the Chancellor of the Exchequer proposed to make the duty on manufactured tobacco, but to about 5s. 5¼d., or 5s. 5½d., the amount which he intended in all arithmetical accuracy to be the amount by which the duty on imported cigars ought to be raised. The difference between 5s. 4d. and 5s. 5½d. might seem small; but he was told by those engaged in the trade that the competition between the English manufacturer and the foreign manufacturer was so keen, and that the balance between them was so nicely adjusted, that even a difference in duty of 1d. or 1½d. would make a considerable difference to the trade. He hoped the Chancellor of the Exchequer wold re-consider the subject.
§ MR. RITCHIEwished to point out that the Chancellor of the Exchequer had omitted from the calculation he had given the Committee an element of great importance. He spoke about the additional duty which would be paid on 2 per cent of refuse; but he omitted to take account of the moisture which added to the weight of the unmanufactured tobacco. In 1863, the right hon. Gentleman the Member for Greenwich (Mr. Gladstone) stated that he had heard of cases in which there was 24 or 25 per cent of moisture, though no case had been 1300 strictly verified. He said, however, that there would be 14 lbs. of refuse and moisture in 100 lbs. of tobacco. If it were borne in mind that the additional duty was payable on something between 14 and 25 lbs. of refuse and moisture, which disappeared in the manufacture of cigars, it would be seen that a considerable addition must be made to the Chancellor of the Exchequer's calculation of the disadvantages under which the home manufacturer laboured. He believed, moreover, that the statement that the stalk was now worth 4d. per lb. more was an erroneous one.
§ SIR JOSEPH M'KENNA, assuming that the home manufacturer had been fairly dealt with in the scale laid down by the right hon. Gentleman the Member for Greenwich (Mr. Gladstone) in 1863, maintained that there was no coin in circulation so small as to represent the disadvantages under which the English manufacturer would labour if the proposals of the Government were carried into operation. He did not see why foreign cigars should not be sold for 4d. per lb. more than they now were, or why there should be a greater additional duty levied upon them. He maintained that 1s. 10d. represented as well now as it did in 1863 a sufficient difference between the duty on tobacco and that on cigars to recoup the English manufacturer for waste on the manufacture of the duty-paid article. Probably, there would be a slightly increased amount of capital involved in the tobacco manufacturing trade than formerly. That was, however, so infinitesimal, that, under all the circumstances, he hoped the Chancellor of the Exchequer would not yield to the seductive proposal made him for increasing the duty on foreign cigars.
§ MR. COURTNEYsaid, that the case was simply this—that a certain amount of duty was put upon a certain amount of raw and unmanufactured tobacco, out of which a certain smaller quantity of cigars could be made; and, therefore, the duty on home manufactured cigars was higher than the duty on tobacco, whether imported in a manufactured state or not. Recognizing these facts, the right hon. Gentleman the Member for Greenwich (Mr. Gladstone) made the duty on the raw material bear to that on the manufactured article the proportion of 3s. 2d. to 5s. If that was admitted to be a correct calculation, the 1301 same proportion ought to be maintained in any alteration. Therefore, in raising 3s. 2d. to 3s. 6d. a proportional increase ought to be put on the 5s., and not the same increase as was made on the 3s. 2d. If the increased duty on the manufactured article were calculated on the ratio that it bore to the raw material, the increase ought to be more than 6d. per lb.
§ THE CHANCELLOR OF THE EXCHEQUERcould not admit, with his hon. and learned Friend the Member for Chatham (Mr. Gorst), or with the hon. Member for Hackney (Mr. Fawcett), that the question was simply one of ratio. It was a mixed question of ratio and other considerations. If they were largely increasing the duty, there was no doubt they would have to increase the difference. But, in a small addition to the duty like this, they had to consider the proportion of the refuse that was saleable. They should further bear in mind the increase in the value of portions of the refuse. He believed that since 1863, when the scheme was settled, the price of the stalk refuse had very much increased, and this fully made up for any slight variation of duty arising from the present increase.
§ MR. J. HOLMSsaid, that they ought, in justice, to maintain the relative positions between the duties on raw and manufactured tobacco at what they formerly were. If that were done, the increase of the duty on the manufactured article would be something like 6d. per lb.; and if the Chancellor of the Exchequer would make that duty, it would satisfy all parties. He would further say that in manufacturing cigars there was a much larger amount of rubbish to be allowed for than the Chancellor of the Exchequer had calculated.
§ MR. DODSONsaid, that the position of the Chancellor of the Exchequer seemed to be this—that the proportion between the duties on the raw material and the manufactured article, established by the right hon. Gentleman the Member for Greenwich (Mr. Gladstone), was correct; but that since then the value of the stalk, for certain purposes, had increased, and, consequently, the ratio had become unduly favourable to the home manufacturer. By the alteration which he was now making, of adding 4d. per lb to each duty, he said he was bringing the ratio to what it 1302 was in 1863. If the addition to the duty were only temporary and to meet an emergency, then the right hon. Gentleman, when he took off the 4d. which he now imposed upon the raw material, ought to take off something more than 4d. from the manufactured article, in order to preserve what he declared to be the right ratio.
