INCOME TAX.

HC Deb 23 April 1901 vol 92 cc1094-139

Motion made, and Question proposed, "That Income Tax shall be charged for the year beginning the sixth day of April, Nineteen Hundred and One, at the rate of one shilling and twopence."—(Mr. Chancellor of the Exchequer.)

* MR. JAMES LOWTHER (Kent, Isle of Thanet)

said the proposals contained in the Budget with regard to the augmentation of the income tax had very properly been taken great exception to. But he wished rather to draw attention to the general features of the Budget taken as a whole. The right hon. Gentleman the Chancellor of the Exchequer had had a great opportunity presented to him in connection with the Budget, and he had missed it, although he had advanced somewhat from the hopeless and impracticable attitude which had been the vogue for many years past. They were used to being told on these annual occasions how our glorious and beneficent fiscal system had enabled this country to surmount all difficulties and dangers. But he noticed the Chancellor of the Exchequer had not this year passed the usual eulogies upon our broken-down financial system. The right hon. Member for West Monmouthshire had indeed spoken of it—possibly reading from some old notes—as the envy and admiration of the world. But the world had shown its envy of the system by universally discarding it.

* THE CHAIRMAN

I must remind the right hon. Gentleman that the only subject that can be discussed on this resolution is the incidence of the income tax. He cannot enter on a general review of the fiscal position.

* MR. JAMES LOWTHER

We were assured by the Government that as they were most anxious to get certain resolutions involving new taxes passed at once, that being a matter of urgent necessity, the Committee would be allowed to take the general discussion upon the remaining resolutions.

* SIR WILLIAM HARCOURT (Monmouthshire, W.)

I asked for an assurance from the Government, and received it, that there should be a general discussion.

* THE CHAIRMAN

That understanding only applied to the next day—Friday—when the general discussion was taken—if I may be permitted to say so—very inconveniently. I never understood that the undertaking would apply to this day.

* MR. JAMES LOWTHER

The Chairman has, no doubt, quite correctly stated the general practice. But on this occasion it was pointed out that it would be extremely inconvenient for these new duties to remain in abeyance while the whole Budget was being discussed. I certainly understood the Government to undertake that indulgence would be extended to those hon. Members who had in the public interest refrained from taking part in the general discussion of the Budget on the earlier resolutions. Anyhow the Government deliberately pledged themselves to such a course in the face of Parliament. The Chairman of Committee was not a party to the under taking, which was, I think, given in the whole House, but the Government distinctly made the promise.

* THE CHANCELLOR OF THE EXCHEQUER (Sir M. HICKS BEACH,) Bristol, W.

I am sure that nothing which I said ought to have given rise to that impression. On Friday night the discussion was certainly general, including as it did a disquisition on the South African war, but I did not understand that the general discussion of that evening was to apply to every day upon which the Budget was put down.

MR. SYDNEY BUXTON (Tower Hamlets, Poplar)

May I remind the right hon. Gentleman that there was not a whole night's debate on Friday, but only half a night's. It commenced at half-past nine.

SIR WILLIAM HARCOURT

I certainly understood that there was to be a general discussion now. There was some doubt about the arrangement at the time, and I asked a question specifically in order to obtain a definite answer. I asked whether the arrangement would apply not merely to the duties which were then discussed, but to the other duties.

MR. KEARLEY (Devonport)

Mr. Speaker refused to allow my motion, for the adjournment of the House on the sugar question, on the ground that the matter was to be discussed to-night.

* THE CHAIRMAN

The hon. Member is mistaken. It was refused on the ground that it could come up on the Report stage.

SIR WILLIAM HARCOURT

But can we discuss it on Report? We are told we cannot.

* SIR M. HICKS BEACH

I never said that. It certainly can be discussed on the postponed Report. As soon as the other resolutions in the Budget are passed in Committee the resolution on sugar will come up for discussion—probably on Thursday, as far as I can judge.

* MR. JAMES LOWTHER

In these circumstances I understand that the discussion now will be a general one.

* THE CHAIRMAN

I am afraid I must stop the right hon. Gentleman. That is certainly not my understanding of the agreement entered into. I was not consulted with reference to the setting aside of the ordinary rules of the House, and was no party to any such arrangement. My duty, therefore, now is to see that the ordinary rules of the House are maintained. The general discussion can take place on the first or second resolution of the Budget, but when subsequent resolutions are reached, then the debate should be confined to the subject-matter of those resolutions. I understood the agreement come to on Thursday evening to be limited to the next sitting of the Committee, but not to extend beyond that day. [Cries of "Move to report progress."]

* MR. JAMES LOWTHER

said a suggestion had been made to him that he should move to report progress, but he recognised that the Chairman's duty was to carry out the rules of the House. The Government, however, distinctly undertook to sanction the arrangement of a general discussion now, and they had the statement of the right hon. Gentleman opposite that he had received an assurance that a discussion of a general character would be allowed to take place on all resolutions. But he did not wish to press the point, and he would therefore deal with that most obnoxious imposition the income tax. He would, however, tell his right hon. friend the Chancellor of the Exchequer that he had introduced a very unpopular Budget, and that he was trying to smuggle it through without discussion. The income tax was the impost of all others most closely associated with the Cobdenic school. It had gone up by leaps and bounds. Designed originally as a war tax, it had since become a favourite instrument for constructing sensational Budgets in time of peace. It had been the refuge of those who wished to evade their difficulties and to retard the fulfilment of their obligations. Our fiscal system had been described as the "envy and admiration of the world." But the "envy and admiration of the world" for the income tax had not hitherto been very marked. Foreign countries had discarded it; indeed, the income tax was highly unpopular in all the countries of the world. No Government—autocratic, a limited monarchy, or a Republic—appeared to approve of it. Our own colonies had not followed the example of the mother country in this respect. They preferred to extract taxes largely from the foreign producer; and it was worthy of notice that the affection of the Chancellor of the Exchequer for this form of taxation exclusively was cooling somewhat. The foreigner hitherto had been a sacred person whose pocket must in no way be touched, but now he was getting somewhat out of favour. One of the Chancellor of the Exchequer's imposts was openly avowed by him as intended to relieve the British taxpayer out of the needs of the foreign consumer. The war was not responsible for the breakdown of our much-vaunted economic system, which it was at last admitted had signally collapsed; it had been the growth of our normal expenditure, which had caused the present difficulties, and no one could predict where it would stop. It was not expenditure upon the defensive forces of the nation which could be held mainly responsible for our difficulties. How about the bloated Education Estimates, the money flung at the heads of the county councils to squander on so-called technical education and matters of that kind, and which was recklessly spent? They did not raise the money, and they did not care how they spent it. The Chancellor of the Exchequer spoke about holding a fair balance between direct and indirect taxation, but he had pointed out before that this balance was based on erroneous premises, because the payers of income tax were relatively also large contributors to indirect taxation. The right hon. Gentleman entirely ignored the fact that the income-tax payers were also large contributors to indirect taxation. Let them take as an instance the increased duty on sparkling wines: was it not the income-tax payer who had also to pay that, and could that be fairly quoted as a contribution from the classes who do not pay income-tax, and which made it necessary to increase direct taxation to balance it. For such really was the argument of the Chancellor of the Exchequer when he spoke of the equal apportionment of direct and indirect taxation. He quoted that to show that the right hon. Gentleman on this point was entirely erroneous in his premises. At the present moment the, direct taxpayer was far more heavily burdened than the Chancellor of the Exchequer had stated to the House. His system was the knocking off of the duty from the numerous articles which formerly contributed to the revenue, and the concentration of all the efforts of the Exchequer upon a few selected articles.

SIR WILLIAM HARCOURT

Hear, hear.

* MR. JAMES LOWTHER

But that system had broken down and collapsed. To increase the income tax at a time when direct taxation had been contributing far more than its fair share of the total liabilities appeared to be indefensible. His right hon. friend had been afforded a great opportunity in connection with the Budget, and it was in his power to have taken I advantage of the patriotic outbursts throughout the, British Empire to draw closer the commercial ties which were the surest means of maintaining the unity of the Empire. There was a general desire for the free interchange of commodities as far as could be in the various parts of the Empire. The right hon. Gentleman had always had strong objection to the cultivation of friendly commercial relations with their colonies. He always treated the foreigner and the British subject upon identical terms, and he knew no difference between the Belgian and the Canadian—indeed he thought that the right; hon. Gentleman preferred the Belgian, as being nearer home. That was what he called Little Englandism. If ever there was one principle which had made greater progress during the last few years it was the establishment of preferential duties between this country and the various parts of the Empire. The Chancellor of the Exchequer must not think that he was asking him to adopt some reactionary protection doctrine, because he was talking of revenue, and as a substitute for his income tax he might have done better if he had consulted an eminent gold medallist at the Cobden Club. Sir Wilfrid Laurier. That gentleman was received with open arms at the Cobden Club, and the Chancellor of the Exchequer might even hope to get the gold medal himself if he would only adopt the policy of Sir Wilfrid Laurier. What had he done? Why he had so arranged the duties as to accord preferential treatment to inter-British trade? Sir Wilfrid Laurier had, in fact, given a preference of 25 per cent., since increased to 33⅓ per cent., to inter-British trade, and was forthwith decorated with the gold medal of the Cobden Club. Why did the Chancellor of the Exchequer not adopt some statesmanlike and patriotic attitude of that kind? Why was the right hon. Gentleman so devoted to Little England finance? The missing of this opportunity had caused great disappointment, not merely in Canada where they had shown the lead and given us for some years past great commercial advantages, but it had also created great disappointment in the new Commonwealth of Australia where they relied upon the Customs revenue but were perfectly ready to reciprocate friendly overtures. This was a principle which his right lion, friend need not think was by any means dead. He might pass it over, but it was making the greatest progress throughout all parts of the Empire, and he would find himself confronted with a strong demand that he should no longer stand in the way of what was a true British demand. The Chancellor of the Exchequer had consoled himself with an addition to the income tax and certain other imposts which it would be irregular to discuss at the present time. Without any very great effort he could have supplied himself with the sum which his income tax was expected to produce without any substantial interference with the habits or the mode of living of the people. The right hon. Gentleman took credit to himself that at any rate this duty would not benefit any British subjects more than the inhabitants of the most distant realms. He hoped the Chancellor of the Exchequer would realise that he had missed a great opportunity, that he had created vast disappointments, and he had done more to retard the general advance of the British Empire than any of his predecessors.

