§ I now come to a second proposal that I have to make in this connection. I have already explained to the Committee that one of the chief reasons for imposing additional taxation on motor cars is the fact that the increase in their numbers necessitates a reorganisation of our main-road system, and it will be obvious that, were I to confine taxation to a mere re-adjustment of the scale of licence duties, the burden would be imposed with absolutely no relation to the extent that the car might use the roads. Some cars are out four or five hours a day all the year round, others are used but rarely, and I believe that, were I to obtain anything like adequate contribution from motor cars entirely by direct taxation, I might hinder to some extent the development of the motor industry by discouraging persons from keeping a motor, or an additional motor, should they only want it for occasional use.
§ I, therefore, propose to put a tax of 3d. per gallon on all petrol used for motor vehicles. This small tax, very small compared with what hon. Gentlemen would have to pay if they were motoring in France, where they would be compelled to pay 1s. 8d.—[HON. MEMBERS: "They have got protection," and "No, no."] I worked it out, and the hon. Member is absolutely wrong. It varies very much, but in the principal towns you also pay an octroi duty. This small tax will fall on motorists in proportion both to the distance travelled and also to the power of the car, for the Committee knows that a high-powered car will consume considerably more petrol per mile run. In order to meet the case of commercial vehicles and vehicles such as motor cabs and omnibuses which will not perhaps profit to so great an extent by the improvement in our roads, I propose to give a rebate of half the duty on the quantity consumed in their propulsion. There will, of course, be a rebate of the whole duty on petrol used for all purposes other than propelling motor cars—though the amount used for such other purposes is comparatively small.
§ I estimate the yield of this tax to be about £340,000 for the 11 months of the current financial year, and to be about £375,000 for a full year. The total sum, therefore, available for that part of my development scheme which bears on road improvement from these two sources (after allowing for the payment to the local authorities of a sum equivalent 505 to the old licence duties) will be some £600,000—a figure which should rapidly increase in succeeding years. I propose that the proceeds of these duties should be issued from the Exchequer to a separate account under statutory arrangements similar to those applicable to the estate duties grant, and the local taxation grant. Now that disposes of motors, and gets them out of the road.