§ SIR JOSEPH M'KENNA,
in rising to call the attention of the House to the inequality of Imperial Taxation on Ireland; and to move for a—Return of the Gross Imperial Revenue of Ireland derived from taxation, and of the Population of Ireland for the years 1851, 1861, 1871, and 1881, and a like Return for Great Britain for the same years, being in both cases a continuation, in like form, of Parliamentary Paper, No. 407, of Session 1874,said, he noticed that the hon. Member (Sir George Campbell) had given Notice to insert "Scotland" instead of "Ireland;" but he begged to say that if the hon. Member made out his case for Scotland against the rest of Great Britain that would only strengthen the Irish case. When he had last addressed the House on the subject of the unequal incidence of Imperial taxation on Ireland as compared with Great Britain the right hon. Gentleman then, as now, at the head of Her Majesty's Government (Mr. Gladstone) had heard what he had to say on the subject—or, at least, heard all he had said, for his (Sir Joseph M'Kenna's) speech was not concluded when it appeared fit to the officials of the Government whose duty it was to "keep a House" or permit "a Count out," to allow the latter alternative to be availed of. There was not so much danger of a similar catastrophe to-night; and yet he would ask hon. Members for English and Scotch constituencies to give some attention to the case he was about to submit, as it was the key to 1040 understanding many things connected with Ireland which at first sight did not appear to be connected with Imperial taxation. It was not his intention to accuse any particular Party or Statesman of intentional injustice to Ireland in the matter of Imperial taxation. He should content himself by exhibiting the case as it stood, showing by Parliamentary Returns how the taxation of Ireland had been increased, and by what proportions, decade by decade, since 1841, in the face of a waning population; whilst in the case of Great Britain, notwithstanding a vast increase of population and wealth, and the natural and consequent increased charge for carrying on the Business of the State, the taxation of Great Britain had been so regulated, and the Revenue so husbanded in her favour, that the pressure of taxation had been continuously lightened, so that as the taxes increased in actual amount their pressure—whether measured by the growing wealth of the country or by their incidence in respect to each head of the population—was less in 1871 than in 1841, 1851, or 1861; and he believed it would be equally shown that the pressure so measured was still less in 1881 for Great Britain. Before he entered on the details of this comparison, he was bound to explain wherein consisted the injustice of the disparity of taxation. Adam Smith laid down in his Treatise on The Nature and Causes of the Wealth of Nations (Book V., Chapter 2) this proposition, which had never been contested—The subjects of every State ought to contribute towards the support of the Government, as nearly as possible, in proportion to their respective abilities—that is, in proportion to the revenue which they respectively enjoy under the protection of the State. The expense of government to the individuals of a great nation is like the expense of management to the joint tenants of a great estate, who are all obliged to contribute in proportion to their respective interests in the State. In the observation or neglect of this maxim consists what is called the equality, or inequality, of taxation.That maxim in the case of Ireland had been for the last 30 years grievously violated. He held in his hand the Parliamentary Return of the 7th of August, 1874, which gave the Revenue derived from taxation of Great Britain and Ireland at the decennial periods 1841, 1851, 1861, and 1871, furnished by the Treasury, by Order of this House, on his 1041 (Sir Joseph M'Kenna's) Motion. The year 1841 was included in that Return in order that the House might have, in juxtaposition, the taxation of Ireland, before, as well as after, the Famine of 1846. The gross Imperial taxation of Ireland in 1841, with a population exceeding 8,000,000, was £3,907,238. The Irish people were not lightly taxed, then, but heavily taxed, having regard to actual ability. Nevertheless, 41 years after the Union, measured by population, the taxation was 9s. 6¼d. per head, and no more. The Imperial taxation of Ireland in 1851 did not recede as compared to 1841, although the population was reduced from 8,175,124 to 6,552,385. The taxation of Ireland in 1851 was £4,006,711. One should rather have expected a reduction. He founded no complaint on that, however; he merely asked hon. Members to bear in mind that 51 years after the Union the Imperial taxation of Ireland stood at £4,000,000 sterling. Owing to the decrease of population over which this taxation had to be distributed, the incidence measured per head rose from 9s. 6¼d.in 1841 to 12s. 2¾d. in 1851. The next decade showed more astonishing figures. Between 1851 and 1861 the Imperial taxation of Ireland was raised from £4,006,711 to £6,420,378, an awful bound, quite 60 per cent increase of the burden; but a still greater increase when measured by each head of the diminished population which had to bear it, for it showed an advance from 12s. 2¼d. to £1 2s. 1¼d. per head, being about 75 per cent in the decade. Between 1861 and 1871 the Imperial taxation of Ireland increased from £6,420,000 to £7,086,593, which showed an increase of 75 per cent as compared to the amount at which it stood 20 years before; but this increase, operating on a still diminishing population, raised the incidence for each head of the population from 12s. 2¼d. in 1851 to £1 6s. 1d. in 1871, an increase in the 20 years of 120 per cent. And he ventured to say that when they obtained the Return which he now looked for, it would be shown that owing to the diminution of the population—even though the gross taxation had ceased to ascend—that the increase of taxation, as measured per head of the population, had grown still more severe. He (Sir Joseph M'Kenna) had adverted to the rule laid down by 1042 Adam Smith, that taxation should, as nearly as possible, be levied on the subjects of a State in the ratio of the incomes which they enjoyed under its protection. That principle applied in strongest force to Empires made up of several Nationalities, and where the possessions of an entire people might be measured with approximate accuracy. How that principle had been set at nought in the case of Ireland and Great Britain he expected to make very clear. In 1851 the Imperial taxation of Ireland was, as compared with that of Great Britain, as one to 12. In 1861, owing to the disproportionately increased levy of Imperial taxation in Ireland, the proportion of the Irish contribution was raised to that of one to nine. In 1871, owing to the still further increase of Imperial taxes on Ireland, the proportion was raised to that of one to eight. Since then, so far as Ireland was concerned, there had not been a vestige of relief or amelioration of any kind. A Return obtained by the hon. Member for Stafford (Mr. M'Laren) in 1884, to which he (Sir Joseph M'Kenna) should again have occasion to refer, would show that for the year ended March, 1883, the Imperial taxation levied off Ireland only amounted to a sum equal to l–10th of Great Britain; but no burden had been struck off Ireland in the meantime. That country had simply broken down, and her purchasing powers had fallen away in the ratio of the diminution of the population since 1871. He (Sir Joseph M'Kenna) should now elucidate the unfairness of the increase of the taxation in Ireland by showing what was the course of things in Great Britain in respect to Imperial taxation within the period 1841 to 1871. The taxation of Great Britain, measured relatively to each head of the population, was—in 1841, £2 9s. 9¼d.; in 1851, £2 7s. 4¼d.; in 1861, £2 9s. 9s; in 1871, £2 4s. 1¼d.—showing a decrease of 11 per cent in the incidence, as measured in respect to each head of the population, between 1841 and 1871. When the like test was applied to the taxation of the population of Ireland, it was found that it had been augmented from 9s. 6¼d. per head in 1841 to £1 6s. 2¼d. in 1871, an increase of 175 per cent, mark, during the very same period when the pressure of taxation was reduced 11 per cent in respect to 1043 each head of the population of Great Britain. But, then, he (Sir Joseph M'Kenna) had been told that the taxation for each head of the population of Great Britain still greatly exceeded the taxation in respect of each head of the population of Ireland. Yes, truly; and the taxation in respect to each head of the population of Ireland was five times as great as the taxation in respect to each head of the population of India; but that did not prove that the Indian population was not more heavily taxed than the Irish, for taxation had to be estimated, and ought to be levied, in proportion to wealth, and not in the ratio of numbers. He (Sir Joseph M'Kenna) had adduced the comparison of the taxation in respect to the populations of Great Britain and Ireland simply to show that in regard to Great Britain it had demonstrated progressive alleviation, and in respect to Ireland an extraordinarily progressive increase of burden. As to the relative powers of Great Britain and Ireland to sustain taxation, he should be more specific presently. There was nothing which he then adduced that had not been within the knowledge of Parliament for more than 10 years; but the legitimate arguments based thereon had been met with every form of evasion. One right hon. Gentleman, a Chancellor of the Exchequer, who now adorned the Upper House, had the temerity to say that Ireland was not taxed at all, but individuals, no doubt, were taxed who happened to reside in Ireland; but their taxation must have been just and fair, because the same tariff was applied in respect to the same articles, whether consumed in Ireland or in Great Britain, and so he disposed of all grievance, ignoring, or