MR. JAMES LOWTHER (Kent, Thanet)complained that the Resolution was not on the Paper, and condemned the singular want of proper arrangements for debating finance, the main business of the House of Commons. They had recently been informed that no general discussion could take place at that stage on the Budget scheme. Two or three years ago he made a suggestion, which was understood at the time to be accepted by the Government, that the first Resolution should be passed pro forma on the night of the introduction of the Budget and that the general debate should take place on a subsequent Resolution. The Prime Minister appeared at the time to approve the suggestion, and although some difference of opinion had since arisen he would mention that the right hon. Gentleman the Member for West Monmouthshire, for one, held that a promise had been given that this course should be adopted in the future. The promise, however, had not been fulfilled, and considerable inconvenience was the result on the present occasion. He trusted that another year the arrangement he had indicated would be established; that the Resolution required to complete the proceedings on the first night should be treated as a formality, and that a general debate on the principle of the 429 Budget should be allowed on a later Resolution. It was hardly treating the House with that consideration which ought to be displayed towards the representatives of the people to call on it to consider these Resolutions without a preliminary discussion on the Budget scheme as a whole. The main function of the House of Commons was to deal with the finances of the country, and that work ought not to be scamped; they ought to have ample scope for discussion all round. There was, he believed, a Resolution to come on later which would afford an opportunity of discussing the general finance of the Budget, but it would be inconvenient to take the debate on that, as he did not wish to anticipate the representations which were to be made to the Prime Minister with regard to one of the sensational features of what he could not help calling an unfortunate Budget.
§ THE CHANCELLOR OF THE EXCHEQUER (Mr. RITCHIE,) Croydonsaid he was not sufficiently familiar with the circumstances which had been alluded to by his right hon. friend to be able to say whether there was an undertaking or quasi promise as to the arrangements for debating the Budget. He understood that the general debate was usually taken on the first Resolution, and if it was the general opinion that the discussion could be concluded on the first night it could not be carried over by agreement. No such general feeling had been expressed on the first night, when the first Resolution was disposed of. The discussion of the other Resolutions must be germane to their subject matter, and therefore he was afraid that the discussion desired by his right hon. friend could not proceed at that stage, but he would remind the House that an opportunity for general debate would be again afforded on the Second Reading of the Finance Bill.
§ MR. JOSEPH WALTON (Yorkshire, W.R., Barnsley)Will ample time be given for it?
§ MR. RITCHIEI do not suppose that any Government would desire to curtail any opportunity, which hon. Gentlemen desire, to discuss such an important question as their financial proposals. As 430 the hon. Member knows the proposals before the Committee are provisional, and when the House adopts them it does not in any way prejudge the course it may choose to take when the Finance Bill comes on.
§ SIR JOHN GORST (Cambridge University)wished to associate himself with what had fallen from the right hon. Gentleman the Member for Thanet in objecting to the method of discussing financial questions which seemed to have grown up during the last two or three years. Formerly, when the Chancellor of the Exchequer introduced his Budget, no financier of any reputation thought of discussing it on the night of its introduction. Only formal remarks were made or questions asked on that night, the general discussion being reserved for Committee of Ways and Means. Now the Chancellor of the Exchequer said that general discussion could only be taken on the Second Reading of the Bill, and as debate on the Second Reading was restricted and entirely different from the free and useful manner in which discussions were conducted in Committee of Ways and Means, he objected to the House being deprived of an ancient privilege. The effect of discussion in Committee of Ways and Means was that the Government sometimes modified its proposals before the Budget Bill was introduced. He did not suppose that there was any prospect of a modification of the present scheme of the Chancellor of the Exchequer, but he must protest against the House being deprived of the opportunity it formerly enjoyed of discussing in an informal manner in Committee of Ways and Means the financial proposals of the Government.
§ SIR HENRY FOWLER (Wolverhampton, E.)said he too wished to associate himself with the protests of the two right hon. Gentlemen who had spoken against this departure from the invariable rule of the House in the case of the Budget. In his opinion it was due to the mistake that had been made of allowing the first Resolution to be taken the night of the introduction of the Budget. Mr. Gladstone was always hostile to any general discussion of the Budget on the night of its introduction; he always 431 reserved his opinion for the subsequent stage in Ways and Means. The first Resolution was, as a matter of form, allowed to be carried the first night, when new taxation was imposed, in order to protect the revenue; but in this instance the Chancellor of the Exchequer was in the position of not having to impose new taxation, and therefore it was not necessary to carry the first Resolution on the first night. The right hon. Gentleman, however, proposed the renewal of the Tea Duty. There was a very thin House and not a very full debate, and he was sorry a division was taken. He trusted that the present practice would not be quoted as a precedent, and that in future the House would, apart from the debate on the first night, have the fullest opportunity of discussing in Committee of Ways and Means the Budget proposals as a whole. In future they ought not to pass any Resolution on the first night excepting those imposing new taxation, which might be required for the protection of the revenue.
