HC Deb 20 July 1909 vol 8 cc461-93

(1) Reversion Duty shall be recoverable from any lessor to whom any benefit accrues from the determination of a lease as a debt due to His Majesty.

(2) Every lessor shall, on the determination of a lease on the determination of which Reversion Duty is payable under this section, deliver an account to the Commissioners setting forth the particulars of the land and the value of the benefit accruing to the lessor by the determination of the lease.

(3) If any person who is under an obligation to deliver an account under this section fails to deliver such an account, he shall be liable to pay to His Majesty a sum equal to 10 per cent, upon the amount of any duty payable under this section, and a like penalty for every month after the first month during which the failure continues.

(4) Section 17 of the Customs and Inland Revenue Act, 1885 (which relates to the power to assess duty according to accounts rendered, and to obtain other accounts), shall apply with respect to any account delivered under this section (with the exception of any provisions relating to appeals).

Mr. JAMES MASON moved in section (1) after the word "recoverable" ["(1) Reversion Duty shall be recoverable"] to insert the words "within twelve calendar months after the determination of any lease or upon the release, transfer or occupation of the land."

The object of the Amendment is twofold. Firstly, to avoid making the owner of a reversion pay the duty before he actually gets some benefit from it. The clause will read, "Reversion Duty shall be recoverable within twelve calendar months after the determination of any lease or upon the release, transfer or occupation of the land." This means that in a case in which there is a release or a sale the owner should have the advantage of paying the duty only when he gets some benefit from that release or sale. I have inserted the words, "twelve calendar months," to provide for the possibility of the property remaining in his hands and his being unable to sell or release it.

Sir W. ROBSON

Is this Amendment in order on this clause? The hon. Member is moving that the Reversion Duty shall be recovered within twelve calendar months after the determination of the lease. It has been decided in Clause 7 that "On the determination of any lease of land there shall be charged, levied and paid" a Reversion Duty. Does not the Amendment raise a point already adjudicated upon?

Mr. PRETYMAN

This very Amendment was moved in Clause 7, and my hon. Friend was referred to Clause 9 by the Chairman.

The DEPUTY-CHAIRMAN (Mr. Caldwell)

The Amendment is in order.

Mr. JAMES MASON

The Amendment would also allow you to decide on the amount of duty chargeable in an actual fact, namely, on the actual sale or release, instead of basing the duty purely upon an estimate. If you compare the first part of the clause with the second you will find that the lessor is bound on the determination of a lease to deliver an account to the Commissioners of the value of the benefit accruing to him. Unless you allow him to wait till he has re-let or sold the property it will be extremely difficult for him to estimate the value of the reversion when he has derived no benefit from it. If he is going to occupy the property himself or holds it unoccupied the time limit is necessary because the duty will have to be estimated in such a case. My object is to secure that where there is a re-let or sale he should pay duty on the actual fact and not on the estimate.

Sir W. ROBSON

Surely the convenient time to make collection of the duty is on the determination of the lease. There seems to be no reason at all why twelve months should be allowed during which the duty is to be in suspense, or until it is seen whether the lessor succeeds in re-letting. Of course, if he does succeed in re-letting that is a factor which will be taken into consideration, and it will help the Commissioners in estimating the value, but it is clearly not right that the Commissioners should wait for any event of that kind. I imagine that in the case of most leases where any industry is being carried on on the property leased, the landlord will have foreseen the determination of the lease and provided himself with a fresh lessee, so there is not likely to be any delay. Unless the lessor is ready to enter and carry on business himself he will have a lessee ready.

Mr. WATSON RUTHERFORD

The learned Attorney-General has pointed out with great force that when this unfortunate man has to pay the duty is when he can get something out of which he can pay it. But the time of the determination of the lease is the moment when his property is empty and he is getting no return. He says: "There is somebody who can pay a tax. His house is empty; he is not coming in; now is the time to make him pay."

Viscount CASTLEREAGH

The learned Attorney-General can hardly have considered the case put forward. He says the question will be in suspense for a year. It will not be in suspense at all. It will be known as perfectly as the duty will be. My hon. Friend (Mr. James Mason) desires that the payment shall be left over for a year until the lessor has some money to make it. The duty is payable on capital value. It may be a very heavy sum. The Amendment can very well be accepted without injuring the Bill at all.

Mr. PRETYMAN

The Amendment has real substance in it, although it is a small point, and I do not think it should be passed over in the light and airy way in which the learned Attorney-General has dealt with it. We must go back to the point that the Reversion Duty may turn out to be an enormous tax. You are not levying the duty upon the annual accrued value which the person, subject to the tax, has always known he will be liable to; you are coining down upon existing property which may fall in next year, or the year after, in the case of a lease which has existed for 99 years, and which was created in the last century when property had a very different value. You are going to impose upon the small owner a crushing burden at a time when he may have no assets whatever. You may have a property falling in which on paper shows that he receives a valuable reversion. But, in fact, until he has realised that benefit he has no money with which to pay the tax, and he cannot realise the benefit unless he occupies the property himself, if he can afford to do it, or unless he has renewed the lease or transfer. The Amendment does not alter the incidence of the tax. We agree that it must be assessed at the time the lease is determined.

That has already been settled by the Committee. This Amendment does not propose to go back on that at all. It merely says that the duty having been assessed, as it must be at the time the lease determines, where the owner has no realised assets with which to pay the tax, and the tax being enormously heavy, he should have twelve months as a maximum time, or a lesser period if he succeeds in re-leasing the property, either by re-letting or selling, in which to pay. I cannot see on what possible grounds the Government can see their way to refuse the Amendment.

Sir W. ROBSON

I think the hon. and gallant Member overlooks the consideration to which I drew the attention of the Committee. After all, the reversioner knows when the lease is going to determine, and he has ample time to make arrangements for the releasing of his property, or, if necessary, to put himself in funds for the payment of the tax. We are bound to assume that he will adopt ordinary business precautions. Either he will or will not have money available to pay the tax, and if he finds that he has not then he must make arrangements.

Mr. PRETYMAN

The learned Attorney-General's objection is not one of substance. It is only in cases where the owner does not succeed in effecting a transfer immediately, and has no funds to pay the duty, that it is suggested this time to pay should be allowed.

Mr. JOYNSON-HICKS

The Attorney-General's argument seemed to me to be based on the fallacy or supposition that lessees are like blackberries, and that the owner can pick them off the first bush. He assumes that every landlord knowing a lease is going to determine will find it possible to make arrangements to have a lessee ready to take up the lease immediately, but that is contrary to all the experience of business men. Take the case of a man owning an ordinary class of house property in London. He may have the leases of a whole block of houses falling in at the same time, and it may be necessary to make considerable improvements in the property, or even to rebuild it. In that case the man will get no income out of the property for six months or a year. In those circumstances really the Government might gave the unfortunate landlord a few months in which to make his arrangements, and to rebuild should it be necessary to do so. It is not asking much that the honest trader should be given an opportunity to get his money together and to put new tenants into his property.

Mr. WYNDHAM

I cannot understand why the Government do not accept this perfectly reasonable Amendment. They are proposing taxation of a novel character, and I should like to know why, when that is the case, are they so wedded to an ancient proceeding. The first argument used in connection with an ordinary Finance Bill is that there is great danger of evasion. That is the first stock argument. The second argument constantly used in the case of an ordinary Finance Bill is that there is great urgency to get in as many shillings as possible in the course of the coming financial year. Neither of those stock arguments apply in the present case, because the Prime Minister has said that these taxes are not expected to bring in much money during the next two years, and there is no danger of evasion. The learned Attorney-General has not given us a single reason for saying that the Government are entitled to refuse this Amendment. Failure to agree to it will not add to the convenience, of the Treasury, and is not necessary in the interests of the finance of the country. On the other hand, the payment he has to make under the Government's proposal will throw a most onerous burden upon the individual, and when a Government is instituting a perfectly novel experiment they are unwise to make the execution of that experiment more precipitate than is necessary.

Mr. HALDANE

The tax is one which is imposed only on an increase in value coming to the lessor. The lessor knows that the lease is going to drop in. He becomes a lessor in possession—that is to say, he has a much more valuable property of which he is in possession. In those circumstances there are banks and half a dozen other agencies by means of which he can secure money for a comparatively small payment. Therefore I do not think there is any ground for suggesting that his is a hard case.

Mr. JOYNSON-HICKS

The property may already be mortgaged up to the hilt.

Mr. HALDANE

Then the lessor will not be much better off twelve months hence.

Mr. JOYNSON-HICKS

But he could not get money from the bank as the right hon. Gentleman suggests.

Mr. HALDANE

I am assuming that the lessor has some capacity to pay the tax. The lessor is by hypothesis in possession of a more valuable property, otherwise he will not be taxed at all.

Mr. JOYNSON-HICKS

May he pay by hypothesis?

Mr. WYNDHAM

The right hon. Gentleman has not made his point. Why the right hon. Gentleman should wish that the lessor, who has not a single tenant, should go and borrow money from the bank I cannot imagine. If the Government would allow the ordinary members of the community to transact their own business in their own way, I think we should get on faster. As they have not offered a single reason for not accepting this Amendment, I think we must divide.