MR. GORSTsaid, the tobacco manufacturer, besides having to allow for refuse, had also to reckon upon a certain amount of moisture and sand in the tobacco. There was one statement of the Chancellor of the Exchequer which, if true, completely met the argument he had brought forward. The right hon. Gentleman said that the value of the stalk had increased so much as to make up for the additional disadvantage every manufacturer was under for not getting a portion of the drawback upon the tobacco which he rejected. Upon the best information which he could obtain, he could state that the value of the stalks had not increased. Whether that was a fact or no the Committee must decide; but he was assured, upon the most positive information, that the value of the stalks had not increased. If the tax were to be increased upon the raw material, it was a question of fair play also to increase the tax in the same proportion upon the manufactured article.
§ MR. SAMUDAobserved, that the reason given by the Chancellor of the Exchequer for not putting a proportionally increased duty on imported cigars was a weak one. He said that the present increase of 4d. all round would go far to restore the home manufacturer to the same proportion of duty which he paid when the scheme was settled in 1863. But no one would have thought of interfering with the home manufacturer had this increase in the tobacco tax not been proposed; and, therefore, the home manufacturer ought not now to be placed in a worse position than he would otherwise have been in.
§ SIR ANDREW LUSKdid not think it wise or politic or just to put the same amount of duty upon an expensive article like cigars, as upon commoner kinds of tobacco filled with refuse and sand.
§ MR. RITCHIEwas satisfied with the discussion that had taken place, and would not press his Amendment. With one exception, all the Gentlemen who had spoken had expressed themselves in 1303 favour of some increase being made in the duty on cigars; and he, therefore, appealed to the Chancellor of the Exchequer, to re-consider his decision on the matter.
§ MR. FAWCETTwould ask the Chancellor of the Exchequer to re-consider this point before the Report, on two grounds. First, that Members on both sides of the House, with only one exception, had expressed themselves in favour of an alteration in his proposals; and, secondly, that the House ought to have some reasons for what the Chancellor of the Exchequer proposed to do. At all events, the Chancellor of the Exchequer could not ask the House to express an opinion on this point. So far as he knew, there was no possible way by which the Committee could give a decision on such a question as the hon. Member for the Tower Hamlets had raised. By voting for the Amendment, the House would virtually vote against the Budget proposal of the Chancellor of the Exchequer, and deprive him of the Revenue; therefore, a division on this particular issue could not be taken. He was sure that the Chancellor of the Exchequer was desirous of doing what was fair; and, as the House could not express an opinion upon it in that debate, he thought it was not too much to ask the Chancellor of the Exchequer again to consider the matter, and to see whether he could not make some alteration in the manner suggested.
§ THE CHANCELLOR OF THE EXCHEQUERsaid, that several hon. Members had, no doubt, been in communication with those interested in the manufacture of cigars, and had received from them a good deal of information which they had naturally used in the discussion. He did not think that it was surprising that the discussion should have been against the Government on either side of the House, for it was not likely that anyone would have taken an interest on the opposite side of the question. It was the consumer who was interested in no alteration being made in a direction which would give such a protection to the British manufacturer as would exclude foreign cigars. The importers of foreign cigars had communicated with him, and had remonstrated against any increase being made in the duty on cigars in this country. The matter lay in a small compass, for the increase of duty was so 1304 small, that if it were merely adjusted on foreign manufactured tobacco, irrespective of the price of the stalks, the increase would be infinitesimal. On the other hand, if the duty were substantially raised, it would be giving a protection to the British manufacturer. With respect to what had been said with regard to the increase in the price of stalks, he was informed that stalks were now 2s. 8d. or 2s. 9d. per pound, and if the increase of 4d. were made to the duty, the price would be 3s. to 3s. 1d.
§ MR. RITCHIEobserved, the stalk referred to by the right hon. Gentleman was the dry stalk.
§ THE CHANCELLOR OF THE EXCHEQUERsaid, he could not undertake then to make any alteration in the proposals before the Committee, but he would consider the matter further before the next stage of the Bill was reached.
§ MR. DODSONobserved, that the argument of the Government was, that the adjustment in 1863 had become unjust by reason of the increased value of the stalks. The whole force of their position lay in that alleged increase, and if it were proved, the argument was sound. After the discussion that had taken place, he hoped the Chancellor of the Exchequer would make further inquiries, to ascertain if the value of the stalks really had increased.
§ Amendment, by leave, withdrawn.
§ Clause agreed to.
§ Clauses 4 to 11, inclusive, agreed, to.
§ Clause 12 (Provision as to deduction for depreciation of machinery or plant).
§ MR. WHITWELL, in moving, as an Amendment, in page 5, line 39, after "tax," to leave out "it shall be lawful for," and, in line 40, after "purposes," to insert "shall," said, he wished to express the satisfaction which he and many others felt at the clause having been introduced into the Bill by the Government. It was right that an allowance should be made for the depreciation and repairs of machinery in the assessment of the Income Tax. But, by the Bill, such allowance was permissive only, and he thought it should be made compulsory. The object of his Amendment was to make it compulsory on the Commissioners, for general and special purposes, to allow a deduction before charging the Income Tax.