MR. GIBSON BOWLES (Lynn Regis)insisted on the great importance of the House retaining its right to discuss the Budget as a whole in Committee of Ways and Means, as such discussions were usually very fruitful of suggestions. The most important feature of this year's Budget was the remission of the Corn Tax. As that was not embodied in a Resolution it could not now be discussed in Ways and Means, but must be reserved for the Second Reading, when it would be mixed up with other questions in a single speech debate. That, he submitted, was a most unsatisfactory state of things.
§ MR. BLAKE (Longford, S.)thought this was really an important question with reference to the efficient conduct of the business of the House. It was of the utmost consequence that they should have a general debate on the Budget under circumstances which permitted freedom and frequency of speech. It was deplorable that the Government should have taken advantage of the willingness of the House to give them their first Resolution on Budget night in order to deprive it of his constitutional right to discuss the Budget as a whole, in Committee of Ways and Means. The Government were not alone to blame for this. The Opposition Leaders 432 had cast upon them an equal duty to protect the rights of the House, and they too had failed in their duty.
§ MR. RITCHIEsaid it was far from his intention, or the intention of the Government, to take any advantage of the House. He acted on Budget night according, as he thought, to precedent. He did not desire to shirk the general discussion of the Budget; on the contrary, he should have been glad if that discussion could take place in Committee of Ways and. Means. But he acknowledged that there was a good deal in the argument, and if he should have again to bring in a Budget he should take care that the House was not put into the position in which, to his regret, it now found itself.
§ SIR H. CAMPBELL-BANNERMAN (Stirling Burghs)said it was clear that the House, for one reason or another, had been deprived of the opportunity of discussing the Budget generally in Committee of Ways and Means, and he understood the right hon. Gentleman to agree that it was not desirable there should be any restriction on the facilities given to the House for such a debate. They might, therefore, hope that on the many other occasions on which the right hon. Gentleman might have to impose or abolish taxes, he would see that the House did not lose its opportunity as had been the case this year. He desired particularly to refer to the absurd system of inviting the House to agree to Resolutions which they had never seen. He had protested against it again and again, and had never been able to understand what the raison d'être of that extraordinary practice was. These was no blame attaching to the right hon. Gentleman, because it had been the universal practice.
§ SIR H. CAMPBELL-BANNERMANsaid he could not go back to the prehistoric times to which the experience of the hon. Member extended. He remembered only about thirty five years. His remarks applied to all Resolutions upon which Bills were to be founded. Long and elaborate Resolutions were 433 read hurriedly from the Chair, to which the House was invited to say "Aye" or "No." One could perfectly understand the necessity of withholding from publication a Resolution for a new tax, which it was necessary to keep dark until the Budget had been announced. There could be no possible objection to that; but as to the other matters, as the right hon. Gentleman seemed to be in a reasonable and improving turn of mind, he hoped he would let the Committee know why such proceedings could not be altered, so that the House of Commons should not be invited to agree to a Resolution of which it was entirely ignorant until it was read from the Table. The Chancellor of the Exchequer had met the Committee very well with regard to Budgets of the future. It might be said that it was an easy thing to give away the Budget arrangements of the future in order to facilitate the Budget arrangements for the present year. But whether easy or not it was a gracious and kindly thing, and for his part he was indebted to the right hon. Gentleman.
§ MR. JOSEPH WALTONreminded the Chancellor of the Exchequer that last year the necessary Resolutions were taken on the Budget night, on the distinct understanding that the general discussion should be allowed when the Income Tax Resolution was proposed, and he asked whether there was anything to prevent a similar course being adopted on the present occasion.
§ MR. RITCHIEsaid that that was really not in his hands at all.
MR. JAMES LOWTHERsaid the right hon. Gentleman had met the Committee in a very reasonable spirit, and as far as he was concerned he would take no further steps in the matter.