affecting to ignore, the fact that unless the habits of the different nations constituting the United Kingdom were identical, and their relative wealth equal, the fact of identity of impost or duty applying to the articles they all more or less consumed afforded no guarantee whatever for the equality of their taxation. Another right hon. Gentleman, who had also been translated to the same convenient haven, whilst admitting the general facts, and that a case of disparity had been made out, raised this phantom of an argument—that he doubted whether it might not be shown that great disparity existed 1044 in the incidence of taxation in one district of England as compared to another; and so he generalized that, because some disparity might exist between one part of England and another, nothing was to be done to mitigate the disparity of taxation between Great Britain as a whole and Ireland as a whole—not even a Commission of Inquiry or a Select Committee was necessary. Not the slightest attempt was made to show why the taxation of Ireland should be increased £3,000,000 a-year contemporaneously with a decrease of 3,000,000 of the population of the unfortunate country; and so things had gone on from bad to worse, redress appearing impossible. All that time there had been great sympathy in England with any foreign Nationality or State which rebelled against its Sovereign or Suzerain. There was slight heed for Ireland calling out in her distress whilst her people were flying from her shores. But the House, as at present constituted, would expect him (Sir Joseph M'Kenna) on this occasion not merely to point out the fiscal results, but to show how the injustice of which he complained had been carried out, and particularly to show how it was possible that a common tariff, applicable with similar duties to Great Britain and Ireland, should favour the former, and work out conspicuous injustice to Ireland. He would explain all this, not exhaustively, but, he hoped, sufficiently. The greatest source of Revenue in the United Kingdom—of the many which existed—was that which might be generalized under the head of "Taxes on Alcoholic Beverages." These were not regulated according to any scientific principle. If it were so, they would, doubtless, be taxed equally, having regard to the quantity of alcohol contained in each. The disparity of duties, however, in respect to alcohol was not of recent origin; but the nature of the disparity had been in our own times altered, and this alteration had been made so as to give England the greatest advantage, and to press with extreme and exhaustive severity on Ireland. From 1840 up to the year 1880, with a slight interval, the Malt Duties—which were, in fact, the duties on brewers' drinks, ale, porter, and beer—had been levied at the rate of 2s. 8¼d. a-bushel on the dry malt. There had also been a duty on hops, another ingredient of beer; but he would take 1045 no further notice of that duty at present, but content himself by saying that the duty was in its result equal to a tax of 2s. a-gallon on the alcoholic equivalent of every gallon of proof spirits contained in the beer. Since that time, in 1880, the Malt Duty had been repealed, and for it was substituted a duty on the brewed liquor computed according to its alcoholic strength. When the right hon. Gentleman now at the head of Her Majesty's Government (Mr. Gladstone) carried the measure for commutation of the Malt Duty into a Liquor Duty, he exposed the fact that the duty on the English national beverage of beer, porter, and ale was only 2s. in respect to the alcoholic equivalent of every gallon of proof spirits contained in the brewed drink. Everyone would agree that in that case there had been an enormous disparity in the tax on alcohol where brewers' drinks constituted the chief popular beverage, as they did in England, contrasted with the duty of 10s. a-gallon on the Irish popular beverage, to which it had been raised from 2s. 8d. a-gallon, the rate of duty in 1853. Now, they had to consider the effect of the increase of the Spirit Duty from 2s. 8d. a-gallon to 10s. a-gallon between 1853 and 1871. The effect of the increase of duty would be illustrated by the following fact, shown by the Return in his hand, if carefully examined. From a population reduced by 1,140,000 souls, and in spite of a reduced consumption of 1,700,000 gallons, there was extracted £2,300,000 more tax on this one article in the year 1871 than in 1851. That was a contemporaneous relief of so much to England. Every additional pound levied off the people of Ireland went as palpably in relief of English taxpayers, or in reduction of the National Debt, as if the amount had been levied off Ireland as a rate in aid or a war ransom. Some people were surprised, or affected to be surprised, for some years past that things had, so to say, broken down in Ireland, and that there had been an uprising against rent. He (Sir Joseph M'Kenna) was certainly not surprised, except that all that had not occurred in Ireland many years before. In no part of Europe, or of the world, so far as he knew, did so monstrous a system of fiscal injustice prevail as the fiscal system of the United Kingdom in its bearing on Ireland. He (Sir Joseph M'Kenna) 1046 attributed no malignant design to anyone; he left it for those who were curious on such matters to determine whether the permanent officials of the Treasury in former years, or the Statesmen who held Her Majesty's Seals of Office, were, or had been, the real authors and inventors of the system. But see in what it had eventuated. In extracting an annual amount of Imperial taxation from Ireland, which, measured by income, would require an Income Tax of 5s. 3d. in the pound to commute it, whilst to commute the whole Imperial taxation of Great Britain into an Income Tax would only require a rating fractionally in excess of 2s. 6d. on identical Schedules to those of Ireland—he could give the precise computations, but that he feared to weary the House, whose indulgence he had already trespassed upon. There had been a Return obtained a few Sessions before by the hon. Member for Stafford (Mr. M'Laren), which purported to give the actual and relative contributions to Revenue by taxation of each of the three countries constituting the United Kingdom. By that Return it appeared that the Revenue raised by taxation in Ireland equalled in amount l–10th of the sum raised by taxation in Great Britain for the year ending 31st March, 1883. He (Sir Joseph M'Kenna) assumed that Return to be accurate. But what did it show? That Ireland paid Imperial taxation equal to l–10th of the amount paid by Great Britain, when, in fact, on former statements of equal authority, her fair proportion would have been l–18th or l–20th; and when that very Return showed that for the year it dealt with—to 31st March, 1883—the taxation of Ireland, measured by the Income Tax, should have been only the l–22nd. The proportion of the relative ability of Ireland to bear taxation, estimated as l–20th of that of Great Britain, he might shortly state, was taken from a Treasury Return of 24th April, 1882, which showed that each penny Income Tax for Ireland yielded £95,000 only, whilst that of Great Britain was set down in the same Treasury Return as £1,946,000 for each penny, a sum 20 times larger than the penny yielded for Ireland. But whilst revolving all those computations and considerations in his mind, after a series of denials from several Chancellors of the Exchequer 1047 that there was really anything abnormal in the incidence of Imperial taxation, after hearing, ad nauseam, that Ireland was a favoured nation, treated with more than sisterly self-sacrificing affection by Great Britain, spared some—albeit trifling—taxes which England paid, but at any rate saved something, he (Sir Joseph M'Kenna) read in the columns of a morning paper a letter which he believed to be from the highest official statistical authority in the service of the Government, which letter confessed all that had been hitherto denied. This was from the letter of "Economist" (Mr. Giffen) in The Daily News of the 6th of this present month (February, 1886)—At present Ireland pays more in taxes than her fair share, comparing her resources with those of Great Britain. The figures are not quite certain; But the Irish taxpayer appears to contribute £6,700,000 a-year to the Imperial Exchequer, whereas his proper contribution ought not to be more than half of that sum."Economist" (Mr. Giffen) then went on to say that Ireland had more than her proper proportion spent upon her. These were his words—The Imperial Exchequer thus gets out of Ireland, in the first place, about £3,200,000 more than it sought to get, and then spends upon the internal administration of Ireland the whole amount.And then he fairly went on to say—The expenditure does not benefit Ireland as it ought to do; but neither does Great Britain gain.He (Sir Joseph M'Kenna) did not complain of these addenda; but he might remark that the chief expenditure on the Imperial Establishments in Ireland, save for the convenience of Great Britain, might as well be made elsewhere—in Malta or Cyprus—except to the extent of £1,000,000 or £1,500,000 a-year. The feeding and lodging and clothing of the Army, the outlay for ordnance, ships, sailors, and the like, were Imperial business; and the charges for all these things had rightly to be defrayed out of the Imperial Revenue, to which Ireland ought to contribute her full quota, and no more; and the amount which Ireland should contribute to the general Revenue of the Empire should be assessed at precisely the same amount if the outlay had been made at London, Malta, Cyprus, Woolwich, or Southampton, as 1048 if it had been made at Dublin, Cork, or Athlone. He maintained that England, as the chief member of the Empire, and with the strongest interest in preserving its unity and integrity, had the greatest reason to maintain that view. However, all that was somewhat beside the question, and he should not pursue it; but he might say that all he had contended for in that