* MR. McKENNA (Monmouthshire, N.)

said he experienced the greatest difficulty in following the line taken by the right hon. Gentleman who bad just sat down. He complained of the income tax being put at 1s. 2d. in the £, and in that complaint he was cheered by hon. Gentlemen opposite. Those very hon. Gentlemen who were applauding the right hon. Gentleman had supported this Government through thick and thin, and the Government were responsible, not for 2d., but for 6d. on the income tax. The right hon. Gentleman and his friends must recognise that as a consequence of their support of the present Government in its extravagant ways they must accept not only an occasional twopenny increase in the income tax, but a shilling in the £1 as a permanency. It was their duty to examine the reasons for this expenditure. The Chancellor of the Exchequer had told them that they had got to provide for a permanent increase of expenditure, amounting in the last five years to no less than £28,000,000 a year. What did that mean? That the 1s. income tax had become permanent. [Cries of "No, no."] They could not point out to him any probable new sources of revenue which were likely to reduce that shilling to a lower figure. They could not look to any reduction so long as they had at the head of affairs a, Prime Minister who had publicly rebuked the Treasury for its parsimony, Before Lord Salisbury could have got to the point of declaring in public that his difficulties were increased by the parsimony of the Treasury what an amount of pressure he must have put upon the Chancellor of the Exchequer to induce him to consent to every kind of extravagance—an extravagance which had landed them to-day with an income tax of 1s. 2d. in the £. Personally, he should not blame the Chancellor of the Exchequer, but rather defend him; he bad been attacked, not from the Opposition side, but by the Prime Minister.

* SIR M. HICKS BEACH

No.

* MR. McKENNA

said it was within the recollection of the Committee that an attack was made upon the Treasury, and the right hon. Gentleman was responsible for the policy of the Treasury. The hon. Member for King's Lynn the other evening declared himself unwilling to drive home the responsibility of the Government for the increase of expenditure, and in very forcible language he appealed to the Government not to imperil their existence, because he saw no possibility of an alternative Government. It was surprising to hear the hon. Member say-that he could see no possible alternative to a Ministry of which he was not himself a member. But although the hon. Member might hold that opinion as to the necessity of maintaining those particular gentlemen in office, he for one did not believe that any such opinion was held by the country at large. On this side of the House they had been twitted that they were not a united Party. [Ministerial cries of "Hear, hear."] Hon. Gentlemen opposite cheered that statement, but those who were present when the Chancellor of the Exchequer made his Budget statement had a very extraordinary spectacle presented to them. Hon. Members opposite could not see it, but it was apparent to Members sitting on the Opposition side. The Chancellor of the Exchequer, after making a brilliant, capable, and honest Budget statement, lasting a very considerable time, sat down between two right hon. colleagues, one on his right and the other on his left, who received his speech with stern silence, with implacable coldness, almost with resentment. In order to bring himself in order he would suggest that that resentment was due to the proposed increase of the income tax, but if he might give his honest opinion he should be inclined to attribute it to the light hon. Gentleman's frank statement that during the last five years the expenditure of the country had been increased by £28,000,000 sterling. It was said that the Government were not responsible for that expenditure, but that the House as a whole was responsible. More than that, it was said that the constituencies were responsible. That statement might very well be made upon a public platform, but he was astonished that anyone should adduce it in that House, where "a miserable and divided Opposition" had learned through bitter experience that they were absolutely impotent in opposing the Government. With the knowledge that year by year they had had their rights and privileges taken from them, were they to be told on this side of the House that they had been responsible for the extravagance of the Government? Not so very long ago Lord Salisbury told the country that the Treasury were too parsimonious. They must look to the head of the Government for the responsibility for the extravagance, and not to those on the Opposition side, who, in season and out of season, had endeavoured by every means in their power to resist that extravagance. It was difficult to put one's hand on each particular item of expenditure, and to say whether it ought to be reduced. He would give the House one instance of extravagance. There was the question raised by the hon. Member for King's Lynn, with respect to the docks which were being built at Gibraltar. A scheme was introduced in the 1892 Parliament which was to cost something like £2,000,000 for the Gibraltar docks.

* THE CHAIRMAN

pointed out that this matter was not relevant to the resolution before the Committee.

* MR. McKENNA

admitted that he laboured under a difficulty in referring to the subject. He would only name it, without going into detail. The hon. Member for King's Lynn, after personal examination of the subject on the spot, found that a very large increase in the expenditure, covering several millions, undertaken by the present Government, was wasted money. A Commission was appointed, of which the lion. Member was chairman. He understood that the Commission had unanimously reported—the Report had not yet been made public—but it was quite obvious, since it was unanimous, and the hon. Member for King's Lynn had already made up his mind on the subject, what the nature of the Report would lie. It was a Report that would justify the pamphlet written by the hon. Member, in which he charged the Government with having wasted a considerable amount of money. If they went to any part of the world where the Government had been carrying on warlike or peaceful operations, they would find that there had been extravagance after extravagance of small sums here and there, contributing largely to the total increase of £28,000,000 during the five years the Government had been in office—apart altogether from the war in South Africa. In the three years during which the late Liberal Government had been in office the public expenditure had increased by only three millions. During the previous twenty years it had increased by only twenty-three millions. Had there been anything in the condition of the world during the past five years to justify an increase of twenty eight millions in the public expenditure? Germany, which had not been behindhand in pushing its policy, had increased its expenditure during the same period by only ten millions. He did not understand the objection of hon. Gentlemen opposite to the increase in the income tax. As they had to swallow a pill, they ought to do it with cheerful countenances. They told their constituencies that they had Heaven-sent Ministers to guide them, but in the House they grumbled and said those Ministers were extravagant. Let them be true to themselves either in the House or in the country.

MR. VICARY GIBBS (Hertfordshire, St. Albans)

said he did not propose to wander quite so far as the hon. Member had done in his speech, but certainly he was encouraged to do so by the amiable indulgence which the Chairman had shown to the hon. Member. He wished to join his right hon. friend the Member for Thanet in expressing regret that the Chancellor of the Exchequer had thought it necessary to increase that onerous and most unfair impost, the income-tax.

SIR WILLIAM HARCOURT

Hear, hoar.

MR. VICARY GIBBS

said the satirical cheers of his right hon. friend the Member for West Monmouthshire did not disturb him. It was not because the increase in the tax fell upon him or upon his friend that he objected to it, but because it was morally unjust in its incidence. That tax fell alike upon the man who had a wasting security and the man who had a permanent security; it fell upon the man who had to earn his livelihood by his own labour or brains, which were subject to exhaustion; and it fell no more heavily upon the man who had a settled income from Consols. It might be said that the middle-classes, to whom the increase in the income tax was a serious matter, had made a mistake in returning the Government to office. Constituents wrote to him saying that they were not going to vote for him again. He was sure that hon. Members would be pleased to hear that these constituents were not going to vote for him; but that did not distress him particularly. He might, however, say that these gentlemen would only get out of the frying-pan into the fire, and he did feel a very great sympathy with them in this matter. A constituent had written to him that day on a small matter, but evidently under a misunderstanding. He inquired if the amount which he was entitled to deduct in respect of the landlord's property tax would be limited to 1s. He did not think there was any difficulty in the matter; for of course the answer was that when the tax was 8d. the deduction was limited to 8d.; when the tax was 1s. the deduction was limited to 1s.; and when the tax was 1s. 2d. the deduction was limited to 1s. 2d. He would be glad, however, if the Chancellor of the Exchequer would make the point clear. The hon. Member who last spoke joined the Chancellor of the Exchequer in a strong demand for economy. He sympathised with that demand; although he fully recognised that there was no party in the House—at least not more than half a dozen Members—who acted together in insisting on economy in national expenditure at all points. Where there was continuous temptation to extravagance, and to which the House fell a victim, was owing to the fact that civil servants had been given votes. [Cries of "Oh, oh."] He knew that that was an unpopular argument, but it was the true thing to say. It was a thing which every man would say in private, but not in public. Here were large bodies of civil servants organising and pressing hon. Members by notes and circulars and in every way to grant their demands, with the implied threat that the votes of a considerable body of men in their constituencies would be withdrawn from them if they did not grant these demands. Well, human nature was human nature, and great was the temptation put before any hon. Member who very much desired the honour of a seat in this House, and who had a very small majority, to succumb to the demands of, say, a very fine body of postmen in his constituency. He did not say that the postmen were unjustified in the demands which they made; but even if they were unjustified they would find Members of Parliament to support them. He asked the House seriously to consider whether a grave blunder had not been made in granting the franchise to the civil servants. It was a serious question, which affected in a most material degree the complaint which the Chancellor of the Exchequer had made. He was debarred, owing to the unfortunate misunderstanding which he and almost every Member of the House had fallen into in regard to the bargain which the Government had made with them, from touching on any other subject than the income tax, and he would only ask the right hon. Gentleman the Chancellor of the Exchequer to seriously consider what he had urged as to the strong distinction which existed between wasting securities, whether of brain or capital, and those which were maturing.

