RESOLUTION.

HC Deb 27 February 1891 vol 350 cc1853-90

(5.14.) MR. PROVAND (Glasgow, Blackfriars, &c.)

I rise to bring before the House the subject upon which I have given notice, and to move the Motion which stands in my name on the Paper. This Motion deals with a question of continual Parliamentary interest. Taxation is the one subject that is sure to come up for consideration every year; indeed, I may go a little further, and say that although many taxation questions will in time be discussed and disposed of, that of the taxation of land is the one question which is certain to remain to be dealt with in every Parliament throughout a very long future. The Motion sets out that land pays at present too little taxation. The owner should be liable to be taxed on what the land is worth, and not merely on what it rents for, and for this purpose it would require to be assessed separately when it is in any way occupied. This change would largely increase the taxation paid by land, and this increase would form a fund by means of which other taxes which press on food, industry, and commerce could be repealed. Therefore the Motion, if carried, would involve a considerable re-adjustment of the incidence of taxation. As land is taxed both for local and Imperial purposes, I must take the sum of Imperial and local taxation together, and begin by showing in round figures the principal amounts of our present taxation and the sources from which we obtain it. Taken together our local and Imperial taxation amounts to about £105,000,000 per annum, and the following are the chief sources from which this was collected in 1889, which is the last year for which the figures have been published. Food was taxed to the extent of nearly £5,500,000, intoxicants £30,000,000, stamps £13,000,000, Income Tax £13,000,000, House Duty £2,000,000, Land Tax £1,000,000, and tobacco £9,000,000, and the local taxation may be taken as £30,000,000, making, with some smaller sums, in round figures a total of about £105,000,000. The reduction in the Tea and Currant Duties made last year will reduce the taxation on food for this year to between £3,000,000 and £4,000,000, but the other sources of taxation will not be much altered except on intoxicants, which will show an increase, I am sorry to say, over last year. Now, the first question is—How much of this gigantic total of £105,000,000 is paid by the landowners? They contribute in six different ways—by Land Tax, by Rates, by Stamps on Deeds, by the Estate Duty, by Succession Duty, and by Income Tax under Schedule A, but all these sources taken together do not contribute probably more than £5,000,000 to the total taxation.

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

And the rates?

MR. PROVAND

In England rates are paid by the occupiers; in Ireland and Scotland they are paid half by occupiers, half by owners. Therefore, leaving out the £30,000,000 derived from drink, as being an article on which there is no intention of decreasing the duty, and the £9,000,000 paid by tobacco, the rest of our taxation during the present year will be derived, say, from food about £3,500,000; from landowners about 5,000,000, leaving nearly £60,000,000 to be paid by occupiers of farms and houses, and by the community in many ways and forms, making altogether an enormous direct or indirect taxation falling on industry. I am now stating these sums in round figures. It is impossible that I can go into the details in the time at my command; and besides that, the exact proportions could not be worked out except by a person having access to figures, which, so far as I know, are not made public. But even if there were discrepancies in the figures I give, this would not affect the principles for which I am contending. Whether one set of figures given is slightly over or under what someone else may say they are, or even prove them to be, will not affect the case. Everyone knows how easy it is to manipulate figures to practically misrepresent an issue. Now, I have shown how little of our taxation falls on the landowners, and indeed the Chancellor of the Exchequer has repeatedly admitted that there are great inequalities to be rectified between the taxation which falls on land and on personalty, but he has said in recent times that rates for local purposes should not be paid by landowners, nor should the Death Duties be made the same on realty as on personalty unless and until the assessment of land to Income Tax was put on the same footing as on other property. I invite him to do so; but I do not expect this invitation will be accepted, as landowners know that any alteration that could legitimately be made in the way land is assessed to the Income Tax would be a very small sum indeed compared with what they would in such case require to pay in local rates and Death Duties. So much, therefore, for my first point—that land pays too small a share of our taxation, and that the burden ought to be increased. Let me now deal with part of the £60,000,000 or so of taxation which is paid by or falls, either directly or indirectly, on food and industry. Even if national necessities, such as a time of war, required any tax to be placed on food, the percentage which is now charged would be out of all reason. The articles which pay duty are tea, coffee, dried fruits, and some other things which, taken all round, are increased in price to the consumer by at least 50 per cent. on account of the duties. But there is another unanswerable reason against any tax whatever being placed on food, and that is, that food is raw material, and it is indispensable that we should obtain it at the least possible cost. The last thing on which there should be any tax is food, and no reasonable defence can be offered for taxing it while we have vast amounts of other property which escapes taxation almost altogether. Something like £30,000,000 a year out of the total of £60,000,000 is collected by rates, which, except in Ireland and Scotland, are paid by occupiers, and the whole of this is paid out of their wages, or out of the businesses which they carry on, and is, therefore, a direct tax upon their industry. Income Tax brings in £13,000,000, and the profits of industry pay the whole amount except what is charged to landowners under Schedule A; and out of £13,000,000 realised from stamps, landowners contribute only a little for deeds used in the sale or purchase of land and for Succession Duties. Except in these cases the whole of the Stamp Duties are charges on trade and commerce. An example of a direct tax on our commerce is the stamp charged on marine insurance policies. This forms an addition to the cost of the merchandise we export and import. Every merchant's in voice for goods contains the charge for marine insurance, and includes this tax, and £140,000 a year is by this means brought into the Exchequer, and everything shipped for sale abroad or imported for sale at home is made dearer by the amount of this duty. £45,000 is collected by the tax on life insurance policies; that is to say, those persons who are thrifty and prudent are taxed because they are so. The question of cheaper railway fares has been repeatedly before this House of late, yet we charge the Railway Companies £330,000 a year for passenger duty. If this were remitted it would enable the companies to do something towards providing the cheaper suburban rates which it is admitted on all hands must be brought about if the workers in large cities are to be able to get backwards and forwards from their homes to their employment. The Carriage Tax which brings in nearly £500,000 a year is another indefensible charge upon industry, although, perhaps a municipal impost on carriages for police purposes might be conceded. Even the briefest examination of the sources of our taxation must convey to the mind of anybody that they have been carefully sought out by successive Chancellors of the Exchequer, moved by the determination that whoever was taxed landowners at least, to a large extent, should go free. There are many taxes which ought at once to be taken off the Statute Book for the sufficient reason that they are unjust. They bring very little money into the National Exchequer and must require a small army of clerks to look after the collection of them. Many kinds of businesses are still taxed, for which there is neither reason nor justification. Why, for example, should a house agent be charged a licence to carry on his business? Why should a solicitor have to pay from £3 to £9 per annum to be permitted to practise his profession? The State does nothing whatever for these men; their businesses are not monopolies. Any person may be a solicitor who will take the trouble to pass the required examinations. These taxes are what remain of a great many of the same kind that were formerly in existence. Calico printers, starch makers, wire drawers, tanners, glass makers, and numerous other trades and businesses could not at one time be carried on unless permission was first purchased from the State by payment of a tax. It is impossible to defend such charges, and we still keep on the Statute Book a number of small charges from which we can get no adequate return. Bat perhaps the high-water mark of injustice as well as meanness is reached on the part of the Government in the profit of something like £90,000 a year which they make out of the Patent Office. It is notorious that, as a rule, inventors are poor men; indeed, in innumerable instances they make and keep themselves poor by struggling to invent, yet this class which does a great deal for us in the extreme competition in which we are engaged with all foreign countries, hampered as we are by their fiscal arrangements—this very class, which should be exempt, at least, from paying a profit to the State, are required to contribute to our Revenue about £90,000 per annum. We have quite recently in this House voted large sums for technical education in order that our youth may be adequately trained to design and to invent, as it is continually brought before us that on many of these points our continental neighbours are better prepared than we are; but as soon as they are old enough to utilise the training provided for them, and to design or invent, we only permit them to do so provided they contribute to the Revenue a profit, after the expenses are paid, of about £90,000 a year. I do not think it would be possible to discover any tax more unreasonable, more likely to discourage skill and industry, or which would be more profitable to give up. I have now given a sufficient number of illustrations of how a large proportion of our national income falls upon food and industry, and it would be wiser to discontinue such taxes, which have the direct effect of hampering our commerce. Land should be assessed on its value, and the assessment should be separate from that of any buildings that may be on it. I recognise the great differences between rural and urban land. The former has a creative power which requires the continual application of labour and capital, while urban land has only an earning power which is entirely derived from the presence of population in its neighbourhood, without the application of either labour or capital on the part of the owner. Rural land is, in fact, in many places, to a large extent, a manufactured article. The methods of valuation for purposes of taxation would, therefore, no doubt be different, and the allowances for improvements in the case of rural land would have to be dealt with; but in the case of urban land there is no such difficulty, and the separate valuation of it, apart from buildings, would be easy. This matter has already been dealt with by a Committee of the London County Council, which took evidence— (a) As to the practicability of separating and recording the value of London land apart from that of buildings or improvements. (b) As to the method of affecting such separation; and (c) As to the steps necessary to be taken in order to ensure the adoption and practical operation of such method, and they found that the separate assessment and record of the separate value of the land was easy and practicable. The subject has also been dealt with by two Municipal Committees in the City of Glasgow, who have both found it will be a simple matter to value and assess land, apart from buildings, and a Special Committee in Glasgow, to which this question was referred, recommended that a copy of their findings should be sent to all Assessing Bodies in Scotland with a request that they will co-operate in petitioning Parliament in favour of legislation on the lines indicated in their Report. The House will therefore see that this point has already been dealt with in London and Glasgow, and there is not the smallest doubt that it will be rapidly taken up by other cities. To carry out this separate assessment of land, and to make the tax payable by the owner, no change in our law is necessary. A new Land Tax, if an increase of taxation took this form, would be on the same footing as the existing one, the law respecting which I quote from the 28th Report of the Inland Revenue Department, in which it says— Land Tax is payable whether the property be occupied or not. The law applicable to Land Tax makes no provision for voids or loss of rent; it is a charge upon the owner, and if the occupier pays it in the first instance he is entitled to deduct it on payment of his rent.