House and outside for the last 20 years was now practically acknowledged, and might be proclaimed without fear of refutation—namely, that the burden of Imperial taxation had been made to fall on Ireland for the last 30 years with double the weight of its incidence than on the wealthier Island. He (Sir Joseph M'Kenna) would now make a few observations on a case suggested or attempted to be set up in mitigation of the injustice of the proven disparity. That case might be shortly put in this form—that the extraordinary levy was in some degree compensated for by the outlay in Ireland of a much larger sum annually than what was now admitted or proved to be her fair share of the expenditure. The writer in The Statist puts this forward for what it might be worth. "Well, it was literally worth nothing. The local taxation of Ireland was £4,000,000 a-year; that also was a greater levy, in proportion to the wealth of the two Islands, than the levy for local taxation of Great Britain. But the case of Ireland which he (Sir Joseph M'Kenna) desired to put was this—that in 1841, when her population exceeded 8,000,000, her Imperial taxes were barely £4,000,000 sterling; that in 1851 they were barely £4,000,000, and that the injustice of the increase of £8,000,000 of annual taxation, without the slightest evidence that Ireland had any pecuniary benefit thereby, was manifest and monstrous. It appeared to have been the policy of the Treasury for some years past to make the real state of the accounts between Great Britain and Ireland as obscure as possible. Up to 1862 the Treasury had been in the habit of publishing the expenditure of Irish taxation separately from that of Great Britain. Since then, however, no such course had been pursued, and they were left to grope through the Returns of various Departments to make some approximate calculations. He (Sir Joseph M'Kenna) should, however, take the latest dissected Beturn—that for 1862— 1049 and tell the House the account it gave of the expenditure of Irish Revenue. In 1862 the Revenue made up of Irish taxation amounted to £6,736,281, and this was how it was expended:—Army and Ordnance, £3,240,380; interest and management of Debt, £1,240,980; miscellaneous payments (including Constabulary), £1,671,814; Public Works, £208,232; remitted English Exchequer, £374,875. How in the name of all that was rational could any sane person treat the expenditure of £3,250,000 on Army and Ordnance as expenditure for Irish purposes, or the interest and management of the National Debt, another £1,125,000? The miscellaneous payments, £1,671,874, no doubt, included items of Imperial Expenditure for Ireland, and so did "Public Works," £208,000. But if it comported with the general policy of the Empire to keep an Army anywhere, it was quite clear the charge for maintaining that Army and the Ordnance Establishments, unless they were quartered on an enemy, should be defrayed out of Imperial funds, to which, of course, Ireland should contribute, having regard to her actual means, in precisely the same ratio as England or Scotland. As a matter of account between the Imperial Exchequer and Ireland, the locality in which the charge for Imperial objects was expended had nothing to do with the distribution of the burden of the charge. He (Sir Joseph M'Kenna) freely admitted that the local trade of the district in which Imperial funds were expended benefited somewhat by the expenditure; but that was not the point, and had no earthly connection with the distribution of the charge amongst the taxpayers of Great Britain or Ireland. The hon. Member concluded by moving the Resolution of which he had given Notice.
§ SIR THOMAS ESMONDE,
in seconding the Motion, said, he desired to make a few remarks on the subject which his hon. Friend had brought forward. In Ireland they considered they were not fairly treated in the matter of taxation. They considered, in the first place, that they were overtaxed, having regard to the amount of the Irish National Debt at the time of the Union; and, in the second place, they considered that they were overtaxed, having regard to the poverty of the people compared with the people of England. Hon. Members in 1050 that House might not be cognizant of the facts regarding the Irish National Debt; and he, therefore, thought it well to say a few words upon it. In the year 1794 the Irish National Debt was £2,400,000, in the year 1797 it was £3,000,000, and in the year 1800, the year in which the Legislative Union was passed, it amounted, according to some authorities, to £28,000,000. It was estimated by Mr. Grattan at £25,000,000; but he (Sir Thomas Es-monde) had made a calculation, and he estimated that the Debt was £24,536,000, but he would take it at the sum of £28,000,000 out of regard to the susceptibilities of Members in that House. He would like to say a word as to how this National Debt was constituted. From 1797 to 1800 it was necessary to maintain a large force of English troops in Ireland. In 1797 the number was 50,000 men; and in 1800 the number reached 170,000 men. The cost of maintaining those troops amounted to £16,000,000. And that was one item in the National Debt. Then there was paid to the owners of Irish boroughs, for the purpose of purchasing their votes and their influence to effect the Legislative Union, a sum of £1,500,000. Then there was paid to a certain class of individuals, who were termed "suffering Loyalists," in satisfaction of their claims £1,500,000. What those claims were must be left to the imagination. There was paid for secret service to informers, who instigated the people to rebellion and then informed upon them, a sum of £53,547. There was given to individuals who were called "deserving men," for suppressing that rebellion and carrying the Act of Union, £1,000,000. There was paid to the Legal Advisers of the Government £500,000; and there was paid to several individuals for compensation for the removal of the Parliament from Dublin, £500,000. To give some idea of the persons who received compensation he might mention that the ratcatcher to the Lord Lieutenant received a certain sum of money. In this way was constituted the Irish. National Debt, which he estimated at £24,536,000; but he would be content to take the larger figure. Now, he did not say anything as to the character of that Debt. They would accept it as an accomplished fact. The Legislative Union, he thought it would be admitted, originated for the 1051 benefit of England; but, nevertheless, the people of Ireland had to pay for it. At the time of the Union the National Debt of England was 16 times greater than the National Debt of Ireland; and by the Act of Union solemn promises were made to Ireland that at no time should she be called upon to bear taxes arising from the pre-Union Debt of England. These promises were embodied in the Act of Union, which a short time ago was described in that House as a fundamental law. But, nevertheless, the promises of that Act were abrogated. English Ministers did not find much difficulty in changing fundamental laws when the change was for their own benefit. It was only when fundamental laws affected other people that English Ministers regarded them as unchangeable. The Irish National Debt at the time of the Union was 1–16th of the National Debt of England; and it was provided, he thought by Clause 7, that should the Debt of Ireland at any time reach 12-15ths of the National Debt of England that the two Exchequers should be consolidated. In 1803 the Irish Debt was £43,000,000. In 1804 it was £53,000,000, and in 1816 it was £112,740,000. How this was brought about was easily explained. The Irish Revenues were not sufficient to meet the increase of the Irish National Debt, which was incurred at the time of the Union; and this deficit was made up by loans which the Imperial Government raised, and then charged to the National Debt. Therefore, it was very easy to understand how in 17 years the National Debt of Ireland had increased from £28,000,000 to £112,000,000. It was stipulated by the Act of Union that Ireland should pay 2–15ths of the taxation of the Kingdom; but when the Union was passed it was charged 2–7ths. In 1817 the Irish Debt was £112,000,000, and the English Debt was £734,000,000; and having reached the limit stated in the Act of Union the two Debts were consolidated, and Ireland was charged a proportion of taxes entirely out of proportion to the amount stipulated in the Act of Union. They also objected, secondly, to the proportion of taxation because of the present condition of the country. Ireland was not a country like England, with great manufactures. Ireland had manufactures prior to the Union; but owing to the system that since then pre- 1052 vailed, these manufactures had disappeared, and commercial enterprize had completely left the country, and the people were obliged to turn their attention solely to the cultivation of the soil. Then, under the system of law that prevailed the land of Ireland was not administered for the benefit of the people, heavy rents were imposed upon them; and he now asserted that Ireland was better able to bear its present taxation prior to the Union than at the present time. Even deducting all that Ireland received, he submitted that, what with taxes and rent to absentee landlords, the country paid a sum of £8,000,000 or £9,000,000 sterling. If they took the basis of property they would find that the value of property on which Income Tax was paid in England in 1869 was £370,000,000, while in Ireland it was £25,000,000. That showed that property in Ireland was l–17th that of England. In 1870 Ireland paid in Revenue £7,000,000, while Great Britain paid £78,000,000. That showed that while Ireland had only 1–17th of the wealth of England it had paid l–9th of the Imperial Revenue. That, he thought, clearly showed that Ireland was overtaxed, and that its just proportion was much lower than £7,000,000 a-year. He thought it was most important that these facts should be known, in view of the alteration that would take place in the relations between the two countries.