Sir W. BULL

I want to know the exact procedure that will be followed in reference to this tax. Is it the case that on the very day the tax falls in the Government will seize the land? That seems to me to be what will happen. An hon. Friend on my right recalls my attention to what happened in Chelsea some years ago. The owner of some fifty leasehold houses died, but instead of being assets these were liabilities to the estate. The result was that they were sold at £1 a piece. They were very old houses. Does the Attorney-General suggest that in a case like that no time should be given in which to pay the tax?

Mr. AUSTEN CHAMBERLAIN

If there is no increase to follow of course there is no duty. But the right hon. Gentleman, in his speech, argued from a number of hypotheses. In the case put forward by, my hon. Friend there is no value. What ground is there for charging duty on that? The right hon. Gentleman is clearly in the wrong. What I really rose to say was that I understand the reason the Government will not accept the Amendment is that they can find no precedent for this in taxation. I will give an analogy. The Chancellor of the Exchequer has frequently likened this tax to the Death Duties.

Mr. HALDANE

No, no.

Mr. AUSTEN CHAMBERLAIN

He did so again and again, and said it was a kind of Death Duty on the death of the lease. Of course, the Secretary for War does not agree with the Chancellor of the Exchequer. But he was not here to hear the speeches of the Chancellor of the Exchequer. He has no hesitation in throwing over the Chancellor of the Exchequer when he is not present. That is a domestic matter, and I have no doubt the Chancellor, of the Exchequer will get even with him. The Chancellor of the Exchequer has likened this to a Death Duty on the death of the lease. The tax really goes much further than my hon. Friend asks. I hope the Secretary for War will see his way to accept it.

Question put, "That those words be there inserted."

The Committee divided: Ayes, 68; Noes, 142.

Division No. 357.] AYES. [4.50 a.m.
Arkwright, John Stanhope Forster, Henry William Pease, Herbert Pike (Darlington)
Balcarres, Lord Gardner, Ernest Percy, Earl
Baldwin, Stanley Gibbs, G. A. (Bristol, West) Pretyman, E. G.
Banner, John S. Harmood- Gretton, John Ratcliff, Major R. F.
Baring, Captain Hon. G. (Winchester) Guinness, Hon. R. (Haggerston) Remnant, James Farquharson
Barrie, H. T. (Londonderry, N.) Haddock, George B. Renton, Leslie
Beach, Hon. Michael Hugh Hicks Hamilton, Marquess of Roberts, S. (Sheffield, Ecclesall)
Beckett, Hon. Gervase Hardy, Laurence (Kent, Ashford) Rutherford, Watson (Liverpool)
Bignold, Sir Arthur Harrison-Broadley, H. B. Scott, Sir S. (Marylebone, W.)
Bridgeman, W. Clive Hermon-Hodge, Sir Robert Sheffield, Sir Berkeley George D.
Carlile, E. Hildred Hill, Sir Clement Starkey, John R.
Castlereagh, Viscount Hope, James Fitzalan (Sheffield) Staveley-Hill, Henry (Staffordshire)
Cecil, Evelyn (Aston Manor) Hunt, Rowland Valentia, Viscount
Chamberlain, Rt. Hon. J. A. (Worc'r.) Joynson-Hicks, William Walker, Col. W. H. (Lancashire)
Clive, Percy Archer Kerry, Earl of Warde, Col. C. E. (Kent, Mid)
Clyde, J. Avon Lane-Fox, G. R. Wilson, A. Stanley (York, E. R.)
Cochrane, Hon. Thomas H. A. E. Lockwood, Rt. Hon. Lt.-Col. A. R. Winterton, Earl
Craig, Captain James (Down, E.) Long, Col. Charles W. (Evesham) Wortley, Rt. Hon. C. B. Stuart-
Craik, Sir Henry Meysey-Thompson, E. C. Wyndham, Rt. Hon. George
Dalrymple, Viscount Mildmay, Francis Bingham Younger, George
Dickson, Rt. Hon. C. Scott- Morpeth, Viscount
Douglas, Rt. Hon. A. Akers- Morrison-Bell, Captain TELLERS FOR THE AYES.—Mr. James Mason and Sir W. Bull.
Duncan, Robert (Lanark, Govan) Newdegate, F. A.
Fell, Arthur Nicholson, Wm. G. (Petersfield)
NOES.
Acland, Francis Dyke Goddard, Sir Daniel Ford Pickersgill, Edward Hare
Agar-Robartes, Hon. T. C. R Gooch, George Peabody (Bath) Pirie, Duncan V.
Allen, Charles P. (Stroud) Greenwood, G. (Peterborough) Pointer, J.
Armitage, R. Haldane, Rt. Hon. Richard B. Ponsonby, Arthur A. W. H.
Ashton, Thomas Gair Hall, Frederick Price, Sir Robert J. (Norfolk, E.)
Astbury, John Meir Hardie, J. Keir (Merthyr Tydvil) Rendall, Athelstan
Baring, Godfrey (Isle of Wight) Hardy, George A. (Suffolk) Richards, Thomas (W. Monmouth)
Barlow, Percy (Bedford) Harmsworth, Cecil B. (Worcester) Richards, T. F. (Wolverhampton, W.)
Barry, Redmond J. (Tyrone, N.) Harmsworth, R. L. (Caithness-sh.) Richardson, A
Bennett, E. N. Harvey, A. G. C. (Rochdale) Ridsdale, E. A.
Berridge, T. H. D. Harwood, George Roberts, Charles H. (Lincoln)
Black, Arthur W. Hayden, John Patrick Roberts, G. H. (Norwich)
Bowerman, C. W. Hazel, Dr. A. E. W. Robson, Sir William Snowdon
Brace, William Hazleton, Richard Rogers, F. E. Newman
Brunner, J. F. L. (Lancs., Leigh) Hedges, A. Paget Rose, Sir Charles Day
Buckmaster, Stanley O. Henderson, J. McD. (Aberdeen, W.) Rowlands, J.
Burns, Rt. Hon. John Henry, Charles S. Scarisbrick, Sir T. T. L.
Carr-Gomm, H. W. Herbert, Col. Sir Ivor (Mon. S.) Scott, A. H. (Ashton-under-Lyne)
Cawley, Sir Frederick Higham, John Sharp Seddon, J.
Clough, William Hodge, John Shackleton, David James
Clynes, J. R. Holt, Richard Durning Shaw, Sir Charles E. (Stafford)
Collins Sir Wm. J. (St. Pancras, W.) Howard, Hon. Geoffrey Silcock, Thomas Ball
Cooper, G. J. Hudson, Walter Simon, John Allsebrook
Corbett, C. H. (Sussex, E. Grinstead) Illingworth, Percy H. Sloan, Thomas Henry
Cowan, W. H. Jenkins, J. Stanley, Hon. A. Lyulph (Cheshire)
Craig, Herbert J. (Tynemouth) Johnson, John (Gateshead) Taylor, John W. (Durham)
Crosfield, A. H. Jones, Leif (Appleby) Tennant, H. J. (Berwickshire)
Crossley, William J. Lamont, Norman Thomas, Sir A. (Glamorgan, E.)
Dalziel, Sir James Henry Lehmann, R. C. Thomasson, Franklin
Davies, David (Montgomery Co.) Lever, A. Levy (Essex, Harwich) Thompson, J. W. H. (Somerset, E.)
Davies, Ellis William (Eifion) Levy, Sir Maurice Thorne, G. R. (Wolverhampton)
Davies, Timothy (Fulham) Lewis, John Herbert Tomkinson, James
Davies, Sir W. Howell (Bristol, S.) Lloyd-George, Rt. Hon. David Toulmin, George
Dewar, Arthur (Edinburgh, S.) Macdonald, J. R. (Leicester) Walton, Joseph
Dewar, Sir J. A. (Inverness-shire) Macpherson, J. T. Ward, W. Dudley (Southampton)
Duncan, C. (Barrow-in-Furness) MacVeagh, Jeremiah (Down, S.) Wason, John Cathcart (Orkney)
Duncan, J. Hastings (York, Otley) M'Laren, H. D. (Stafford, W.) Watt, Henry A.
Dunne, Major E. Martin (Walsall) M'Micking, Major G. White, J. Dundas (Dumbartonshire)
Edwards, Sir Francis (Radnor) Manfield, Harry (Northants) White, Sir Luke (York, E. R.)
Elibank, Master of Marnham, F. J. Whitley, John Henry (Halifax)
Evans, Sir S. T. Masterman, C. F. G. Wilkie, Alexander
Everett, R. Lacey Menzies, Sir Walter Williams, J. (Glamorgan)
Falconer, James Middlebrook, William Wilson, W. T. (Westhoughton)
Fenwick, Charles Mond, A. Wood, T. M'Kinnon
Ferens, T. R. Montagu, Hon E. S.
Fiennes, Hon. Eustace Morse, L. L.
Fuller, John Michael F. Nannetti, Joseph P. TELLERS FOR THE NOES.—Captain
Gladstone, Rt. Hon. Herbert John O'Brien, K. (Tipperary, Mid) Norton and Sir Edward Strachey.
Glover, Thomas Philips, John (Longford, S.)

Captain CRAIG moved in section (1), after the word "any" ["Reversion Duty shall be recoverable from any lessor to whom any benefit accrues"] to insert the word "pecuniary." Under the Clause as it stands, no matter what the benefit may be, Reversion Duty of some sort will be recoverable from the lessor. I think the Chancellor of the Exchequer desires to get some revenue from this peculiar land taxation, but I do not see how he can get it unless he translates in every instance the benefit which accrues into some terms of money.

