HC Deb 21 March 1890 vol 342 cc1566-76
*(7.42.) LORD HENRY BRUCE (Wilts, Chippenham)

When I last had the honour of addressing the House on the subject of the Inhabited House Duty I regret to say that the Chancellor of the. Exchequer was not in his place to hear the arguments which were used on both sides; but in winding up the discussion the Financial Secretary to the Treasury-said he hoped the Chancellor of the Exchequer would be able, if not now, at any rate on some future occasion to at least rectify some of the anomalies which exist. There was a ray of hope in those words—a speck of blue sky. The history of this tax—which does not exist in Ireland—has been one of blundering and plundering. Its origin dates from the time of William and Mary, and its vagaries are a matter of history. It has been re-cast several times; first by Lord North in 1778, during the war of American Independence; again in 1798 Pitt combined the Window Tax and this tax into one; then again in 1802, on the repeal of the Income Tax after the Peace of Amiens, the rates were doubled by Addington, and the duties re-enacted in a Consolidating Act (42 Geo. III., chap. 34); in 1806, after the death of Pitt, 10 per cent was added to the tax by Lord Henry Petty, when he was compelled to abandon his proposal for a tax on pig-iron; in 1808, another consolidation was effected by Spencer Percival; in 1817, the question was again brought forward and redresses granted; in 1825, some further important alterations were made-by Robinson, and in the Reform Parliament of 1832 Lord Althorp tried his hand at it, and in 1834 finally repealed it. But, unfortunately, 17 years later—in 1851—the policy of 1834 was reversed by Sir Charles Wood; the old rates were I discontinued (which from 1808 to 1834 were on a graduated scale), and they were replaced by an assessment of houses of the annual value of £20 and upwards. "In this shape," said Sir Charles," it is a tax which is the fairest and best that can be levied." How everyone loves his own bantling. Well, Sir; only two years later attention was again directed to the tax, and in 1853, 1867, 1869, and 1878, redresses were granted, and I may say that the tax has been condemned by all the leading statesmen of our age. There is an old saying that "political memories are short." Now, the Chancellor of the Exchequer, in the year 1871, brought in a Bill named the Hating and House Tax Bill, Clause 11 of which ran thus— From and, after a certain date to be fixed by an Order in Council, the House Tax shall cease to be payable to the Crown, but shall be levied by and be payable to the Parochial Board in each parish to be applied by them in the reduction of the Consolidated Kate. This enactment shall apply to the Metropolis as well as to the rest of England, and the term Consolidated Bate shall mean the Poor Rate. A year or two ago the Chancellor of the Exchequer brought in his proposal for a Van and Wheel Tax, the proceedings of which were to be devoted to local purposes; and I maintain that he has now an opportunity of showing his consistent by making up the loss which was sustained locally by his failure to carry that tax. I should like to point out a few of the anomalies which exist in connection with this t ix. It is complained, in the case of caretakers in banks, warehouses, and professional houses, that where the caretaker acts in any capacity besides taking care of the premises the Inhabited House Duty is charged. In regard to this, in page 87 of the Report of the Commissioners it is observed— There is another class of exemptions concerning which many difficulties arise. Houses which are occupied for trade purposes only, and which consequently do not fall within the limits of the tax, are now very usually placed in the charge of caretakers who reside on the premises. Does the fact of such residence-convert the house into a dwelling-house? The present rule is that if the caretaker is a bonâ fide menial servant, and resides on the premises solely for the purpose of taking charge of them, his residence does not render them liable to duty. It is not difficult to see how easily this exemption may be abused. The caretaker is often accompanied by a wife and family, and there have been eases where attempts have been made to introduce more distant relatives or strangers. In fact, caretakers have oven tried to bring in servants of their own. We do our best to check such practices, but the points involved in them are sometimes very fine, and we are not sure that the revenue always receives its due. Similar questions as to caretakers have to be considered when they are placed in charge of otherwise unoccupied houses Of course, we are quite willing to render unto Cæsar the things that are Cæsars; but our contention is that Cæsar should make his taxes intelligible. Now, banks are called upon to pay 9d. in the £1, and the reason given is that they are not places of business in the strict sense of being traders. Again, although a house may not in itself be liable to House Duty, the fact that it has any communication with one that is liable renders that house also liable to the duty. In 1878 the right hon. Gentleman the Chancellor of the Exchequer brought in a Bill on this subject, and it was incorporated in the Customs and Inland Revenue Bill, which received the Royal Assent on the 27th May. But though the Bill passed into law it was two years afterwards tripped up by the action of the Inland Revenue Department. Now, why should lodging-house-keepers have to pay 9d. in the £1? Why should they not be treated like shopkeepers, and pay only 6d.inthe £1? There is another question I should like to ask, and it is a very important one. We want to abolish structural severance in tenement buildings, which are intended for the working and poorer classes. It is admittedly an unhealthy way of living to be compelled to live in rooms communicating, and when it is possible to have the advantage of separate rooms it should be secured, but the imposition of this tax prevents that advantage being secured. I contend, further, that collectors of Queen's taxes should be paid by salary and not by poundage, for we know full well that the present system leads to increasing assessments. I know there is an appeal to the Local Commissioners against the assessment; but the appellant is compelled to attend in person instead of being allowed to send a solicitor; and if the local appeal is unsuccessful, and ho desires to carry the matter further, he is compelled to attend personally at Somerset House, thus involving a considerable loss of time. The game, therefore, is hardly worth the candle. I will take another objection to this impost. It is a tax upon an outgoing instead of on an incoming, and I think that the House may naturally ask why it was ever re-imposed. The answer is that it was renewed in order to meet financial emergencies arising in connection with the Crimean War. No such emergency can now be pleaded by the Chancellor of the Exchequer, for the revenue is not falling, and there is no difficulty in making both ends meet. I think I have shown the House the injustice of the tax: I condemn it on the ground that it is arbitrary, capricious, and unjust, and it seems to me to be levied on the principle that They should take who have the power, And they should keep who can. Faulty in principle and injurious in conception it is opposed to all the rudiments of political economy and detrimental to the best interests of this country. I hope to see the day when the Chancellor of the Exchequer will pluck up his courage and put an end to the tax.