SIR RICHARD PAGET (Somerset Wells)

Will the hon. Member quote from the same Report the origin of that tax?

MR.PROVAND

I should be delighted to do so if I had the time to spare. The next point is who should be assessed, and authorities are all agreed that the occupier should be charged in the first instance, and the way in which he would recover the part for which he was not liable is stated with admirable clearness by the present Chancellor of the Exchequer in his hook on Local Taxation, published in 1872, and from which I take the liberty to quote. He said— Power being given to the occupier to deduct from his rent the proportion of the rates to which the owner may be made liable, and provision being made to render persons having superior or intermediate interests liable to proportionate deductions from the amount received by them, as in the case of the Income Tax with a like prohibition against agreement in contravention of the law. That is what the right hon. Gentleman wrote in 1872, and, of course, it is quite as applicable now as then. That the landowner should be prohibited from contracting himself out of the tax will be necessary, otherwise we should find ourselves in our present position; that is to say, it would be paid by the occupiers, and in effect be an increase of rent. Now, Sir, in advocating an increase in the taxation of land, I am not proposing anything which is new. The right hon. Member for Mid Lothian, when Chancellor of the Exchequer, introduced the Succession Duty, and the present Chancellor of the Exchequer in 1888, and again in 1889, increased the charges on land by raising the Succession Duty in the former year, and by creating what is called the Estate Duty in the latter year. The points to which public attention have been mainly directed are that land, when vacant, pays no rates, and when occupied the rates are paid in England by the occupier. This is an old standing injustice, and, in 1871, the Chancellor of the Exchequer, who was then President of the Local Government Board, introduced a Local Government Bill, and, in doing so, he said.— Justice and public policy require that the owner shall pay a certain portion of the taxes. And further on he said— The Government have decided that such an anomalous state of things shall no longer exist, and a provision rendering void any engagements by which owners contract themselves out of the payment of local taxation is made in this Bill. But that Bill did not pass, and the injustice continues to this time. Now, Sir, justice and public policy are as powerful reasons to-day as they were 20 years ago in favour of the landowner being required to pay more taxes and also against his being permitted to contract himself out of their payment. I may mention that, with the exception of the right hon. Gentleman the Chancellor of the Exchequer himself, the Government of that day—that is, in 1871—now occupy the Front Bench below me. A landowner could not contract himself out of an Imperial tax, nor should he be allowed to do so in the case of a local tax. Landowners have been enriched enormously by the expenditure of rates paid by the occupiers; and although the case against the country landowner is not so strong, because not so general, on this point as against the town landowner, nevertheless the evil exists to a very large extent. I have said that there would be some differences in the methods applicable to increasing or imposing fresh taxation on rural land from urban land, and although land in towns is that which most stands in need of attention, nevertheless the fact of land being enormously increased in value by the expenditure of the occupier's money is in many cases as noticeable in the country as in the towns. Time will not permit me to give more than one example of how this injustice is worked in a country place. In the North of England there is a manor of about 2,800 acres, the lord of which has paid throughout the last 20 years less than £4 in rates. In the meantime, the Local Authorities have spent, or are spending, £40,000 in draining, reading, and lighting the neighbourhood, the whole of which forms a tax upon the occupiers and their successors. The value of the land has been enormously increased by this expenditure without the owner having contributed anything whatever except less than the sum of £4 on rates. When we come to the towns the cases are numerous and notorious. Every city furnishes examples of the whole community being taxed, their industry mortgaged, probably for generations to come, largely for the benefit of those who own the land. We have an example within a short distance of this House in the land lying to the east of Victoria Railway Station. It is not so long since this was a marsh. It is now closely covered with houses which have become the property of the owner of the land without any outlay on his part whatever of either money or industry. Some idea may be formed of the rate at which value is being created in this way when I mention that the Local Authorities expended more than £67,000,000 sterling during the last year, and they are building up a local debt secured on the rates which now amounts to £230,000,000. Most of this money has been, and is now being, expended on such objects as to directly increase the value of land, and yet the landowners, except in Ireland and Scotland, do not contribute one farthing in towns, and only sometimes in rural parts, towards this expenditure. It is laid out in making roads and streets, in lighting, paving, draining, and sanitary improvements of every kind, all of which add to the value of the land, and yet towards this landowners, who appropriate the value, pay only partially. In the work on Local Taxation, published in 1872 by the present Chancellor of the Exchequer, he says on this point— The result of the present state of things has been that many great improvements in the Metropolis, in Liverpool, Manchester, and other large towns, have been made during the last 10 years exclusively at the cost of the occupiers without the landlords contributing a single shilling towards the expense. Still more unjust to the community even than not separately taxing occupied land is allowing vacant land to be untaxed. Land can, therefore, be held by the owner without outlay of any kind. Meantime the improvements are going on round about, and increasing the value of his property until, finally, he lets it on building lease perhaps to secure a still greater value to himself in the future, or sells it at a price far beyond what it would have been worth if he had not been able to hold it while the community were taxing themselves to add to its value. There are many reasons which could be urged against vacant land being untaxed. It is a direct premium to its being kept out of use, and it is also, in effect, making the community find the capital without interest for the owner to hold it from sale. This great public injustice has been repeatedly noticed and reported against by Local Bodies, and in 1885 the Royal Commission which sat on the Housing of the Working Classes reported in favour of land available for building being taxed at, say, 4 per cent, on its selling value. This was done on account of the notorious examples brought before them of landowners deliberately keeping their land out of the market and parting with it only in small quantities so as to raise the value beyond even the natural price which land would command by its advantages of position. They also notice in this Report that this increased value to the land was not a recompense for any industry or expenditure on the part of the landlords, but was the natural result of the industry and activity of the townspeople themselves. Many other Reports might be quoted in a similar sense, but these would be merely cumulative testimony in reference to an evil which