Motion made, and Question proposed,
That there he laid before this House, a Return of the Gross Imperial Revenue of Ireland derived from taxation, and of the Population of Ireland for the years 1851, 1861, 1871, and 1881, and a like Return for Great Britain for the same years, being in both oases a continuation, in like form, of Parliamentary Paper, No. 407, of Session 1874."—(Sir Joseph M'Kenna.)
§ SIR GEORGE CAMPBELL,
who had on the Paper an Amendment to leave out the word "Ireland" and insert "Scotland," said, when he intimated his Amendment he did not do so in any unfriendly spirit, his desire simply being that the facts should be brought out. He contended that a Return issued on the Motion of the hon. Member for Stafford (Mr. M'Laren) with regard to the Revenue in 1882–3 gave all the information necessary for practical purposes. It appeared to him that the 1053 hon. Member for South Monaghan (Sir Joseph M'Kenna) was in the position of having; aimed at the pigeon and hit the crow while he had endeavoured to prove his case with regard to Ireland, he had really given material for an incontestible case for Scotland. The Return procured by the hon. Member for Stafford showed that in 1882–3 the population of Ireland was about one-seventh of the United Kingdom; whereas the taxation of Ireland was as nearly as possible one-eleventh part of the taxation of the United Kingdom. He quite admitted that Ireland was a poorer country, and ought to pay a smaller proportion of taxation. He thought there was not a glaring injustice under the present arrangement; but, on the contrary, Ireland paid pretty much what she ought to pay, being a proportion of something more than half what the average inhabitants of England or Scotland paid. On the other hand, Ireland had great advantages, in many ways, over England and Scotland with respect to taxation. The Income Tax was collected much less harshly in Ireland than in Great Britain, and the upper classes in Ireland were exempted from many taxes that were paid in the Sister Isle. In Ireland no Land Tax, no House Tax, no assessed taxes, no police or education rates were paid. Ireland also received a large amount by way of local grants; they merely looked at the financial question. He contended that Ireland was not an oppressed country, but, on the contrary, was a specially favoured one. But while Ireland was liberally and even generously dealt with, what were the facts with regard to Scotland? It was a very great hardship that the alcohol consumed by the people of Scotland, and to a great extent by the people of Ireland, paid five times as much per gallon as that imposed on the people of England. The Englishman was enabled to muddle himself with beer five days a-week for the same sum which the Scotsman paid for a glass of whisky on Saturday night, if he was imprudent enough to take it at that time. Scotland paid in regard to taxation of whisky the same as Ireland paid; but Scotland consumed more whisky in proportion than Ireland, and consumed less beer. The consequence was that the taxation of Scotland was really very 1054 much heavier in proportion than the taxation of England, because they had in Scotland their whisky taxed very much heavier than the beer in England. All other taxes were paid equally in Scotland. They had no exemptions from Land Tax, or House Tax, or assessed taxes, or from education and police rates. On the contrary, they paid, he believed, more for their schools than almost any other part of the Kingdom. It was, therefore, undoubtedly the case that Scotland paid more than her fail share of taxation. In 1883 Ireland, with a population of 5,000,000, paid a taxation of £6,654,000; whereas Scotland, with a population of only 3,800,000, paid a taxation of £8,000,000. When they compared the taxation of Scotland with that of the United Kingdom they found in respect of spirits and beer that Scotland paid £4,000,000 out of £27,000,000, or a good deal more than one-seventh of the whole taxation, whereas the population of Scotland was a good deal less than one-ninth of the population of the Kingdom. The total taxation of Scotland, which was £8,000,000 out of £73,000,000, was somewhat larger than the proportion of population; and when they contrasted the enormous wealth of the City of London and the poverty of the Highlands and Islands of Scotland the disparity appeared very much greater. He was in favour of justice, and even generosity to Ireland; but, at the same time, as a Representative of Scottish taxpayers, he was anxious that in any new arrangement they should not impose a heavy additional burden on the over-taxed people of Scotland in order to carry to an excess generosity towards Ireland.
§ MR. GOSCHEN
I do not rise to continue the controversy between Scotland and Ireland, which has been initiated by my hon. Friend; but I am anxious to express my sense of the extreme importance of the question which has been brought before the House by the hon. Member opposite. I regret that the matter has not been dealt with by a Committee or otherwise at an earlier stage; because, if there is a case on behalf of Ireland, everyone must be most anxious to examine that case to the very bottom, and those of us who are in favour of maintaining the Legislative Union between England and Ireland do 1055 feel all the more bound to see that in maintaining that Union we are not doing any financial injustice to a country which is in a minority so far as this House is concerned. Therefore, I think every Motion that comes before the House from the Irish quarter, which can substantiate even a primâ facie case of financial injustice, ought to be examined with the most anxious desire on the part of the House to probe it to the bottom. It seems to me that this matter has obtained additional importance from the circumstance to which the hon. Member who brought the Motion before the House alluded—namely, that a distinguished statistician has made the statement that Ireland is paying too much towards Imperial taxation. This Motion is for a Return carrying forward the figures which have been submitted on previous occasions to this House; but I venture to think that even when those figures are in our hands we shall not be advanced very much further. We require the figures in order to form our judgment; but the Return will not show whether Ireland is paying too much, or her fair share, or too little. It cannot be shown simply by a dry Return, and for this reason, that the question is, what principles are to be applied in determining what each country ought to pay? Every hon. Member would see that according as you take up the principle of population, or of property, or of the various forms of ability to pay, so you will be able to establish whether a country is paying too much or too little. Let me take a case for instance—I do not say whether at this moment it goes for or against me—but I am prepared to contend that the amount of Income Tax which is paid by a country does not in itself form any basis as to the aggregate taxation which that country ought to pay. It simply constitutes one element in that most complicated problem. It might be possible that one country had a very large wealthy class and a very poor class; that, on the other hand, another country might have a very substantial population of artizans, but very few above that line. Then any deduction which would be drawn from the relative amount of the taxable property of the two countries would give a very inadequate standard as to what the classes below the Income Tax would be liable to pay. That is only an illustra- 1056 tion; but it does not apply to Ireland, because, while the Irish have a very much smaller class of men who contribute Income Tax, when you go below the line where Income Tax is paid they have again a poorer population than we have in England. That, then, is a circumstance to be taken into account upon the other side. Then here is another question. How far is it any compensation, in looking to the taxation of Ireland as a whole, that there are large exemptions in favour of certain classes of the wealthier inhabitants—for instance, that they pay no taxes in respect of servants, and other exceptions of that kind? That is no great advantage to the bulk of the population who, if a certain total is to be raised from Ireland, have to pay so much more. The hon. Member for Kirkcaldy (Sir George Campbell) made this observation—that if the wealthy classes are paying too little in Ireland, perhaps the poorer classes are paying too much. Well, supposing, on the whole, Ireland is paying its fair share, I can, nevertheless, fancy that the distribution of the burden would not give satisfaction to the bulk of the population in Ireland. Then, again, the hon. Member who seconded this Motion (Sir Thomas Esmonde) spoke of the aggregate rateable property, if I understood him, with regard to the Income Tax, and compared that with the total payments made by the Irish people in regard to taxation. But I would venture to contend that that is not a fair application of the principle at all, because while rateable property is an element of the contributing wealth, neither rateable property, nor personal property, nor any form of wealth, is the only contributor towards taxation. If there are also taxes on consumption a population, of course, ought not to escape its fair share of payment for consumable articles, because the rateable property happens to be less than it is in the Sister Island. I have ventured to put forward these considerations in order to show that I do not think that we shall advance the matter very much simply by the production of figures. What will some time or another be necessary, if it is not done on the present occasion, is that the principles should be grappled with by a Committee, or otherwise, and that then, applying those principles, we should see whether or not we could come to some agreement. I am sure the bulk 1057 of the population of both countries would wish to come to a fair agreement upon this matter. I have thought myself of moving to substitute a Committee on this occasion for a Return; but I have reason to believe that that in the present position of Irish affairs would not be a very convenient arrangement, and I further think it will be wise, and may advance the matter, if the Return should be procured without any delay. But if nothing should come of the presentation of the Return, I trust at some future period that this question may be renewed, and that we may endeavour by such means as may be in our power to probe this very important question to the very bottom to see if a grievance exists, and if a grievance really exists, to set to work to remedy it in a spirit of justice and equity to all parts of the United Kingdom.