DR. MACNAMARA (Camberwell, N.)

said he need not traverse the general unfairness of the incidence of the income tax, but he wished to point out the extreme unfairness of an increase without readjustment. The impost would fall with extreme severity on the smaller class of income tax payers. In 1894 the late Chancellor of the Exchequer—the result of whose financial statesmanship must be very agreeable to the present Chancellor of the Exchequer just now, although he opposed it strongly at the particular time—increased the income tax from 7d. to 9d., but in such a way that no fewer than 500,000 income tax payers paid less at 8d. than they would have done under the old system at 7d. That was to say, the smaller class of income tax payers got off more cheaply, for the Chancellor of the Exchequer of that day raised the exemption from £150 to £160, and widened the range of abatements. He wanted to know why that policy had not been pursued now. Why should not the Chancellor of the Exchequer be able to get all the additional revenue he required without increasing the impost on the smaller income tax payers? There were no more estimable and blameless members of society than the small middle class people, who were ground down with taxation. The Chancellor of the Exchequer might find cold comfort in saying that the income tax was 2s. in the £1 at the time of the Peninsular War: but the men for whom he pleaded had to bear far heavier burdens, in the way of local taxation particularly, than were known at the time of the Peninsular War. The Chancellor of the Exchequer said that at the time of the Crimean War the income tax was 1s. 1d., and therefore 1s. 2d. should be paid cheerfully now. But there was then a differential rate of income tax—the small payer paid 11½d and the larger class paid 1s. 4d. He confessed he did not know whether that was good political economy, but he would like to go back to the differential rate, and put a much heavier impost on the linger incomes. He pleaded for the lower middle class of people, who had so many burdens on them, and who lived a godly, righteous, and sober life, and who were the cream of the community. The education of their children was expensive, the State not having provided cheap secondary education. They were, perhaps, buying their houses through a building society, and had often poor relatives to assist. Convention demanded a measure of respectable living and clothing which was a severe drain on their small incomes. He would take the opportunity to test the question as to whether or not, even in this Budget, some plan could be devised to relieve that class from additional imposts on incomes up to and including £500 a year. It ought not to tax the ingenuity of the Chancellor of the Exchequer and his officials to lay out a scheme in the Schedule on the lines of his own scheme of 1899, and to go back to the days of the Crimean differential rate by relieving incomes up to £500 of any further impost, and yet be able to get the revenue he required. It was said that they ought to be punished for "Mafficking," but there was no public policy in telling a man that, because he was deluded into a mistaken act two years ago, he should be overburdened with taxation. Moreover he did not think that it was the class for whom he was pleading that did the "Mafficking."

MR. BARTLEY (Islington, N.)

said he would like to say a few words on the income tax. There was no doubt that the extra 2d. was necessary at the present time, but it was a fact that it was causing a great deal of annoyance among a most estimable body of the community. Inasmuch as the Chancellor of the Exchequer had raised two thirds of his additional revenue from indirect and only one third from direct taxation, he thought all would agree that, taking it as a whole, it was a fair arrangement. He strongly urged on the Chancellor of the Exchequer to consider the question whether some arrangement could not be made on the lines of the suggestions of the hon. Member for the St. Albans Division. A good many years ago he himself had brought forward a scheme of differential rating on incomes from old investments and on the reward of present-day labour; and he was sure there would never be a perfectly fair income tax until a distinction was made between these two sources of income. Of course a change of this sort involved a great deal of trouble, and a Chancellor of the Exchequer did not like to embark on a new and difficult system of taxation which involved that. The tax would be less unpopular if a differentiation could he made between incomes derived from labour and incomes derived from investment. All taxes were unpopular, especially the income tax, and therefore the Chancellor of the Exchequer should levy it with as much consideration as possible. He was afraid that that was not now done. He brought before the House last year an instance as to the system of claiming arrears of income tax on the higher rate, a matter which he supposed concerned a great many persons, and which seemed to him to be sharp practice on the part of the Treasury. In some instances especially most extortionate demands had been made in connection with arrears. He would again mention the ease of the. Jamaica Railway, which was established practically by the English people in order to promote the well-being of Jamaica. The great bulk of the money required to build the railway was raised on debentures, and there was a clause in the agreement that if the railway did not answer they should be exchanged for Colonial Bonds. Of course the railway did not answer, and the debentures became Jamaica Bonds. Three years elapsed before the arrangement was completed, and in the meantime the income tax had been raised from 8d. to 1s., and because the income tax for the three years was paid on the 10th of April instead of on the 30th of March, a 1s. tax was claimed for the entire period. That seemed to him to be a system of imposing the income tax which made the tax very much more unpopular than it otherwise would he. It was not fair, and if a tradesman had acted in that way he would not be supported by the law. No doubt the Chancellor of the Exchequer was acting within his right, but such a system as that tended to make people dislike and resent the payment of the tax.

The whole question of the income tax had been many times debated in the House of Commons during the last half century. Mr. Gladstone had an idea of amending its various anomalies, but the matter proved too difficult even for him to carry out. With the income tax at its present enormous high rate—and in his opinion it would not be much lower—it was essential that it should be leyied on a fairer and more equitable system. What the Chancellor of the Exchequer said about the enormous increase of expenditure was a matter which should he considered by all who had the interests of the country at heart. No doubt the enormous increase in the national expenditure was largely due to hon. Members themselves. The Chancellor of the Exchequer was about the only man in the House who really seemed to try and control expenditure. With reference to the remarks of his hon. friend on the various phases of the public service, the Chancellor of the Exchequer once said that it might be necessary to disfranchise public servants, if they went on clamouring in the way they did for more pay, while their appointments were clamoured for by hundreds of people who could not get them. The Government should be fair and liberal, but it was never intended that an organised body should exist for the purpose of increasing the salaries of the class to which they belonged. While being fair and liberal to the servants of the country, the system of always endeavouring to increase payment, whether it was deserved or not, ought to be discouraged. The current expenditure of the country was growing in a way that was very alarming, apart altogether from the war. The enormous expense of war was, to a certain extent, an advantage, because it prevented people going into war as readily as they otherwise would, and he thought it was providential that war was so enormously expensive. How could the increasing national expenditure be stopped? It was quite clear that unless the Government with the largest majority of modern times was firm and strong—and it ought to have, if any Government ever had, the power of putting a stop to unnecessary expenditure, whether it was popular or not—unless they had the pluck and determination to arrest the development of expenditure, they would have to regard 1s. as the normal income tax, and would have to increase taxation in many directions. The infliction of suffering on the part of the poorer people was a matter which should also be considered, and they would not be worthy of the position they held in the House of Commons unless they insisted on the Government doing something to prevent the enormous growth of national expenditure from year to year.

MR. SYDNEY BUXTON

said that after discussing several subjects on the Budget they had at last settled down to the income tax, but he was afraid that it was very unfortunate that they were confined to one subject. After the ruling of the Chair, he did not desire to revert to the general question, as no doubt there would be another opportunity of dealing with it. The hon. Member who had just sat dowm desired an income tax which would fall with equal weight on every income-tax payer. He desired to tax the individual income, but that was an impracticable position. It had been attempted more than once, and had been found impossible. In 1853 Mr. Gladstone proved, as far as a proposition could be proved, that it was impossible to deal with the individual income, and that incomes must be dealt with by taxing them at their source. The hon Member would distinguish between one class of income and another. Personally, he did not pay any income tax as an individual. His sources of income were already taxed before they reached his hand; but under the system of individual taxation he would have to make a return of his full income, and he was afraid his inclination would be not to put his income higher than he possibly could. Permanent income at the present moment was derived from realised property, which was subject to a tax which was not unreasonable. The high death duty did away with a good deal of the injustice of the inequality of taxation. Year by year the actual pressure of the tax on precarious incomes had been diminished by abatements and concessions. The system of graduated taxation upon free incomes of the lower class, under which incomes up to £160 were altogether exempt, was a complete system of graduated taxation so far as it went, and he thought that that system should be extended to a much higher figure. He should not hesitate to graduate income tax in that way up to incomes of £1,000 a year or more. That was a proposition which any Government might accept, because Governments of both parties had from time to time given greater exemptions and abatements in regard to income tax. He was in accord with the hon. Member for Camberwell that when the income tax was raised it should be graduated to a greater extent. He regretted that he could not support this proposal as a whole, He was not, he said, one of those who thought the additional 2d. ought not to have been placed on the income tax. In his opinion a yet further addition of 2d. should have been placed upon it. We were in the middle of a long war, which was to cost £170,000,000, and yet it was only proposed to raise £27,000,000 by extra taxation. In his view the amount raised by extra taxation was inadequate to the total amount of the war. His general objection to the whole Budget was that the Government were not raising enough by extra taxation to meet the great burden placed upon the country. That observation also applied to indirect taxation, which did not produce sufficient revenue, taking into account the cost of the war and the disturbance to trade that would be involved by the imposition of the sugar and coal duties. He was glad that the Chancellor of the Exchequer had not given way to the clamour against taxing the rich at all, on the ground that the poor relations of the rich would suffer. He should support this resolution.

MR. DAVID MACIVER (Liverpool, Kirkdale)

said that the Chancellor of the Exchequer had done as well as he could under the circumstances. He cordially supported the proposals as to sugar and coal; but he accepted the increase of the income tax as a disagreeable necessity, forced upon the Chancellor of the Exchequer by the desirability of winning some measure of support from the front Opposition bench. The income tax was one which was levied mainly on British industries, while incomes derived from investments abroad were largely exempt, not theoretically, perhaps, but for all practical purposes, because those who held shares in British concerns had their income tax deducted from the dividends when paid. In the case of those who had investments abroad the dividends had first to be traced. It was not too much to say that there was a large amount of leakage in that respect, and that many persons who ought to pay income tax paid nothing at all. There was also a good deal of money which ought to be collected which was not collected. There were a great many people employed in the colliery districts who were well known to be in receipt of £200 or £300 a year who never contributed. He supported the Budget, and would vote for the extra 2d., on the income tax because he believed the Chancellor of the Exchequer could not avoid, placed in the position he was, putting it on. The speech of the hon. Gentleman who had preceded him represented largely the view of the opposite side of the House that there ought to be more than 2d., but with that view he could not agree. There could not be in a large form a worse tax than the income tax. He greatly regretted that it had not been possible for the Chancellor of the Exchequer to propose that the foreign importations into this country, which contributed nothing to the revenue, and many of which entered into competition with our industries, should bear some portion of the burden, instead of it being imposed upon the unfortunate British taxpayer in the shape of income tax. He should, however, not oppose the income tax resolution, but support it as a disagreeable necessity forced upon the Government by the obvious common sense position in which the Chancellor of the Exchequer found himself, of being obliged to follow the line of least resistance.