I am sure no Member of this House will venture to defend. In the Report of the Land Valuation Committee of the London County Council, they mention that in Kensington the value of vacant land is about £1,700,000 sterling, which is practically not rated at all, the rates not being worth considering; and land in parts of Kensington is now worth from 7 to 8 times more than it was 25 years ago. In some of the central, and also in all the outlying districts of London, land is kept vacant while it is annually increasing in value without in most cases contributing a farthing to the local requirements. This part of the case against land is unanswerable. Every reason which can be adduced is in favour of it being taxed on its value and not being exempt from taxation which, when imposed for local purposes, is directly the means by which its value is increased in the market. I have now dealt with the several points in the Motion. Firstly, that land is taxed too little, and this was stated by the Chancellor of the Exchequer himself in his speech made in 1871, when he also showed how much more land pays in other countries than in ours. I quote his words and figures— The amount paid by land alone in England is 5½ per cent.; in Holland land alone pays 9 per cent., in Austria 17½ per cent., in France 18½ per cent., in Belgium 20½ per cent., and in Hungary 32½ per cent. What do these facts prove? They prove that, as regards Imperial taxation, land in this country is in an infinitely better position than land in any other European State. Also that there will be no difficulty in imposing fresh taxation, as any new tax might follow the law which regulates the existing Land Tax. Nor would there be any difficulty in assessing and collecting a separate tax, as the Reports of the Committees of the London County Council and of the Glasgow Municipal Council say that an assessment on the value of land separate from that of the houses covering it is practically easy. The method of collecting the tax would be that recommended by the Chancellor of the Exchequer himself in his Draft Report on Local Taxation which I have read to the House. And now, Sir, I submit that I have made a perfectly sound case for an increase of the taxation to be paid by landowners and also for that which is implied by the Motion, an equivalent reduction of taxes which are now charged on food and industry. The Government have recently taken up the labour question. After all, this is a branch of the labour question, and perhaps the most important branch which is at present under consideration. There is a popular idea that a working man pays no taxes unless he drinks or smokes. This is a delusion. He not only pays on his food; but leaving that entirely aside, he pays a larger percentage of his income on local taxation than any other class of the community. Workmen's houses are rated at about 20 to 25 per cent. of their annual value, and a workman usually pays 20 to 25 per cent. of his wages in rent. Taking him, therefore, at an average of 25s. per week, which is a high average, his rent would be about 5s., on which he would pay from 1s. to 1s. 3d. for rates, either through his landlord in rent or direct himself, and this represents from 4 per cent. to 5 per cent. on his income, which is a larger percentage than is paid by any other class; and, besides this, it must not be forgotten that it is a much greater strain to pay 4 per cent. or 5 per cent. on a very small income than it would be to pay the same proportion on a very large one. It is the working classes on whom local taxation falls heaviest, and when local burdens are largely shared by the landowner, as they ought to be, the working classes will get the benefit in lower rents. I have repeatedly mentioned and quoted the Chancellor of the Exchequer, and my reason for doing so is because there is no man in this House who knows so much about this subject as he does, and also because he is the only person to whom we can look for assistance. He has the stewardship of our national finances, and the local finances are controlled by this House under his initiative. And I desire to enforce my appeal by the statement that while he has been in power for four years, during three of which he has had large surpluses, he has discriminated in favour of the land and added to land taxation only about £200,000, while he has added more than four times that amount to personalty by the new Estate Duty alone, which he brought in two years ago. We have yet to see what he has added to the taxation of land by the Estate Duty. Twenty years ago the Chancellor of the Exchequer told us in this House that justice and public policy required that landowners should pay more taxes than they did then; and as almost nothing has been done since to make them pay more the case is now infinitely stronger, and justice and public policy call louder than ever for an equitable readjustment of taxation. On the one hand, landowners pay a mere trifling increase of taxes; while, on the other hand, hundreds of millions of pounds have meantime been raised from rates or borrowed by Local Authorities, nearly the whole of which have been spent in improvements, which have largely gone to enrich landowners. This is no exaggeration. In 1871 it was intended to divide the rates between the occupier and landlord in England and Wales in the same way as they are divided in Ireland and Scotland. That was not done. What has happened since then? During the intervening 20 years nearly £500,000,000 sterling have been raised by rates in England and Wales; and if the law had been changed in 1871, £250,000,000 of this would have fallen upon the landowners. They are, therefore, now this amount in pocket, besides having become possessed of all the increment of the land which has resulted from the local expenditure of the most of this enormous sum of money. But even this does not express all the advantage which has been given to them since 1871, for, besides the rates that have been raised and expended, the Local Authorities in England and Wales have borrowed in the meantime something like £100,000,000 of money, which has also been expanded in local enterprises and improvements which have added to the value of land. If, therefore, the Chancellor of the Exchequer was right when he said that the state of things then existing was unjust and against public policy, there are far stronger reasons in existence now in favour of this opinion than there were when he expressed it. I think, therefore, I may confidently appeal to him to give his early and earnest consideration to the great injustice which is being done to the community by permitting the landowners to escape their share of the public burdens. We are sure to hear more on this subject in the early future, both in this House and in the constituencies, and it is certain to be brought prominently before their notice in view of the coming General Election. As the Government is setting its house in order against that possibly evil day, I hope it will take this question into consideration, and deal with it at least on as fair a basis as was intended by the Government of 1871. If they will not do so, they may be assured the country will take notice of their refusal to remedy this notorious injustice, and will deal with them accordingly when the General Election gives the people an opportunity of doing so. I beg to move the Resolution down to the word "increased" in the third line.

Amendment proposed, To leave out from the word "That" to the end of the Question, in order to add the words "in the opinion of this House, the proportion of taxation which falls upon and is payable by land and its rentals is insufficient and ought to be increased,"—(Mr. Provand,) —instead thereof.

Question proposed, "That the words proposed to be left out stand part of the Question."