Mr. LLOYD-GEORGE

I am not quite sure what object the hon. and gallant Member has in view in moving his Amendment. The benefit which accrues is already defined by sub-section 2 of Clause 7, in amongst innumerable subsections which the hon. and gallant Member wanted to omit.

Captain CRAIG

May I point out with all respect, that it says "For the purposes of this section." That is Clause 7.

Mr. LLOYD-GEORGE

I am sure the hon. and gallant Member, after he has given very close scrutiny to the clause which establishes the Reversion Duty will see that there the benefit is defined, and all these benefits are included. Although the hon. and gallant Member said he wants me to strengthen the drafting of the Bill, I am sure he will find that what he proposes is quite unnecessary.

Mr. WATSON RUTHERFORD

This Amendment in itself is exceedingly appropriate, and I venture to think it is an exceedingly useful one. The right hon. gentleman has probably forgotten the position of some lessors owing to their having empty houses thrown on their hands. Our attention is called to it in a dramatic manner by the Amendment of the hon. and gallant Member, who has pointed out that it is advisable to insert the word "pecuniary." Let us take an instance—an ordinary case in which 90 years have expired since the lease was granted. [MINISTERIAL cries of "Oh, oh!"] I strongly advise hon. Members on the other side to give me a patient hearing. We have just got to the beginning of this clause, and I advise them to behave themselves. [MINISTERIAL cries of "Oh, oh!" and cries of "Go on."] The case I was putting was that in which 90 years have expired since the lease was granted. When the lease was granted the land was probably worth £100. Now I can take hon. Members to see an instance of this kind to a spot within 200 or 300 yards, of the spot where we are now sitting, and—

The DEPUTY-CHAIRMAN

Order, order. I do not think that touches this Amendment. It is proposed that the word "pecuniary" be inserted.

Mr. WATSON RUTHERFORD

I am obliged to you, Mr. Deputy-Chairman, for pointing out to me the nature of the Amendment. What is the "pecuniary" benefit which the lessor gains by a lease expired? A property may be worth probably £5,000, but it does not become entitled to that immediately the lease expires. The owner may have been enjoying a rental of £250 a year; but at the end of the lease the tenant goes out. In the meantime the property is depreciating. Where is the "pecuniary" benefit? He has lost his rents. I think this is a very useful Amendment indeed, enabling us to-point out what an astonishing thing this Reversion Duty is.

Mr. G. YOUNGER

We are not particularly interested in this Reversion Duty in Scotland; but there are cases in Scotland in which land is let on building leases with the obligation that the lessor at the end of the period shall buy the buildings. I do not think this Bill provides for a case of that sort. I should like to ask the Chancellor of the Exchequer or the Secretary for War (Mr. Haldane), who is familiar with the law both in Scotland and in this country, whether such a case is covered by the Bill? It is not a common case; but it is a very peculiar one?

Mr. HALDANE

Will the hon. Member put a case in the concrete?

Mr. YOUNGER

Yes. Land is let on a building lease for a period of years, during which buildings are erected. On the expiry of that lease these buildings do not revert to the lessor at all, but he has to pay for them.

Mr. HALDANE

The benefit that would accrue would be so much less.

Viscount CASTLEREAGH

I cannot think the empty houses for which the individual in question will receive no benefit whatever can be called a benefit, because it is in addition to his actual property, but by reason of the addition to the property of this individual he is called upon to pay 10 per cent, on the value of that property which has increased in the last 99 years. Well, that property has got a certain value which may not be a realisable value. But the owner is called upon to pay 10 per cent, of the total unrealisable value. I venture to say that the Amendment proposed by my hon. Friend is an Amendment of substance, and one which the right hon. Gentleman would do well to accept, because I cannot see that there is any justification whatever for the State calling upon these people to pay ready money on unrealisable property. There are houses it is absolutely impossible to let to anyone, even for a nominal rent. If only the word "pecuniary" could be inserted before the word "benefit" that would obviate a great deal of difficulty and remove all anxieties.

Earl WINTERTON

I think I can strengthen the case of my hon. Friend (Captain Craig) from cases where, not only empty houses are an unrealisable security, but where the mere fact of having them upon one's hands involves a great expense. The Chancellor of the Exchequer should make it clear that the man in the position stated by the hon. Member for Ayr Burghs (Mr. Younger) will not suffer loss.

Mr. LLOYD-GEORGE

If the buildings are not valuable then this is 10 per cent, not of nothing, but of something less than nothing. The point put to me is solely with regard to buildings. I can quite understand there are many cases where the site would be much more valuable if cleared of buildings. In that case the buildings, so far from adding to the value, would really be a deduction from the sum on which the 10 per cent, would be charged.

Mr. REMNANT

I know of a case of land under lease in which the lessor was approached by the lessee, who wanted to extend the buildings and was quite willing to spend a considerable sum in doing so provided that the owner would reduce the rent he had been receiving and give him a considerable extension of the lease. This the ground landlord agreed to do, and a considerable sum was expended on the building. Am I right in concluding from what the Chancellor of the Exchequer said that when the man died—as he did—and the lease fell in and it was impossible to find an immediate lessee because of the unsuitability of the building, the landlord would be entitled to deduct from the value of the land the so-called unmarketable value of the building? Surely in that case you could not say the building was worth anything?

Mr. LLOYD-GEORGE

The hon. Member has misapprehended what I said. It is entirely a question whether the building on a site adds to or detracts from the value. In many cases the site would get a better price if cleared of buildings than if buildings were on it. In those cases there would be a deduction before you arrived at the 10 per cent.

Mr. AUSTEN CHAMBERLAIN

The right hon. Gentleman's explanation is perfectly clear and correct. I hope my gallant Friend (Captain Craig) will not think it necessary to go to a division on this Amendment. I am bound to say that the speech we have just had from the right hon. Gentleman, has served a really useful purpose. It will have educated the Secretary for War in a tax which he has been defending. On the last occasion, when the Chancellor of the Exchequer was not here, the Secretary for War said that in the case described there would be no tax due at all. The Chancellor of the Exchequer has pointed out that the Secretary for War did not know the nature of the tax imposed.

Captain CRAIG

I ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Mr. WATSON RUTHERFORD moved, in section (1), after the word "Majesty" ["as a debt due to His Majesty"] to insert the words, "but shall not be a charge on the land."

The Bill is so loosely drawn that it is nowhere stated who is to pay the tax. In reading the opening words of Clause 7 you find that the Reversion Duty is to be charged, levied and paid, but it does not tell you what it is to be charged on, how it is to be levied, or who is to pay it, but when you come to Clause 9 it says the duty is to be recoverable from the lessor. There is no lessor when a lease comes to an end. When a lease comes to an end the lessor may be a person who has received no benefit at all. The clause says that the duty is to be recoverable as a debt due to His Majesty, and I want to make it clear that whoever is to pay it, that it is not to be a charge on the land. We have been told, in the course of these discussions that it is not a charge upon the land, but only upon the benefit value that arises. I want to know what it is charged on.

Mr. LLOYD-GEORGE

May I point out to the hon. Member that there is an Amendment we can accept in the name of the hon. Member for North-West Manchester (Mr. Joynson-Hicks) which comes after the word "Majesty," and it would not be inserted if the Committee accepts the words of the hon. Member for the West Derby Division (Mr. Watson Rutherford). I would suggest that the hon. Member for North-West Manchester should move his Amendment first and get it into the clause, and then the hon. Member for the West Derby Division can move his Amendment. The Amendment I refer to is one providing that the duty shall be recoverable as a debt due to His Majesty, but shall rank pari passu with all other debts due from such lessor.

Mr. RUTHERFORD

As a matter of fact I have exactly the same words down in another place, but that has nothing to do with the point I am now raising.

Mr. LLOYD-GEORGE

I am not endeavouring to get the Amendment of the hon. Member ruled out of order, but I am pointing out that the Amendment of the hon. Member for North-West Manchester should come in now.

Mr. RUTHERFORD

Then I will defer my Amendment for the time being.

Amendment, by leave, withdrawn.

Mr. JOYNSON-HICKS

I beg to move quite formally to insert at the end of the first sub-section the words "but shall rank pari passu with all other debts due from such lessor."

Question, "That those words be there inserted," put and agreed to.

Mr. RUTHERFORD

I will now move to add after the words just inserted, "but shall not be a charge on the land." It is only fair and right that the Government should say at once whether they intend the tax to be a charge on the land or not. My Amendment would accomplish a useful object if we could get a straight statement from the Government on the point.

Mr. HALDANE

There is nothing in the clause, of course, making the Reversion Duty a charge on the land, which is a Crown rent.

Mr. RUTHERFORD

What I want to know is whether somewhere or other in this Bill Reversion Duty is made a charge on the land.

Mr. HALDANE

No.

Mr. RUTHERFORD

As I understand it is clear that this Reversion Duty is not to be a charge on the land, I beg leave to withdraw my Amendment.

Amendment, by leave, withdrawn.