MR. FLYNN (Cork, N.)

said that many extraordinary economic heresies had from time to time been put forward in the Committee, but the view of the hon. Member for the Kirkdale division really beat all. If hon. Members who held such opinions attempted to put their theories into practice they would all within a couple of years cease to represent any commercial community in the country. With regard to the income tax, he thought that where it was desirable that direct taxation should bear the largest possible proportion of the taxes Irishmen would be in favour of the direct taxation being in the form of an income tax. The incidence, of course, whether between individuals, employments, or countries, was quite another matter. He and his colleagues were all in sympathy with the graduation of the tax, so that the higher the income the larger the proportion of the tax imposed. Up to 1853 Ireland was recognised as a separate fiscal entity as regarded the income tax. Owing to the disastrous years of scarcity in 1847–8, large local sums for relief became due, and these amounts were paid by the English Treasury. Shortly afterwards Mr. Gladstone imposed for the first time the income tax in Ireland, in order to counterbalance the sums the Treasury had paid. The tax was avowedly imposed as a temporary charge—for eleven years—but forty-seven years had since passed, and still the income tax remained. In discussing the general financial relations, the Treasury usually urged the difficulty of arranging the matter with regard to indirect taxation generally without erecting custom-houses and creating trade barriers in Ireland, but here was a tax in regard to which the Treasury could, without any such alteration, give some effect to the findings of the Royal Commission of four or five years ago. One could not help having a feeling approaching contempt for the men who hurrahed and shouted for the war, but were now grumbling through The Times and the Standard at the paltry addition of 2d. on the income tax which they were called upon to pay. If there was any portion of the Empire which under present circumstances ought to escape this additional income tax it was Ireland, not only because of the historical fact to which he had alluded, but also because the increase was undoubtedly due to the enormous expenditure on the costly and bloody war in South Africa, against which Ireland had always protested, and therefore for which she should not be called upon to pay.

SIR E. ASHMEAD-BARTLETT (Sheffield, Ecclesall)

considered that the Budget as a whole was as fair a Budget as could under the circumstances have been devised, and the Chancellor of the Exchequer was to be congratulated on having made the additional burden of taxation fall as equally as possible on all classes and interests. Those who were disposed to criticise the income tax should remember that such questions had to be regarded not only from their financial and ecomonic aspect, but also from their political aspect, and it would not be possible for any Chancellor of the Exchequer to put taxes on sugar and coal—both of which were commendable under present circumstances—without also increasing to a moderate extent the income tax. The hon. Member for Poplar was not likely to get many to join in his regret that an additional 4d. was not put on the income tax, and that the taxes on coal and sugar were not 2s. 6d. per ton and 1d. per pound respectively.

MR. SYDNEY BUXTON

pointed out that his regret was that the taxation imposed this year was not twice as much, considering the amount of the debt.

SIR E. ASHMEAD-BARTLETT

said that was practically the same thing. From that point of view the criticism of the hon. Member was very unfair. The Chancellor of the Exchequer had hit upon a very happy mean in the amount he had imposed upon present taxpayers and that which posterity would have to pay. The war was one for which posterity would gain to a much larger extent than was the case with regard to many wars in which this country had been involved, and therefore the Chancellor of the Exchequer and the Government were quite justified in placing a very considerable portion of the burden upon the shoulders of posterity. British trade with South Africa amounted to about £20,000,000 before the war. He believed that ten years after the war had finished and peace been restored that trade would have doubled, and no one could say that that would not be a great benefit to future generations and to the present generation. The hon. Member who had just sat down took the same line which was taken the other night by the right hon. Gentleman the Member for West Monmouthshire and other speakers on the opposite side in throwing the whole responsibility for this great expenditure upon the present policy of His Majesty's Government. He held that that was a most unjust charge, for the persons who wore really responsible for it were those who caused the war originally by the capitulation after Majuba. This extra 2d. on the income tax was due to their action far more than to the policy of His Majesty's Government. All the expenditure upon this war might have been averted by timely action, but who were the persons responsible for preventing that timely action? Why, the hon. Gentlemen sitting on the opposite benches. In every single case they carried on a policy of inaction. In 1884, 1894, and 1896, they were the persons who prevented action being taken when it would have saved all this expense. Hon. Gentlemen opposite had no right to throw the responsibility for these increases on His Majesty's Government. The war in South Africa was forced upon this country, and a great British conspiracy in South Africa rendered the war inevitable. [Nationalist cheers.] Hon. Members opposite were always ready to take advantage of a slip. He should have said that a great anti-British conspiracy had rendered the war inevitable, and the persons who could have avoided that war, or at least made it easy and inexpensive, were those persons who should have dealt with that anti-British conspiracy in time. He protested against the way in which hon. Members opposite had charged the Government with responsibility for this expenditure, when they themselves were the cause of it.

With regard to the incidence of taxation, he was not aware that the income-tax payers had raised any outrageous cry against the tax. There had been a certain amount of correspondence in the press, and he had heard much complaint from the Ministerial Benches. Although everyone regretted the increase in the income tax, yet he thought the income tax payers as a whole had behaved much more creditably than the coalowners and great coal merchants, who had made an outcry of which he was thoroughly ashamed. Nobody had gained so much by this war from the increased price of coal, carriage, and transport as they had; they ought to pay, and he was glad the Chancellor of the Exchequer was going to make them pay, although he believed that in the long run the tax would fall rather on the foreign consumer. He congratulated the right hon. Gentleman on his Budget, in which he had made a very equal division of the taxation. He believed this Budget was an original, bold, and fair one, and one which would be popular with the country.

MR. E. J. C. MORTON (Devonport)

said that the hon. Member who had just sat down had managed to wander somewhat from the strict subject of the debate. The whole of the speakers on the opposite side of the House had, with the exception of the hon. Member who had just spoken, been harping upon the imposition of 2d. upon the income tax, and he could not help feeling that underlying some of the speeches made on the other side was the desire, perhaps unconscious, to return to protectionist theories and practices in the taxation of this country. Two hon. Members—the Member for Thanet and the Member for Liverpool—blurted out that they did desire to return to protection; indeed, one hon. Member bad spoken of the exploded theory of free trade. The income tax was of all existing forms of direct taxation the one against which most reasons might be urged, and there were, he understood, insuperable practical difficulties in the way of graduating it. But, after all, he approved of that form of direct taxation far more than the two other methods by which the Chancellor of the Exchequer proposed to raise additional taxation.

The hon. Member for Thanet had made his contribution towards the settlement of this difficult question of the finances of the country which they were considering at the present moment, and he had spoken of the bloated expenditure upon education. He could understand the hon. Member saying that until his anti-educational policy was carried out there would be little chance of inducing the mass of the people to agree to his theories with regard to protection. If it were accepted that £11,000,000 was to be raised by the three distinct methods proposed, then he thought the right hon. Gentleman had not proposed a sufficient increase of the income tax in proportion to the other methods. If they took the average family of a labourer with a wage of £1 a week, they found that the indirect taxation he would pay on sugar would amount to 1–54th of his income, whereas the increase in taxation to the man with an income of £1,000 a year, owing to the increase of income tax plus the tax on sugar, would amount to 1–105th part of his income. So that the labourer with £1 per week would pay almost double the proportion of his income that the man with £1,000 a year and upwards would pay. Seeing that every additional penny added to the income tax yielded loss than the last one, he could not help thinking that it would have been a more just and economical way of dealing with the question if the Chancellor of the Exchequer had gone as far as to increase the income tax by 4d. in the £1. He knew perfectly well that he was excluded from considering the scheme of the Chancellor of the Exchequer as a whole, but he presumed he was not precluded from expressing the utmost possible dissent from the principles that underlay the speeches of hon. Gentleman opposite with respect to the increase of the income tax. The view that underlay those speeches in most cases was that this country should return to the protective system. He believed that such, an attempt was hopeless. He believed that the people of this country were convinced by two generations of human life as to the enormous advantages we derived as compared with foreign nations from the system of free trade. Our national finance was based to a greater extent than that of any other nation in the world upon direct taxation. It seemed somewhat late in the day to have to argue that in the House of Commons. We could not by putting a duty on imports tax the foreigner. We were often told that good trade was the result of having a Unionist Government in office. But we had now removed almost all restrictions on trade, and there was no opportunity for a Government by its policy to produce good trade. But, although a Government could not produce good trade, it might by its legislation produce bad trade. It was the duty of every free-trader to nail to the counter such a false coin as the suggestion that we should return to the evil system of protection which sixty or seventy years ago well nigh ruined the country. By getting out of it, practically the recent prosperity of this country was wholly due.

* MR. FIELD (Dublin, St. Patrick)

said the hon. Member for the Ecclesall Division had alluded to certain points on which he desired to say a few words. The hon. Member had endeavoured to put the blame for the war on previous Governments. He had no desire to enter into useless discussion in regard to the origin of the war, because the constituency he represented, and the people of Ireland generally, were opposed to the war, and had been from the commencement. They could not understand why they should be called upon to support a war upon which they were not consulted, and of which they disapproved. In regard to the way in which the war was begun, he could hardly understand the want of system that existed in this country, which was supposed to be a constitutionally governed country and under the management of the House of Commons. This war was manipulated and brought about by a capitalist clique altogether outside this House, but when the cost of the war was to be paid an appeal is made to Parliament which was not consulted, and they were obliged through their constituents to meet the expenditure. It appeared to him that a great constitutional principle was being lost sight of by the House, and he thought it would be well in future, when war was looming in the distance, that the First Lord of the Treasury should call the House of Commons to consider the question, and to consult it as to the advisability and necessity of plunging into war which the country would have to pay for in men, money, and social suffering.

