RESOLUTION. (Hansard, 7 June 1878)

§ MR. O'DONNELL,
on rising to move— That, in the opinion of this House, the present system of Land Taxation is inequitable, and requires to be amended, said, the land tax appeared to be an extremely valuable contribution to the public revenues, for it purported to be 1356 assessed at the rate of 4s. in the pound on the yearly value of lands, tenements, and hereditaments throughout Great Britain. The lands throughout this country, as the House was aware, were all originally held on certain tenures from the Crown, and the idea of actual property in land was an idea which had only sprung up comparatively recently. The primary idea of landholding was a trust and enjoyment of certain benefits on condition of performing that trust. The landowner held lands on condition of supplying men and arms for the Public Service for the defence of the country. The original signification and purport of what was now called the land tax was to provide for the Military Estimates of the Kingdom by various forms of knight service. By the Restoration Parliament, however, all the old knight tenures and military burdens upon land were swept away. After the Restoration the relief of land from taxation laid the foundation of the whole of that system of taxing commodities which rose to such an enormous height during the 18th and a portion of the 19th centuries. When the Revolution resulted in setting William and Mary upon the Throne in the year 1692, there was a new arrangement. The landed gentry were somewhat at a discount at that period. They generally espoused the cause of the exiled Sovereigns, and owing to the pressing necessities of the new Government, recourse was at once had to the historical methods of raising taxes, and thus a land tax to the amount of 4s. in the pound was imposed. Under the Act of William and Mary the yearly value was returned at £2,000,000, in round numbers; more than 100 years afterwards, in 1798, when another change took place, notwithstanding the immense increase in the value of land, the Return was principally the same as it was in 1690. The landed gentry were still largely actuated by feelings of loyalty to the exiled house, and were probably objects of greater suspicion than Irish tenant righters of the present day. Sir Robert Walpole, therefore, thought it necessary to instil feelings of loyalty by a system very nearly tantamount to bribery. Under the powers granted by the Act of George III., about half of the land tax existing at the end of the last century had been redeemed, and he admitted that that fact threw some difficulty in the way 1357 of a re-adjustment of land taxation. If they looked at the yearly value of lands, tenements, and hereditaments, they could easily arrive at some knowledge of the great inequalities of the land taxation. In Surrey the nominal tax of 4s. in the pound upon the full actual value of the lands really amounted to 7⅛d. in the pound. In Yorkshire it amounted to 7½d. in the pound; in Middlesex it realized 1⅜d. in the pound; in Lancashire only ⅛d. in the pound; in Bedfordshire 4¾d. in the pound; in Berks, 3½d.; and in Bucks, 3 1–16d. If the full rate of 4s. were levied it would bring in £26,000,000, and yet it now only produced £1,000,000 per annum. There was the greatest possible difference in the incidence of the tax throughout the different counties in Great Britain, and if the Government were to do nothing more than introduce some equalization of the incidence of the tax—if they were only to make a 3d. or a 6d. tax all round—it would abolish what was only a farcical contribution to the Imperial Revenues. He had no doubt whatever that the reform of the land tax in this country and the simplification of the whole system of raising Revenue were questions that would have to be faced, if not by a Conservative, certainly by a Liberal Administration. The taxation on land still bore on its face the impress of the process which was had recourse to in olden time for the purpose of reconciling the landholding class to important constitutional changes. It was time to relieve the public burdens from the evils which they suffered owing to the bribing of Jacobite gentlemen into accepting the Hanoverian dynasty.

§ MR. O'CLERY
seconded the Amendment.

§ THE CHANCELLOR OF THE EXCHEQUER
said, the Motion covered a much larger ground than the speech in which it was introduced. The Motion had reference 1358 to the present system of land taxation, whereas the speech was entirely confined to the land tax, and he did not know whether it was even reasonable to call the land tax a part of their present system of land taxation. If, however, it were reckoned a part, it certainly constituted only a very small part of the system, and it would be perfectly impossible to discuss the question of the land taxation of this country on the exceedingly narrow basis suggested by the land tax. With regard to the land tax, he did not think it desirable to go into the historical arguments which the hon. Member had suggested to the House. The effect of all the proceedings, taken together, was that the land tax, as a source of taxation, was, in point of fact, abolished by the change which was made by Mr. Pitt, when it became no longer a tax, but a rent-charge upon the land. For the last century, or nearly so, land had changed hands subject to that burden. About the time Mr. Pitt dealt in this way with the land tax, he instituted a different system of taxing landed and other property by the introduction of the property and income tax. In treating of the taxation of land, they must consider the burden of taxation which fell upon land through the instrumentality of that which was really a tax—namely, the income tax, in as far as it fell upon landed property. That, however, would lead them into a very wide field, into which they ought not to be tempted to enter by a speech which was confined to the land tax. With regard to the land tax itself, he believed there was nothing to be done except to leave it as it was; but if it were changed, some system of compulsory redemption ought to be applied to it, so as to extinguish it altogether, and then the matter might be dealt with de novo. But to re-arrange the land tax, and to bring about what the hon. Member for Dungarvan had termed an equitable adjustment of the tax, in relation to its charge upon one class of the country and upon another, would be quite impossible, and would itself lead to inequitable consequences.

§ MR. PARNELL
denied that it was Mr. Pitt's intention to convert the land tax into a rent-charge, and hoped that next Session the hon. Member for Dungarvan (Mr. O'Donnell) would have an opportunity on the Budget of going 1359 more fully and clearly into his views upon the question of land taxation.

§ MR. O'DONNELL
expressed a wish to withdraw his Amendment, announcing, at the same time, his intention to bring the whole subject forward again next Session.