*(7.57.) MR. W.SIDEBTTOM (Derbyshire, High Peak)

I do not often trouble the House, and I do not wish now to occupy much of its time or to prevent it going into Committee of Supply, but I have an excellent excuse for rising on this occasion, which is that the subject of the Inhabited House Duty is one in which a part of the constituency which I have the honour to represent takes a very deep interest, and as I so seldom trespass upon the time of the House I hope I may claim a little indulgence when I think it my duty, in the interests of my constituents, to say a few words on behalf of some of them. I do not wish to enter upon a discussion of the whole of the subject which has been opened by the noble Lord who has just sat down, but simply to draw the attention of the House to the case of one class of persons mentioned in the Motion who consider—and, I think, justly so consider—that they are grievously injured by the Inhabited House Duty as at present enforced. I mean the persons who are lodging-house keepers, and are called upon to pay duty at the rate of 9d. in the £1. No one, I think, will dispute that lodging-houses are used as business premises, and, in fact, that they are as much business premises as shops and warehouses in very many cases, and the keepers of these houses cannot understand why they should pay duty at the rate of 9d., while shopkeepers only pay at the rate of 6d. in the £1. I may be told that an alteration of this tax would cause a heavy loss to the revenue of the country, but we are all expecting that the right hon. Gentleman the Chancellor of the Exchequer will have this year a large surplus to dispose of, and I think he cannot better employ a small portion of that surplus than by relieving these people from the injustice of which they complain. Again, I may be told that if lodging-house keepers were put on the same footing as shopkeepers in regard to this tax that there would be considerable difficulty in ascertaining which were bonâ fide lodging-house. But I do not think that this is in any way a sufficient answer to the case, and I submit that it is not right to subject these people—many of whom have to struggle for a bare existence—to this injustice, simply because the remedying of that injustice would load to the creation of this small difficulty. I hope the Chancellor of the Exchequer, who last year received a large deputation on this subject, will be able to devise some means of determining who are bonâ fide lodging-house keepers; and I should like to remind him that, speaking generally, lodging-house keepers are an industrious hard-working class, who are very often in poor circumstances, and who consider that they are very unfairly treated with respect to this tax. I will conclude my remarks by thanking the House for the patience with which it has listened to me, and by expressing a hope that the right hon. Gentleman will be able to see his way to remove the injustice of which I venture to complain.

(8.0.) COLONEL LAURIE (Bath)

Mr. Speaker, I support the view which has just been expressed to the House by the hon. Member. The Chancellor of the Exchequer is perfectly familiar with the grievance of lodging-house keepers, and he knows very well that in the constituency which I represent a great portion of the inhabitants earn their livelihood by letting lodgings. They find that large hotels and lodging-houses on a larger scale only pay 6d. in the £1, while they are compelled to pay at the rate of 9d. I know there are some practical difficulties with reference to this question, but it has been suggested that by some system of registration it would be very easy indeed to get rid of these difficulties; and to be able to assess those who earn their livelihood by letting lodgings on the lower scale on which are placed those who are really carrying on a very large scale. I think the Chancellor of the Exchequer will concur that the class to whom I refer suffer from a real grievance, and I hope it is a grievance he may be able to remedy.