Mr. JOYNSON-HICKS

I beg to move, after the words last inserted ["but shall rank pari passu with all other debts due from such lessor"], to insert the following sections:— (2) Where any lessor from whom Reversionary Duty shall be recoverable under the provisions of this Act is a trustee he shall be entitled to be recouped any such payment out of the trust estate, and shall have full power to raise the necessary money by sale or mortgage of the subject matter of this settlement. (3) Where any lessor from whom Reversionary Duty shall be recoverable under the provisions of this Act shall be a mortgagee, he shall be entitled to add any sum so paid in respect of such duty to his security, and where he is the first of two or more mortgagees, he may add such sum to his security in advance of the second or subsequent incumbrances. These Amendments are framed to meet the case of the lessor who is a trustee. They are taken from the report of the Council of the Incorporated Law Society on this Bill. The point is that nowhere in the Bill is there a provision that where the lessor is a trustee and has to pay the Reversionary Duty he should be enabled to recoup himself out of the trust estate. It is absolutely necessary that these Amendments should be inserted because the landed estate may be the only property settled, and the trustees should have power to raise the duty by sale or mortgage.

Mr. HALDANE

There is a good deal in what the hon. Gentleman says, I think, if a mortgagee is in possession, but the only case we have to consider is that of a trustee, and he has the power already. We desire, however, to make the point quite clear, and the only difficulty about the Amendment is that it is confined to Reversion Duty, whereas we think it should apply to all the duties. The Government will, accordingly, undertake to bring up a clause in the proper place applying the principle of the Amendment not only to the Reversion Duty, but to all the duties.

Mr. JOYNSON-HICKS

I am quite satisfied with that promise, and beg leave to withdraw my Amendment.

Amendment, by leave, withdrawn.

Sir HENRY CRAIK

I should like to move an Amendment in the name of the hon. Member for Durham (Mr. Lambton). It is to leave out the words "every lessor shall" ["every lessor shall, on the determination of a lease"]. The Amendment is to be understood in connection with consequential Amendments, which would make the clause run: "On the determination of a lease on the determination of which Reversion Duty is payable under this section, the Commissioners shall deliver an account to the lessor setting forth the particulars of the land, and the value of the benefit accruing to the lessor by the determination of the lease." The object of the Amendment, or rather the series of Amendments, is to lay the burden of assessing the tax on the Commissioners, and not on the individual, who is to be subject to it. It is, I think, a new and very dangerous principle that a man should not only have to pay, but to assess his own tax. We know that great difficulties will arise, and that a serious burden of cost will be thrown upon the lessor if he is compelled 1o furnish these particulars himself. Surely the responsible duty involved in making this valuation ought not to rest on the unfortunate lessor, who is himself to be the subject of the tax. For the first time the Government are laying upon the subject a duty which has never been laid upon him before. I think we ought to follow the analogy of the Income Tax and not follow this dangerous principle of forcing the subject to undertake not only the payment of the tax but the duty of His Majesty's officers—namely, that of collecting the duty.

Sir W. ROBSON

As the sub-section stands now it provides that every lessor shall, on the determination of the lease, deliver an account to the Commissioners setting forth the particulars of the land and the value of the benefit which accrues to him on the determination of the lease. Now it is proposed by this Amendment exactly to reverse that process and to make the Commissioners deliver to the lessor an account setting forth the particulars of the land and the value of the benefit accruing to the lessor. I think one needs only to state the meaning of the Amendment in order to see that it is one the Government could accede to.

The Earl of KERRY

This case seems to me to be on a par with the valuation in connection with the Increment Value Duty for two reasons—(1) Because the valuation is retrospective, and (2) because it includes the value of buildings. It seems to me that it would be very much more difficult for the owner to make the valuation in this case than in the former. Therefore I think we are justified in asking that the Commissioners should make the valuation instead of the owner. After all, it must to a large extent be an arbitrary valuation. Somebody has to make a shot at it, and I think it is only fair to let the Commissioners make the first shot. I do not think the most sanguine supporters of the tax would assert that the valuation could be easily made. That being the case, I think it would tend to simplification if the Commissioners set the ball a-rolling at the first instance.

Viscount CASTLEREAGH

I do think we are entitled to an answer from the Attorney-General.

Sir W. ROBSON

This is a case of the lessor giving information to the Commissioners and not the Commissioners giving advice to the lessor in the first instance.

Mr. A. CHAMBERLAIN

Does the Attorney-General mean to say that the lessor will have to make a valuation and assess his tax? My hon. Friends have been trying to draw attention to the fact that it is the lessor who has to present the account. I understand the Attorney-General to say the account is simply an account of the particulars of the land and of the value of the benefit. I thought that would have been involved in valuation. When the Commissioners get the information from the lessor will it be the duty of the Commissioners to inform the lessor what is due?

Sir W. ROBSON

The subject sends in particulars, and thereupon the Commissioners decide whether or not they will accept that account just as in the case of the Death Duties.

Mr. PRETYMAN

In the case of the Death Duties all the taxpayer has to do is to tell the actual value of the property. In this case a new kind of valuation is required. The effect of the case would be met if my hon. Friend would consent to alter his Amendment so as to make the lessor submit particulars and the Commissioners make the valuation.

Sir W. ROBSON

I think it would work much better for the lessors to make the account on which the duty is assessed. The number of cases in which the Commissioners would come down and insist on valuation would, I should hope, be very small indeed, but the amendment would bring the Commissioners down in every case.

Mr. J. F. HOPE

The clause says every lessor shall, on the determination of a lease, deliver an account to the Commissioners setting forth the particulars of the land and the value of the benefit accruing to the lessor. How can he always tell what benefit he is going to derive? He cannot tell until he has tested the market. This is not the case of a re-grant of lease, but a determination of lease. That must be hypothetical. It may take him a long time before he can realise the benefit, and in the meantime he can only make a shot, and what sort of a shot can he make? The lessor would have to go through all this calculation in order to supply the particulars which this sub-section imposes upon him. It would be exceedingly burdensome and he could hardly do it correctly. I would suggest that all the words after "land" should be omitted. It is quite right that particulars of the land should be delivered, but not particulars of the value of the benefit accruing to the lessor.

Mr. WATSON RUTHERFORD

In Liverpool our leases are all for 75 years or over. The position is simply this: 75 years ago nine-tenths of the place consisted of green fields, and the immensity of the task of finding out what their original value was would be an exceedingly serious matter for the lessor. But I quite agree that the Amendment is impracticable because if the owner himself cannot furnish particulars it is quite clear that the Commissioners cannot because they have not got the material with which to do it.

Sir HENRY CRAIK

I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Mr. JOYNSON-HICKS moved to insert after "lessor" the words "to whom a benefit shall have accrued." [Every lessor "to whom a benefit shall have accrued" shall.]

This raises the whole question more or less debated in regard to increment value that on the determination of every single lease throughout the whole country, whether there is any increment or not, the lessor shall furnish an account to Somerset House. I think as this clause is drawn everybody will have to deliver an account on the determination of a lease. Surely that cannot be the object of the Government.

Mr. EMMOTT

This Amendment has already been settled by a previous decision.

Amendment ruled out of order accordingly.

Captain CRAIG

It seems to me that this section, too, is very loosely worded so far as the stipulation as to rendering of the account to the Commissioners is concerned. It would make the section more perfect if, after the word "section" the words "deliver an account" were left out ["Every lessor shall on the determination of a lease on the determination of which Reversion Duty is payable under this section deliver an account"] and the words "render a return on the form prescribed by the Commissioners" were inserted. It strikes me that it will be very difficult indeed to render a return unless there is some prescribed form issued by the Commissioners for the purpose. A great many of these leases which run out are the property of poor people, and they will not care to incur great expense in securing legal help in the matter. If it is left entirely to themselves this account will be of a very odd kind in some cases. It will help them if they have got forms prescribed by the Commissioners.

Question proposed, "That the words proposed to be left out—'deliver an account'—stand part of the Clause."

Mr. LLOYD-GEORGE

I do not think it necessary to put in the section words of this kind, because there will be regulations under this Act, and there will be forms. If these words were inserted here they would have to be inserted in various other parts of the Bill, in regard to Increment Duty, Development Duty, and other matters. It would be a great mistake to insert the words, for the Commissioners will provide all necessary forms. I trust, therefore, the hon. and gallant Member will not press his Amendment.

Amendment, by leave, withdrawn.

Mr. WATSON RUTHERFORD

I should like to move three Amendments together—to insert the words "short," "estimated," and "reversioner," so that the end of the section will read—"deliver an account to the Commissioners setting forth the—'short'—particulars of the land and the—'estimated'—value of the benefit accruing to the 'revisioner'—[instead of 'lessor']—by the determination of the lease." The proposed changes will make the section more clear and it will relieve the taxpayer of the thought of having to furnish what appears at first glance to be a return of serious magnitude. I now simply move to insert the word "short." This will show the taxpayer that he is not to furnish elaborate plans and particulars of properties. He has to give short particulars as in the case of making a return in respect of Death Duties and in returns for the Inland Revenue Department.

Sir WILLIAM ROBSON

"Short" is not a very nice expression, and I think it would be a term very difficult to construe. I think we may accept the hon. Member's Amendment to insert the word "estimated." As regards the substitution of "reversioner" for "lessor," I think it is better to keep—

The CHAIRMAN

I think that is consequential.

Amendment, by leave, withdrawn.