(5.55.) MR. J. STUART (Shoreditch, Hoxton)

I rise to second the Resolution, and I shall do so very shortly indeed. I must express my gratification that my hon. Friend has omitted the latter portion of his Resolution, and has therefore enabled the House to vote upon a clear issue, instead of an issue complicated by a variety of subjects not necessarily involved the one in the other. I will not endeavour to follow the complicated line of reasoning so ably pursued by my hon. Friend, because I only intend to deal with a few large lines of argument. I take it that it is admitted on all sides of the House, by the Chancellor of the Exchequer as well as by gentlemen on this side, that, so far as Imperial taxation is concerned, land in this country pays considerably less than land in any other countries, and that the percentage paid by land in this country towards Imperial purposes is less than the percentage paid by any other class of property. I think it is admitted on all hands that the amount paid by houses and land in England towards Imperial taxation is very different from what is the case in other countries. In England it is 10½ per cent., as stated by the Chancellor of the Exchequer, while in France it is 29 per cent., and in Hungary 38 per cent. To form any proper conception of the burden borne by land we must take into consideration what is paid to local as well as to Imperial purposes. In this connection land is divided into two categories —land in towns, and arable or cultivable land. The cases of these two differ considerably, and what I want to urge on the Chancellor of the Exchequer and the House is that there is no doubt what ever that land in towns pays very little indeed to local purposes. In our great towns the burden of the rates falls principally upon the occupier. The burden upon land in so far as Imperial taxation is concerned, is very slight, and in towns the burden on land with regard to local purposes is also slight. I admit that in the case of agricultural land, the burden of local rates falls more upon the land, but I should like the Chancellor of the Exchequer to show the House what is the total amount of local burdens upon any agricultural district, and I very much doubt whether he will find in the figures connected therewith any sufficient size of figures to compensate for the deficiency of the other charges on land. I now come to the question whether the owner or the occupier is the person who really pays in the agricultural districts. I admit that the owner pays more in the agricultural districts than in the towns; but here there are two points to consider; the first is the real incidence of local taxation in such cases, and the next is the apparent incidence of local taxation in such cases. I wonder why it is that the right hon. Gentleman, the Chancellor of the Exchequer, who has expressed such sentiments as those which we remember him to have uttered in the past, has remained in a position of such authority in this House for so long a period, and has taken no steps to carry out that division of rates as between owner and occupier to which in previous years he pledged himself. The reason for this division as argued for by hon. Gentlemen on this side of the House, is that they think that the burden is borne by the occupier, while hon. Gentlemen on the other side of the House think that in the agricultural districts all, or a great part of the burden, is borne by the owner. There never was a worse tax than that which has the obloquy of being borne by two persons, when we know that two persons cannot bear it. There is no doubt that some of the local taxation falls on the shoulders of each, and if that be so, I say it is better that it should be put half on each than that all should be placed on one individual. Doubtless it will tend to distribute itself with a certain amount of fairness, but at the same time rates have a tendency to stick where they are placed, and if we want to do justice it is better for the House to endeavour to right these things, than to let them remain as they are. Now, I want to clear up the point at issue in this discussion as to the apparent and the real incidence of the rates, and I would ask the right hon. Gentleman the Chancellor of the Exchequer whether he will be prepared before long to carry out the sentiments which he himself has been one of the great advocates for spreading through the country—the sentiments embodied in the principle of the division of rates between the owner and occupier. I am very far from thinking that a. mere division of a nominal character would settle the true incidence of taxation on land and other things that are taxed; but I believe that the division is more nominal than real, though at the same time I think the question will admit of a large amount of argument. So much for this part of the question. Now, I want to tell the House why it is that I do not desire to detain it long on the present occasion. The mover of the Resolution has dealt with the subject necessarily and mainly from the point of view connected with agricultural land. I have no hesitation in saying that the argument is much stronger in respect of land and houses, for sometimes they are joined together, and sometimes it is. attempted to separate them. The argument is certainly much stronger in regard to the towns than in regard to the country. Indeed, it is because of its immense strength in regard to the towns that I have risen to support the Resolution; but I do not now intend to enter into that part of the argument. I may here state that the Liberal representatives of the Metropolis have consulted together on this matter. We have in the first place framed a Resolution in reference to the local taxation of the Metropolis, for the discussion of which we have secured this day fortnight, arid therefore it would be an unnecessary detention of the House, and would tend to somewhat complicate the argument if we were to go at any length into the question as connected with the Metropolis. At the same time, as it might otherwise be thought that we are unsympathetic with regard to this Resolution, I have ventured, on behalf of my hon. Friends, to second the Motion in order that I might explain the reason why we defer a portion of the Debate. The question, as far as it relates to the Metropolitan aspect of the taxation of land, is a very specific and definite one, and I trust we shall be able to obtain from the House a vote in respect of a Resolution which we can put much more definitely from our point of view than in the case of the present proposal. Before I sit down I want to urge upon the House another point with regard to the taxation of land. Passing from the larger and wider view of the question I would endeavour to impress on the House the necessity there is for dealing with the questions arising on the taxation of land, question by question as they present themselves, with more equity than you at present adopt in respect to other taxation. Take the reform introduced by the Chancellor of the Exchequer. I allude to the additional Death Duty which he has lately placed upon properties of upwards of £10,000. How does the right hon. Gentleman deal with the case of land and personalty? In the case of personalty, if there is an estate of upwards of £10,000 he imposes an additional percentage upon it, however it is subdivided; but when it comes to the case of land, even if the estate should be valued at £100,000 and be divided into portions of less than £10,000 each, he does not put on a single penny of additional taxation. Now, why is this distinction drawn? In the next place I go to the anomaly the right hon. Gentleman endeavoured somewhat to correct the other day. I allude to the anomaly which existed in the Death Duty in its connection with the Succession Duty on the one hand, and with the Probate and Legacy Duty on the other. I will not enter into that question, but on the facts before the House it appears that whereas something like £8,000,000 a year is got from the Death Duty there is less than £1,000,000 a year got from the Succession Duty, and that which is got is paid upon easier terms. Why is it that there is this great discrepancy? I know the answer will be similar to that which was given to the Commission which was appointed in the time of Edward III. to ascertain what was the cause of the Goodwin Sands. As the Commissioners went nearer and nearer to the Goodwin Sands, they were always told that there was some old gentleman who could tell them when they got there, and when at last they did get there, the old gentleman said the cause of the Goodwin Sands was Tenterden church steeple. That is a very old story to quote; but what it all comes to in the present instance is this: That whenever we find a certain anomaly in our taxation or rating which lets off land much more easily than other property, we are always told that the reason is to be found in the local taxation of agricultural land. That is the Tenterden steeple of hon. Members opposite. I have now pointed out one or two anomalies in taxation which, if removed, would tend greatly to do away with a good deal of the misapprehension which exists on this subject. That misapprehension does exist, will, I think, be readily admitted. If I were to complicate this discussion by going into the Metropolitan question, I should be able to show, as we will endeavour to show a fortnight hence, the extraordinary unfairness on land in general, and on the Metropolitan district in particular, of the incidence of taxation of land as connected with other forms of property included in this Resolution.

(6.12.) THE PRESIDENT OF THE BOARD OF AGRICULTURE (Mr. CHAPLIN, Lincolnshire, Sleaford)