*(8.2.) SIR W. GUYER HUNTER (Central Hackney)

Sir, last year I had the pleasure and honour of saying a few words on this subject, and it is unnecessary to detain the House for any lengthened period after what has fallen from my hon. Friend, to whose observations I have little or nothing to add. Last Session I referred to a deputation to the Chancellor of the Exchequer in 1889, and I trust the right hon. Gentleman will not depart from the promise which he then made. Since last year the objections to this tax have become far wider, and many Members on both sides of the House have taken up the question with exceeding warmth, and I trust the Chancellor of the Exchequer may see his way to getting rid of this unjust piece of taxation. Although the right hon. Gentleman may not be able to do so before the Budget, yet afterwards I trust he may see some way of repealing a tax which is unjust in its incidence, and causes much hardship.

*(8.5.) MR. S. SMITH (Flintshire)

Mr. Speaker, I happen to represent a constituency in which there is a large number of lodging-house keepers. I am quite aware of the extreme difficulty of making exemptions to a tax of this kind, and of drawing a line between those who are properly lodging-house keepers and those who are not. But the lodging-house keepers are really a poor and struggling class, consisting mostly of widows, and if anything could be devised whereby the tax would bear more leniently upon them, I believe it would be very acceptable to a large section of the community.

(8.6) MR. CURZON

Mr. Speaker, I desire to appeal on behalf of the lodging-house keepers, who are engaged in a cognate line of business, though on a very much smaller scale, with shopkeepers and the tenants of hotels. The difference is one of degree, the hotel being a large lodging-house, and the lodging-house being a small hotel. The Chancellor of the Exchequer, in reply to the deputation, rather more than a year ago, raised certain objections to our proposal. He asked us if our appeal was made only for lodging-house keepers at watering places, or for lodging-house keepers in general. Of course I only speak for the lodging-house keepers of watering places, with whose case I am familiar. I do not ask, however, that they should beexceptionally treated, and hon. Members for other constituencies can state the case of the lodging-house keepers whom they respectively represent. The Chancellor of the Exchequer also asked us whether the tax is not paid by those who rent, and not by those who let the lodgings. I believe that this is not the case. I believe that the tax in its present incidence presses hardly upon those who take in lodgers. Their margin of profit is very small, and the source of income is a precarious one, being largely dependent upon the character of the season and the number of tourists. I think the case is one deserving the attention of the Chancellor of the Exchequer, and as we know that the circumstances are such that he is perhaps more able to comply with our demand on this than he will be on future occasions, I think he may be asked to treat this appeal generously.

(8.11.) SIR HENRY FLETCHER (Lewes)

I also represent a watering-place in the County of Sussex, where lodging-house keepers are very much, dependent for their subsistence upon visitors, and I do trust the Chancellor of the Exchequer will listen to the arguments which have been adduced, because they are very material ones indeed.

*(8.11.) MR. JOHN KELLY

Mr. Speaker, I wish to say a few words on a different point. The exemption in this tax is in favour of houses of a less value than £20 per year. While that exemption is, no doubt, of very great benefit in the country, it is of no sort of benefit in the large towns, where separate houses under the value of £20 are almost unknown. But there is a class of house (for such they really are) which ought to be looked upon as of under the value of £20—the tenement dwellings. I do not refer to such as the Peabody buildings, which do not pay the Inhabited House Duty. I wish to say nothing against those who are providing the industrial blocks for our poor; but I am bound to point out that these dwellings have great drawbacks as compared with houses built in tenements, for the poor who use them have mostly cither to mount up great distances, or to live in rooms from which the sunlight is wholly shut out. I think the question of tenemented houses one of vast importance to the community. My appeal is strictly limited to tenemented houses built as such, which unfortunately cannot be said to have "structural severance." These words have led to much difficulty and injustice, and I should indeed be sorry to see any favour of any kind shown to the owners of converted houses, which are really nothing but "rookeries." What is asked for is no great slice of the Chancellor of the Exchequer's surplus. I believe if he freed these tenemented houses from the Inhabited House Duty, it would only be a question of some £200,000 in all. I should like to point out to him that those who take the same view as I do of this matter of tenemented houses feel deeply grateful to the right hon. Gentleman for the kind way in which ho received the deputation, and for the very great trouble which he allowed his Secretary to take in this matter. I appeal to the Chancellor of the Exchequer with some considerable hope, for if the great question of the housing of the poor is to be solved, I believe this can and should be done, and by offering facilities for the construction of tenemented houses, and that, in this way, insanitary districts could be replaced by healthy dwellings for the poor without casting any fresh pecuniary burden whatever on the ratepayers. By freeing them of the charge of the Inhabited House Duty, and some reduction of the rates, I believe we should see a great part of the worst streets of London pulled down, and suitable tenemented houses erected.