The object of just taxation ought to be to adapt the financial burden to the capability of those who were called upon to hear the tax. He held that the wealthier classes did not pay a proportionate share of the income tax. A business man was called upon to make a hypothetical return of the amount of profit he was likely to realise in the ensuing year. That was a preposterous way to levy taxation. The poor governess was disproportionately burdened. Brains were taxed entirely out of ratio with rentals or royalties. The whole subject required to be reformed, and greater gradations of payments introduced. The income tax in Ireland was introduced in 1853 by Mr. Gladstone, who said it was to be a tax for seven years, but it had been continued ever since. British financiers when they got hold of a tax seldom relinquished it. The Irish people were told that it was in exchange for the payment of £260,000 a year, in connection with the Consolidated Fund annuities, that the income tax was imposed. The income tax amounted to double the amount of the Consolidated Fund annuities, and the result was that they had paid something like £30,000,000 in income tax since then. In his opinion Mr. Gladstone was the most expensive friend that Ireland ever had, from a taxpayer's point of view, and the sooner his system of taxation was abolished the better. For what had been the result of that financial policy? It had increased taxation and decreased population. For according as the population decreased, the incidence of taxation increased. Now that was a result that had not been attained or attempted by the Government of any civilised country in the world. While the population had decreased by one half since Her late Majesty came to the throne, the taxation had increased three-fold. These were very serious facts, and demanded the immediate attention of everyone in this House who had any interest in Ireland. He entirely traversed the statement made by the last speaker in regard to free trade. He did not believe that it was a policy of free trade. It was a policy of free imports; for they received everything from all parts of the world, while there was a wall of protection against British and Irish products and manufactures wherever they were exported. The Manchester school and all those who had obtained prosperity under so-called free trade looked upon a man as an utter fanatic who had the courage of his convictions on this question; but he believed that the time was approaching when the whole fiscal system of this country would have to be reconsidered and reconstituted, because if they went on as they were going—

* THE CHAIRMAN

I would remind the hon. Gentleman that the income tax is the subject of debate.

* MR. FIELD

said he was coming to the income tax. If the community of Great Britain ceased to earn money, then they could not pay anything, even income tax. That was what he was trying to prove. If the exports decreased and the imports increased to the same extent as had occurred during the last few years, then the income tax, instead of increasing, would diminish to such an extent that they would be obliged to put the taxes on something else. He maintained that they must reconsider the basis and the principles which governed the whole fiscal system of this country, because if it was continued, and the main burden of taxation was paid by the producer for the benefit of the consumer, the system could not last. England was living on its capital rather than its earnings; manufactures were declining, and the cultivation of land did not pay. In regard to Ireland and the Irish income tax, he found that it had decreased between 1896 and 1900 by no less a sum than. £10,000. Now, that was a very important fact, and the Government naturally desire to keep up their Imperial revenue. This might be accomplished by revaluation through a Government department. The city of Belfast had recently been revalued, and the result was that the people of that city had to pay £13,000 per annum more in income tax. And what did they find? Loyal Belfast, which was supposed to open its arms to receive the burden of taxation, or any other gift, from this country was up in arms against that increase of the income tax. If this revaluation was to go on all over Ireland, and was calculated on the same basis as in Belfast, the result would be that the over-taxation of Ireland would be increased by more than a million a year. That was a very serious consequence. They were overtaxed by a sum of no less than three millions; and under this new Budget it would be almost four millions. What did that mean? There was a population of only 4½ millions, and it meant that every man, woman, and child would pay £1 of Imperial over-taxation. If the money was spent in the country there might be some justification for it; but it was nearly all exported and spent out of Ireland, so the financial ruin of Ireland was accelerated. As a Nationalist he protested against the income tax being increased, because after all he had no desire to see the wealthier classes of Irishmen leaving the country. On the contrary, his desire was that every Irishman should be able and willing to live at home. But if this system of increasing the income tax, and taxation generally, was persisted in, it was not alone the working people that would leave the country, but also the wealthier classes, and there would be fewer people to tax by and by. [Laughter.] Hon. Members might laugh, but that was a very serious statement. The population had decreased by nearly five millions in the last fifty years. He had been examining the emigration statistics, and he found that there had been a larger emigration last year than the year before. That was a subject which ought to interest the sympathy of humane men, instead of exciting laughter. After all, the people were the State, and if they had no people they would have no State, and if they had fewer people in Ireland they would get less taxes. He protested against this increase of the income tax in Ireland, though he did not object to an increase of the taxation on the wealthier classes by further graduating the income tax. He suggested that the Chancellor of the Exchequer should give them some scheme whereby he would remit to Ireland the same amount which he proposed to take out of it by the increase in the income tax. An equal sum ought to be given back in the shape of a grant for some useful reproductive national purpose; some practical proposal should be offered and considered. A suggestion had been made in the Report of the Financial Relations Committee of giving a grant for reducing the rates of freight and fares on the Irish railways, which he commended to the Chancellor of the Exchequer. When Sir Robert Peel introduced his Income Tax Bill in 1842 it was strongly pressed on him to include Ireland, but he declined to do so on the ground that, having regard to the relative resources of both islands, Ireland as a whole already contributed to the Imperial revenue a quota relatively to her means quite as heavy as the people of Great Britain would have to contribute with the addition of income-tax, therefore the justice and necessity of remission and restitution to the overburdened Irish taxpayer.

MR. CATHCART WASON (Orkney and Shetland)

said that an hon. Gentleman who had spoken had criticised the system which allowed the Government to go to war without the consent of Parliament. The Government did not go to war; it was the Boers who commenced to raid our territory and destroy the property of our settlers. There was no country in the world, so far as he knew, in which Parliament was consulted in regard to war. In the great American Civil War—which was the only one that had any resemblance to this war with the Boers—war was not declared by Congress but by the rebels. This war was also declared by the rebels.

An HON. MEMBER on the Irish Benches: They were not rebels, but a free people.

MR. CATHCART WASON

said he did not know what constituted a rebel in the minds of hon. Gentlemen opposite. Loyalty and rebellion in their minds seemed to him to be very mixed up. It was a rebellion. [Cries from the Irish Benches of "It was not."]

* THE CHAIRMAN

The hon. Member is getting far from the resolution before the Committee.

MR. CATHCART WASON

said that he would not have intervened in the debate were it not for the refreshing remarks of the hon. Member for Devonport. The hon. Member resembled the worshippers in a barbaric country who set up an idol for themselves, worshipped it, then took it down, turned it inside out, put a bit of gilt paper on it, and then set it up again. The very suggestion of Protection had induced the hon. Member to tell the Committee what free trade had done for the country, and what would be the result of any modification of the present fiscal system. He was quite certain that the time would come when the country would have to reconsider its entire fiscal arrangements. Recent events had shown that the country stood almost alone, though not quite alone, as she had the hardy sons from her colonies around her. Just as America, a great nation which could stand alone against any foreign combination, had declared itself a Protectionist State, as had also the colonies, England would have to resort to Protection.

* THE CHAIRMAN

The hon. Member must connect his remarks somehow with the resolution before the Committee:

MR. CATHCART WASON

said, with reference to the taxation of incomes, he did not altogether hold with the system proposed by the Chancellor of the Exchequer. He thought the time had arrived when some distinction ought to be made as regards the source from which incomes were derived. Whether an income came from a man's professional work or from realised wealth should be considered, and an increase might be put on incomes from the latter source. It would also be an improvement to carry the graduation of the income tax very much further. He agreed that it was a very difficult matter to impose new taxation, and he was sorry that the Government had not seen fit to throw the whole cost of the war on the Transvaal and Orange Free State.

* THE CHAIRMAN

That does not arise. The matter has been discussed on another resolution and cannot be reopened.

MR. CATHCART WASON

said that he would only say in conclusion that in his opinion it would have been much wiser and better if a graduated tax had been imposed, graduated not only in reference to the amount of the income, but also in reference to its incidence, so that it would not press too heavily on professional men whose incomes died with them, but should rather press on persons whose incomes were derived from realised wealth without having to work for it. The position of the taxpayer was not altogether a fortunate one, and he would simply have to make the best he could of it.

* MR. HERBERT LEWIS (Flint Boroughs)

said he had no intention of following the hon. Gentleman who had just spoken into the realms of idolatry. But there were two suggestions made by the hon. Gentleman with which he heartily agreed. During the debate very little attention had been paid to what, in his opinion, was the most important question connected with the resolution—namely, the incidence of the income tax. When the tax stood at 8d. it was a very annoying and very oppressive one, but now that it had advanced to 1s. 2d. it was for certain classes of the community an almost intolerable tax. He did not propose that the Chancellor of the Exchequer should receive from the income tax less than he proposed to raise by his present scale, but he suggested that some regard should be paid to the taxable capacity of the various classes who would be called upon to pay the tax. Five years ago he put down a series of Amendments to the Finance Bill, his object being to obtain a graduated scale of taxation so far as the income tax was concerned. The right hon. Gentleman then said that it was practically impossible to adopt a graduated scale, but in the following year he appealed to the right hon. Gentleman to extend the principle of graduation which existed as regards incomes up to £500, and the right hon. Gentleman did extend it to incomes up to £700. It was perfectly possible to graduate the income tax by means of exemptions. There was absolutely no difficulty whatever in taking that course, because the right hon. Gentleman and the Department over which he presided would only be following on the lines of existing legislation and existing administration. Was it right that a man with an income of £500 should only receive an abatement on £120, whereas a man with an income of £5,000 or £10,000 from invested funds was not required to pay a penny more in proportion, always excepting the small allowance he had mentioned. He would very earnestly support the appeal made by the hon. Member for Orkney and Shetland that a distinction should be made between incomes earned by a man's own exertions and incomes derived from investments. Such a distinction was drawn in one of the great colonies of the Empire and there was no reason why it should not be drawn in Great Britain also. He would urge on the right hon. Gentleman that there was absolutely no difficulty whatever in graduating the income tax up to any desired point by means of exemptions.