§ MR. LOUGH (Islington, W.)said that the Chairman, as well as the Speaker, had often permitted discussions when the Chancellor of the Exchequer, or the Leader of the House had said that a certain course might be for the general convenience. The point raised by the hon. Member for Barnsley was well worthy of consideration, and he hoped 434 it was not too late to adopt the course he had suggested.
THE CHAIRMANNo general discussion is permissible on this Resolution. The ordinary rule of the House is that the discussion must be relevant to the Motion before it. There are certain exceptions to that rule. One exception is in the case of the first Budget Resolution, the second is the first Vote for Army Services, and the third the first Vote for Navy Services. With those three exceptions all debate must be relevant to the subject-matter proposed from the Chair. It has happened in the past, when the general discussion has not been concluded on the first night, that, by a general arrangement—the consent of the Chair not being withheld—the discussion has been postponed, and taken on the second, third, or any other of the Resolutions. Of course that is by general arrangement made during the discussion of the first Resolution. Unless that general arrangement is made while the discussion of the first Resolution is going on, a general discussion cannot take place on any of the subsequent Resolutions.
§ MR. LOUGHsaid he did not suggest that the general discussion should be taken on the present Resolution, but some further facilities might be granted on one of the future Resolutions. He did not question the ruling of the Chair, but the Committee were always placed in this difficulty on the first night because it was necessary that one Resolution should be obtained.
THE CHAIRMANIt has been the custom to take one Resolution or more whenever a new tax was imposed. But where no new tax is imposed it is not necessary to take a Resolution. In this case the difficulty has arisen from the fact that on the first night a Resolution was taken which, strictly speaking, was not necessary, because the duty on tea would have been levied whether the Resolution was taken or not.
§ MR. LOUGHsaid that was a most important ruling, because it was suggested on the occasion in question that it was not necessary to persevere with the Resolution. In the course of the discussion 435 it had been suggested that on the Budget night no serious discussion could take place, and that all they could do was to ask a few meaningless questions. He desired to protest against such a proposition. On the occasion of the last four Budgets the proposals of the Chancellor of the Exchequer had been modified in certain important respects on the first night. He desired certain information with regard to the Resolutions now under discussion. Was it true that the increase of revenue derived during the last two or three years from tobacco, spirits, and beer had not been proportionate to the increase of the duty? Another point was why this duty was brought up annually instead of being fixed like the Sugar or Corn Duties. Had the Government some scheme up their sleeve with regard to the disposal of this revenue?
§ MR. RITCHIEsaid he had no scheme in his mind for dealing with these duties, as the hon. Member seemed to suppose. They had been annually proposed on each occasion since their imposition, and if he had introduced a Finance Bill to make them permanent he would doubtless have I met with much more difficulty than he was likely to meet with by adhering to the usual practice in this respect. As to how the revenue had been going on, he explained in his Budget speech that during last year, in consequence of the cold summer, not so much beer was drunk, and in consequence of the warm winter not so much spirits was drunk, and therefore the revenue, so far as those two articles were concerned, was not as satisfactory as could have been expected. With regard to tobacco the revenue was on the whole satisfactory.
§ SIR HENRY FOWLERasked the Chancellor of the Exchequer to give the actual figures for wines, spirits, beer, and tobacco, in accordance with the usual custom. He had been expecting the revised speech of the right hon. Gentleman, and his statement at the end showing what the taxes had produced as contrasted with previous years. His hon. friend had asked why these Resolutions were proposed annually? The reason was in order that the House of Commons might retain its control over the taxation. They were not now dealing with general 436 taxation upon spirits, beer, and tobacco, but only with the increase which was put on for the war. The Chancellor of the Exchequer had circulated a Return in which tobacco ranked amongst the articles subject to war taxation, and the amount of that taxation was put down as one of the burdens imposed upon the consumers of commodities with reference to the war. He contended that tobacco had paid no war duty at all. As a matter of fact tobacco was paying less than before the war, and when additional taxation was imposed upon tea and other articles, tobacco was practically exempted. Down to the year 1900, for more than fifty years, there had been no variation in the tax on tobacco except an increase of 4d. made in connection with the war in Europe and the East at the close of Sir Stafford Northcote's Chancellorship of the Exchequer, and which was subsequently remitted by Mr. Goschen. The fixed rate of taxation for tobacco for fifty years had been 3s. 6d. In 1898 the tax was reduced by 6d., and he thought there was no money more un fortunately spent than in that reduction, for the money was simply transferred to the trade and the consumers had no beneficial result from it. Instead of the 6d. being restored the late Chancellor of the Exchequer put on 4d., and therefore the war taxation on tobacco was 2d. less than it was the year before the war commenced. He wanted some information upon that point. The amount received from tobacco in 1898 was £11,433,000; in 1899, when the reduction took place, it went down to £10,993,000; and in 1900 it was £10,880,000. There was an enormous over-payment in the following year in anticipation of additional taxation, because it was expected that this 6d. would be restored. The amount actually paid in the year ending March 31st, 1901, was £12,838,000, and in 1902, with the additional 4d. restored, it was only £10,567,000. Therefore, to say that any taxation was being paid on account of the war was a misuse of language. He wanted the Chancellor of the Exchequer to tell the House what was the amount raised on tobacco in 1903, and then they would know where they were, for they could contrast the amount 437 of the revenue now being received from tobacco with the revenue of previous years. He thought the result would show that there had been no war taxation paid in respect of tobacco at all.