Sir HENRY CRAIK moved, in section 2, to leave out the words "the particulars of the land and" ["deliver to the Commissioners an account setting forth the particulars of the land and"].

I wish to point out that under this section the particulars have to be furnished whenever the duty is payable—namely, on the termination of any lease. I am advised it is doubtful whether the words "duty is payable" mean that a substantial payment is to be made or whether it is merely a question as to what duty is payable. I desire to confine the giving of these particulars only to cases where valuable benefit arises. Under Clause 4 a register of land was established. Under Clause 9 there would be added to that a register of all leases. With the Amendment I propose the lessor will only be compelled to furnish an account to the Commissioners "setting forth the value of the benefit accruing to the lessor by the determination of the lease." It would not be fair if, when the question of paying the duty arises, although there is no real benefit accruing, lessors should be compelled to give particulars of all their leases.

Mr. LLOYD-GEORGE

The effect of omitting these words would be that in cases where there was an undoubted right on the part of the Exchequer to Reversion Duty particulars need not be supplied. I know that is not the object of the hon. Member. It is for the Exchequer to adjudicate in such cases, and they can only do so upon an account being rendered. The hon. Member would go even further. He would not make the supplying of particulars imperative even in cases where it is undoubted that the Commissioners have a right to the duty.

Sir H. CRAIK

I know there is a difficulty in the wording of the Amendment. It is not my object to stop the Commissioners from calling for particulars, but I do not wish those particulars to be furnished for every lease all over the country. I do not want to establish a register of leases whether they are such as should bring a contribution to the Treasury or not.

Mr. LLOYD-GEORGE

The Amendment moved does not contemplate the case the hon. Member wishes to put. Even where the duty is payable the hon. Member, if he succeeded in passing this Amendment, would prevent the Commissioners obtaining particulars. Particulars are only to be supplied in cases where the Reversion Duty is payable under this section. In cases where the lease is under 21 years no particulars can be supplied, but in all other cases, even though the Commissioners find as a result of the accounts that there is no claim, still the lessors must submit accounts. The taxpayer cannot be allowed to be the judge in his own case. The case is analogous to the Death Duty. Even where the estate is so small that no duties are payable accounts have to be submitted in order that the executor may establish his claim to exemption, and that is the case here. The particulars must be supplied.

Sir H. CRAIK

Does the Chancellor of the Exchequer propose that the local registry established under Clause 4 should extend to this clause?

Mr. LLOYD-GEORGE

That is really not the point.

Sir H. CRAIK

It is my object to prevent that extension.

Mr. LLOYD-GEORGE

I do not know what the object may be. I only know what the Amendment is.

Sir W. ANSON

We want to know whether the Chancellor of the Exchequer means that in the case of any lease for 21 years when the lease falls in, and whether or not Reversion Duty is payable, particulars are to be returned and recorded. If the Reversion Duty is put on the same basis as the Increment Duty, you will get a register of all the leasehold property throughout the country. That is the feature of the Amendment.

Mr. LLOYD-GEORGE

I do not know what the feature of the Amendment is. I only know what the Amendment is. It is not at all a question of the register; it is purely a question whether the Commissioners are to have the opportunity of checking in each case. The case of a lease under 21 years is not a case for adjudication, but there must be a case for adjudication so long as the lease is over 22 years. The reversioner may say there is no value, and he sends in an account to show it. The Commissioners have the right to say, "You have not supplied full accounts; you have omitted something or you have underestimated the value." Surely the Commissioners should have that right. We have already discussed that point on Clause 4, section (l), and it is impossible to discuss one point over and over again. Section (4) of Clause 9 gives the Commissioners power to assess upon the accounts supplied under section (2). How are they to adjudicate under section (4) unless particulars are supplied to them? The lessor may say the buildings are of no value at all, but he ought not to be allowed to come to that conclusion without submitting all particulars. In the case of dog licences particulars have to be supplied. Every man who keeps a dog cannot say, "In my judgment I am entitled to exemption, and I am not going to pay." You have to supply particulars, even if you are a bonâ fide shepherd and keep dogs to look after sheep. I do not like to call a lessor a dog; but the only question is whether he is liable to the tax. The reversion is there, and it is for him to show that he is entitled to exemption. Let me put it in this way: The taxable subject-matter is the reversion of a lease of over 21 years.

Mr. AUSTEN CHAMBERLAIN

It is the benefit accruing from the lease.

Mr. LLOYD-GEORGE

Then comes the question whether there is an increase of value, and in order to adjudicate upon that I think the Commissioners are entitled to the full particulars. It is really analogous to an exemption from the Death Duty. A man may say, "I have not £100 after you deduct the Estate Duty and I am not liable." But he is not entitled to adjudicate on his own case. He is bound to submit, the particulars to the Commissioners of Inland Revenue. That is the case here.

Mr. JOYNSON-HICKS

With great respect, I think that is a false analogy. Unless there is a will to be proved the subject is the person who is entitled to say there are no accounts to be delivered in regard to the estate. If a man dies and the administrator of his estate says, "I have no assets," he is not bound to deliver any account of the estate whatever. That I submit is exactly the case here.

Mr. LLOYD-GEORGE

No, no. Of course, if there were no assets, there would be no account to deliver, but the question here is whether there are assets which come up to the amount at which a tax accrues.

Mr. JOYNSON-HICKS

Who is to decide whether there are no assets? For Estate Duty purposes it is the representative of the deceased. In this case the man himself is the one who has to say there is no taxable benefit. His position is this: My lease is dead; there is no taxable benefit arising to me. But under the Bill on the determination of every lease over 21 years, whether there is any benefit accruing or not, the unfortunate lessor has to fill up these forms and send them to Somerset House.

Earl WINTERTON

I think the Chancellor of the Exchequer should have told the House that he would put down an Amendment similar to one of mine which he accepted on another clause, inserting the word "reasonable" before "particulars." As to the argument about the dog—every man who keeps a dog has to take out a licence.

Mr. LLOYD-GEORGE

No, no.

Earl WINTERTON

At any rate, compared with the people who have to take out a licence, an infinitesimal number are exempt because they keep a dog for trade purposes. Every dog owner has to take out a licence except this properly privileged class, and surely that has nothing to do with this particular point. I believe if the right hon. Gentleman knew the amount of trouble and inconvenience which will be caused to owners of property throughout the country, he would be inclined to consider the point very seriously. The right hon. Gentleman should also realise the enormous expense that will be thrown on the Government in dealing with these matters, and I should like to know in this connection if he can give the Committee any idea of the number of leases in an average year which will come under the operation of the clause.

Sir W. ANSON

It ought to be understood, I think, that whether there is any

benefit accruing or not, the lessor is bound to make a return. I would ask the right hon. Gentleman to bear in mind, pursuing his own analogy, that it is not the lease, but the benefit, which is the dog. What he is proposing here is that every man in the Kingdom should make a return, whether he does or does not keep a dog.

Question put, "That the words 'particulars of the land' stand part of the Clause."

The Committee divided: Ayes, 140; Noes, 64.