I do not propose to follow the hon. Gentleman who has just sat down into the question of Goodwin Sands or Tenterden steeple, but perhaps the House will allow me, as the representative of the Agricultural Department in the Government, to offer some observations in reply to the two speeches on the Motion which is now before us, and which deals with the question of taxation on land. The hon. Gentleman who moved the Resolution explained the different items under which land was taxed at present, but I own I was unable to follow the argument by which the hon. Gentleman arrived at the conclusion that £5,000,000 a year was all that was paid by taxation on land. The hon. Member left out of account altogether the burden of rates. for he roundly declared that rates fell upon the occupier alone, and were in no way paid by the land. The occupier pays a certain sum for the use of the land, and in that sum are included rates as well as taxes. The effect on the owner is that if the rates are high he gets less rent; and if they are low he gets more rent, and I maintain that it would not be difficult to show that ultimately the whole burden of the rates falls upon the owner of the land and on nobody else. In that contention I am to some extent supported by the Seconder of the Resolution, who appears to differ very considerably from my hon. Friend the Mover. The hon. Member who seconded the Motion appealed to the Chancellor of the Exchequer to introduce legislation for the purpose of dividing the rates between owner and occupier. That was a reform which was recommended many years ago by a Commission, presided over by the Duke of Richmond, of which I was a member, and it is a reform Her Majesty's Government are perfectly ready to give, provided a fitting representation is given to owners of land as well as occupiers. I admit it is true, as stated by the hon. Member, that land in foreign countries pays more taxes than land in this country, but he cannot omit from his consideration the question of local taxation. The Motion which has been read over from the Chair, has been wisely, I think, curtailed. The House will observe that although it deals with the question of taxation on land, the hon. Member dealt with the question of urban as well as rural land, and I think it will simplify matters greatly if I deal with the question of urban and rural land separately. Take urban land to begin with. What is the grievance of the hon. Gentleman? He based his case, as I understood him to say, on the Report of the Committee for the Housing of the Working Classes, and he also directed his arguments to the question of taxation of vacant land. I am quite prepared to make this admission, that the case of urban land differs very widely from that of rural land, yet I think it is one with regard to which the hon. Member entirely failed to make out his case. I should require very much more conclusive arguments than those which the hon. Member has adduced before I could accept his views. I will content myself by opposing the Motion on three grounds. In the first place the grievance, whatever it is, whether it be great or whether it be small, is limited, I think the hon. Member said, to £1,700,000, and in its very nature it must be more or less temporary in its character. In the second place, the whole of this subject, unless I am mistaken, is now under the consideration of a Committee sitting at this moment on Town Holdings. But there is a much more serious ground, I think, than either of these, on which the Motion might be opposed, and that is that, if the land were to be taxed—as the hon. Gentleman, I think, pointed out was his intention—upon its capital value, instead of upon the income, it would be an entire departure from the principles of taxation upon property which have been accepted in this country up to the present time. It would be manifestly unfair and undesirable to apply this principle to one-third of property only, and we should require very much more conclusive arguments and complete evidence than has been laid before us before we could accept a proposal of that kind. I come now, Sir, to the question of rural land, and here I must say that I think the case is conclusive against the views of the hon. Gentleman. He says the taxation of the land and of its rentals is insufficient, and, therefore, ought to be increased. I confess, to begin with, that I have some difficulty in understanding precisely what it is that the hon. Gentleman means. Insufficient compared with what? Does he mean it is insufficient as compared with the taxation levied upon other kinds of property, or with the taxation upon land in foreign countries? He argued the question at considerable length, and, if he will permit me, I will reply to those observations. In the first place, although he pointed out that in countries which he named, and in others which he did not name, land is much more heavily taxed than in this country, and in which I agree with him; yet he failed to point out one very good reason for this, namely, that in some of those countries there is probably little, if anything, else but land which can be taxed. Again, I would point out that in nearly all of those countries there is a system of heavy protective duties, and whatever may be the effect of a protective system upon the position of a country as a whole—a subject I am not concerned to argue now—it undoubtedly has the effect of very materially enhancing the price of the produce of the land, and, therefore, upon that ground the landowners in those countries may justly and equitably be called upon to pay more taxation in respect of their land than is the case in England. But there is another reply to the argument of the hon. Member on that point, which I venture to think is infinitely more telling than either of those I have adduced. How much of our taxation in this country is needed for purposes which are not required in the countries to which I have referred; or, if they are needed, only in a comparatively minor degree? How much of our taxation is required for the purposes of our trade and commerce, and for the maintenance of our Empire in all parts of the world? What country in these respects can compare with us for a moment, and why should the land for all these great purposes be exceptionally taxed? The mere statement of the question carries with it its own answer, and supplies a complete refutation of the hon. Member's argument, which is based on the difference of taxation on land as between this and foreign countries. Well, Sir, can a more favourable comparison be made on any other ground—say as compared with taxation upon other kinds of property—in this country. Both hon. Gentlemen have pointed to the Death Duties, and complained of the inequalities as regards personal property. While I admit that concessions have been made of late years in local taxation, I can point, in reply, to the incidence of the Income Tax and the unfairness with which, according to our view, it falls upon land. I could quote, if it were necessary for me to do so, the opinions of most distinguished authorities on this subject. The right hon. Gentleman opposite, in 1853, after a most elaborate argument and dissection of the whole of this question, proved to demonstration the case which I support in respect of land, so far at all events as this, that he maintained that an Income Tax of 7d. on other kinds of property in reality was equal to a tax of 9d. upon land. That is a grievance which has remained un-removed until this day; what was true then is absolutely true at the present moment. Then, again, the Land Tax in its earliest inception was undoubtedly a tax on personalty as well; it was a tax on all kinds of property. Very much like local rates, after many years it became gradually disused, as far as regards other kinds of property, and ultimately fell wholly upon the land. As far as the history of the Land Tax is concerned it will not bear investigation for a moment, and coupling it with the grievance justly felt with regard to Income Tax, I maintain, if there be any question of altering the taxation on land at present, we claim, and claim, I think, with full justice, and we could adduce arguments to make good our claims, that we are entitled to a decrease rather than an increase of taxation on land. Well, Sir, if our present taxation is not sufficient as compared either with foreign countries or with taxation on other kinds of property in this, in what other way can the hon. Member make good this proposition? "Taxation," said the hon. Member, "upon land is insufficient, and ought to be increased." Well, that is the view of another person, Mr. Henry George, of whom we have heard a good deal lately. I do not know how far hon. Members share the views of that very distinguished individual, but all I know is this, that no amount of taxation of land in the world would ever be sufficient or satisfactory in the eyes of Mr. George, if any taxation was raised in any other way whatever. This is not a matter to be settled off hand by Motion on a Friday afternoon in the House of Commons. Authorities of the highest position, and differing entirely in their political views, have expressed opinions on this subject varying in toto from those expressed by both hon. Members. In the year 1872 my right hon. Friend the Chancellor of the Exchequer made this statement— There can be no more difficult or complicated question than that which is mentioned in determining the equitable proportion of taxation which real property ought to bear as compared either with land or with the consuming classes. It is not a question of statistics only; it is a political question. I recollect well the late Professor Thorold Rogers wrote on this subject, and I ask permission to quote his work, because he was a man of advanced and even of extreme opinions. Yet his views are diametrically opposed to those of hon. Members opposite. In his work on taxation he says— Now, I am ready enough to admit that there are some local taxes which should not fall on real estate. The only special taxes which are justly levied on landowners, and in justice should be directly levied upon them, are those which are essential to beneficial ownership on the employment of real estate. I think the hon. Member would find it hard to have an addition to the Land Tax at the present moment for beneficial ownership.

MR. PROVAND

May I be permitted to explain? I did not propose any new Land Tax.

MR. CHAPLIN

In that case I mistook the hon. Member.

MR. PROVAND

I only spoke in favour of increasing the taxes on land. I did not go into the particular way in which it should be done; but, I recommended towards the conclusion of my remarks that the Government should do that which was proposed by the Government of 1871—divide the rates between the landowner and the occupier.