§ MR. RITCHIEthought the right hon. Gentleman would agree that it was a mistake to put additional taxation upon an article of consumption, if the effect was to decrease the consumption so as not to bring in sufficient revenue to justify it. The figures given by the right hon. Gentleman appeared to suggest that when the additional taxation was last put on it led to a considerable falling off in the revenue. He did not say that that was due to the taxation, but that the amount received after that taxation was put on, was less than the amount received before.
§ SIR HENRY FOWLERIf you put the two years together you get no change at all.
§ MR. RITCHIEsaid that at least it was suggested that there was no increase of revenue taking the two years together. He thought the Committee would see that, if so, there was clear evidence that the limit of taxation had been reached, and that it would have been a mistake to have attempted to put on any more additional taxation. If what the right hon. Gentleman had suggested were correct, it would follow that in consequence of the income not being greater than it was before, tobacco had not paid its proper share of war taxation. He really did not know how they could have endeavoured to make tobacco pay a larger sum, except by increasing the rate of taxation, and if the effect of increasing the rate reduced the consumption so as not to bring in any more than it did before, it followed however much they piled on the duty they would not get any more money.
§ SIR HENRY FOWLERI have not got the figures for 1903, which is the key to the whole position.
§ MR. RITCHIEIf the right hon. Gentleman will put a Question on the Paper I will give him the exact details.
§ MR. EDMUND ROBERTSON (Dundee)asked if the Chancellor of the Exchequer really meant that addition to the tax on tobacco resulted in a reduction of revenue.
§ MR. RITCHIEOn assumption drawn by the right hon. Gentleman from the figures given by him, it would seem that we did not get much more out of the increased taxation on tobacco than we got before it was put on.
§ SIR JOHN GORSTsaid that for many years previous to 1900 it was the general opinion of the revenue authorities that the tax on tobacco had reached its maximum, and that if they increased it they would so diminish the consumption that they would not get any more money from it. It was contended that the reduction in the consumption would be so great that it would not increase the revenue. The experience of the Customs and Inland Revenue authorities was that tobacco was an article of luxury which the mass of the population gave up in bad times. After that they cut down their expenditure upon alcohol, and the last thing they reduced their expenditure upon was tea and sugar. The experience given by the Chancellor of the Exchequer appeared to show that the view of the Revenue authorities was correct, and that tobacco had reached its maximum.
§ MR. RITCHIEI did not say that.
§ SIR JOHN GORSTsaid in 1902 the revenue was the smallest since 1898. He thought it was quite possible under these circumstances that the Chancellor of the Exchequer might obtain an increased revenue by reducing taxation on tobacco. In that way the Chancellor of the Exchequer would be gratified, and the consumer as well. They ought to put upon tobacco the precise amount of taxation which would raise the maximum of revenue.
§ MR. SYDNEY BUXTON (Tower Hamlets, Poplar)said it was very unfortunate that the Chancellor of the Exchequer had not got the figures for this year. It was quite clear that nothing at all had been produced by the 439 addition of 4d. on the Tobacco Duty. The right hon. Gentleman said that the two years should be taken together. These two years produced £23,300—an average of £11,650. The produce of the tax before the 4d. was put on was not £11,650. In 1900 it was £10,800, and in 1899 it was £11,000, so that it was quite clear that the right hon. Gentleman was mistaken in thinking that this tax produced nothing at all. On the contrary, it was very productive. It was generally admitted at the time the reduction was made that the consumer had not benefited. It was the producer and the middleman in the trade who got the benefit. He hoped the right hon. Gentleman would not leave the Committee under the impression that the addition to the tax did not produce anything. Some of them thought it would have been better to increase the tobacco duty further instead of raising the money required by taxation on corn and sugar.