§ SIR JOHN LUBBOCK
said, he must compliment the hon. Member for South Monaghan (Sir Joseph M'Kenna) on the manner in which he had prepared his case; and though he could not altogether agree with the hon. Baronet who seconded him, still the care with which he had studied the question gave them every reason to hope that he would prove a valuable contributor to their debates. He did not rise to oppose the Motion; but, at the same time, those figures must be accepted with some reservation. For instance, the hon. Member stated the relative wealth of England and Ireland, taking the Income Tax as an absolute proof. But the Irish holders of foreign securities and English funds registered at the Bank of England would appear as English taxpayers. A certain portion of the Beer Duties, though paid in Ireland, fell on English consumers, and this could not be exactly allowed for. The hon. Member very fairly admitted that if Ireland contributed somewhat more than her share, she received also much more than in proportion. It was a salient fact that no tax fell specially on Ireland, while Ireland was exempt from some which fell on England. Again, Irish and Scotch farmers paid at a lower rate than English. On the whole, he doubted whether Ireland or Scotland was unduly taxed; but they only wished for what was fair and just; and he suggested that, instead of omitting Ireland to include Scotland, as suggested by the hon. Member for 1058 Kirkcaldy, the Returns should include both.
§ MR. DILLON
said, he did not desire to take up the time of the House for more than a few minutes. His wish to address the House was chiefly owing to some observations which had fallen from the right hon. Gentleman the Member for Edinburgh (Mr. Goschen). He must congratulate the House upon the fact that the right hon. Member had now, after a long time, spoken in a fair spirit towards Ireland. The impression on his mind was that the right hon. Gentleman, great financier as he undoubtedly was, was in a state of doubt upon the question whether the Irish people had received fair treatment with respect to taxation. It was a striking fact that, although the right hon. Gentleman had been many years in that House, that doubt had newer crossed his mind until now, though the question had been raised both inside and outside the House over and over again. He could easily explain that extraordinary change. He was glad to think that in the minds of those who were intensely anxious to maintain the Union between the two countries there was a growing desire to be just to Ireland. The right hon. Gentleman had said that the produce of the Income Tax was not a fair test of the comparative ability of the two countries to bear taxation. But in the degree in which it was not a fair test the argument was even stronger in Ireland's favour. The right hon. Gentleman had said that in one of two countries there might be a very wealthy class, while the remainder of the people were miserably poor, and in another there might be a large body of prosperous artizans and lower middle class. But it was a commonplace with respect to Ireland that the prosperous middle class was absent, and that there was a great gulf between the two sections of the population. The wealthy in Ireland, though not so rich as the wealthy class in England, were yet not so much poorer than the corresponding class in England as the poor of Ireland were poorer than the poor of England. Between the very rich and the very poor in England there was a large class of persons coming gradually down who were all just under the Income Tax. When, however, they got out of the ranks of the wealthy in Ireland, they at once dropped into the great 1059 unfathomable gulf of poverty and misery, with no intervening middle class. Whatever was the case during a period of comparative prosperity in the past, the great wave of depression which had passed over England as well as Ireland had notoriously struck the agricultural class more severely than the manufacturing or trading class. As the people of Ireland were only an agricultural class, they had, consequently, suffered infinitely more severely, and the poverty which had always existed became intensified. His hon. Friend, therefore, was really doing less than justice to Ireland in taking the Income Tax as the test. In Ireland the tax produced about £500,000, as against upwards of £10,000,000 in England. Thus, Ireland's wealth ought to be reckoned as 1–20th of that of England alone, whereas she paid l–10th of the whole Revenue of the United Kingdom. Therefore, he believed his hon. Friend would be inside the truth if he said that on the present basis of taxation Ireland had been paying more than twice her share. Any arguments based on the assumption that a due proportion was spent in Ireland were entirely beside the question. It was a wasteful expenditure, necessitated by ill-government, and was a practical waste of money. It was true that by an imposition of taxes upon the wealthy classes in Ireland something might be done to redress the balance; but the taxes from which the wealthier classes were exempted were very small—as, for instance, the Land Tax, which did not produce much. He did not believe that such a tax would make any appreciable difference in the Revenue. The House was perfectly welcome to put on a Land Tax at once on the wealthier classes if they would redress the grievances of the poor of Ireland. Then it was said that there was a good deal of Irish capital invested in England. But that was far more than compensated by English investments in Ireland. The more this question was examined the more it would be found that it was not a matter of ancient history, but would be found to be one of pressing interest when the relations of the two countries came to be re-adjusted, as they would in the course of a very short time. It would be one of the main points for inquiry, if the whole question were gone into, how Ireland came to be charged with a share of 1060 the Debt of the country altogether different from what was provided for under the provisions of the Act of Union; whether that was done justly; whether at present Ireland was not paying an undue proportion of the general Expenditure; and, further, whether, in the times when the Irish Exchequer was managed separately, those having charge of it did not, in the dark and without any control, practise a wholesale and monstrous robbery, amounting to £100,000,000. His own desire and view as to the issue of this question would be that some arrangement might be come to which would be accepted on all sides as a fair and just arrangement—that they should mutually consent simply to draw a veil over the past and agree to do justice to each other in the future.