MR. CHAPLIN

I regret that I should have misunderstood the hon. Member. I have already intimated that the Government do not object to the proposal to divide the rates between the owners and occupiers; but, certainly I understood the hon. Gentleman in his speech, to intimate the opinion that a new Land Tax should be proposed, and I thought that all the more remarkable because I knew the hon. Member must know perfectly well that nearly half the old Land Tax has been redeemed already. In the latter half of the hon. Member's Motion, as it appears upon the Paper, he proposes that an amount of taxation corresponding to that with which he wishes further to burden the land shall be taken off food, commerce, and industry. I have often observed that the taxation of food was a very favourite topic with hon. Members on that side of the House; but, as a matter of fact, during the last decade the only taxes which have been left upon food are the duties on tea, coffee, cocoa, chicory, and dried fruit. These amounted in 1879–80 to 5.5 per cent. of our gross revenue receipts; in 1884–85 they reached 6.1 per cent.; but in the current year, taking the receipts for 1889–90 as a basis for calculation, they have fallen under the beneficent reign of my right hon. Friend the Chancellor of the Exchequer (Mr. Goschen), to 3.8. per cent. Hon. Members opposite, then, have no ground whatever to complain of the present Government in connection with taxes upon food. The great bulk of our indirect taxation at the present moment is raised from intoxicants. Except with regard to them, I know not where any reductions can be made. Is it seriously proposed by the hon. Member that the taxes on intoxicants shall be reduced, and that an amount of taxation corresponding with the reduction shall be put on the landed estate? I think I have said enough with regard to food, but I must be permitted to say a word with regard to the question of industry dealt with by the hon. Member. He says we are to reduce taxation falling upon industry. Are we to understand that the hon. Member alleges seriously that agriculture is not an industry of this country? It is not only that, but it is an industry in one branch of which, at all events, many of the gentlemen sitting around the hon. Member are constantly professing their great interest. In these days we are all, I believe, unanimous in our desire to encourage and to increase the number of that class which Mr. Bright once described as men who "till the land and own the land they till." There is actually a Bill before the House, introduced by the hon. Member for the Bordesley Division (Mr. Jesse Collings), having for its object the increase of that class, and my right hon. Friend the leader of the House has only this evening given the assurance that the Government are going to deal with the subject if time should permit. For my part, I should rejoice if it were possible to carry a Bill for this purpose during the present Session. But what encouragement are the Mover of this Resolution and his supporters giving to the people to invest their hard-earned savings in the purchase of land for small holdings? Will they be encouraged to purchase with threats of this kind hanging over their heads? I declare I can conceive no proposal more calculated to defeat, to render useless, and absolutely inoperative every measure that may be passed, and every effort that may be made in this House to advance the interests of the class of small agriculturists. Agriculture is something more than one of the industries of this country; it is its chief, its greatest and its foremost industry. Of late years, unhappily, we have fallen upon evil times, we have passed through a cycle of agricultural trouble and depression such as probably no man living has ever known before; but now, thank God, there is reason to hope that we have seen the worst; and I must say it speaks well for the pluck, the courage, and the mettle of our agriculturists and farmers that on the appearance of the first glimmer of sunshine they have thrown themselves heart and soul into their work, and are doing their utmost to recover and, if possible, to repair the past. What that past has been, and what the difficulties through which the agricultural industry, which some hon. Members now seek to tax afresh, has gone, the House can judge for itself when I remind them that the decline in the annual value of land, as assessed for Income Tax, during the last decade has been no less than £400,000. And this is the moment which the hon. Member selects. This is the moment which he considers to be appropriate and auspicious for putting forward his doctrinaire schemes, in order I suppose, to assist and encourage agriculturists in the work they are endeavouring to perform, and the only possible result of which can be to bring ruin on thousands of individuals, and to add largely to that amount of land in this country which unhappily has gone out of cultivation and has ceased to be useful and profitable already. I think I have said enough in reply to the hon. Gentleman, and I do not wish to detain the House longer. On the part of the Government, I have to say we will have none of his proposals. Parliament, I am persuaded, will not sanction them, I am satisfied the country, does not desire them, and I hope the House of Commons will reject what, under all the circumstances, appears to me to be a most singularly ill-timed and injurious proposal.

(6.40.) MR. W.E.GLADSTONE (Edinburgh, Mid Lothian)

I shall endeavour to imitate the right hon. Gentleman in keeping the remarks which I have to make within a very moderate compass, and, to begin with, I shall express my concurrence with the right hon. Gentleman upon two points. In the first place, I am prepared without pity or scruple to deliver over Mr. Henry George to the right hon. Gentleman's tender mercies. There are persons who view the proposals of Mr. George as proposals of a very enlightened character, and who very much resent the use of hard words respecting him. I shall carefully eschew hard words; but I will say that, so far as my examination or knowledge of his proposals goes, I find it extremely difficult, and, indeed, for myself altogether impossible, to exclude them or extricate them from the category of those plans to which hard words no doubt are commonly applied. In the second place, I agree with the right hon. Gentleman that those connected with the agriculture of this country have behaved well in the crisis through which they have been called upon to pass. I think that the farmers of this country—though they are accused of occasional grumbling, which, however, is the privilege of every Englishman—I think that they have borne what they have had to bear with very great firmness and courage, and that they have applied themselves with remarkable energy and spirit upon the first revival of hope in connection with the condition of agriculture to make the best of their great and noble pursuit. I am bound also to say—although I think sometimes that the landlords of this country are a great deal too much given to complain—that during these times of reduction of rent—a fact established by the Income Tax Returns—they have, on the whole, borne that reduction with patience and resignation and in a spirit which befits a great class of Englishmen. At this point I am afraid my concurrence with the right hon. Gentleman ceases, and I fear that my view of his speech is one that he will he very far indeed from approving. But it is an important speech, because we must bear in mind not only that the right hon. Gentleman represents the Department of Agriculture, but that he has been chosen on this occasion as the organ of the Government to express the views of the Government. I thank my hon. Friend for having simplified the issue, but I wish to take particular notice of certain declarations made by the right hon. Gentleman. In the first place, I notice one declaration—that the effect of protection is undoubtedly very largely to increase the prices of agricultural produce. That is an important declaration coming from the Government when applied to the history of this country.

MR. CHAPLIN

I said in many of the countries in which it has been tried.

MR. W. E. GLADSTONE

Does the right hon. Gentleman mean that Protection in one country tends to increase the prices of agricultural produce, but that in another country it does not? Why, Sir, if it has increased the price of agricultural produce in foreign countries, I think I am justified in saying that would have been the case in this country; and I am sorry to say that it stands upon record that for many generations, when the landed class was in almost exclusive and absolute possession of the two Houses of Parliament, they maintained a rigid system of Protection to raise the prices of commodities in which they dealt themselves, and when finally the proposal was made to abolish that system of Protection they offered to it the most desperate resistance, and they drove from their ranks that most illustrious man whose name will ever remain honourably associated with the emancipation of trade and commerce in this country. Now, that is an awkward admission on the part of the right hon. Gentleman, but when he came to criticise the speech of the Mover of this Motion with respect to rates he made a declaration, which I carefully recorded by the aid of my pencil, and which I think ought to be engraved not only upon a fly sheet of paper that will find its way to the waste-paper basket or the fire, but which ought to be recorded upon the living tablets of the hearts of the House of Commons and of the people of this country. The right hon. Gentleman contests, with a great deal of truth, the doctrine of my hon. Friend that the rates are paid entirely by the occupier of the land in this country. No doubt they are paid immediately by the occupier of the land, and the immediate benefit of a reduction of the rate goes to the occupier, as the burden of an increase goes to the occupier also. But the right hon. Gentleman evidently referred to the ultimate incidence of the rate, and he stated in terms, quite unreservedly, that if the rates were so much more the rent was so much less, and that the whole rate in the last resort was paid, not by the occupier, but by the owner. That is a very important declaration, and one that ought to be borne in mind not only in the present Debate, but in future Debates which will infallibly arise on this question; because now we have it on record from the speech of the Minister who has been selected to declare the deliberate voice of the Government that the rates are paid by the owner of the land in the last resort. Consequently, there stare us in the face these facts—that about three years ago the Chancellor of the Exchequer made a present of £5,000,000 from the Consolidated Fund to the rates. He also added last year another £1,000,000 out of the abundance of his riches, and when he did not know what to do with that plethora of wealth with which he was oppressed. That £6,000,000 was given by one who is not the youngest Member of this House, and who had not been just sent up by his constituents, but by one who had had great experience, and who, with that experience, made this present to the land at the expense of the Consolidated Fund—which is made up by the labour quite as much as by the property of the country. He made that present to the landowners.