§ MR. RITCHIEsaid it was a matter of interest to know what the amount of revenue raised by the duty on tobacco was. His observations on the subject were based on what had been stated by the right hon. Gentleman the Member for Wolverhampton. There was no doubt that the right hon. Gentleman the Member for Poplar had fairly stated the case. There had been an increase. The revenue from the tobacco duty in 1901 was £12,838,000; in 1902, £10,567,000, and in 1903, £12,443,000. The estimate for 1904 was £12,500,000.
MR. GIBSON BOWLES (Lynn Regis)said this was a very important matter. What they were now discussing was really whether these additional taxes they were now asked to vote were justified by the return from them. That turned on the question whether they had brought about an increase or a decrease of the revenue. He agreed with the right hon. Gentleman the Member for Wolverhampton that there had been a decrease as the result of the additional duty. In 1901 the yield was £12,838,000, and in the next year, when the duty was in fuller operation, it was £10,567,000. Although it was true that 440 in 1903 it was £12,443,000, it was less than in 1900–01. As for the estimate for the year on which they had entered, his opinion was that all the estimates were a bit too high. It seemed to him, from the figures, that the return, in spite of the extra duty imposed, showed a decrease. The doctrine which the right hon. Gentleman had preached was one that had stood the test of experience, and it was also the doctrine of Adam Smith and other economists. There was a point beyond which, if duties were raised, they got a smaller and not a larger amount of revenue. It encouraged smuggling and diminished consumption, and it was a very grave question for the Committee whether these extra duties ought not to be abolished in the interest of the revenue. The Chancellor of the Exchequer by his own figures had made out a strong case for taking that course. He should view with regret the abolition of any of the annual duties. This was one of the occasions on which they could call attention to the burdens which were imposed annually. Those taxes which were imposed permanently by Act of Parliament entirely escaped the notice of the House of Commons. They remained, whatever the people or their representatives might say. The other and the more constitutional method of imposing additional taxation was the annual method, but it was the permanent method that had received the patronage of the Treasury Bench. The proportion of our revenue raised by permanent imposts on the people, and which was incapable of being changed except by Act of Parliament, was two-thirds, and only one-third was raised by the constitutional method of voting taxes for one year. The effect this year, in consequence of the remission of the Corn Tax and the large amount taken off the Income Tax, which was an annual tax, would be that the proportion of annual taxes would be very much reduced, and instead of there being only one-third there would be considerably less, and the result was pro tanto to diminish the power and influence of the House of Commons. If it were true that the effect of the additional duty on tobacco was not to increase but to diminish the revenue, it certainly 441 would be better to withdraw that portion of the duty. The consumer would like it better, and the Chancellor of the Exchequer would get more out of it. He did not think the Committee should pass the Resolution without being satisfied as to what was the true view on that point. What he had said was true also of beer and spirits. He suggested that the Chancellor of the Exchequer, having given the Committee somewhat tardily the figures in regard to tobacco, should now proceed to give the figures in regard to beer and spirits, so that they might know whether the additional taxes had resulted in an increase or decrease of the revenue.
§ MR. GROVES (Salford, S.)said that large quantities of tobacco had been withdrawn from bond in the earlier year referred to in anticipation of the duty being increased. When the increase had been put on, the dealer reversed his policy and took the smallest quantity he could out of bond and held the smallest stock possible in anticipation of a reduction of duty the following year. He thought that was the real solution of the question. The same reasoning applied to spirits. In that case there was a rush in the earlier year to take increased quantities of spirits out of bond. They had now arrived at a time when spirits and beer could no longer be subjected to an increase of duty. The figures showed that they had been taxed up to, and beyond the amount they ought to bear. The late Chancellor of the Exchequer made certain pledges in the House in regard to those articles, and he thought the present Chancellor ought to be reminded of them plainly and clearly, at a time when he had a large surplus and when he was giving a greater reduction of the Income Tax than anyone in the House or out of it anticipated. They looked for an early redemption of the pledges referred to.