* MR. MOULTON (Cornwall, Launceston)

said he fully appreciated the importance, as regarded public convenience, of restricting the discussion to the resolution. He did not mean to traverse the ruling of the Chairman that the discussion must be thus restricted, and yet there was never an occasion on which it was more difficult, he might a most say impossible, to discuss the resolution without entering on the question of alternative taxation. When expenditure was such as to require further taxation, it was idle to criticise a proposed tax merely on the ground that it created inconvenience. Every tax must do so. The only effective criticism was to show that the money could be obtained in some other way with less inconvenience. But the importance of thus treating the question was specially great on the present occasion. In the speech on the introduction of the Budget—a speech which they all felt did the right hon. Gentleman great honour—the Chancellor of the Exchequer claimed for his Budget that it should not be regarded as a temporary expedient. He unflinchingly put before the House of Commons all the difficulties of the country, all its new indebtedness and all its increased expenditure, and he said that they should no longer consider the taxes he proposed as temporary expedients to tide over a temporary difficulty, but that they should be looked upon as changes in the normal taxation of the country. Therefore, they had to consider the income tax now proposed as being substantially the normal income tax in the future, and would have to compare it not with the 1s. tax of last year, which was confessedly temporary, but with the income tax as it stood before the war. Viewed in this light the normal income tax had been raised from 8d. to 14d., and they would have to consider whether it was right to almost double the income tax as a permanent measure. They could not of course criticise the tax properly without considering what substitute should be provided for it, but he did not propose to examine generally the alternatives that might be suggested. He was going to assume that the Chancellor of the Exchequer was right, and that he was obliged to raise by direct taxation as much as this increased income tax would yield. But the fact that the sum was to be raised by direct taxation did not necessitate its being raised entirely by the income tax. Our system of taxation would be a very unfair one if the income tax was the only form of direct taxation. Both the previous speakers had pointed out that one of the greatest objections to the income tax was that it fell alike on those who earned their incomes by their own skill or brains, and on those who derived their incomes from realised property. It taxed the owner and the earner alike, and now that the income tax was doubled the inequality of taxing the earner as much as the owner had become more serious. A man with an income from £10,000 in Consols paid neither more nor less income tax than a clerk who earned £275 a year. But those hon. Members had not realised that in this matter of direct taxation the inequality between those who earn and those who own was redressed in this country by means of the death duties. These fall solely on realised property, and though for the sake of general convenience they are levied once for all at a man's death, they are equivalent to an annual tax which is paid on realised property by those who own it, and which does not fall on the year's earnings. Thus a fair adjustment can be made between the direct taxation falling on owners and earners by properly proportioning the rates of the income tax and the death duties. When those duties were fixed the income tax was at 8d., and very careful calculations showed that in those circumstances those who derived their income from earnings paid just about half the rate per pound paid by those who derived their income from realised property. No one could say that such a proportion was unduly hard upon those who derived their income from realised property. But that balance had now been wholly destroyed, because the income tax had been nearly doubled, and there had been no increase in the capital tax levied by the death duties. The consequence was that by adopting this as a permanent method of raising revenue an undue proportion of the new burden was laid on the weaker shoulders. He did not attach any religious sanction to this particular balancing of the two sources of income, although he thought the proportion of two to one very reasonable under existing circumstances, but the arrangement was made by Parliament as being a fair proportion between those who had realised property and those who had not, and the burden on the back of the earner ought not to be increased without taking care that this proportion was being kept, and in this manner they could best satisfy the aims of those who wished to introduce a graduated income tax. It was easy to graduate the death duties, and therefore those who desired a graduated income tax could get all they wanted by making the death duties increase pari passu with the income tax. That not only enabled them to fairly divide the burden between the owners and earners and to effectually graduate the income tax, and what he regretted was that this great increase had been made in the income tax instead of the money being raised by increasing simultaneously and in the same proportion the income tax and the death duties.

MR. TULLY (Leitrim, S.)

said the House was indebted to the hon. Gentleman who had just sat down for the advice which he had given to it. It was largely owing to his advice that the death duties had been the success they were, and he hoped that the views of the hon. Gentleman would receive due consideration from the Government. He could not agree with those who had protested against the increase of the income tax; it was they who had returned to power the gentlemen responsible for the policy which had resulted in the war and this increased taxation, and he had no admiration for the men who, having voted for the war, now came squealling to the House because an additional 2d. was put upon the income tax. In his opinion the increase should have been 2s. The gentlemen responsible for the war should be made to pay. One hon. Gentleman suggested a universal income tax of 4d. in the £, so that a labourer earning £50 a year would have to pay 17s.; he would not imagine that such a tax would be popular, and thought it would be a pity that hon. Gentlemen who advocated it did not address their constituents upon that subject. If they did, the House probably would not be burdened by their presence for long. The Chancellor of the Exchequer had truly said that much more taxation could not be put upon Ireland; the result of increasing the income tax from 8d. to 1s. had only been to secure an increased amount of £24,000, and such figures told the tale of poverty that all classes in Ireland suffered from when increasing the income tax by half only brought in such a paltry amount. When the income tax was imposed in 1873 upon Ireland it was distinctly stated by Mr. Gladstone that it was only to be levied for seven years; nevertheless, it was still being levied, and it had been increased until it had reached the straining point. The way in which this impost was levied in Ireland was absolutely iniquitous. Every year the persons responsible for gathering the tax increased their demands, until the unfortunate people who had to pay were forced to appeal to the courts, and the small traders of Ireland who were so forced had to disclose their poverty at the very worst time of the year for them, and the result was, in several cases, to his knowledge, within a very few months of applying to the court, those unfortunate persons found themselves in the Bankruptcy Court. He protested against such a system being allowed. Irish Members were entitled to protest on every possible occasion against any increase in the taxation imposed upon Ireland, as since 1893–94 the total amount levied in that country had increased from £7,568,000 to £8,664,000, and the present proposals would mean the addition of another £500,000. The persons mainly responsible for the present increases were the small income taxpayers, who, through their jingoism, forced on the war in South Africa. These were the people who were now complaining, but they had previously had very little regard for the suffering and desolation caused by the policy of fire and sword, which, through their votes, they were the means of bringing into South Africa.

* SIR M. HICKS BEACH

I will not attempt to go into the question raised by the hon. Gentleman who last sat down, because, after all, I think if there be a grievance in Ireland with regard to taxation it is not in regard to the income tax. I have never been able to see why a person who is above the income-tax limit should not pay income tax in Ireland just as well as in Great Britain, and to excuse persons from the payment of income tax because they live in Ireland would seem to me to be an utterly unreasonable proposition to I advance in regard to the taxation of the United Kingdom. This debate has been an interesting one to me. From one side have come theories as to taxation; from the other side have come other theories, but I do not think anybody has questioned the fact that we must raise more taxation this year, and that we must raise part of it at any rate by direct taxation. My right hon. friend the Member for the Isle of Thanet has with great skill utilised the opportunity for ventilating his peculiar theories upon the subject of our fiscal system. He almost suggested that if we would follow those theories we might abolish the income tax. At any rate, I think he went as far as this—that if I had adopted his theories no increase of the income tax would be necessary this year. Sir, I prefer the increase of the income tax to the adoption of his theories. I believe it to be better for the country, and I believe it to be fairer. Though I hope he may live for many years, I do not think he is likely to sec the adoption of those theories by any Chancellor of the Exchequer, no matter to what Government he may belong. Hon. Members on the other side of the House, so far from objecting to the resolution which is now before the House, have rather blamed me for not proposing that, instead of 2d. additional to the income tax, 4d. additional should be levied this year. I endeavoured very carefully to balance the burden which this Budget has thrown upon the taxpayers of the country, together with the burdens which they were already bearing, and I think if I had adopted such a proposal as that it would have been unfair to the payers of direct taxation. Those who argue in favour of this, with the exception of one hon. and learned Gentleman, the Member for the Launceston Division, forget the heavy burden thrown on the payers of direct taxation in other ways. A good deal of the afternoon has been occupied with the discussion initiated by my hon. friend the Member for Hertfordshire with regard to the taxation of what he calls wasting incomes, or incomes derived from brain power, as compared with incomes derived from property; and the hon. and learned Gentleman the Member for Launceston went so far as to say—so I understood him—that any addition to the income tax, as compared with 8d. in the pound, at which it stood in the year 1894, ought to be balanced by a corre- sponding addition to the death duties. That certainly is not my view. I think the death duties were put in 1894 at an extremely high point. And I think the hon. Member has omitted to consider this, that to make the death duties a varying tax, which you might increase or decrease as you increase or decrease the income tax from year to year, would be extremely unfair to persons whose estates might be subject to the death duties within a particular year in which the tax was increased, while it would be extremely favourable to those persons whose estates became subject to the death duties when the duties were diminished.

MR. MOULTON

was understood to express the belief that it was to be a permanent increase.

* SIR M. HICKS BEACH

I am a little more sanguine than the hon. and learned Gentleman. I do not look forward, though he may, to a permanent income tax of 1s. 2d. in the pound. I have hopes still lingering in the bottom of my mind that the additional taxation proposed in this year will turn the thoughts of the country, as I think it has already turned the thoughts of many members of this House, to the virtues of economy. Therefore a 14d. income tax may not be one of our permanent institutions. Another suggestion was, I think, made by the hon. Gentleman the Member for Flint Boroughs, who has taken great interest in this question, and has always been good enough to do me justice with regard to it, that there should be some further graduation of income tax in favour of the possessors of small incomes. One hon. Member, speaking from that side of the House, went so far as to suggest that the possessors of all incomes not exceeding £500 should be free from the additional income tax imposed for this year. I think such a proposal as that would be by no means a fair one. I should be very sorry myself in a year with an increased income tax to single out a particular class of income-tax payers as a class to be relieved of that increase. I think that that, financially, would be an extremely immoral course: it would be almost purchasing the support of that class in favour of an increase of taxation which, however unpopular it may be, ought to be levied by Parliament, so to speak, all round. And when the hon. Gentleman the Member for the Flint Boroughs invites me to a further graduation this year I must remind him that my last proposals of abatements, though accepted by Parliament, were not by any means universally approved of at the time by this House. There were comments precisely of the nature which I have just made myself, although in that year the income tax was not increased. I should be sorry to raise the rate of exemption from income tax. I think you could hardly make a greater mistake in our financial system.