§ THE CHANCELLOR OF THE EXCHEQUERsaid, the alterations were not made, because he thought them unnecessary; but he had no objection to the words proposed being substituted in the Bill.
§ Amendment agreed to.
§ Consequent Amendments agreed to.
§ MR. CHADWICK, in moving, as an Amendment, in page 6, line 1, to leave out "to," and insert "and they shall," and, in the same line, to leave out "they may think," and insert "shall be," said, its effect would be that the General and Special Commissioners should first settle the deductions for depreciation, and then, anyone who had any reason to object, would have a right to go to the Court of Exchequer, and contest the amount of the allowance. As the words stood in the Bill, the General and Special Commissioners would have a right to say what was "just and reasonable," and he feared there would be no appeal from their decision; whereas his proposition was, that a "just and reasonable" allowance should be made, and would be decided ultimately by the Court of Exchequer. The Amendment ought to be acceded to by the Government, for it was right that a "just and reasonable" amount should be allowed in respect of those deductions. The matter was left entirely in the hands of the General and Special Commissioners by the terms of the Bill. Who were the General and Special Commissioners to whom such a large discretion was intrusted? The General Commissioners were persons appointed in every town in England, and the Special Commissioners were gentlemen at Somerset House. With some experience of both classes of Commissioners, he should be inclined to take the question to the Court of Exchequer in every case in which he differed from them. Should such a discretion be invested in the Commissioners, in one town certain allowances would be made; whereas, perhaps, in the next, an entirely different set of rules would prevail. On the other hand, if Parliament declared that the deduction should be a "just and reasonable" one, an uniform rule could be readily settled. In any case, they wanted to be assessed at the full amount of their real profits, and 1306 they wished to keep their capital intact at the end of the year. For the last 33 years they had suffered under an injustice in that respect, and he was personally much obliged to the Chancellor of the Exchequer, for having, at length, honestly grappled with the question of depreciation in machinery and works, and he earnestly begged him to allow the Amendment. It would go to satisfy a numerous class of iron-masters, manufacturers, and coal-owners, by assuring them that a fair allowance would be made for depreciation, leaving their capital intact.
§ MR. KNOWLESsaid, this was the first time depreciation in works and machinery had been recognized. He was very glad it had, and thought it would be wise to put it on as firm a basis as possible, by affirming that such a deduction should be allowed as was "just and reasonable," instead of leaving it a question entirely for the opinion of the Commissioners. He did not go quite so far as his hon. Friend the Member for Macclesfield (Mr. Chadwick), in saying that he should not agree with anything that the Commissioners did; for he had found that they generally had a fair knowledge of depreciation in all classes of property. The amount of depreciation was a question of degree, some property depreciating very fast. The Local Commissioners, as a rule, had sufficient knowledge to enable them to deal justly with the matters coming before them. But still, he thought the substitution of the words "shall be just and reasonable," for "as they may think just and reasonable," would be advisable.
§ MR. ASSHETONimagined that the Commissioners would be bound to make a due allowance for depreciation, whether the words used in the Bill or those proposed in the Amendment stood part of the clause. With regard to the principle of the Amendment they were discussing, he really saw no difference between it and the words of the Bill, for the Commissioners must allow what they considered just. It was a distinction without a difference, and they could admit the Amendment or leave it alone with the same result.
§ SIR HENRY JACKSONapprehended that the distinction between the clause proposed and the Amendment was this. According to the Government scheme, the discretion of the Commissioners 1307 would be final, and, being a discretion, no Court of Law could interfere with their decision; whereas, according to what the hon. Member for Macclesfield suggested, any aggrieved manufacturer would have a right, by reference to a Court of Law, to have the propriety of the deductions allowed by the Commissioners determined as matter of law. Until some rule or standard was fixed, they ought to be contented with the concession made by the Government, and should not imperil what they had got by asking for more. It was a great advantage for the manufacturer that the Commissioners would be obliged to allow, at any rate, what they thought fit, and the question was, whether the Commissioners could not safely be trusted with a discretion in the matter?
§ MR. RITCHIEsaid, that if the General and Special Commissioners were to be allowed to exercise their judgment, without the manufacturer having any appeal, things would thus remain in a state of chaos. If the Amendment were made, any person dissatisfied could appeal to the Court of Exchequer, and have some definite rule laid down. He remembered the case of an appeal to the Commissioners, in which the question was put by them—"How much did you pass through your bankers in the course of a year?" On being told, they said—"Your returns do not show 5 per cent profit on this amount." Every mercantile man would know that profits were not to be arrived at in that way. In another case, the Commissioners Inquired into a large amount on the debit side of an account. It was explained to them that it was a loss through a Government contract, when the Commissioners replied—"that if people were foolish enough to enter into contracts with Government, and lose money on them, such a loss could not be set off." They further said that if a man were foolish enough not to insure his house and it was burnt down, the amount of loss would not be allowed him. He supported the Amendment, thinking that no more discretion than necessary should be placed in the hands of the Commissioners.