§ The SECRETARY TO THE TREASURY (Mr. H. H. FOWLER)
thanked the hon. Gentleman opposite for the spirit in which he had initiated the present discussion; and to the Motion which had been submitted to the House Her Majesty's Government would offer no opposition. Their desire was to ascertain what were the real facts of the case. He was quite sure that no one in that House wished otherwise than that while Ireland should not enjoy exceptional advantages she should not bear exceptional burdens. The hon. Member for Kirkcaldy (Sir George Campbell) had imported Scotland into the matter; and the same remark, of course, applied to Scotland. Might he be permitted to apply it to England also?—because such re-adjustments as were proposed for Ireland and for Scotland might possibly tend to press somewhat severely on the English taxpayer. He was quite willing to admit, in the first instance, that we could not exclude from consideration the relative capacity of those upon whom the taxation fell. He himself could not see that we could upon any principle simply take up the sum total of the amount to be raised and divide that by the sum total of population, and then say the taxation should be borne in those proportions. To take one illustration, the entire amount raised in this country on tobacco was in the last year, for which he had the Return before him, £8,800,000, of which Scotland paid £807,000, or one-tenth, whereas the amount contributed by Ireland was £1,200,000, or 1061 about one-seventh of the whole. Now, when the House remembered that when an Irish peasant spent 6d. on tobacco he paid 5d. in taxation, they would remember what a very heavy burden this imposed on, perhaps, the most necessitous class of the community. With reference to the general figures, the taxation borne by Great Britain in 1851 was £49,250,000, of which the sum raised in Ireland was £4,000,000. In 1861 the taxation of Great Britain had sprung up to £57,500,000, of which there was raised in Ireland £6,500,000. In 1871 the figures were practically stationary; but in 1883 the taxation of Great Britain had advanced to £66,500,000, whereas that of Ireland still remained at £6,500,000. Therefore, although there had been a very large—as he thought, a too large—increase in the taxation and Expenditure of the country in that time, yet his hon. Friend would see that the extra burden of the taxation imposed in the period referred to had been borne to a great extent by Great Britain, and not by Ireland. Now, the Revenue of Great Britain, according to the Return he held in his hand, was £66,250,000 in 1883, and the population 30,500,000, making the average taxation per head £2 3s. 5d. In Ireland in the same period, the Revenue being £6,750,000, and the population 5,000,000, the taxation was equal to £1 6s. 4d. per head, showing a very considerable difference per head as between the two countries. Some of the criticisms in reference to this Return he admitted were not inaccurate; but taking the year 1884–5, he would give his hon. Friend the exact amount paid into the Exchequer. In Customs, £1,928,000; Excise, £4,270,000; Stamps, £610,000; Income, Tax, £564,000; Total, £7,372,000. But that amount had to be adjusted in two directions; it had to be increased, and it had to be decreased. There was a considerable amount of duty levied in Ireland in the shape of Excise on spirits and beer which were consumed in England, and the duty on which, of course, was paid by the consumer; and, on the other hand, there was a certain quantity of tea and other Customs-bearing articles the duty on which was paid in England, but which were consumed in Ireland. In this and other ways there was considerable difficulty in ascertaining exactly what was the true propor- 1062 tion of taxes levied upon Ireland. H had, with the assistance of the very able officers of the Treasury, given his best attention to this matter; and the result he had arrived at was that the net taxation borne by the people of Ireland in the financial year ending March, 1885, was about £6,500,000. Reverting to the general taxation of the Kingdom, he found that the income from taxes in the financial year 1884–5 was, in round figures, £73,000,000—that was the sum raised in the Three Kingdoms. Of that £73,000,000, £58,340,000 was raised in England and Wales, £8,005,000 in Scotland, and the amount raised in Ireland was the figure he had named. He was not in those figures including the Post Office, for it was not a source of Revenue, but a business carried on by the State. It was, indeed, to be regretted that the national accounts were kept so as to include the Post Office Returns, for it led to wrong ideas on the subject. For instance, people talked about burdens of £80,000,000, £90,000,000, and £100,000,000 on the taxpayers, while, as a matter of fact, the taxation last year was only £73,000,000. To this taxation Ireland contributed £6,500,000, or about 1–11th. It was necessary to consider the local expenditure of that money, though he knew that this was a delicate subject as regarded Ireland. They were, however, confronted with the expenditure in Ireland; and he must consider it, though he expressed no opinion as to whether the expenditure was in all respects wise or not. He, of course, did not fasten upon Ireland any special charge for the military in Ireland. The actual Civil Service Expenditure in Ireland was, exclusive of collection of Revenue expenses, £4,000,000 out of that £6,500,000 which it contributed.
§ MR. H. H. FOWLER
said, it certainly did, and the Constabulary Vote formed a large portion of it. It was last year £1,500,000. In England there was a Constabulary Vote, too, the only difference being that only half the expenses of the English Constabulary were paid from the Consolidated Fund, whereas the whole expense was paid in the case of Ireland.
§ MR. H. H. FOWLER
said, he was hardly able to do that without reference. Education, he was glad to say, now amounted to nearly £1,000,000 a-year in Ireland. There were law and justice and other items that brought up the expense for what might be termed the local government of Ireland to £4,000,000. The Imperial Charges on the Consolidated Fund might be taken at £31,000,000, and £30,000,000 for the Army and Navy, and that made £61,000,000 for Imperial Charges. To this Ireland's contribution was about £2,500,000, and he would be within the mark if he said that Ireland's contribution was less than l-20th of these Imperial Charges. It therefore appeared that Ireland, in round figures, contained one-seventh of the population of the United Kingdom, contributed about 1–11th of the gross Revenue, and after deducting the cost of local government less than l–20th to Imperial Charges. He did not desire to argue about these figures, but to place them before the House for due consideration. Attention had been called to the poverty of Ireland as compared with Scotland. Ireland certainly had not the resources and reservoirs of mineral wealth possessed by Scotland. There was, in fact, an enormous disproportion between the wealth of Scotland and that of Ireland. But he did not think that Ireland was on those retrograde lines that had been described. A good test of wealth—a more accurate test than the payment of taxation or Income Tax—was the amount paid for Legacy and Succession Duty in respect of property in the country. In 1871 the property in Ireland on which Legacy and Succession Duty were assessed was £7,500,000 in value, while in 1884 it was £10,650,000. The Income Tax Returns told the same story. In 1871 the gross amount, without deductions, on which the tax was charged, was £26,000,000; in 1874 it was £36,000,000; and the actual payments were on £27,000,000. Under these circumstances, he did not think they ought to take so very gloomy a view of the financial condition of Ireland as had been presented by some hon. Gentlemen opposite. He had no objection to grant the Return asked for, and, if the Scotch Members desired, to include Scotland within its scope; and he hoped and believed that, whatever course might be 1064 taken, full justice would be done in this matter to the claims of England, Ireland, and Scotland.
§ MR. J. F. X. O'BRIEN
said, he should not pretend to add anything to the information which had already been placed at the disposal of hon. Gentlemen. He was able to do little more than recapitulate the figures and facts to which they had already listened. In 1841 the taxation of Great Britain was £2 9s. 9½d. per head, and in Ireland 9s. 6½d., Ireland's proportion of the gross taxation being about 1–12th. In 1871 the taxation in Great Britain was £2 2s. 1½d., and in Ireland £1 6s. 3¼, certainly a vastly disproportionate arrangement. While the taxation of Great Britain declined moderately, that of Ireland was increased to nearly three times what it was in 1841. In Great Britain the population rapidly increased and the taxation fell, while in Ireland the population diminished and the taxation increased. According to the assessment for Income Tax in 1861, Ireland's wealth—Ireland's capacity to pay taxes—was 1–17th that of Great Britain; and in 1882 it had declined to the proportion of 1 to 21. This, he submitted, was a very fair indication of the relative capacity of the several Kingdoms to contribute to the National Expenditure. It was no answer to the charge that the taxation of Ireland was unfair to say that Ireland was free from certain taxes which were levied in Great Britain. They had no objection at all to the wealthy classes of Ireland being taxed the same as the wealthy classes in England; but what was complained of was that Ireland, as a whole, was overburdened with taxation of a general kind. While Great Britain with its vast wealth paid only 2s. 6d. in the pound on its income, impoverished Ireland paid 5s. 3d. in the pound on her income. The population and wealth of Great Britain increased and taxation declined. While the population and wealth of Ireland declined rapidly, Irish taxation per head almost trebled from 1841 to 1871. When in 1853 it was proposed to increase the taxation of Ireland, the taxation of Great Britain was subjected to a net reduction of £1,040,000, which drew from an English Member of this House—Sir Francis Baring—a protest against the conduct pursued towards Ireland. No one could deny that wrong and in- 1065 justice were thus inflicted upon that country. Dr. Johnson must have known his countrymen very well when he warned the Irish people that if they ever entered into a Legislative Union with England, Ireland would be robbed. Certainly Ireland had been robbed.
