§ I will now turn to tobacco. The Exchequer receipts from tobacco in 1897–98 were £11,437,000. In framing my Estimate for last year, I had to allow on one side for the loss of revenue by the lowering of the duty by 6d. in the pound; and, on the other, for the natural increase in consumption which would follow the lowering of the duty; and my Estimate of the yield from tobacco was, for the year, £10,630,000. The Exchequer receipts have only been £10,420,000. But I should state to the Committee that there will probably be shown, when the accounts are made up, to be a considerable difference between the net receipts and the Exchequer receipts, and it will be due to the following causes: During the last few weeks, including a few days at the end of the financial year, there has been the most extraordinary rush to clear tobacco, in anticipation of a possible increase of duty in the coming year. And although the great bulk of these extraordinary receipts did not reach the Exchequer until the present year—to which indeed of course they properly belong, for they were purely an anticipation of the duty of the present year—vet the trade returns will show, as the honourable Member for Dundee discovered the other day, a remarkable increase in the clearances of tobacco just towards the end of March. Well, making all allowances for this, and taking the Exchequer receipts of £10,420,000 as what I believe they were, the normal receipts from tobacco of last year, I have to confess to a disappointment in this matter. It was due to this cause: Tobacco is, unlike other articles of our tariff, the raw material of a manufacture, and if you touch the taxation on the raw material of a manufacture you have to deal with many complex issues. There are two 998 sets of prices to begin with—there are the manufacturers' prices, and there are the retailers' prices, and these prices, in the case of tobacco, have to be resettled on consideration not only of the reduction of duty by 6d. in the pound, but also by the reduction of the rate of moisture by five degrees. And this had to be done in the face of great disputes in the trade, due to other causes, and to the short supply of tobacco, owing to bad harvests and the war in Cuba, which raised the price of the raw leaf by something like 1½. to 2d. in the pound. Thus the trade during the earlier months of the last financial year was thrown into utter confusion, business was disorganised, and the benefit of the reduction of the duty was largely delayed in reaching the consumer. The consumption, therefore, did not increase as had been anticipated. But things have settled down now. The trade has been doing well during the last half of the year, quite apart from the extraordinary clearances to which I have alluded. Things are evidently prosperous, and if we are able —I shall recur to the matter again—to leave tobacco alone this year, I am quite confident that my anticipations of an increased revenue from increased consumption will be more than realised in the year that is to come. Sir, I now conic to the Inland Revenue.