§ MR. THOMSON HANKEYventured to think that the clause as it now stood was much better than the Amendment proposed. Unless persons had 1308 some confidence in the discretion of the Commissioners, who generally gave a great deal of attention to the subject, the business of the country could not go on. It was better to trust to the discretion of the Commissioners than to go to a Court of Law. He was sure that in London, parties would rather abide by a decision of the Commissioners than appeal further.
§ MR. J. G. HUBBARDsaid, that if books were properly kept, an allowance was made for depreciation before the profits were assessed. Now, they had a legal and effective declaration to the Commissioners that that was the proper system to pursue. The clause would be entirely unambiguous, if the Chancellor of the Exchequer were, through the Inland Revenue Department, to issue Instructions to the Commissioners as to the allowances they were to make.
§ MR. RYLANDSsaid, if he had understood rightly the remarks of the hon. and learned Member for Coventry (Sir Henry Jackson), they amounted to this—that the clause as it stood would have the effect of placing entirely at the discretion of the Commissioners, the deduction to be allowed on machinery and works; and if the clause were altered in the way proposed by the hon. Member for Macclesfield(Mr. Chadwick), it would lead to this—that if the Commissioners did not make a sufficient allowance for depreciation, it would be open to the manufacturer to appeal to a higher Court, in order to get the Commissioners' decision over-ruled. For his own part, he had such confidence in his hon. and learned Friend's knowledge of law, that he was prepared to accept it; and he looked upon that statement of the law as the strongest possible argument in favour of the Amendment of his hon. Friend the Member for Macclesfield. He recognized most fully the evident disposition of the Commissioners to meet just claims on the part of the owners and occupiers, and he had the fullest confidence that they would deal in this matter in a fair and reasonable spirit. The effect of the Amendment was this—that if, through want of judgment or some other reason, a wrong decision was come to, then there was a chance of the decision being over-ruled. As he understood the Bill, it was proposed that, however mistaken the Commissioners might be, their decision must be accepted 1309 and there was no remedy. He thought that, under these circumstances, the right hon Gentleman would do well to consider favourably the proposed Amendment, and so put the clause in a shape which was likely to be satisfactory.
§ MR. ISAACthought the clause should be a compulsory and not a permissive one; as it stood, it would leave the Commissioners a great many loopholes to creep out of. It was necessary to avoid driving owners of mills, &c., into the Law Courts. Personally, he preferred the expression "shall be," and he should vote for the Amendment if there should be a division.
§ SIR ANDREW LUSKsaid, it was a very important Amendment. The right hon. Gentleman would do well to stand to the clause as it was. He could not put anything more to the purpose or more effective; it might be a hard clause, but he thought it perfectly necessary. It was a very reasonable and fair clause.
§ MR. NEWDEGATEsaid, that the Commissioners differed as to whether when machinery was let they ought to allow for depreciations or not. It was exceedingly hard that a tenant, holding under a long lease for 20 or 30 years, should not have the same benefit as an owner. The Amendment sought to impose it as a duty on the Commissioners to make the same allowance, and he should certainly support it. That was the difficulty arising in the district with which he was connected.
§ MR. GOSCHENthought the hon. Member had not quite apprehended the point. It was conceded that the Commissioners were in every case to make some allowance, and that was a very great concession. The question was whether the discretion was best confided to the Commissioners or to the Courts of Law. He presumed that the Government had been baffled in the attempt to find a principle to be introduced into the Bill. The depreciations would have to be practically worked out according to some tentative system; and the Commissioners must find their way to some equitable, universal, and uniform system. He did not think it wise to refer to the Courts—the owner would not accept their decisions, and the Courts would be laying down a system of taxation. On the whole, he certainly inclined to the clause as it stood, rather than have an immense amount of litigation.
§ THE CHANCELLOR OF THE EXCHEQUERsaid, that the right hon. Gentleman the Member for the City of London (Mr. Goschen) had very accurately appreciated the position of the Government in the matter. The hon. Member for Oldham had taken very great interest in the matter last year, and it was very much owing to his representations, and those of his hon. and learned Friend behind him that the matter had been considered. They did not attempt to clear the Income Tax or the Dog Tax from all anomalies; but it was possible to mitigate them. Last year, the hon. Member for Oldham had called attention to the matter, and an attempt had been made, but unsuccessfully, to meet the difficulties complained of. He had caused very particular inquiries to be made, by competent gentlemen, into the circumstances, and as to what could be done in the matter of allowances for depreciation; and, in the first place, he found that the principles adopted were extremely various. In the case of shipping property, depreciation was allowed for; and with railway-plant, and for much machinery used in private establishments, deductions were, more or less, made. In other cases there was none, because the Commissioners did not think themselves authorized by law to permit it. It still more clearly arose in the case of joint-stock companies, whose accounts were made up under the direction of auditors, who required that a certain sum should be set aside for the depreciation of machinery; yet, when the Income Tax was paid, the Commissioner was not justified in allowing that sum to be deducted. Those were anomalies which should be remedied, and he had attempted to lay down rules, it being found difficult or impossible to draw a satisfactory clause. In communication with the hon. Member for Oldham (Mr. Hibbert), the latter had entirely confirmed him in the view that it was better not to attempt to lay down cast-iron rules, but to leave it to the discretion of the Commissioners themselves, whereby far less injustice would be done than if such matters were made the subjects of appeal to Courts of Law. He could hardly conceive how the Courts could deal with many of those questions. They had given power to the Commissioners to make the allowance, and made it a direction to them that they 1311 should. He thought hon. Gentlemen would do well to rest content, and see how it worked.