Division No. 358.] AYES. [6.20 a.m.
Acland, Francis Dyke Gooch, George Peabody (Bath) Pickersgill, Edward Hare
Agar-Robartes, Hon. T. C. R. Greenwood, G. (Peterborough) Pirie, Duncan V.
Allen, Charles P. (Stroud) Haldane, Rt. Hon. Richard B. Pointer, J.
Armitage, R. Hall, Frederick Ponsonby, Arthur A. W. H.
Ashton, Thomas Gair Harcourt, Robert V. (Montrose) Price, C. E. (Edinburgh, Central)
Astbury, John Meir Hardie, J. Keir (Merthyr Tydvil) Price, Sir Robert J. (Norfolk, E.)
Baring, Godfrey (Isle of Wight) Hardy, George A. (Suffolk) Rendall, Athelstan
Barlow, Percy (Bedford) Harmsworth, Cecil B. (Worcester) Richards, Thomas (W. Monmouth)
Bennett, E. N. Harmsworth, R. L. (Caithness-shire) Richards, T. F. (Wolverhampton, W.)
Berridge, T. H. D. Harvey, A. G. C. (Rochdale) Richardson, A.
Black, Arthur W. Harwood, George Ridsdale, E. A.
Bowerman, C. W. Hayden, John Patrick Roberts, Charles H. (Lincoln)
Brace, William Hazel, Dr. A. E. W. Roberts, G. H. (Norwich)
Brunner, J. F. L. (Lancs., Leigh) Hazleton, Richard Robson, Sir William Snowdon
Buckmaster, Stanley O. Hedges, A. Paget Rogers, F. E. Newman
Burns, Rt. Hon. John Henderson, J. McD. (Aberdeen, W.) Rose, Sir Charles Day
Carr-Gomm, H. W. Henry, Charles S. Scarisbrick, Sir T. T. L.
Cawley, Sir Frederick Herbert, Col. Sir Ivor (Mon. S.) Scott, A. H. (Ashton-under-Lyne)
Clough, William Higham, John Sharp Seddon, J.
Clynes, J. R. Hodge, John Shackleton, David James
Cobbold, Felix Thornley Holt, Richard Durning Shaw, Sir Charles E. (Stafford)
Collins, Sir Wm. J. (S. Pancras, W.) Howard, Hon. Geoffrey Silcock, Thomas Ball
Corbett, C. H. (Sussex, E. Grinstead) Hudson, Walter Simon, John Allsebrook
Cowan, W. H. Illingworth, Percy H. Sloan, Thomas Henry
Craig, Herbert J. (Tynemouth) Jenkins, J. Stanley, Hon. A. Lyulph (Cheshire)
Crosfield, A. H. Johnson, John (Gateshead) Taylor, John W. (Durham)
Crossley, William J. Jones, Leif (Appleby) Tennant, H. J. (Berwickshire)
Dalziel, Sir James Henry Lamont, Norman Thomas, Sir A. (Glamorgan, E.)
Davies, David (Montgomery Co.) Lehmann, R. C. Thomasson, Franklin
Davies, Ellis William (Eifion) Lever, A. Levy (Essex, Harwich) Thompson, J. W. H. (Somerset, E.)
Davies, Timothy (Fulham) Levy, Sir Maurice Thorne, G. R. (Wolverhampton)
Davies, Sir W. Howell (Bristol, S.) Lewis, John Herbert Tomkinson, James
Dewar, Sir J. A. (Inverness-shire) Lloyd-George, Rt. Hon. David Toulmin, George
Duncan, C. (Barrow-in-Furness) Macdonald, J. R. (Leicester) Walton, Joseph
Duncan, J. Hastings (York, Otley) Macpherson, J. T. Ward, W. Dudley (Southampton)
Dunne, Major E. Martin (Walsall) M'Laren, H. D. (Stafford, W.) Wason, John Cathcart (Orkney)
Edwards, Sir Francis (Radnor) M'Micking, Major G. Wedgwood, Josiah C.
Elibank, Master of Manfield, Harry (Northants) White, J. Dundas (Dumbartonshire)
Evans, Sir S. T. Marnham, F. J. White, Sir Luke (York, E. R.)
Everett, R. Lacey Masterman, C. F. G. Whitley, John Henry (Halifax)
Falconer, James Menzies, Sir Walter Wilkie, Alexander
Fenwick, Charles Middlebrook, William Williams, J. (Glamorgan)
Ferens, T. R. Mond, A. Wilson, P. W. (St. Pancras, S.)
Fiennes, Hon. Eustace Montagu, Hon. E. S. Wilson, W. T. (Westhoughton)
Fuller, John Michael F. Morrell, Philip
Gladstone, Rt. Hon. Herbert John Morse, L. L. TELLERS FOR THE AYES.—Cap-
Glover, Thomas Nannetti, Joseph P. tain Norton and Sir E. Strachey.
Goddard, Sir Daniel Ford Philips, John (Longford, S.)
NOES.
Anson, Sir William Reynell Bridgeman, W. Clive Dalrymple, Viscount
Arkwright, John Stanhope Bull, Sir William James Douglas, Rt. Hon. A. Akers-
Balcarres, Lord Carlile, E. Hildred Duncan, Robert (Lanark, Govan)
Baldwin, Stanley Castlereagh, Viscount Fell, Arthur
Banner, John S. Harmood- Cecil, Evelyn (Aston Manor) Forster, Henry William
Baring, Capt. Hon. G. (Winchester) Chamberlain, Rt. Hon. J. A. (Worc'r) Gardner, Ernest
Barrie, H. T. (Londonderry, N.) Clive, Percy Archer Gibbs, G. A. (Bristol, West)
Beach, Hon. Michael Hugh Hicks Clyde, James Avon Gretton, John
Beckett, Hon. Gervase Cochrane, Hon. Thos. H. A. E. Guinness, Hon. R. (Haggerston)
Bignold, Sir Arthur Craig, Captain James (Down, E.) Haddock, George B.
Hamilton, Marquess of Morrison-Bell, Captain Staveley-Hill, Henry (Staffordshire)
Hardy, Laurence (Kent, Ashford) Newdegate, F. A. Valentia, Viscount
Harrison-Broadley, H. B. Nicholson, Wm. G. (Petersfield) Walker, Col. W. H. (Lancashire)
Hermon-Hodge, Sir Robert Pease, Herbert Pike (Darlington) Warde, Col. C. E. (Kent, Mid)
Hill, Sir Clement Pretyman, E G. Wilson, A. Stanley (York, E. R.)
Hope, James Fitzalan (Sheffield) Ratcliff, Major R. F. Winterton, Earl
Hunt, Rowland Remnant, James Farquharson Wyndham, Rt. Hon. George
Kerry, Earl of Renton, Leslie Younger, George
Lane-Fox, G. R. Roberts, S. (Sheffield, Ecclesall)
Law, Hugh A. (Donegal, W.) Rutherford, Watson (Liverpool)
Lockwood, Rt. Hon. Lt.-Col. A. R. Scott, Sir S. (Marylebone, W.) TELLERS FOR THE NOES.—Mr. Joynson-Hicks and Sir H. Craik.
Long, Col. Charles W. (Evesham) Sheffield, Sir Berkeley George D.
Mildmay, Francis Bingham Starkey, John R.

Question, "That those words be there inserted," put, and agreed to.

Mr. JAMES HOPE

I gave notice of an Amendment to this section. Surely the Government would be satisfied with having particulars sent in to Somerset House, without obliging the lessor to give calculations. The extreme complexity of these calculations would be really worse than ascertaining the site value.

Mr. AUSTEN CHAMBERLAIN

I hope my hon. Friend will not persist with his proposed Amendment. We did discuss practically the same point some time ago, and we agreed that it was not to the advantage of the subject that the compiling of this valuation should, in the first place, be left to the Commissioners. The Attorney-General himself has pointed out that if the subject supplied the information he would be likely to get off much more lightly than if it were left to the Commissioners to come down upon him in each case.

Mr. JAMES HOPE

I defer to my right hon. friend, but I entirely dissent from him.

Mr. WATSON RUTHERFORD moved, in section (2), before the word "value" ["the particulars of the land and the value of the benefit accruing"] to insert the word "estimated."

Mr. WATSON RUTHERFORD moved, in section (3) after the word "section" ["If any person who is under an obligation to deliver an account under this section fails to deliver such an account"] to insert the word "knowingly."

Mr. LANE-FOX moved in section (3) after the word "account" ["If any person who is under an obligation to deliver an account under this section fails to deliver such an account"] to insert the words "within the period of six months after the determination of the lease." I desire to secure that a reasonable limit of time should be given for the delivery of an account.

Mr. LLOYD-GEORGE

I offered the hon. Gentleman three months, and he will have to take that reduced sentence.

Mr. LANE-FOX

I am prepared to take the verdict of the right hon. Gentleman.

Amendment proposed, "After the word 'account' to insert 'within the period of three months after the determination of the lease.'"

Mr. WATSON RUTHERFORD moved, in section (3), to leave out the words "equal to" ["liable to pay to His Majesty a sum equal to (not exceeding) 10 per cent,"] and to insert the words "not exceeding."

Amendment agreed to.

Mr. WATSON RUTHERFORD moved, in section (3), after the word "ten" ["a sum equal to 10 per cent."] to insert the word "shillings." The penalty under the Bill is to be 10 per cent, a month. It almost reminds one of the kind of sum one would be charged if one were to be injudicious enough to answer letters offering to lend on note of hand. I think the Government must have seen some of those letters when drawing up this clause.

Mr. LLOYD-GEORGE

I trust that after the insertion of the words "not exceeding" the hon. Member will not think it necessary to press this Amendment. There are cases where 10 per cent, would be a very small penalty, and in other cases, I agree, it might be a very heavy penalty. The words "not exceeding" would be applicable to all cases.

Mr. AUSTEN CHAMBERLAIN

I think we must press the right hon. Gentleman a little further on this point. He is in a yielding mood at this hour of the morning, and I hope he will yield a little more. In Clause 4 we had to provide for an exactly similar state of things, but the penalty put in by the Government there is not the savage penalty which is proposed in this section. It is, instead, a penalty of £10, with 5 per cent, per annum interest.

Mr. LLOYD-GEORGE

It is really taken out of the Customs and Inland Revenue Act of 1885.

Mr. AUSTEN CHAMBERLAIN

As I do not know, I cannot argue on the facts of the Act of 1885. Here are two cases in which you impose penalties for the first time in the same Bill, and yet you are imposing wholly different penalties. I think we ought to keep these two taxes on the same lines in regard to this matter.

Mr. WATSON RUTHERFORD

I have an Amendment lower down to provide a penalty after the sixth month instead of the first month. As the clause stands, simply delaying the delivery of an account is made a very serious matter.

Mr. PRETYMAN

May I appeal to the right hon. Gentleman to assimilate his penalty in this case to that given in another part of the Bill? He can charge his interest and let it be interest at so much per annum. It appears to me that there should be a penalty and that there should be a maximum fixed sum, and there should be five per cent, interest charged from the time of the failure to deliver the account.

Mr. LLOYD-GEORGE

I would point out to the hon. and gallant Gentleman that the offence must be a serious offence for the full penalty to be inflicted. In 1885 our predecessors in office, in the case of corporations, included the words to be found in this Bill. We have adopted them, and I hope the hon. and gallant Gentleman will allow us to get on with this section.