§ THE FIRST LORD OF THE TREASURY(Mr. W. E. GLADSTONE)
I should be very sorry to disturb in any degree the excellent spirit which has pervaded this debate, and I do not think that anything I have to say will produce that effect. I must admit that the question has been approached from all sides in a considerate spirit, and in that I rejoice, for this reason above all others, that there is no other hope of arriving at a definite settlement of the question. It does not admit demonstrative handling. It has been found extremely difficult on all sides. The right hon. Gentleman the Member for Edinburgh (Mr. Goschen) stated with truth that we could not expect to make great advance by moans of this debate, and he expressed the wish that a Committee should be appointed to examine it more thoroughly. That is a most natural wish; but it behoves us to recollect that Committees have been appointed for the purpose of examining this question, and "bolting it to the bran," and that the last of these Committees, at any rate, which I will take as the most important, has not been able to arrive at a definite conclusion. The Committee of 1863–4, which was appointed for the express purpose of determining, if possible, within the Committee Boom whether Ireland pays excessively or not in proportion to her means—that Committee arrived at no conclusion, and made no Report upon that subject. But the Committee made a very full Report upon the general subject and upon many points, and evidently gave very great attention and labour to the investigation; but upon the main point I do not think that the most careful examination of the Report will succeed in discovering any distinct utterances on the part of the Committee. The Committee was obliged to give the go-by to the question, for the very simple reason that it could not arrive at any amount of unanimity, even by a majority, on that point. I felt myself obliged, having listened with interest to the whole of the debate, to notice one or two propositions to which I am bound to say I cannot accede, and 1066 by which I cannot be bound, and especially the proposition which appears a favourite one with Irish Members on these occasions—namely, that the yield of the Income Tax affords, upon broad and general grounds, a fair and just test of the ability of Ireland to pay taxes, and, therefore, of the measure in which taxation should be paid by Ireland. I think it is much more true that the yield of the Income Tax is one of the elements necessary in order to enable us to form the best judgment we can upon the matter; but the reasons are distinct why we cannot possibly take it as an absolute measure. [Sir Joseph M'KENNA: Hear, hear!] I am glad that the Mover of the Motion, whom I compliment on the manner in which it was moved, admits that proposition. Undoubtedly, it is the fact that so far as Schedule A is concerned—I am not aware that the same observation would apply to Schedule B—and I do not urge it in that case; because there, although an apparent inequality, unquestionably as far as Schedule A is concerned—which in Ireland bears a very important proportion to the whole—the taxpayer in Ireland has considerable advantage, a large advantage, as compared with the taxpayer in England. He pays upon his net income by no means so much, inasmuch as he pays upon valuation, whereas in England and Scotland—in Scotland with one exception, and in England with no exception—the tax is paid upon the gross rental, which includes not only charges of management, but includes charges for repairs, in many cases extremely heavy, the charge in England forming a considerable proportion, sometimes 10, 15, and even 20 per cent of the rental. These repairs, which are absolutely necessary to keep the property going, and enable it to pay taxes at all, are subject to taxes. This is one reason why you cannot take Income Tax as a test. A second reason is that a proportion of Income Tax is paid by Irishmen in England, to which there is nothing to correspond on the other side of the account, and that amount, whatever it may be, swells the proportion of the English Income Tax in comparison with the Income Tax in Ireland. But I must also say that the relative distribution in society affects the Income Tax in Ireland very differently from the manner in which Eng- 1067 land is touched by it. Some Gentlemen have assumed, not like the Mover of the Motion, that absolutely the Income Tax, be what it may, affords a just test. If the Income Tax is to afford the test of ability, the first thing you must do in order to raise the presumption is to apply it to all incomes. If you apply it to all incomes—of course, that is impossible—it would be obviously necessary to do so to get at the taxable ability. There is another subject to which I will refer—namely, the very large expenditure of the Imperial Exchequer for the Civil Service of Ireland. It has been said by some Gentlemen representative of Ireland that Ireland derives no benefit from that expenditure. I will not say whether Ireland derives benefit or not, or how far it ought to be charged against her in an account of this kind; but one thing I will say, in connection with a long experience at the Treasury, that I have always observed when there has been a question of diminishing that expenditure at any point, or in any particular, such proposals have not been received with favour by the Irish Members. I recollect one particular occasion in which it was proposed to introduce a measure for effecting a large and very important, and evidently necessary, economy in certain classes of Irish establishments, that an Irish Member of great ability gave fair Notice to the Government that he would oppose the Bill, not because the reduction was not necessary, but unless the Government gave a pledge that the money to be saved by it should be expended elsewhere in Ireland for Irish purposes. I do not complain of that, although I think it was pushing things rather far. But you cannot, at the same time you hold that language, say that Ireland derives no benefit from this expenditure. If she has no interest in it why show so considerable anxiety that it should not be diminished? I do not give any positive opinion upon the subject; but I am sorry to say, not from the fault of Ireland, but through the operation of complex causes, especially of the financial administration of this country, it has been found during the whole period of my experience very much more difficult to apply principles of sound economy to the details of administration in Ireland than in England or Scotland. I think that is to be ac- 1068 counted for by large considerations, into which I will not enter, and I am not referring to it as a matter of complaint. I make this concession fully to the Mover of the Motion and the Irish Representatives. It was made by the Committee of 1863–4. They did not make it in express terms, but I cannot have any doubt upon the subject. The Committee of 1863–4 referred to various considerations, and said these considerations unquestionably pointed towards the conclusion that the proportion fixed under the Union arrangement—namely, a proportion of 2 to 15 in the expenditure for Ireland—was too high. I make the admission frankly; I think it is too high. The Committee went on to say, with perfect truth, that Ireland had never paid that proportion. That I believe to be unquestionably true. The question whether Ireland has paid too much or not is another matter, which may deserve very careful consideration. I think the question is of great interest. It is worth while to say one word upon the chapter of finance to which my hon. Friend the Secretary to the Treasury referred as exhibiting a probable test of the relative wealth of the three countries, and that is the amount of property upon which Legacy and Succession Duties have been levied. These Legacy and Succession Duties are singularly variable from year to year. I have often been surprised in Treasury administration at the degree in which they vary from year to year, even in a country like England, where the amounts are at all times so vast. I am inclined—I will not dogmatize upon the subject—but I am inclined to put to the House that upon the whole the amount of property over a sufficient number of years chargeable to Legacy and Succession Duties is perhaps the very fairest test that we could get of relative ability to bear taxation. It is certainly not open to the same objections as the Income Tax. Upon the other hand, there are no doubt exemptions in the Legacy and Succession Duties; but these exemptions, especially as they have recently been shaped, are exemptions entirely applicable to the class of such very limited means that no one would wish, if he could avoid it, to make them in any heavy degree subjects of taxation. Now, Sir, the Return which my hon. Friend (Mr. H. H. Fowler) had in his hand does not give us the sum total of these Legacy and Succession 1069 Duties for a large number of years. That is to say, the sums are not added up, and I had not time to add up all the figures of a total of 14 or 15 years. But I have taken the three last of these years, and I am bound to say that my strong impression is that that is not at all a mode of proceeding unfavourable to Ireland. But I am bound to observe that in the first of the three years—that is, 188–12—the amount in Ireland was extremely low, and lower than at any time during the 14 years. It was only £7,142,000; whereas they ear before it was£9,000,000; and the year after it was £9,525,000. The next lowest year is 1879, when it was £7,532,000. Ireland, therefore, in my computation, gets the benefit of that excessively low year. Now, Sir, the result of my comparison is this—I take the three last years; I add them together; I find that the property chargeable to Legacy and Succession Duties in Great Britain during these three years was £361,000,000; I find that during the three years the amount chargeable in Ireland was about £28,000,000; and dividing the sums one by the other the result is that the wealth of Ireland as tested by that test is as 1 to 13. My contention is that, upon the whole, the property chargeable to these Duties affords the fairest test that we can get. I give this, not as absolutely accurate, but as very near the mark. I will only say, further, that I agree with Members who have said this subject cannot sleep very long. It is quite evident that there are other relations between England and Ireland besides those of direct taxation which ought to be taken into view, which have been very important in former times, and which may become still more important—I mean the relations which subsist between Ireland as a debtor and England as a creditor. I am sure Gentlemen who sit opposite, in the spirit of candour which they have shown to-night, will admit that Ireland has received very considerable advantages from the use of the Imperial credit in the relation to which I have just referred. Well, Sir, it may be that circumstances, if they should lead to further and more extended attempts to deal with questions profoundly affecting Ireland, such as the question of Irish land, may open up the whole of that subject upon such a scale as to make it absolutely necessary, not only that the Government, but 1070 likewise the House, should form as well as it may a conclusive and a solid judgment upon the proportion of the relative taxability. I beg Members to remember that this is a subject that does not bear being handled by demonstrative evidence. Debate it as long as you will, appoint as many Committees as you will, it will still be in the main a matter of argument. The best security and guarantee that we can have for arriving with tolerable facility at some tolerably fair conclusion is that all Gentlemen shall endeavour to approach the question in a thoroughly considerate spirit and with an abatement of all extreme opinions. If they do that, I believe the matter is perfectly capable of a practical solution; and it is because I think the temper that has been shown to-night affords considerable promise of progress in that direction, should the necessity arise, that I congratulate the hon. Gentleman and the House upon the spirit in which the debate has been conducted.