§ MR. CHADWICKfelt disposed to withdraw his Amendment; but they wanted to avoid disputes in the future. They were perfectly willing to abide by a judicial decision; but it would be very difficult if conflicting decisions occurred in various districts. He denied that there was great difficulty in deciding what was a fair, proper, and reasonable scale of depreciation. For many years he had, as professional auditor, assisted to determine the depreciations of 60 large manufacturing and mining concerns. The words "shall be what is just and reasonable" would be sufficient.
§ MR. DODSONsaid, the hon. Member for Macclesfield (Mr. Chadwick) had given a very good reason why they should vote with the Chancellor of the Exchequer for the support of the law as it stood. He had said there was no difficulty in settling those questions. Did the House think that any Judge on the Bench, however learned, was capable of deciding those questions? It was an experimental clause; he hoped the hon. Member would not divide the House.
§ MR. ORR-EWINGsaid, that as there appeared to be very little difference between hon. Members on the subject, he thought that after what had been said by the right hon. Gentleman the Chancellor of the Exchequer the Amendment should not be pressed.
§ MR. CHADWICKbegged to withdraw the Amendment.
§ Amendment, by leave, withdrawn.
§ MR. CHADWICK, on rising to move, in page 6, line 2, after "any," the insertion of the word" buildings," said, that if the Government objected to it, and would allow the substitution of the words "so as to leave the capital intact," as proposed in the following Amendment, which would be carrying out the recent decision, he would be satisfied.
§ THE CHANCELLOR OF THE EXCHEQUERthought the Amendment would carry the principle farther than he was prepared to go, and he must object to it.
§ MR. ORR-EWINGsaid, there were many buildings which might be so described. The clause was an attempt to do justly by manufacturing persons, who had ever, since the Property Tax Act 1312 had been passed, been unjustly dealt with by not permitting them to deduct anything for depreciation. The object was to remedy that injustice; but, unfortunately, the clause of the Bill now under discussion would not carry out that intention. He was not sure what was meant by "machinery and plant." Power was given to the Commissioners to allow for depreciation upon machinery and plant, but other and valuable portions of what constituted manufactories were not brought within the operation of the clause. He thought no hon. Member who had any knowledge of business would object to a fair amount being deducted for depreciation of value in machinery and plant before the profits of a manufactory, public work, or mine, were calculated for division among the partners. He could not suppose that the intention of the law was to act unjustly, and he could assure the Committee that injustice was done by the existing state of things; because, owing to the fact that deductions were not allowed, income tax was paid upon what every manufacturer who kept his books on proper principles deducted for depreciation before dividing the profits of the year. In the case of mine owners, it not unfrequently happened that they had to pay income tax upon minerals lying beneath their lands for years before they had been brought to the surface and converted into money. He, therefore, begged to move an Amendment, in the following terms:—Page 6, line 2, leave out from "any" to the end of the clause, and insert—
Manufactory, public work, or mine, which the trader, manufacturer, or mine owner, may consider necessary to make allowance for in making a true balance of his books, from time to time, for a division of profits.
§ MR. SERJEANT SPINKSsaid, that the concession would be appreciated by the manufacturing classes; but its grace would be marred somewhat if the further concession proposed by the hon. Member for Macclesfield (Mr. Chadwick), with regard to buildings was not also granted.
§ MR. KNOWLESsuggested to the hon. Member for Macclesfield (Mr. Chadwick), that he should withdraw his Amendment on condition that the Chancellor of the Exchequer adopted the proposal of the hon. Member for Dumbartonshire (Mr. Orr-Ewing), modified in 1313 such a way as that the Commissioners of Taxes should be satisfied as to the amount proposed to be allowed, instead of allowing traders, manufacturers, and mine owners to be the sole judges of the allowances in question. He thought no difficulty could arise in the case of sound concerns if this proposal were adopted; and, further, that in such cases, a great deal of what was inquisitorial in the incidence and levying of the tax would be avoided.
§ MR. WHITWELLsupported the clause as drawn by the Chancellor of the Exchequer, and hoped its harmony would not be marred. If any alteration in it were thought necessary, it ought, in his (Mr. Whitwell's) view, to be made by means of an addition, and not by interpolation.
§ MR. CHADWICKsaid, he would not press his Amendment.
§ Amendment (Mr. Chadwick), by leave, withdrawn.
§ MR. GOLDNEYhoped the Amendment of the hon. Member for Dumbartonshire (Mr. Orr-Ewing) would not be pressed, as it would exclude the unfortunate farmers from all benefit they would otherwise enjoy under the proposal of the Chancellor of the Exchequer.