Earl WINTERTON

The right hon. Gentleman speaks of a serious offence; but I do not think his remarks seriously affect the clause or the Amendment proposed. I would venture to point this out. You are proposing under this clause to put upon the subject the effect of a most onerous penalty and you are thereby, in addition to the rights which the Government have of recovery in a court of law, putting the Crown in a much more favourable position than it should be put, and in a much more favour- able position than the ordinary private individual to whom another private individual owes a debt. Not a word has been used by the right hon. Gentleman in favour of the proposal before the Committee. It is a monstrous proposal to make a man who fails in the manner described pay 110 per cent, on the duty originally imposed. The only object of the proposal in the Bill is to make things as difficult and as harassing as possible to the owner of land. I think it is very hard on the part of the Government to make this proposal.

Mr. E. A. RIDSDALE

I think there is a general feeling that this penalty is too strong. [MINISTERIAL cries of "No, no," and OPPOSITION cheers.] I certainly think it is myself. Ten per cent, is undoubtedly too much. At any rate it would be better, I think, if the section stopped at the word "section," so as to leave the penalty at 10 per cent.

Mr. J. M. HENDERSON

Large companies are liable sometimes to penalties of £50 per day for not filing accounts by a certain date.

Mr. AUSTEN CHAMBERLAIN

The point which the right hon. Gentleman was offering is not the same as my hon. Friend was taking. Personally I prefer the Government's proposal to that of my hon. Friend. It lessens the penalty. I would sooner have a penalty of 10 per cent, after three months, as proposed, than the penalty of 10 per cent, for every month as it stands in the Bill. It reduces the penalty to 40 per cent, per annum instead of 120 per cent, per annum. I want to draw the Chancellor of the Exchequer's attention to what is the real gist of the objection which my hon. Friends and I have to his Amendment. It is partly that the penalty is too strong in any circumstances, but it is a perfectly uncertain penalty, not dependent upon the gravity of the offence but upon the amount of the tax that is due. We do not mind a sliding scale according to time, but we do not like a sliding scale according to the tax due. I do not quite understand whether the penalty is to follow the amount of the tax instead of the nature of the offence. I would press the Chancellor of the Exchequer to do in this case what he has done in regard to the Increment Tax. He has put no fixed penalty in this case.

Mr. LLOYD-GEORGE

I think I have really gone a very long way to meet the Opposition, thereby departing from the precedent set by the right hon. Gentleman opposite. I have improved upon them to the extent of 80 per cent.

Mr. WATSON RUTHERFORD

Am I to understand that the suggestion is a sum not exceeding 10 per cent, upon the amount of any duty payable under this section, and a like penalty for every three months after the third month? When does failure to deliver an account begin?

Mr. LLOYD-GEORGE

Failure begins at the end of the three months.

Mr. WATSON RUTHERFORD

I ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Mr. WATSON RUTHERFORD moved, in section (3), to leave out the word "month" ["and a like penalty for every month"] and to insert the words "three months."

Mr. LLOYD-GEORGE

I agree to that.

Amendment agreed to.

Mr. LLOYD-GEORGE moved, in section (3), to leave out the words "after the first

month" ["after the first month during which the failure continues"].

Mr. AUSTEN CHAMBERLAIN

Does the Committee know what they are doing? I am not certain that the Chancellor of the Exchequer knows. He gave us three months during which no liability occurs. It is only at the expiration of that three months that any liability occurs. Under this proposal you have practically four months. You are now taking away something from the subject.

Mr. LLOYD-GEORGE

I am not certain that the right hon. Gentleman is not right. I think we had better leave the words as they are until Report. We are quite agreed as to our object. I withdraw the Amendment.

Amendment, by leave, withdrawn.

Mr. LLOYD-GEORGE rose in his place and claimed to move, "That the Question 'That the Clause, as amended, stand part of the Bill,' be now put."

Question put, "That the Question 'That the Clause, as amended, stand part of the Bill,' be now put."

The Committee divided: Ayes, 138; Noes, 64.

Division No. 359] AYES. [6.55 a.m.
Acland, Francis Dyke Falconer, J. Lewis, John Herbert
Allen, Charles P. (Stroud) Fenwick, Charles Lloyd-George, Rt. Hon. David
Armitage, R. Ferens, T. R. Macdonald, J. R. (Leicester)
Ashton, Thomas Gair Fiennes, Hon. Eustace Macpherson, J. T.
Astbury, John Meir Fuller, John Michael F. M'Laren, H. D. (Stafford, W.)
Baring, Godfrey (Isle of Wight) Gladstone, Rt. Hon. Herbert John M'Micking, Major G.
Barlow, Percy (Bedford) Glover, Thomas Manfield, Harry (Northants)
Bennett, E. N. Goddard, Sir Daniel Ford Marnham, F. J.
Berridge, T. H. D. Gooch, George Peabody (Bath) Masterman, C. F. G.
Black, Arthur W. Greenwood, G. (Peterborough) Menzies, Sir Walter
Bowerman, C. W. Haldane, Rt. Hon. Richard B. Middlebrook, William
Brace, William Hall, Frederick Mond, A.
Brunner, J. F. L. (Lancs., Leigh) Harcourt, Robert V. (Montrose) Montagu, Hon. E. S.
Buckmaster, Stanley O. Hardie, J. Keir (Merthyr Tydvil) Morrell, Philip
Burns, Rt. Hon. John Harmsworth, Cecil B. (Worcester) Morse, L. L
Carr-Gomm, H. W. Harmsworth, R. L. (Caithness-sh.) Nannetti, Joseph P.
Cawley, Sir Frederick Harvey, A. G. C. (Rochdale) O'Brien, K. (Tipperary, Mid)
Clough, William Harwood, George Pickersgill, Edward Hare
Cobbold, Felix Thornley Hayden, John Patrick Pirie, Duncan V.
Collins, Sir Wm. J. (St. Pancras, W.) Hazel, Dr. A. E. W. Pointer, J.
Corbett, C. H. (Sussex, E. Grinstead) Hazleton, Richard Ponsonby, Arthur A. W. H.
Cowan, W. H. Hedges, A. Paget Price, C. E. (Edinburgh, Central)
Craig, Herbert J. (Tynemouth) Henderson, J. McD. (Aberdeen, W.) Price, Sir Robert J. (Norfolk, E.)
Crosfield, A. H. Henry, Charles S. Priestley, Sir W. E. B. (Bradford, E.)
Crossley, William J. Herbert, Col. Sir Ivor (Mon. S.) Rendall, Athelstan
Dalziel, Sir James Henry Higham, John Sharp Richards, Thomas (W. Monmouth)
Davies, David (Montgomery Co.) Hodge, John Richards, T. F. (Wolverhampton, W.)
Davies, Ellis William (Eifion) Holt, Richard Durning Richardson, A.
Davies, Timothy (Fulham) Howard, Hon. John Geoffrey Roberts, Charles H. (Lincoln)
Davies, Sir W. Howell (Bristol, S.) Hudson, Walter Roberts, G. H. (Norwich)
Dewar, Sir J. A. (Inverness-sh.) Illingworth, Percy H. Robson, Sir William Snowdon
Duncan, c (Barrow-in-Furness) Jenkins, J. Rogers, F. E. Newman
Duncan, J. Hastings (York, Otley) Johnson, John (Gateshead) Rose, Sir Charles Day
Dunne, Major E. Martin (Walsall) Jones, Leif (Appleby) Scarisbrick, Sir T. T. L.
Edwards, Sir Francis (Radnor) Lamont, Norman Scott, A. H. (Ashton-under-Lyne)
Elibank, Master of Lehmann, R. C. Seddon, J.
Evans, Sir S. T. Lever, A. Levy (Essex, Harwich) Shackleton, David James
Everett, R. Lacey Levy, Sir Maurice Shaw, Sir Charles E. (Stafford)
Silcock, Thomas Ball Thorne, G. R. (Wolverhampton) Whitley, John Henry (Halifax)
Simon, John Allsebrook Tomkinson, James Wilkie, Alexander
Sloan, Thomas Henry Toulmin, George Williams, J. (Glamorgan)
Stanley, Hon. A. Lyulph (Cheshire) Walton, Joseph Wilson, J. W. (Worcestershire, N.)
Taylor, John W. (Durham) Ward, W. Dudley (Southampton) Wilson, W. T. (Westhoughton)
Tennant, H. J. (Berwickshire) Wason, John Cathcart (Orkney)
Thomas, Sir A. (Glamorgan, E.) Wedgwood, Josiah C. TELLERS FOR THE AYES.—Cap-
Thomasson, Franklin White, J. Dundas (Dumbartonshire) tain Norton and Sir Edward Strachey.
Thompson, J. W. H. (Somerset, E.) White, Sir Luke (York, E. R.)
NOES.
Anson, Sir William Reynell Duncan, Robert (Lanark, Govan) Nicholson, Wm. G. (Petersfield)
Arkwright, John Stanhope Fell, Arthur Pease, Herbert Pike (Darlington)
Balcarres, Lord Gardner, Ernest Peel, Hon. W. R. W.
Baldwin, Stanley Gibbs, G. A. (Bristol, West) Pretyman, E. G.
Banner, John S. Harmood- Gretton, John Ratcliff, Major R. F.
Baring, Capt. Hon. G. (Winchester) Guinness, Hon. R. (Haggerston) Remnant, James Farquharson
Barrie, H. T. (Londonderry, N.) Guinness, Hon. W. E. (B'y St. Edm'ds) Renton, Leslie
Beach, Hon. Michael Hugh Hicks Hamilton, Marquess of Roberts, S. (Sheffield, Ecclesall)
Beckett, Hon. Gervase Harrison-Broadley, H. B. Rutherford, Watson (Liverpool)
Bignold, Sir Arthur Hermon-Hodge, Sir Robert Scott, Sir S. (Marylebone, W.)
Bridgeman, W. Clive Hill, Sir Clement Sheffield, Sir Berkeley George D.
Bull, Sir William James Hope, James Fitzalan (Sheffield) Starkey, John R.
Carlile, E. Hildred Hunt, Rowland Staveley-Hill, Henry (Staffordshire)
Castlereagh, Viscount Joynson-Hicks, William Walker, Col. W. H. (Lancashire)
Cecil, Evelyn (Aston Manor) Kerry, Earl of Warde, Col. C. E. (Kent, Mid)
Chamberlain, Rt. Hon. J. A. (Worc'r.) Lane-Fox, G. R. Wilson, A. Stanley (York, E. R.)
Clive, Percy Archer Lockwood, Rt. Hon. Lt.-Col. A. R. Winterton, Earl
Clyde, J. Avon Long, Col. Charles W. (Evesham) Wyndham, Rt. Hon George
Cochrane, Hon. Thomas H. A. E. Mildmay, Francis Bingham Younger, George
Craig, Captain James (Down, E.) Morpeth, Viscount
Craik, Sir Henry Morrison Bell, Captain TELLERS FOR THE NOES.—Viscount
Dalrymple, Viscount Newdegate, F. A. Valentia and Mr. H. W. Forster.
Douglas, Rt. Hon. A. Akers-