With regard to the increase of abatements to a higher level, I confess that to my mind a limit of £700 does seem a reasonable point to which abatements may extend. It is too often forgotten by the possessors of small incomes and by those those who advocate their cause that with regard to the lowest grade of incomes on which income tax is paid the abatements system does give a very large relief now. I think it ought to. I do not say it might not be increased, but I should not think it right to make a proposal for increasing it at such a time as that with which we are now dealing. There is no difference, so far as I know, in the House as to the necessity of further taxation, and I think there is very little difference as to the necessity, at any rate, of a considerable part of that taxation being raised by an increase of the income tax. Therefore, as we have had a discussion of some length dealing with many aspects of the income tax, I would venture to ask the Committee whether we might not now be allowed to come to a decision on a matter on which, I think, we are generally agreed—that there should bean increase of the income tax to the extent of 2d. in the pound. So far as I have noticed there is only one other point in the discussion to which I ought to refer. My hon. friend the Member for North Islington criticised the administration of the tax with regard to the question of arrears. He referred to a matter that happened last year, and has not been repeated now, at any rate. The tax is levied, and must I be levied on income which accrues to the possessor in the course of the year That income accrued—though the possessors were unfortunately kept out of it for some time—in the course of the year in which the tax was increased. That was unfortunate for them. But it might have accrued in a year in which the tax was lowered, and then we should not have heard any complaint. I by no means say that the income tax is a perfect one. I do not know any tax that can be so described; but if any Iron. Members think that they can easily make the income tax more perfect than it is now, I cannot give them better advice than that given by the hon. Member for Poplar—namely, to read that remarkable speech made by Mr. Gladstone on the income tax in 1853. A good many points have been raised as to the unfairness of the incidence of the income tax as between incomes derived from trade and brain work and incomes derived from those sources which are permanent; but of this I am quite certain—that as a new kind of direct taxation has been derived from the enormous increase of the death duties, the burden is now practically fair as between persons who derive their income from their brains on the one side and those who are the possessors of property on the other side. Although it may be possible in quieter times and with less difficulties in regard to taxation to amend the income tax, still I do not think it would be easy, and I do not think that any other country has ever devised a better system on the whole than that system which we now possess.

SIR WILLIAM HARCOURT

I agree so entirely with what has fallen from the Chancellor of the Exchequer as to the course he has adopted that I shall not detain the Committee more than a few seconds in referring to the income tax. All taxes are bad, but taxes are the fruit, as the Chancellor of the Exchequer has shown, of extravagance, and whenever this House or the country makes up its mind no longer to have extravagance,

then we shall diminish the income tax, and not before. But I observe that the people who most denounce the income tax are those who most promote extravagance. You will find that extravagance is not really discouraged in this country; on the contrary, it is encouraged, and encouraged to a very great degree by those who most complain of the income tax. There is a great desire, no doubt, that the whole burden of taxation should be cast upon those who have an income of less than £160 a year, which is the low limit of the income tax. The people who want to get rid of the income tax are those who wish to levy the whole of this extravagant expenditure on the poorest classes of the community. ["No, no."] It is so. I cannot now go into an argument on the subject. Allow me to ask the Chancellor of the Exchequer whether he is able now to make any reply to the appeal which I made to him earlier in the evening, at question time, to postpone the Report stage of the resolution as to the coal tax until an opportunity has been given for the miners to make representations to him on the subject.

* SIR M. HICKS BEACH

Yes, Sir; I have considered that matter, and I will undertake that the Report of the resolution shall be postponed until next week; but may I express the hope that the Committee will decide as to the present resolution now, and then the remaining resolutions can be taken on Thursday?

MR. O'MARA (Kilkenny, S.)

argued that there were many reasons why the proposed increase in the income tax should not apply to Ireland. Within the last seven years there had been a great falling off in incomes in Ireland. There was also a historical reason why the increase should not apply to Ireland—

Question put.

The Committee divided:—Ayes, 363; Noes, 88. (Division List No. 138.)

AYES.
Acland-Hood, Capt. Sir Alex. F.	Arkwright, John Stanhope	Bain, Col. James Robert
Agg-Gardner, James Tynte	Arrol, Sir William	Baird, John George Alexander
Agnew, Sir Andrew Noel	Ashton, Thomas Gair	Balcarres, Lord
Aird, Sir John	Asquith, Rt. Hon. Herbert H.	Balfour, Rt. Hon. A. J. (Manch'r
Allan, William (Gateshead)	Atkinson, Rt. Hon. John	Balfour, Rt. Hon. G. W. (Leeds).
Allhusen, Augustus Henry E.	Austin, Sir John	Banbury, Frederick George
Anson, Sir William Reynell	Bagot, Capt. Josceline Fitz Roy	Bartley, George C. T.
Archdale, Edward Mervyn	Bailey, James (Walworth)	Bathurst, Hon. Allen B.
Beach, Rt. Hn. Sir M. H. (Bristol	Faber, George Denison	Kearley, Hudson E.
Beach, Rt. Hon. W. W. B. (Hants	Fellowes, Hn. Ailwyn Edward	Kennaway, Rt. Hon. Sir John H.
Beaumont, Wentworth C. B.	Fergusson, Rt Hn. Sir J. (Manc'r	Kenyon, Hon. Geo. T. (Denbigh
Beckett, Ernest William	Finch, George H.	Kenyon-Slaney, Col. W. (Salop.
Black, Alexander William	Finlay, Sir Robt. Bannatyne	Keswick, William
Blundell, Col. Henry	Fisher, William Hayes	Kimber, Henry
Bolton, Thomas Dolling	Fitz Gerald, Sir Robert Penrose-	King, Sir Henry Seymour
Bond, Edward	Fitzmaurice, Lord Edmond	Kinloch, Sir John G. Smyth
Boscawen, Arthur Griffith-	Fitzroy, Hon. Edward Algernon	Kitson, Sir James
Boulnois, Edmund	Flannery, Sir Fortescue	Lambton, Hon. Frederick Wm.
Bowles, T. G. (King's Lynn)	Foster, Sir Walter (Derby Co.)	Langley, Batty
Brigg, John	Fowler, Rt. Hon. Sir Henry	Law, Andrew Bonar
Brodrick, Rt. Hn. St. John	Fuller, J. M. F.	Lawrence, William F.
Bull, William James	Galloway, William Johnson	Lawson, John Grant
Billiard, Sir Harry	Garfit, William	Legge, Col. Hon. Heneage
Burt, Thomas	Gibbs, Hn. A G H. (City of Lond.	Leigh-Bennett, Henry Currie
Butcher, John George	Gibbs, Hon. Vicary (St. Albans)	Leighton, Stanley
Buxton, Sydney Charles	Gladstone, Rt Hn. Herbert John	Leveson-Gower, Frederick N. S.
Caldwell, James	Godson, Sir Augustus Frederi'k	Lewis, John Herbert
Campbell, Rt. Hn. J A (Glasgow	Gordon, Hn. J. E. (Elgin & Nairn	Llewellyn, Evan Henry
Carson, Rt. Hon. Sir Edw. H.	Gordon, J. (Londonderry, S.)	Lockwood, Lt.-Col. A. R.
Causton, Richard Knight	Gordon, Maj. Evans-(T'rH'm'ts	Long, Col. Charles W (Evesham)
Cavendish, R. F. (N. Lancs.)	Gord, Hon. F. S. Ormsby-	Long, Rt. Hn. Walter (Bristol, S
Cavendish, V. C. W (Derbyshire	Gorst, Rt Hn. Sir John Eldon	Lowe, Francis William
Cawley, Frederick	Goschen, Hon. George Joachim	Lowther, C. (Cumb., Eskdale)
Cayzer, Sir Charles William	Goulding, Edward Alfred	Lowther, Rt. Hon. James (Kent)
Cecil, Evelyn (Aston Manor)	Green, Walford D (Wednesbu'y	Loyd, Archie Kirkman
Cecil, Lord Hugh (Greenwich)	Greene, Henry D. (Shrewsbury)	Lucas, Reginald J. (Portsmouth
Chamberlain, Rt. Hn. J. (Birm.	Greene, W. Raymond- (Cambs.	Lyttelton, Hon. Alfred
Chamberlain, J Austen (Worc'r	Grenfell, William Henry	Macartney, Rt. Hon. W. G. E.
Channing, Francis Allston	Gretton, John	Macdona, John Cumming
Chaplin, Rt. Hon. Henry	Greville, Hon. Ronald	MacIver, David (Liverpool)
Chapman, Edward	Grey, Sir Edward (Berwick)	Maconochie, A. W.
Charrington Spencer	Griffith, Ellis J.	M'Arthur, Charles (Liverpool)
Cochrane, Hn. Thos. H. A. E.	Guest, Hon. Ivor Churchill	M'Arthur, William (Cornwall)
Coddington, Sir William	Gunter, Colonel	M'Calmont, Col. J. (Antrim, E.)
Cohen, Benjamin Louis	Gurdon, Sir W. Brampton	M' Iver, Sir Lewis (Edinburgh W
Collings, Rt. Hon. Jesse	Hain, Edward	M'Kenna, Reginald
'Colomb, Sir John Charles Ready	Haldane, Richard Burdon	M'Killop, James (Stirlingshire)
Colston, Chas. Edw. H. Athole	Hall, Edward Marshall	Malcolm, Ian
Colville, John	Halsey, Thomas Frederick	Manners, Lord Cecil
Cook, Sir Frederick Lucas	Hamilton, Rt Hn Ld. G. (Midd'x	Mansfield, Horace Rendall
Corbett, A. Cameron (Glasgow)	Hamilton, Marq. of L'nd'nderry	Maple, Sir John Blundell
Corbett, T. L. (Down, North)	Hanbury, Rt. Hon. Robert Wm.	Mappin, Sir Frederick Thorpe
Craig, Robert Hunter	Harcourt, Rt. Hon. Sir William	Markham, Arthur Basil
Cranborne, Viscount	Hare Thomas Leigh	Mather, William
Crombie, John William	Harmsworth, R. Leicester	Maxwel L Rt Hn Sir H E (Wigt'n
Cubitt, Hon. Henry	Harris, Frederick Leverton	Maxwell, W. J. H. (Dumfriessh.
Cust, Henry John C.	Haslem, Sir Alfred S.	Mellor, Rt. Hon. John William
Dalrymple, Sir Charles	Haslett, Sir James Horner	Melville, Beresford Valentine
Davies, Alfred (Carmarthen)	Hay, Hon. Claude George	Middlemore, J. Throgmorton
Davies, M. Vaughan-(Cardigan	Hayne, Rt. Hon. Charles Seale-	Milward, Colonel Victor
Denny, Colonel	Hayter, Rt. Hon. Sir Arthur D.	Mitchell, William
Dewar, J. A. (Inverness-sh.)	Heath, Arthur Howard (Hanley	Montagu, G. (Huntingdon)
Dewar, T. R. (T'rH'mlets, S Geo	Heath, James (Statfords, N. W.	Moon, Edward Robert Pacy
Dickinson, Robert Edmond	Helme, Norval Watson	More, Robert J. (Shropshire)
Dickson-Poynder, Sir John P.	Henderson, Alexander	Morgan, Hn. Fred. (Monm'thsh
Digby, John K. D. Wingfield-	Hermon-Hodge, Robt. Trotter	Morley, Rt. Hn. John (Montrose
Dilke, Rt. Hon. Sir Charles	Higginbottom, S. W.	Morris, Hon. Martin Henry F.
Dimsdale, Sir Joseph Cockfield	Hoare, Edw Brodie (Hampstead	Morrison, James Archibald
Dixon-Hartland, Sir F. Dixon	Hoare, Sir Samuel (Norwich)	Morton, Arthur H. A. (Deptford
Dorington, Sir John Edward	Hobhouse, Henry (Somerset, E.)	Morton, E. J. C. (Devonport)
Doughty, George	Holland, William Henry	Moss, Samuel
Douglas, Rt. Hon. A. Akers-	Hornby, Sir William Henry	Moulton, John Fletcher
Doxford, Sir William Theodore	Houldsworth, Sir Wm. Henry	Mount, William Arthur
Duke, Henry Edward	Howard, J. (Kent, Faversham	Mowbray, Sir Robert Gray C.
Duncan, J. Hastings	Howard, J. (Midd., Tottenham	Muntz, Philip A.
Dunn, Sir William	Hozier, Hon. James Henry Cecil	Murray, Rt Hn A. Graham (Bute
Durning-Lawrence, Sir Edwin	Humphreys-Owen, Arthur C.	Murray, Charles J. (Coventry)
Edwards, Frank	Hutton, Alfred E. (Morley)	Murray, Col. Wyndham (Bath)
Egerton, Hon. A. de Tatton	Button, John (Yorks, N. R.)	Myers, William Henry
Elliot, Hon. A. Ralph Douglas	Jacoby, James Alfred	Newdigate, Francis Alexander
Emmott, Alfred	Jessel, Captain Herbert Merton	Newnes, Sir George
Evans, Sir F. H. (Maidstone)	Johnston, William (Belfast)	Nicol, Donald Ninian
Evans, Samuel T. (Glamorgan	Joicey, Sir James	Norman, Henry