§ SIR ANDREW LUSKalso opposed the Amendment, remarking that if every man was to be allowed to judge as to the amount of Income Tax he should pay, there would be no occasion for Commissioner; who, as far as he had experience of them, had always performed important and delicate duties in a satisfactory manner.
§ MR. J. G. HUBBARDthought the Amendment ought not to be passed, on the ground that it would deprive of concessions some of the important industries which it was, and, he thought, with justice, intended to benefit.
§ THE CHANCELLOR OF THE EXCHEQUERsaid, the clause, as he had proposed it, was not drawn in consequence of any particular decision that had been arrived at, but in order to meet a difficulty which had for years been felt in regard to manufactories in which machinery was extensively used. He could not, therefore, accept the Amendment of his hon. Friend the Member for Dumbartonshire (Mr. Orr-Ewing), which 1314 would go far beyond the point he was at present willing to concede. The only additional concession he was able to make was that the clause should apply to machinery rented, as well as to machinery which was the actual property of the person using it.
§ MR. HERSCHELLthought it would be well not to press the Amendment then; but that, on the Report, it should be brought up in a modified form.
§ MR. ORR-EWINGsaid, he should be willing to accept the suggestion of the hon. and learned Member who had just addressed the Committee.
§ Amendment (Mr. Orr-Ewing) negatived
§ MR. CHADWICK moved, as an Amendment, in page 6, lines 3 and 4, to leave out "and belonging to the person or Company by whom the concern is carried on," and to insert, "so as to leave the capital intact." If they did not allow for the depreciation of hired machinery, they would be doing an act of injustice. If the worker of a mill had hired machinery, which, by arrangement with the lessor, he was bound to keep in repair, there was no reason whatever why he should not be allowed for depreciation the same as though that machinery was absolutely his own.
§ THE CHANCELLOR OF THE EXCHEQUERpointed out, that if the Amendment were adopted, it would make the remission in favour of the wrong person, because it would give the remission to the person who hired, and not to the lessor of the machinery; therefore, he proposed to retain the words which were under the consideration of the Committee, and then go on to add to the clause to meet the cases where machinery was let. The words he proposed to add were—
And where any machinery or plant is let, the lessor shall be entitled, on claim made to the Commissioners for general or special purposes, in the manner prescribed by section sixty-one of the Act of the fifth and sixth years of Her Majesty's reign, chapter thirty-five, to have repaid to him such a portion of the sum which may have been assessed and charged in respect of the machinery or plant, and deducted by such lessee on payment of the rent, as shall represent the Income Tax upon such an amount as the said Commissioners may think just and reasonable for depreciation in respect of the wear and tear of such machinery or plant: Provided, 1315 That no such claim shall be allowed unless it shall be made within twelve calendar months after the expiration of the year of assessment.Thinking these words more appropriate than the Amendment of the hon. Member for Macclesfield, he should propose to substitute them.
§ MR. CHADWICKsaid, he would agree to the Government Amendment, and withdraw his Amendment.
§ THE CHANCELLOR OF THE EXCHEQUERsaid, if the hon. Gentleman wished to put his Amendment—which he supposed he did not—so as to leave the capital intact, it would be more convenient to propose it before the words he had proposed to add to the clause were considered.
§ MR. CHADWICKbelieved, if the words were inserted as he proposed, the Commissioners would be saved a great deal of trouble. In Knowles's case in the Court of Exchequer, the three Judges had held that when coal was taken out and consumed in the way of business, it was to be allowed in deduction from the income of that business. The whole of the remarks of the Judges went to the principle of allowing, in the case of a Company or individual, the capital to remain intact; and, therefore, the insertion of those words would convey to the minds of everyone that they were not to pay on any portion of their capital, whether it had been absolutely consumed in taking out coal from a coal mine, or absolutely consumed in the wear or tear of machinery. Therefore, the words he suggested would, he believed, save a great deal of trouble and give very much satisfaction, showing plainly that people were not to pay Income Tax upon capital, as had been the case for many years. After consideration, he thought he should be compelled to take a division on the words he proposed.
§ MR. GOLDNEYsaid, as the clause stood at present, in looking at the profits of a concern, so much was to be allowed for wear and tear of machinery. As to leaving the capital intact, he did not know what the hon. Member opposite (Mr. Chadwick) meant—whether it was the capital of the concern, or whether he meant the capital of the machinery. The clause did not in the slightest degree interfere with the decision of the Court of Exchequer as regarded mines; but here it was wanted to add words which meant allowing so much in respect 1316 of wear and tear of machinery, which would keep the capital intact, or the capital of the machinery intact. He thought the words really had no sense at all, and, instead of being clear, they would only be misunderstood.
§ MR. NEWDEGATEadvised the consideration of the addition proposed to the clause by the Chancellor of the Exchequer, to see if that did not meet the views of the hon. Member for Macclesfield (Mr. Chadwick).