Question put accordingly, "That the Clause, as amended, stand part of the Bill."

The Committee divided: Ayes, 138; Noes, 63.

Division No. 360.] AYES. [7.5 a.m.
Acland, Francis Dyke Fenwick, Charles Macdonald, J. R. (Leicester)
Allen. Charles P. (Stroud) Ferens, T. R. Macpherson, J. T.
Armitage, R Fiennes, Hon. Eustace M'Laren, H. D. (Stafford, W.)
Ashton, Thomas Gair Fuller, John Michael F. M'Micking, Major G.
Astbury, John Melr Gladstone, Rt. Hon. Herbert John Manfield, Harry (Northants)
Baring, Godfrey (Isle of Wight) Glover, Thomas Marnham, F. J.
Barlow, Percy (Bedford) Goddard, Sir Daniel Ford Masterman, C. F. G.
Bennett, E. N. Gooch, George Peabody (Bath) Menzies, Sir Walter
Berridge, T. H. D. Greenwood, G. (Peterborough) Middlebrook, William
Black, Arthur W. Haldane, Rt. Hon. Richard B. Mond, A.
Bowerman, C. W. Hall, Frederick Montagu, Hon. E. S.
Brace, William Harcourt, Robert V. (Montrose) Morrell, Philip
Brunner, J. F. L. (Lancs, Leigh) Hardie, J. Keir (Merthyr Tydvil) Morse, L. L.
Buckmaster, Stanley O. Harmsworth, Cecil B. (Worcester) Nannetti, Joseph P.
Burns, Rt. Hon. John Harmsworth, R. L. (Caithness-shire) O'Brien, K. (Tipperary, Mid)
Carr-Gomm, H. W. Harvey, A. G. C. (Rochdale) Pickersgill, Edward Hare
Cawley, Sir Frederick Harwood, George Pirie, Duncan V.
Clough, William Hayden, John Patrick Pointer, J.
Cobbold, Felix Thornley Hard, Dr. A. E. W. Ponsonby, Arthur A W. H.
Collins. Sir Win. J. (St. Pancras, W.) Hazleton, Richard Price, C. E. (Edinburgh, Central)
Corbett, C. H. (Sussex, E. Grinstead) Hedges, A. Paget Price, Sir Robert J. (Norfolk, E.)
Cowan, W. H. Henderson, J. McD. (A'deen, W.) Priestley, Sir W. E. B. (Bradford, E.)
Craig, Herbert J. (Tynemouth) Henry, Charles S. Rendall, Athelstan
Crosfield, A. H. Herbert, Col. Sir Ivor (Man., S.) Richards, Thomas (W. Monmouth)
Crossley, William J. Higham, John Sharp Richards, T. F. (Wolverhampton, W.)
Dalziel, Sir James Henry Hodge, John Richardson, A.
Davies, David (Montgomery Co.) Holt, Richard Durning Roberts, Charles H. (Lincoln)
Davies, Ellis William (Eifion) Howard, Hon. Geoffrey Roberts, G. H. (Norwich)
Davies, Timothy (Fulham) Hudson, Walter Robson, Sir William Snowdon
Davies, Sir W. Howell (Bristol, S.) Illingworth, Percy H. Rogers, F. E. Newman
Dewar, Sir J. A. (Inverness-sh.) Jenkins, J. Rose, Sir Charles Day
Duncan, C. (Barrow-in-Furness) Johnson, John (Gateshead) Scarisbrick, Sir T. T. L.
Duncan, J. Hastings (York, Otley) Jones, Leif (Appleby) Scott, A. H. (Ashton-under-Lyne)
Dunne, Major E. Martin (Walsall) Lamont, Norman Seddon, J.
Edwards, Sir Francis (Radnor) Lehmann, R. C. Shackleton, David James
Elibank, Master of Lever, A. Levy (Essex, Harwich) Shaw, Sir Charles E. (Stafford)
Evans, Sir S. T. Levy, Sir Maurice Silcock, Thomas Ball
Everett, R. Lacey Lewis, John Herbert Simon, John Allsebrook
Falconer, J. Lloyd-George, Rt. Hon. David Sloan, Thomas Henry
Stanley, Hon. A. Lyulph (Cheshire) Walton, Joseph Wilson, J. W. (Worcestershire, N.)
Taylor, John W. (Durham) Ward, W. Dudley (Southampton) Wilson, P. W. (St. Pancras, S.)
Tennant, H. J. (Berwickshire) Wason, John Cathcart (Orkney) Wilson, W. T. (Westhoughton)
Thomas, Sir A. (Glamorgan, E.) Wedgwood, Joslah C.
Thomasson, Franklin White, J. Dundas (Dumbartonshire)
Thompson, J. W. H. (Somerset, E.) White, Sir Luke (York, E. R.) TELLERS FOR THE AYES.—Cap-
Thorne, G. R. (Wolverhampton) Whitley, John Henry (Halifax) tain Norton and Sir Edward
Tomkinson, James Wilkie, Alexander Strachey.
Toulmin, George Williams, J. (Glamorgan)
NOES.
Anson, Sir William Reynell Fell, Arthur Pease, Herbert Pike (Darlington)
Arkwright, John Stanhope Gardner, Ernest Peel, Hon. W. R. W.
Balcarres, Lord Gibbs, G. A. (Bristol, West) Pretyman, E. G.
Baldwin, Stanley Gretton, John Ratcliff, Major R. F.
Banner, John S. Harmood- Guinness, Hon. R. (Haggerston) Remnant, James Farquharson
Baring, Capt. Hon. G. (Winchester) Guinness, W. E. (Bury St. Edmunds) Renton, Leslie
Barrie, H. T. (Londonderry, N.) Hamilton, Marquess of Roberts, S. (Sheffield, Ecclesall)
Beach, Hon. Michael Hugh Hicks Harrison-Broadley, H. B. Rutherford, W. W. (Liverpool)
Beckett, Hon. Gervase Hermon-Hodge, Sir Robert Scott, Sir S. (Marylebone, W.)
Bignold, Sir Arthur Hill, Sir Clement Sheffield, Sir Berkeley George D.
Bridgeman W. Clive Hope, James Fitzalan (Sheffield) Starkey, John R.
Bull, Sir William James Hunt, Rowland Staveley-Hill, Henry (Staffordshire)
Carlile, E. Hildred Joynson-Hicks, William Walker, Col. W. H. (Lancs.)
Castlereagh, Viscount Kerry, Earl of Warde, Col. C. E. (Kent, Mid)
Cecil, Evelyn (Aston Manor) Lane-Fox, G. R Wilson, A. Stanley (York, E. R.)
Chamberlain, Rt. Hon. J. A. (Worc'r.) Lockwood, Rt. Hon. Lt.-Col. A. R. Winterton, Earl
Cilve, Percy Archer Long, Col. Charles W. (Evesham) Wyndham, Rt. Hon. George
Clyde, J. A. Mildmay, Francis Bingham Younger, George
Cochrane, Hon. Thomas H. A. E. Morpeth, Viscount
Craig, Captain James (Down, E.) Morrison-Bell, Captain TELLERS FOR THE NOES.—Vis-
Craik, Sir Henry Newdegate, F. A. count Valentia and Mr. H. W.
Dairympie, Viscount Nicholson, Wm. G. (Petersfield) Forster.
Douglas, Rt. Hon. A. Akers-

Committee report Progress; to sit again upon Monday next.

Resolved, "That this House do now adjourn."—[Captain Norton.]

Adjourned accordingly at Thirteen minutes after Seven o'clock a.m. (Wednesday, 21st July).