HC Deb 29 April 1909 vol 4 cc502-3

I now come—and I trust that the Committee will not think that I have delayed too long—to the most interesting and the most difficult part of my task, the explanation of the various proposals for fresh taxation which I have to lay before them. I think it will be to the convenience of the Committee if I deal first with motor cars, and so dispose at once of a source of revenue from which, as I have explained, I, as Chancellor of the Exchequer, shall derive no advantage. In Great Britain, private cars, as distinct from hackney carriages (i.e., taxicabs and motor omnibuses) at present pay £2 2s. carriage tax if under one ton in weight, with an additional £2 2s. if between one and two tons in weight, and an additional £3 3s. if between two and three tons, while motor-cycles pay 15s. In Ireland there is at present no tax on motor- cars. I propose to remove that Irish grievance. These duties brought in for the year 1908–9 the sum of £150,569.

I propose to substitute for this a new and increased scale, with graduations, which will come into force next January, for the whole of the United Kingdom, and I have decided to base the scale on the power of the cars and not on the weight. The horse-power will be determined in accordance with regulations made by the Treasury, and in the case of petrol cars with reference to the bore of the cylinders. It will no doubt be somewhat more difficult to ascertain the power than it is to ascertain the weight, but I believe that the plan I am adopting will be on the whole the fairest method of distributing the tax.

The scale I propose will be as follows:—

Under 6½ horse-power, tax £2 2s.
Under 12 horse-power, tax £3 3s.
Under 16 horse-power, tax £4 4s.
Under 26 horse-power, tax £6 £6
Under 33 horse-power, tax £8 8s.
Under 40 horse-power, tax £10 10s.
Under 60 horse-power, tax £21 0s.
Above 60 horse-power, tax £42 0s.

It will be seen that the tax rises rapidly when we get to cars over 40 horse-power—a provision with which I think the Committee will not quarrel.

Doctors' cars I propose to charge at one-half these rates.

Motor cycles I would charge at the uniform rate of £1.

No additional duties will be placed on hackney carriages, and the existing exemptions to trade vehicles will be continued. The new duties on private cars and motor cycles I estimate to yield, in the aggregate, this year £410,000, or an increase of £260,000 over last year's figures; but such an estimate must be to a large extent guess-work, for, though I am able to say with fair certainty that the number of private cars is about 55,000 and of motor cycles 40,000, the number of the former in each category of power is of course entirely a matter of conjecture. I need hardly say that, in accordance with the Prime Minister's undertaking in ids Budget Speech in 1907, arrangements will be made so that the local authorities will continue to obtain a sum equivalent to the old duties.