Norton, Capt. Cecil William	Sackville, Col. S. G. Stopford-	Tufnell, Lt.-Col. Edward
Nussey, Thomas Willans	Sadler, Col. Samuel Alexander	Ure, Alexander
O'Neill, Hon. Robert Torrens	Samuel, Harry S. (Limehouse)	Valentia, Viscount
Orr-Ewing, Charles Lindsay	Sassoon, Sir Edward Albert	Walker, Col. William Hall
Palmer, Sir C. M. (Durham)	Schwann, Charles E.	Walton, John Lawson (Leeds, S.
Palmer, Walter (Salisbury)	Scott, Sir S. (Marylebone, W.)	Walton, Joseph (Barnsley)
Partington, Oswald	Seely, Charles Hilton (Lincoln)	Warde, Col. C. E.
Peel, Hn. Wm Robert Wellesley	Seton-Karr, Henry	Warner, Thomas Courtenay T.
Hemberton, John S. G.	Sharpe, William Edward T.	Wason, Eugene (Clackmannan
Percy, Earl	Shaw-Stewart, M. H. (Renfrew)	Wason, John Cathcart (Orkney
Perks, Robert William	Shipman, Dr. John G.	Weir, James Galloway
Pierpoint, Robert	Sinclair, Capt John (Forfarshire	Welby, Lt.-Col. A C E (Taunton)
Pilkington, Richard	Sinclair, Louis (Romford)	Welby, Sir Charles G. E. (Notts.
Platt-Higgins, Frederick	Smith, Abel H. (Hertford, East)	Whiteley, H (Ashton und. Lyne
Plummer, Walter R.	Smith, H. C (North'mb, Tynes'e	Whitley, J. H. (Halifax)
Powell, Sir Francis Sharp	Smith, Samuel (Flint)	Whittaker, Thomas Palmer
Price, Robert John	Smith, Hn. W. F. D. (Strand)	Williams, Osmond (Merioneth)
Pryce-Jones, Lt.-Col. Edward	Soames, Arthur Wellesley	Williams, Rt Hn J Powell- (Birm
Purvis, Robert	Spear, John Ward	Willox, Sir John Archibald
Quilter, Sir Cuthbert	Spencer, Rt. Hn. C. R (North'nts	Wilson, A. Stanley (York, E. R.)
Rankin, Sir James	Spencer, Eriest (W. Bromwich)	Wilson, John (Falkirk)
Ratcliffe, R. F.	Stanley, Hn. Archur (Ormskirk	Wilson, John (Glasgow)
Rea, Russell	Stanley, Lord (Lancs.)	Wilson, J. W. (Worcestersh, N.
Reid, James (Greenock)	Stevenson, Francis S.	Wilson-Todd, Wm. H. (Yorks.)
Remnant, James Farquharson	Stewart, Sir M. J. M'Taggart	Wodehouse, Rt. Hn. E. B. (Bath
Renwick, George	Scone, Sir Benjamin	Wolff Gustav Wilhelm
Rickett, J. Compton	Stroyan, John	Woodhouse, Sir J. T. (Huddersf'd
Ridley, Hn. M. W (Stalybridge	Strutt, Hon. Charles Hedley	Wortley, Rt. Hon. C. B. Stuart-
Rigg, Richard	Sturt, Hon. Humphry Napier	Wrightson, Sir Thomas
Ritchie, Rt. Hn. Chas. Thomson	Talbot, Rt Hn. J G. (Oxf'd Univ.	Wylie, Alexander
Robertson, H. (Hackney)	Taylor, Theodore Cooke	Wyndham, Rt. Hon. George
Hoe, Sir Thomas	Thomas, Abel (Carmarthen, E.)	Wyndham-Quin, Major W. H.
Rolleston, Sir John F. L.	Thomas, Alfred (Glamorgan, E.	Yerburgh, Robert Armstrong
Ropner, Colonel Robert	Thomas, F. Freeman-(Hastings	Young, Commander (Berks, E.)
Rothschild, Hon. Lionel Walter	Thornton, Percy M.	Younger, William
Round, James	Tomkinson, James
Royds, Clement Molyneux	Tomlinson, Wm. Edw. Murray	TELLERS FOR THE AYES—
Russell, T. W.	Trevelyan, Charles Philips	Sir William Walrond and Mr. Anstruther.
Rutherford, John	Tritton, Charles Ernest
NOES.
Abraham, William (Cork, N. E.)	Healy, Timothy Michael	O'Connor, T. P. (Liverpool)
Allen, Chas. P. (Grouc., Stroud	Hemphill, Rt. Hn. Chas. H.	O'Donnell, J. (Mayo, S.)
Ambrose, Robert	Horniman, Frederick John	O'Dowd, John
Atherley-Jones, L.	Jameson, Major J. Eustace	O'Kelly, Conor (Mayo, N.)
Barry, E. (Cork, S.)	Jones, Wm. (Carnarvonshire)	O'Mara, James
Bell, Richard	Jordan, Jeremiah	O'Shaughnessy, P. J.
Blake, Edward	Joyce, Michael	O'Shee, James John
Boland, John	Kennedy, Patrick James	Philipps, John Wynford
Boyle, James	Lambert, George	Power, Patrick Joseph
Cameron, Robert	Layland-Barratt, Francis	Reddy, M.
Campbell, John (Armagh, S.)	Leamy, Edmund	Redmond, J. E. (Waterford)
Clancy, John Joseph	Levy, Maurice	Redmond, William (Clare)
Cogan, Denis J.	Lundon, W.	Roberts, John H. (Denbighs.)
Condon, Thomas Joseph	MacDonnell, Dr. Mark A.	Roche, John
Crean, Eugene	M'Neill, John Gordon Swift	Shaw, Charles E. (Stafford)
Cullinan, J.	M'Dermott, Patrick	Soares, Ernest J.
Daly, James	M'Govern, T.	Sullivan, Donal
Delany, William	M'Killop, W. (Sligo, North)	Tennant, Harold John
Dillon, John	M'Laren, Charles Benjamin	Thompson, E. C. (Monaghan, N.
Doogan, P. C.	Minch, Matthews	Tully, Jasper
Douglas, Chas. M. (Lanark)	Mooney, John J.	Wallace, Robert
Duffy, William J.	Morgan, J. L. (Carmarthen)	White, Patrick (Meath, N.)
Farrell, James Patrick	Murnaghan, George	Whiteley, G. (York, W. R.)
Kenwick, Charles	Murphy, J.	Wilson, John (Durham, Mid.)
Field, William	Nannetti, Joseph P.	Young, Samuel (Cavan, East)
Flynn, James Christopher	Nolan, Col. J. P. (Galway, N.	Yoxall, James Henry
Gilhooly, James	Nolan, Joseph (Louth, South)
Goddard, Daniel Ford	O'Brien, James F. X. (Cork)	TELLERS FOR THE NOES—
Hammond, John	O'Brien, K. (Tipperary, Mid)	Sir Thomas Esmonde and Mr. Patrick O'Brien.
Harrington, Timothy	O'Brien, P. J (Tipperary, N.)
Hayden, John Patrick	O'Connor, Jas. (Wicklow, W.)

Main question, as amended, put, and agreed to.

And, it being after ten minutes to Seven of the clock, the Chairman left the Chair to make his Report to the House.

Resolution to be reported to-morrow; Committee to sit again to-morrow.