said, they must all acknowledge the tone and spirit in which the Prime Minister had approached the consideration of the subject, and the general character of his statement. The Prime Minister appeared to consider that ultimately when the Return was procured it would at least tend to show the relative capacity for taxation of the two countries. He looked upon the Prime Minister as the greatest authority on the subject; but in this instance he was not only judge but advocate, and in his speech he possibly selected three very good years for his argument. Accepting, however, the figures of the right hon. Gentleman for the three years, it was evident that Ireland was taxed 20 per cent more than England. The general gist of the whole statistics on the subject was to put the capacity of Ireland to bear taxation at between 1–16th and 1–17th of the capacity of the United Kingdom; and if that proposition was correct, it followed very naturally that Ireland was overtaxed. The Secretary to the Treasury had stated the total taxation levied from Ireland at about £6,500,000; but they could not allow the figures of that hon. Gentleman in the present case to pass unchallenged. According to the House of Commons Return of 1883, the taxation levied from Ireland he took to be a long way over £7,000,000; and, therefore, unless there had been a great fall- 1071 ing off in the amount since then, he thought the Secretary to the Treasury had under-estimated the sum paid by Ireland. That hon. Gentleman had reckoned the amount of Public Expenditure in Ireland at £4,000,000; but how was that sum made up? Nearly £1,000,000 was paid for education, and the Civil Service absorbed nearly £2,000,000; so that in order to get his total of £4,000,000 the Secretary to the Treasury must include the item for the Constabulary. Now, the Constabulary were a very expensive, although a very useful, force; they were armed men, and could in a very short time be converted into soldiers; and the total of £4,000,000 of local expenditure in Ireland reckoned by the Secretary to the Treasury largely turned on the question of the Constabulary, and whether they were to be considered as a Civil or as a Military force. They wore told that half the cost of the police was paid for in England by the ratepayers. He had looked into the matter, and, as far as he could make out, he gathered that in England some counties paid only 1d. in the pound and others 2d. for the police; whereas in Ireland, although they received all that money for the Constabulary, they had to pay 9d. in the pound in some counties for extra police alone. In fact, they paid in Ireland as much, or nearly as much, for extra police as was paid in England by the ratepayers for ordinary police; and therefore it was incorrect to say that they got their police for nothing. The argument of the Secretary to the Treasury was that the difference of £2,500,000 between the £6,500,000oftaxation and the £4,000,000 of local expenditure represented Ireland's contribution towards the Imperial Exchequer, and that that contribution was only 1–20th of the whole taxation of the United Kingdom, and could not be excessive. The Prime Minister had spoken of Ireland as being 1–13th as rich as England; but he rather disputed the accuracy of that notion. He disputed the contention of the Secretary to the Treasury that the Constabulary Force of Ireland was a Civil force; his opinion was that the Constabulary was essentially a Military force, doing police duty occasionally. As to the contention that Scotland was more aggrieved in respect to the inequality of Imperial taxation than Ireland, he admitted that 1072 Scotland contributed a far larger proportion in taxation as compared with the amount returned to it in the shape of local expenditure than Ireland; but then the circumstances of Scotland and Ireland in respect to local expenditure were totally different. There were no great State Military and Naval Establishments maintained in Scotland as in Ireland; and, in point of fact, Scotland was, in respect to local expenditure, as much a part of England as was Yorkshire or Lancashire. Then Scotland was comratively a rich country as compared with Ireland. Comparing the average individual wealth of the three countries, they were represented by the figures 260, 276, and 110, the latter representing the average individual wealth in Ireland. The wealth of Scotland formed 11 per cent of that of England, and its taxation was also 11 per cent of the taxation of England; so that Scotland could not complain of unfair or disproportionate taxation in comparison with its national wealth. On the other hand, the case for Ireland amounted to this—that while her wealth only amounted to 6 per cent, she paid in taxation 9½ per cent. The question of expenditure in Ireland was not the Question before the House that evening; but he might remark that a more unproductive expenditure could not be imagined. There were £4,500,000 spent in Ireland on soldiers, Constabulary, the Navy, and naval and military pensions. The great military countries in Europe, weighed down as they were with expenditure, only paid 29 per cent of their gross income on military establishments, while Ireland paid at least 50 per cent. What the Irish people desired, therefore, was to see that Ireland paid only in proportion to her wealth. He believed the more the case of Ireland was sifted the more it would be found that she was paying a proportion of taxation largely in excess of her capacity.
MR. J. WILSON (Edinburgh)
said, from the length of time to which this debate had extended it was manifest that hon. Members regarded the subject as one of great importance. His object in rising was to make a suggestion so as to render the Return as valuable as possible. The Motion proposed that the Return should apply to Ireland only; but it would be of comparatively small value unless they had similar Returns 1073 from England and Scotland, so that a fair comparison might be made of the Revenues of the respective countries; and that was what he fancied was primarily aimed at by the Motion. He would suggest that the words "Great Britain" be deleted, and that the words "England and Scotland" be introduced. He thought it was also desirable that they should have information down to the latest date; and, as he believed the Secretary to the Treasury was ready to give the figures down to 1885, he would suggest that this Motion should be altered accordingly. During the discussion frequent reference was made to the large amount of money repaid to Ireland for expenditure for local purposes. It was very important to have the amounts repaid in a similar manner to England and Scotland respectively, and he would suggest that the Resolution be amended with that object. He had all the more reason for pressing that, seeing the amount repaid or expended in that manner in Scotland was comparatively small.
Notice taken, that 40 Members were not present; House counted, and 40 Members being found present,
MR. J. WILSON,
resuming, moved to amend the Motion by substituting the words "England and Scotland" for "Great Britain," and extending its scope so as to bring the figures down to the latest date, and so as to include the amounts expended in England, Scotland, and Ireland, in aid of local purposes.
§ Amendment made, in lines 3 and 4, by leaving out the words "Great Britain," and inserting the words "England and Scotland," instead thereof.
Main Question, as amended, put, and agreed to.
Ordered, That there be laid before this House, a Return of the Gross Imperial Revenue of Ireland derived from taxation, and of the population of Ireland for the years 1851, 1861, 1871, and 1881, and a like Return for England and Scotland for the same years, being in both cases a continuation, in like form, of Parliamentary Paper, No. 407, of Session 1874.