§ SIR ANDREW LUSKsaid, capital intact would mean the capital in the business, but the business might not be intact for various reasons. The question was a difficult one for anyone to go into. The words of the hon. Member for Macclesfield (Mr. Chadwick) might do very well on a piece of paper; but when they came to sit down, and give a decision upon them, it would be found that they involved considerations which could not be dealt with at all. He did not know how they could go into the question of capital in a business, and he hoped the Chancellor of the Exchequer would resist the Amendment. At the same time, he wanted to make an appeal to the right hon. Gentleman. He had proposed, he believed, a very reasonable Amendment; but he thought it only fair to the Committee to ask to have it brought up on the Report. If they saw the proposal in print, they would have an opportunity of considering what it was like; but he thought it impossible to gather all the meanings and intentions of an intricate Amendment on hearing it read. He hoped the right hon. Gentleman would consent to bring up his addition to the clause on Report.
§ MR. J. G. HUBBARDadvised the hon. Member for Macclesfield (Mr. Chadwick) to withdraw his Amendment. As to the addition to Clause 12, proposed by the Chancellor of the Exchequer, he (Mr. Hubbard) had been completely lost while it was being read, and he should be glad to see it in the Paper before it was agreed to.
§ MR. WHITWELLhoped the hon. Member for Macclesfield (Mr. Chadwick) would not press his Amendment. With regard to the addition proposed by the right hon. Gentleman the Chancellor of the Exchequer, he (Mr. Whitwell) had a strong wish to see it in the Paper, and for this reason—at present, a great deal of machinery was let on a term of years, 1317 subject to its value being kept up, and restored to the lessor exactly the same as it was handed over to the lessee. Therefore, it would not be at all consistent for the lessor to receive a reduction in Income Tax for depreciation of machinery, inasmuch as the lessee would have made all depreciations good, and he would very naturally expect to get this money back again at the end of the lease. Therefore, he hoped the right hon. Gentleman would see his way clear to place his Amendment on the Paper.
§ MR. CHADWICKwithdrew his Amendment.
§ Amendment, by leave, withdrawn.
§ THE CHANCELLOR OF THE EXCHEQUERwas sorry to have to refuse to put the Amendment on the Paper. The fact was, that the point had been considered by the Inland Revenue officials, and they thought such an Amendment as he had proposed would be advisable. They prepared it, and the object of it was, that if a man let his machinery, the person who had to pay rent for it should be entitled, on paying his rent, to deduct the income tax which he was charged, and the person to whom the rent was paid should have a portion of that income tax in respect of his machinery. That, he thought, would be a reasonable proposal to pass.
§
Amendment made, by adding, at the end thereof, the following words:—
And where any machinery or plant is let, the lessor shall be entitled on claim made to the Commissioners for general or special purposes, in the manner prescribed by section sixty-one of the Act of the fifth and sixth years of Her Majesty's reign, chapter thirty-five, to have repaid to him such a portion of the sum which may have been assessed and charged in respect of the machinery or plant, and deducted by such lessee on payment of the rent, as shall represent the Income Tax upon such an amount as the said Commissioners may think just and reasonable for depreciation in respect of the wear and tear of such machinery or plant: Provided, That no such claim shall be allowed unless it shall be made within twelve calendar months after the expiration of the year of assessment."—(Mr. Chancellor of the Exchequer.)
§ MR. CHADWICKdesired to see the Amendment in print.
§ MR. HERSCHELLsaid, in the case of a man who owned machinery, it was quite clear that the deductions for depreciation would come to him. But in the case of a lessee, who was to bear the loss by depreciation? It was not unfrequently 1318 the case that when machinery was let, the real person on whom the loss fell was the lessee, who was bound by his agreement to restore it just as he found it. Therefore, the lessor in that case sustained no loss by depreciation, because the cost of depreciation in no way fell upon him. Therefore, he thought the matter required a little consideration.
§ THE CHANCELLOR OF THE EXCHEQUERsaid, the Amendment would be printed in the Votes on Tuesday, and would be in the hands of hon. Members, who would be able to see how the clause stood. Then, if anyone wished to make any other Amendment on Report, it was competent for him to do so.
§ SIR ANDREW LUSKthought it unreasonable on the part of the right hon. Gentleman not to agree to place the Amendment on the Paper. As he had previously said, he believed the Amendment might be what was desired, but surely it was a reasonable request to ask that it might be allowed to come up on Report. [The CHANCELLOR of the EXCHEQUER: It will come up to-morrow.] That might be so, but he thought the Committee ought to have an opportunity of discussing the matter after it had been placed on the Paper, and not on the Report.
§ MR. GOLDNEYsaid, the Amendment of the Chancellor of the Exchequer was not like a fresh Amendment, coming on before it had been placed on the Paper. In his Amendment, the Chancellor of the Exchequer had adopted language which he thought would meet the case, and which had been approved by the Inland Revenue authorities.
§ Amendment agreed to.
§ Clause, as amended, agreed to.
§ Clause 13 (Amendment of the law as to inhabited house duty).
§
MR. J. G. HUBBARD moved, in page 6, to add the following subsection:—
Where any dwelling-house, partly occupied by a shop or warehouse for goods exposed to sale, is chargeable under the Act of the fourteenth and fifteenth Victoria, chapter thirty-six, with a duty of sixpence in the pound, that duty of sixpence shall be charged whether the premises be occupied by the owner or by a tenant or tenants of the owner.