MR. GOSCHEN

I beg my right hon. Friend's pardon. When my right hon. Friend (Mr. Chaplin) spoke of the land, he pointedly distinguished between the urban case and the agricultural case. He did not state that the owner in towns stood in the same position as the owner in the country. The right hon. Gentleman also errs in his memory. It was £3,000,000, not £5,000,000.

MR. W. E. GLADSTONE

Oh, yes, I beg pardon; I admit that correction. I spoke of the whole, but it was not all given by my right hon. Friend, for a portion was given by his predecessor. I quite admit that that explanation is one which it becomes the Chancellor of the Exchequer to give. I am not quite certain, however, why it was that the Chancellor of the Exchequer found it necessary to explain the speech of his right hon. Friend. It is an unusual incident of Parliamentary discussion, and I do not know whether it is part of the principles of the present Government or whether it has any connection with the maintenance of the Union. I am quite aware that there is a distinction to be drawn between urban and rural land in respect of the incidence of the rates, and that in the case of urban land it is very much more difficult to lay down an absolute and positive doctrine. I did not hear the President of the Board of Agriculture draw that distinction.

MR. CHAPLIN

Pardon me; I stated that the two were absolutely separate from each other. I dealt first with the question of urban land, and then, in the later part of the speech, I spoke of rural land.

MR. W. E. GLADSTONE

That is quite true but I did not hear him draw a distinction between them with respect to the incidence of the rates. I quite admit that the distinction ought to be drawn, though I am prepared to admit, in the case of the urban land—although the process may be much more difficult to trace, and though it may not be absolutely clear as to its ultimate form—that in that case also the landlord obtains in the long run the bulk of the remission. But when I spoke of those £6,000,000 I did not intend to convey that the whole of those £6,000,000 were given to the owners of the land. They were given to the whole of the rates in the three countries, and not in England alone. But this fact stands—that as to all that portion of the £6,000,000 which went to the relief of rates falling upon rural land, it is in the long run a sheer, unmixed, undiluted gift to the landlord. That is the statement which I wish to place on record, and a most important statement it is. There is a point I want to notice in the speech of the right hon. Gentleman, because he did me the honour to refer to a speech made by me in 1853 on the subject of the Income Tax, and he has founded upon that reference to my speech a case of grievance for the land. He says that there is a grievance for the land under the Income Tax, and that I proved it by showing that, according to the best computation I could make, the 7d. in the £1 in Schedule A, taking the case of householders or rural land, was equal really to 9d. in the £1 under any other Schedule. It is perfectly true that I used that argument, and though it is not capable of being stated in a precise or mathematical form, I believe the substance of it is sound. But what was the purpose of that argument, and in what circumstances was it made? It was made in a Debate when the House of Commons was very largely set upon constituting a difference of taxation between the different Schedules of the Income Tax. The Liberal Party was very largely of opinion that if realty were charged at 7d., income proceeding from such sources as those of Schedule D ought to be charged at a lower rate; and not only so, but a Conservative Government adopted that doctrine. The Government of Lord Derby, by the mouth of Mr. Disraeli, had had immediately before a proposal submitted to Parliament to reduce the tax under Schedule D to 5d., while the tax under Schedule A was to remain at 7d. It was in answer to that proposal, it was to induce the House of Commons to give up that plan, which opened the door to a large and complicated subject, that I pointed out to the House what was the truth—that as far as Schedule A is concerned, in comparison with Schedule D, the land undoubtedly pays more, especially in England, than 7d. in the £1. In Scotland it is not less than 7d. in the £1, but still it is less than in England, because in Scotland the landowner does not execute the repairs to the same extent, and likewise because there is an allowance made to the Scotch landlord on account of the public burdens. In Ireland the landlord enjoys a happy exemption indeed, for he falls back on the Poor Law valuation, and, as he has nothing to do with repairs and improvements, he really pays less than 7d. Those were the circumstances in which I endeavoured to show that the land under Schedule A pays more than 7d. in the £1, and that the burden is greater than it is commonly supposed to be. My right hon. Friend (Sir W. Harcourt) reminds me that it might be urged that that has been redressed by the contribution. If we are to speak of that I would say that, in my opinion, it has been a great deal more than redressed by the contribution. But I was about to refer for a few moments to what was done by the Chancellor of the Exchequer in respect to the remission of rates. In respect to that remission of rates he made a change in the Succession Duties, and that change in the Succession Duties was supposed to redress and equalise the balance in the interests of personalty as against realty, after the great gift made from the rates. The £5,000,000—now £6,000,000—having been given from the rates, what my right hon. Friend then proposed by way of an equivalent was to lay a tax which, so far as all personalty was concerned, would have been comparatively of a very insignificant character, reckoned in hundreds of thousands and not in millions at all; and, so far as land was concerned, was even less than insignificant, if possible. I believe my right hon. Friend raised the rates on lineal succession to 1½ per cent, from 1 per cent., and made a very considerable increase on successions not lineal. But it is always to be borne in mind in dealing with Succession Duty that in the case of land the great bulk of successions are lineal, and the consanguinity scale operates in a totally different manner in the case of lauded property from that in which it operates in the case of personal property. The fact is this, that—I am not now speaking of rural land alone—while realty has received an enormous boon at the expense of the Consolidated Fund, a boon of which the whole, in the case of rural land, goes to the landlord, and of which a large part, if not the whole, in the case of land not rural goes to the landlord—while that boon has been given to the landlords of the country, rural and urban, at the charge of the Consolidated Fund, a compensation has been administered to the Consolidated Fund in return, which is, I believe I am right in saying, an affair of a few hundreds of thousands of pounds. In these circumstances, what is the position of the Government? Are we permitted to hope that the Government will do something more to redress the balance, something which will bring the change in the Succession Duties to a point, if not equal, yet, at all events, more nearly approaching to the enormous boon that the owners of property have received? No, Sir; the Chancellor of the Exchequer long ago told us that he had nothing more to offer, that he could hold out no further expectation; and the right hon. Gentleman the President of the Board of Agriculture has to-night not only given emphasis to that doctrine, but has told us, and told us on behalf of the Government, that it is the rural landlords who have a grievance, that they already pay too much, that they, if they chose, might make out a case for relief from the House of Commons, and come before Parliament as a claimant. That, we are to understand, is the position taken up by Her Majesty's Government in the face of the industry and labour of this country. These, I think, are very important declarations and deserve to be recorded and carefully borne in mind. I think the Chancellor of the Exchequer will have to restrain himself a little, perhaps, in order to keep fully abreast of his right hon. Colleague. On a great variety of subjects he has shown a wonderful suppleness and elasticity, of which in former years he was not at all suspected, when rigid doctrines and very liberal doctrines had possession of his breast. How that may be I know not, but this I know: that the question between the rates and the Consolidated Fund is not a settled question, that no proper equivalent, no fair and proper consideration, has been given to the Consolidated Fund by a readjustment of taxation in respect of that enormous boon which has been handed over to the rates, and that a further and larger change than has yet been made in the Death Duties is, in my opinion, a matter of absolute necessity, on the plainest ground of justice, before Parliament will have fully vindicated its character as the just distributor of benefit and burden among the several classes of the community. It is not necessary for me now to enter at large into that question. I will only say there is one other question, in which, perhaps, the Consolidated Fund has a less interest, but which appears to me to be embraced within the scope of the Motion as it now stands—it is that which is commonly known under the phrase of the taxation of ground-rents. It appears to me beyond all doubt that under our present system ground-rents enjoy undue exemption; and in the Metropolis, in particular, the owner of property has long enjoyed, at the expense of the ratepayers, privileges which are really unjust. I do not now speak of the manner in which these difficulties should be dealt with, but, undoubtedly, this is a matter as to which the people of London do look to Parliament to effect a material change and improvement in their condition, and as to which I think, on grounds of justice and high policy, it will be important to make a change. I will not trouble the House farther on these enormously important points. I think the speech of my hon. Friend the Mover of the Resolution contained a great deal of important elucidation which will be of value in the country. The House will see that this, after all, is the only way of keeping alive a protest which it is the duty of the Liberal Party to make upon the subject of the present distribution of the taxation of the country. Depend upon it the time will come when these efforts will bear their fruit, and when, after due and fair consideration of all claims on all sides, an endeavour will be made to bring the taxation of the country, as between property and labour and as between real and other property, into a state as near exact justice as human infirmity will permit.