§ MR. LOUGHsaid the right hon. Gentleman the Member for Wolverhampton had reminded the Committee of the reduction of the Tobacco Duty in 1898, but he did not mention a most important fact in connection 442 with that, namely, that the quantity of moisture allowed in tobacco was reduced at the same time. It was said that the yield of the duty would be reduced one-seventh, but it only fell from 11.4 millions to 10.8 millions, so that really the reduction which took place was very slight indeed. The 3s. duty, with the small proportion of moisture, was almost as productive as the 3s. 6d. duty had been. He thought the hon. Member for Lynn Regis had fallen into a mistake in supposing that the 3s. 4d. duty had not realised more revenue. As a matter of fact the revenue had gone up £1,000,000. He was sorry to fall foul of his right hon. friend the Member for Cambridge University for stating that tobacco was a luxury which could be sacrificed. The right hon. Gentleman had stated the view which was largely held in England. But in a country like Ireland, where a great many people consumed no butcher's meat from one year's end to the other, tobacco occupied a different position in the dietary of the people. It was held by many to be a necessity, or, at any rate, it was held to be one of the articles of consumption on which the people could starve better than on any other. In the West of Ireland, when the people, and especially old women, had no dinner at all, they preferred half-a-pipe of tobacco to what would appear to them a luxurious meal. When the Chancellor of the Exchequer reduced the duty in 1898 it was done as a concession to Ireland, and but for the alteration made at the same time in regard to the moisture it would have been a substantial concession. But the English were quite different. They could never tax these two peoples alike with fairness in regard to certain articles. Tobacco was the standard article which illustrated that principle. Until the two Exchequers were amalgamated the duty levied on tobacco in Ireland was never heavier than 1s. per lb. But it was quite different in England, where almost since the year 1800 the Tobacco Duty ranged from 3s. up to 4s. per lb., and yet that high duty had been borne by the people in this country without the slightest murmur and without any sense of oppression in it. That was a point the Chancellor of the Exchequer ought to bear in mind in a debate of this kind. He hoped the Chancellor of the Exchequer would 443 send for the other figures, as the right hon. Gentleman had got the tobacco figures readily enough. They did not pay sufficient attention to the exactions they took out of the people on whatever pretext. They ought to look carefully at them, because every million they took from the people, in taxation tended to poverty. Therefore, they ought to hear what these new and heavier taxes had produced, and whether they had produced revenue in proportion to their increased rate.
§ MR. DAVID MACIVER (Liverpool, Kirkdale)said he altogether dissented from the proposition that the right way of dealing with the Tobacco Tax was to put it at the highest figure possible. He agreed very much with the last speaker in regard to Ireland, and the use of tobacco by the poorer classes of that country, but he thought the hon. Gentleman underrated the extent to which tobacco was used almost as a necessity by working people in this country. He maintained that the great bulk of the Tobacco Tax was borne by the working people, and that it was in fact a tax upon the poorer classes, who ought not to be taxed in that way. Perhaps the Committee, as a whole, did not appreciate how enormous that Tobacco Tax really was. Liverpool was the principal port for dealing with tobacco in this country, and the port where it was bonded and whence it was distributed. There was in Liverpool at that moment tobacco of the actual value, without the duty, of about £5,000,000. The duty on that tobacco, if it was paid now upon the basis of the Resolution before the Committee, would come to about £16,000,000. That was to say the duty on the tobacco in Liverpool now was rather more than three times the actual value of the article. That was a very tremendous tax upon what was, whether treated as a luxury or a necessity, very essential to large numbers of our working classes. It was somewhat inconvenient that those Resolutions should be before the House by word of mouth. If he had the Resolution in printed form he would be very much inclined to put down an Amendment, but any one moving a Resolution which did not appear on the Paper had not got the same chance of that Amendment receiving fair consideration as if 444 Members knew beforehand what was likely to be brought forward.
§ MR. RITCHIEYou can move an Amendment, if you care to, on the Finance Bill.
§ MR. DAVID MACIVERsaid that would deal with other subjects, but he was now talking of the particular Resolution before the Committee. He would wish, further, to point out that tobacco was, to an increasing extent, the production of our own colonies, and it seemed to him that it was highly undesirable that those colonies should have the tobacco they grew taxed to anything like the amount of three times its value. He wished to reiterate his entire dissent from the proposition that the proper way of dealing with that tax was to put it up to the highest possible amount, and to express the belief that they ought rather to consider the well-being of the masses of the people and not unreasonably to tax their luxuries.