He considered it perfectly absurd that because the owner of a house in which
1319
he had a shop lived somewhere else, and not in the shop premises, that he should pay a duty of 9d. and not of 6d. Such a proceeding simply made it obligatory that the owner and occupier should be the same man. At present there might be two houses with shops, both exactly alike, owned by two persons; but, whilst the one who lived on the premises only paid a duty of 6d., the one who let a portion to a tenant had to pay 9d. He thought nothing more need be said to get rid of such an anomalous clause, and he hoped his right hon. Friend would adopt his Amendment.
§ THE CHANCELLOR OF THE EXCHEQUERsaid, he could not agree with the principle which was contended for, because the Government regarded this tax not as being, in this sense, imposed upon the premises, but as a tax with reference to the person who occupied the premises. The truth was, that when a shop-keeper was obliged to take a shop in an expensive part of the town for the purpose of carrying on his business, and when he occupied some of the rooms over the shop as a dwelling-house, he was not rated as if the house were his dwelling-house; but it was generally allowed that he was living there in a more expensive situation than his means would otherwise allow from the necessity of attending to his business. But, if he left his business and went elsewhere to reside, and if he made profit out of the rooms above his shop by letting them to the other persons in order that he might derive advantage from the high rents in Bond Street or Regent Street, for example, then it was fair and reasonable that the portion of the house so let should be charged with a proper proportion of the tax. An alteration had been made by this clause, which would give relief in cases where the house and the shop were let as separate tenements. If the shop were not occupied at night, it would come under this new proposal of the law.
§ Amendment negatived.
§ COLONEL MAKINS moved the insertion of a sub-section exempting the Inns of Court and the Universities from payment of the Inhabited House Duty.
§ THE CHANCELLOR OF THE EXCHEQUERsaid, he must ask his hon. and gallant Friend to give Notice of his Amendment, which, he added, might be 1320 considered on the Report of the Committee. The point raised was new to him, and he was unable, without further consideration, to say whether it would be desirable to insert the Amendment in the Bill.
§ MR. HERSCHELLsaid, the Inns of Court and the Universities appeared to him to stand on a different footing under this clause. He was by no means sure that, as regarded the Inns of Court, the case would not be met by the words as they at present stood, though the Universities might not be exempted.
§ COLONEL MAKINSsaid, he should be quite content if the Chancellor of the Exchequer would consider this proposal between the present time and the bringing up of the Report.
§ Amendment, by leave, withdrawn.
§ Clause agreed to.
§ Clause 14 (Amount fixed by the Treasury to be paid to clerks to Commissioners in lieu of allowances in certain cases).
§ SIR HENRY SELWIN-IBBETSON moved to insert, in line 4, the words "exclusive of necessary office expenses."
§ Amendment agreed to; words inserted accordingly.
§ Clause, as amended, agreed to.
§ Clause 15 (Appeal from High Court of Justice in cases stated under the Customs and Inland Revenue Act, 1874).
§
SIR HENRY SELWIN-IBBETSON moved to add, page 7, line 12, the words—
And from the decision of the Court of Session as the Court of Exchequer in Scotland upon any case so stated in the House of Lords.
§ SIR ANDREW LUSKdesired to know what was the object of the Amendment?
§ SIR HENRY SELWIN-IBBETSON, in reply, said, that its object was to bring the law relating to taxes into harmony with the law relating to the Legacy and Succession Duties. In the case of the Legacy and Succession Duties, an appeal lay to the Court of Exchequer, and from thence to the House of Lords. No such appeal was allowed in cases relating to these taxes, and this seemed rather absurd, inasmuch as many of the questions relating to the levying of taxes were of a most important nature.
§ MR. COURTNEYthought that the clause, as it stood, provided only for appeals to the Court of Exchequer in certain cases, and did not allow of appeals being taken from the Court of Exchequer to the House of Lords.
§ THE CHANCELLOR OF THE EXCHEQUERsaid, his hon. and learned Friend the Solicitor General had called his attention to the matter. His hon. and learned Friend said that, although, in his opinion, it would not be absolutely necessary, yet it would be desirable, in order to make the point quite clear and free from ambiguity, to add to the clause the words "and from thence to the House of Lords."
§ SIR ANDREW LUSKobserved, that he was of a rather Conservative disposition, and was content to let things remain as they were. The income tax had been levied for 35 years on the old principle, and why should the Government now open a field for new litigation by allowing appeals to be made from one Court to another?
§ THE CHANCELLOR OF THE EXCHEQUERbelieved his hon. Friend the Secretary to the Treasury had already explained that, in all cases involving questions of liability to Legacy or Succession Duty, the Crown had a right to appeal from the Court of Exchequer; whereas, in tax cases, there seemed to be at present no such right. Surely it was highly desirable to make the law uniform.
§ Amendment agreed to; words inserted.
§ THE CHANCELLOR OF THE EXCHEQUERthen moved to add to the clause the words "and from thence to the House of Lords."
§ Amendment agreed to; words inserted.
§ Clause, as amended, agreed to.
§ Clause 16 (Serjeants' Inn transferred to City of London for purposes of taxes) agreed to.