(7.10.) SIR R. PAGET

The remedy suggested by the Mover of the Resolution is that there should be a large extension of the Land Tax as at present levied. I wish to call the attention of the hon. Gentleman to one sentence in the same Report of the Inland Revenue Commissioners from which he quoted, which deals with the question of the Land Tax. I will give one paragraph of the Report showing what was the early inception of the tax, which is as follows:— Nothing can be more certain though it is but little known, than that the so-called Land Tax was in effect a Property and Income Tax, and moreover that personal estate was quite as much the object of the charge as land. There we have the historical statement of the original imposition of the Land Tax; it was a tax upon property and personal estate. How is it that it now touches land alone? Personalty has, it seems, escaped by some of those mysterious means by which owners of personal property do occasionally contrive to evade their responsibilities. The right hon. Gentleman who has just sat down has made merry at the expense of the President of the Board of Agriculture, and has pinned him down to the statement that the ultimate burden of rates in rural districts falls on the owner and not on the occupier. But I thought that that was one of the things long since settled, and about which there can now be no dispute. If that statement requires any qualification whatever it is this—that every occupier has to bear the additional burden of increased rates that occurs during the time of his tenancy. Still, on the other hand, the occupier gets the advantage if the rates are diminished during his tenancy. Subject to that very small qualification it is plain that the ultimate burden of the rates in rural districts does fall on the owner, and is a burden upon his property. Any relief to that burden is I admit distinctly ultimately a relief to the owner, but the whole burden of the argument that has been adduced in this House time after time is this—that if the figures of taxation were calmly summed up they could only lead to the one conclusion that readjustment of taxation was necessary in order to establish an equilibrium. Of the points which have been touched on I wish specially to mention one—that every step taken, either by the Chancellor of the Exchequer, or those who have preceded him in that office, has been based on figures which cannot be confuted—figures by which we are distinctly told that one class of property—personal property—is increasing in value in England by leaps and bounds, while another great class of property—that in land, especially in rural land—is steadily diminishing. Those are facts which cannot be denied, and the circumstances of the case clearly show that a re-adjustment is both right and reasonable. We are sometimes told that all these things are to be explained away by what is called the doctrine of hereditary burdens. It is claimed that those taxes are hereditary burdens, and are, therefore, no burdens at all; but that argument seems to me to be disposed of by the reductio ad absurdum. How long is it necessary that a burden should rest on the land before it becomes hereditary? Is it possible to contend that the burdens connected with expenditure on elementary education are in any respect hereditary burdens? Or will anyone urge that the burden of police maintenance is an hereditary one? For the imposition of compulsory education and the institution of the Police Force have taken place within the memory of all of us here. It is to be regretted that the Mover of the Resolution has spoken throughout under the influence of a complete fallacy as to the ultimate burden of rates, which has not been shared by the Seconder or by any other Member of the House—indeed, one half of the argument of the Mover of the Resolution has been admirably met by the Seconder. I regard it also as a misfortune that we have been brought down here to debate a great number of separate issues which have been presented to us at considerable length. I should like to hear one clear Debate on one point alone, namely, as to the comparative burdens of personal estate and land and house property. I repeat, it is capable of absolute proof that if houses and land are compared with personal property the burdens upon them would be found to be infinitely greater. I will go further and say that if we split up real property into the two great divisions of land and houses and compare them, it will be found that in respect of State subventions houses have very largely the advantage. In the recent adjustments of taxation made by the Chancellor of the Exchequer it is clear that houses have benefitted more than land. The right hon. Gentleman the Member for Derby shakes his head, but I think it might be proved by figures. I quite grant that in the Metropolis the amount of the subvention has not been to the same extent as it has been in the case of boroughs or rural districts, but there is another point to be considered—the Metropolis it must be remembered has £150,000 towards the expenses of the superannuation of the police; and that sum was largely in excess of any share which would have accrued to it if the whole £300,000 given for that object had been divided equally among all the districts. The question is an intricate one, but I again maintain it is capable of absolute proof that the contention of the landowners is a reasonable one. On their behalf I ask for and court a most complete inquiry. They only want equality of taxation; they want no kind of favour from any Member or any Party in the House; they want nothing more than an absolute re-adjustment on the basis of equality and justice.

(7.27.) DR. CLARK (Caithness)

The argument which has been put forward is that the present Land Tax was, in its origin, a tax upon both real and personal property, and those who represent agriculture are asking that the Land Tax shall be reduced. But may I point out that there is, from an historical standpoint, still stronger reason for increasing it. Why was the Land Tax of William and Mary passed? Because the first Parliament, after the Restoration, abolished all other burdens on land, such as scutage and socage, and in place thereof placed the burdens on industry. Until that time the bulk of the cost of keeping up the Crown had been on land, but the Restoration Parliament placed the tax equally on personal and real property. But it is forgotten sometimes that the Land Tax was stereotyped at the then value of the land—that is to say, on a valuation made 200 years ago. If the Land Tax were paid at the present value of the land, instead of giving the owners a subvention of £2,000,000 a year, the taxpayers would be receiving £40,000,000 a year from the land. I hold what probably in this House are unpopular views on this matter. I am one of a small minority here, and possibly a minority also in the country, but still a growing party, who wish to put taxation not upon rental but upon land value. We do not mean by that merely the agricultural value of land, but the value increased by the buildings upon the land. In towns or on agricultural land near towns yon could place millions upon the taxation of land values, and by the time you have placed upon land round about London some 16,000,000, I believe you will be only reducing the value of the land to the position in which owners of agricultural land are at present. I repudiate the idea that landlords represent the agricultural interest. They might as well claim to be miners as agriculturists. They might claim to be miners because they let the mines to people who work them and make money out of them. I do not want to prolong the Debate, because I know there is an understanding that we shall take a Division before dinner time. The argument advanced by the Minister for Agriculture and the hon. Baronet the Member for the Wells Division simply proves that a series of rights accompanied the possession of land, and were given on condition of the performance of certain duties, but owners have practically repudiated these duties upon which the tenure of the land was given while they retain the land. The present system tends to place the heavier burden on the land least able to bear it. It has been suggested that small owners under the Bill introduced by the hon. Member for Bordesley (Mr. Jesse Collings) if they think there is going to be an increase of land taxation will not buy; but I think there is every indication to those who follow the progress of opinion among the Liberal Party, and may desire to purchase allotments and small holdings, that they need not be deterred from doing so by the suggestion that their burdens as landholders will be increased, because the taxation that is aimed at, as the Minister for Agriculture well knows, is not the taxation of agricultural values, but the taxation of land values in and near towns, which present a splendid field for a future Radical Chancellor of the Exchequer.

(7.35.) The House divided:—Ayes 128; Noes 77.—(Div. List, No. 70.)

Main Question again proposed.