§ MR. WILLIAM REDMOND (Clare, E.)said that when the Tobacco Duty was increased during the war objection was raised to it on behalf of the Irish people by the Irish Members, and in the course of the debate it came out that some experiments were being made under the auspices of the new Agriculture Department in Ireland in tobacco growing. The late Chancellor of the Exchequer made the interesting statement that, if these experiments were a success, he could hold out the hope, or assurance he thought it was, that no difficulty would be placed by the Government in the way of tobacco growing in Ireland. At present it was illegal to grow tobacco in Ireland, and what he wanted to ask the present Chancellor of the Exchequer was whether he shared the view of his predecessor on that matter and would repeat his assurance that all legal difficulty in the way of; tobacco growing in Ireland would be removed. He understood that the experiments had been a success. He had had some samples of Irish-grown tobacco sent him by a gentleman in County Meath interested in the subject, and had placed them on exhibition in the smoking room. He believed the tobacco was 445 greatly admired, and that some hon. Members even went the length of trying to smoke it—but he did not know with what result. At any rate, there was sufficient evidence to show that there was something in this tobacco growing in Ireland. He was entirely in agreement with what had been said by the hon. Member for Islington in regard to the pressure of the increased duty on tobacco on the Irish people. There was no doubt it could be very easily shown that the increased duty was felt in Ireland in greater proportion than in this country, and that for many reasons. He remembered pointing out, when the increase of duty was first proposed, that the increase on the ordinary tobacco was altogether out of proportion to the increase on expensive cigars. The increase on the common tobacco used by the masses of the people was very serious, whereas the increase on expensive cigars was a very small matter to those who smoked them. He asked the Chancellor of the Exchequer if he could not make any alteration this year, whether he would not consider before next year that it would be a just, fair, and paying thing to put a greater tax than existed at present upon expensive foreign manufactured tobacco, and to some extent ease the expense of the common tobacco used by the working classes He believed that more shilling cigars were sold in the House than any other kind, and he thought, that people who consume a shilling or one and sixpence worth of tobacco in five or six minutes ought to be compelled to pay a great deal more in proportion than the working classes. He noticed that the hon. Member for Tyrone was laughing. He did not know whether the hon. Gentleman smoked, although he knew that he did not do anything else that was bad. What he said, however, was perfectly true; and a working man whom they might meet going home from his work smoking his clay pipe, paid a great deal more on account of this increased taxation than the hon. Gentleman who went into the smoking room and smoked the most expensive cigars. The Chancellor of the Exchequer might think that this was not a very serious matter, but, as a matter of fact, it was; and he asked the Chancellor of the Exchequer whether he could not hold out some hope of increasing the duty on foreign cigars and tobacco 446 manufactured abroad, and give relief to the ordinary tobacco manufactured in this country, and used by the masses of the people.
SIR W. CUTHBERT QUIETER (Suffolk, Sudbury)said he wished the Chancellor of the Exchequer to give his opinion whether the high rate of duty on beer and spirits had to any extent deteriorated the quality of these articles. He had heard it stated that every rise in the duty on spirits had a serious effect on the linings of the stomachs of His Majesty's lieges. That might or might not be so, but, anyhow, some years ago the Government appointed a Committee on poisons, which, for some unaccountable reason, had not yet made its final report, although the public were awaiting it with great interest. Pending its presentation, the Government might be prepared to take some action on this most important matter. He understood that the last rise in the Beer Duty had not been productive of very much extra revenue to His Majesty's Treasury, while he feared that it had been accompanied by a deterioration in the class of materials employed in the manufacture of the national beverage. He hoped that the Chancellor of the Exchequer, if he had any information on the subject, would give it to the Committee.
§ MR. FIELD (Dublin, St. Patrick)said he wished to point out that the high duty on tobacco was very oppressive, and he hoped the right hon. Gentleman would take into consideration the representations which had been submitted to him by Messrs. Good body and other manufacturers. As the right hon. Gentleman was aware, there was a certain amount of rivalry between English and Irish tobaccos and American tobaccos, and steps ought to be taken to preserve the home industry as far as possible.
§ MR. COURTENAY WARNER (Staffordshire, Lichfield)said he desired to press on the Chancellor of the Exchequer, not for this year but for some future year, the suggestion of the hon. Member for East Clare—viz., that the more expensive kinds of tobacco ought to pay a proportionate duty in order that the duty might not be paid mainly, as it 447 was at present, by the working classes. He hoped that the duty would in future years be made ad valorem. Tobacco was now almost a necessity, and he hoped something would be done to make it fall equally on all classes.
§ MR. PIKE PEASE (Darlington)asked if the right hon. Gentleman could state what was the amount of revenue received from the tax on tobacco and also on cigars.