*(8.16.) THE CHANCELLOR OF THE EXCHEQUER (Mr. GOSCHEN,) St. George's, Hanover Square

Mr. Speaker, it is the general assumption that there is to be a very large surplus, but I wish to ask the House that if there are many large demands for its expenditure in every direction, where will the surplus be? It is rather anticipating events to say I have a surplus at my disposal, ready to meet all the demands made upon it. Hon. Members have put several points to me, but I must labour under the disadvantage in answering that if I were to argue with any of these hon. Gentlemen they would endeavour to extract from me whether or not I intended to deal with their points. On the other hand, if I abstain from replying, they may draw the opposite conclusion. Therefore I must, with the greatest respect, not attempt to reply with argument in any way. I notice that whenever a claim is made for remission of taxation in the case of any particular class, that class is always the most deserving in the whole community, and has the hardest struggle for existence. Lodging-house keepers are an industrious class, a hardworking class, and, as a hon. Member has said, a very struggling and very deserving lot." Hon. Members will see that I have taken to heart the character of the persons for whom they have pleaded. I have noted the great sympathy which they feel with a most deserving class. I am perfectly acquainted with the arguments of hon. Members, and I am afraid that that is all I can say with regard to the relief of the lodging-house keepers. My noble Friend who introduced the subject has spoken of the poundage assigned to assessors and collectors. Assessors are a very different class from collectors, because assessors assign the amount of the tax, but collectors only collect, and a little gentle stimulus in their case might be of advantage. But it is my intention in a few days to place on the Table a Bill of two or three clauses dealing with this question of poundage to assessors and their clerks. My hon. Friend who last spoke dealt with the question of tenement houses, and stated most fairly the difficulty with regard to structural severance. My hon. Friend will probably remember that the owners of some of the worst house property have made exactly the same claims. I feel very strongly that if the Government are to give way to the demands thus made upon them they will be giving an exemption to a certain class of owners not entitled to special privilege. The whole question of structural severance is one of great difficulty. My hon. Friend stated that the whole question meant £200,000 for London alone.


I beg the right hon. Gentleman's pardon. I meant £200,000 for the whole country.


I thought the hon. Gentleman meant London, and I do not say that the cost should affect the question of whether the House Tax should be put upon any particular class of houses adapted to the working classes. Thus far I am willing to go, that I think it would be a very undesirable thing to discourage the building of any particular class of houses for the working classes. Beyond that I am unable to go. I must apologise to my hon. friends that I am unable, just a fortnight before the Budget, to enter into the points they have raised, though I have listened to the contentions and arguments which have been brought forward.

(8.22.) MR. O. V. MORGAN (Battersea)

Sir, in my constituency, during the last two or three years, a large number of small double houses have been built, in which families can live separately, and have separate entrances from the ground floor to the lower and upper floors. The tenements are completely severed, and each consists of four rooms. The two are generally let at a total rental of £25 a year, and it would be a great boon to these people if they could be relieved of the House Tax. I hope the Chancellor of the Exchequer will kindly take into consideration this class of small double houses, of which whole streets have been put up.

Notice taken, that 40 Members were not present; House counted, and 40 Members being found present,

*(8.54) MR.PROVAND&c) (Glasgow, Blackfriars,

The right hon. Gentleman the Chancellor of the Exchequer made a very sympathetic address to his Friends on his own side, and undertook to consider their arguments, and look into the matter of the incidence of the House Tax. No doubt there are many anomalies connected with the tax, but if the right hon. Gentleman is going to consider those points brought under his notice by the Mover and Seconder of the Motion, he should also take into view the incidence of the tax generally, and see if all other people are fairly rated. Over a large portion of this country the incidence of the tax is most anomalous and unfair. For example, country mansions are rated very unfairly. The tax is based upon the annual value, and that is perfectly reasonable, or would be if the correct value were ascertained. In the case of country mansions, however, they are very seldom rented. They are mostly owned by the occupier, and the question of annual value is settled by Local Overseers who are not inclined to fix the valuation of these mansions of the wealthy as high as it ought to be, and, as a result, we find such places as Chatsworth, Blenheim, and Hamilton Palace, and many other mansions of that kind, rated at a lower amount than are many ordinary dwelling houses in our cities. If, therefore, the right hon. Gentleman is going to examine into the anomalies of the tax, he cannot legitimately confine his attention to the points brought before him by the Mover of the Motion. Besides the case of the mansions, and castles of the nobility he must also consider the anomaly in the case of tied-houses, where the rate is paid not by the occupier but by the brewer, who is the owner, and who, to have a low rate, frequently makes the rent much under a fair letting value. We are entitled to ask that the Chancellor of the Exchequer, when he comes to review the whole incidence of this tax, will see that rates are levied fairly and impartially on all houses throughout the country.