§ MR. RITCHIEsaid he could not answer that. The hon. Gentleman opposite asked whether he was prepared to endorse what his right hon. friend, the late Chancellor of the Exchequer had said with regard to growing tobacco in Ireland. He should like to see what his right hon. friend had said before he said whether he would endorse it or not. On general principles, however, he thought the whole House would be glad if another industry arose in Ireland which would be profitable to the country and to the growers. He could assure the hon. Gentleman that he would regard it with the greatest favour, and render every assistance in his power to the development of any such industry. The hon. Gentleman said that hon. Members had consumed some of this tobacco in the smoking-room, but he did not say what the result was. He hoped it was satisfactory.
§ MR. WILLIAM REDMONDThey were all returned at the last General Election.
§ MR. RITCHIEsaid he would have to know the political views of the hon. Gentlemen before he could accept that as a good argument for doing what the hon. Gentleman desired. The matter was, however, one of very great importance to Ireland, and he could readily understand the hon. Gentleman pressing the same view now as he pressed on his right hon. friend. As far as he was concerned, he would have the greatest pleasure in assisting to develop the industry and in giving it every possible encouragement. 448 With regard to moisture, he had received two deputations on the subject, each representing tobacco dealers. The result was very satisfactory; because while one deputation urged that less moisture ought to be allowed, the other referred to the great advantage of more moisture. Putting the two views together, he came to the conclusion that the House had in all probability struck the happy mean, and that, he thought, was a sufficient reason why he did not attempt to deal with a thorny subject which was a matter of contention between one class of manufacturers and another. His hon. friend had stated that his right hon. friend had given some pledge in connection with the duty on tobacco manufactured in this country and the duty on imported cigars. No doubt there was a great deal of difference between the duties, and he believed it had formed the subject of considerable consideration; but no means had been found by which an ad valorem duty could be imposed, without great disadvantage. No doubt the working classes enjoyed a pipe of tobacco, and he would be very glad if they could have it at the cheapest possible rate, but taxation must be raised somehow. Taxation was never popular, and if the working classes did pay a little more for their tobacco because of the great additional cost which had fallen on the country in connection with the war, and the large expenditure the country had to make for its defensive forces, for education, and other matters, he did not believe that they grudged it. If the additional amount of taxation on tobacco was compared with the wages earned by the working classes it would be found to be really very small. His hon. friend spoke of the pledge given by his predecessor with regard to the additional taxation on beers and spirits; and he said justly, that his right hon. friend did hold out hopes that this additional taxation would be more or less of a temporary character, and that he would be glad when the opportunity arose to deal with it. That was perfectly true. His right hon. friend did use an expression of that kind, but he was sure his hon. friend would agree that when his right hon. friend was speaking about 449 these duties he was also speaking about the increased duties on commodities in general, and not specially about beer and tobacco, although undoubtedly he did mention them along with the other taxes imposed for the war. But his hon. friend would hardly expect on the first occasion on which taxation was taken off that he should deal with the commodities mentioned. He could not admit that the additional taxation had fallen wholly on the dealers in beer and spirits. No doubt some portion of the taxation might have fallen on the dealers, but he imagined that the great bulk of it had fallen on the consumers in one form or another, either by an increase in price or, if not that, by slightly reducing the strength of the commodities. His hon. friend might deprecate that reduction, but he himself did not think that the consumer was very much worse off. He thought he had now answered all the questions that had been put.
§ MR. RITCHIEsaid he would be glad to answer that if a Question were put on the Paper.
§ MR. LAMBERT (Devonshire, South Molton)asked if the right hon. Gentleman could exercise any differentiation in regard to the duty on cigarettes. Too many cigarettes were being smoked. He had seen at every turn in London small boys of eight or ten years old smoking cigarettes; and even in Devonshire boys were following that pernicious example. If the right hon. Gentleman could, by some means or other, differentiate the duty and put a higher rate on cigarettes it would be very desirable. They had heard that the stamina of the British race was decreasing very rapidly. He did not take that very seriously; still, cigarette-smoking did not do boys any good, and if the right hon. Gentleman could stop the habit it would be much to the good of the country.
§ 1. Resolved, That the Additional Customs Duties on tobacco, beer, and spirits imposed by sections two, three, four, and five of the Finance Act, 1900 (including any increased Duties imposed by section five of that Act), shall continue 450 to be charged until the first day of August, nineteen hundred and four.—(Mr. Chancellor of the Exchequer.)