§ That on and after the thirtieth day of April, nineteen hundred and nine, the following duties be charged in respect of land:—
- (i) A duty on any increment value accruing after the said date at the rate of one pound for every full. five pounds of that value, the duty to be taken on the occasion of the transfer, or the grant of a lease of the land, and on the occasion of the death of any person where the property passing on his death comprises any such land, and in the case of land belonging to a body corporate or unincorporate on such periodical occasions as Parliament may determine;
- (ii) A duty on the value of any benefit accruing to a lessor by reason of the determination of a lease at the rate of one pound for every ten pounds of that value;
- (iii) An annual duty in respect of the capital site value of land which has not been developed for building or other purposes, and the capital value of ungotten minerals, at the rate of one halfpenny- for every pound of that value.
§ Resolution read a second time.
§ Motion made and Question proposed, "That this House doth agree with the Committee in the said Resolution."
1200§ Sir WILLIAM ANSONI suppose that there is no part of the large and miscellaneous financial proposals of the right hon. Gentleman which has excited more general interest than this proposal as to land value. The few remarks with which I mean to trouble the House I shall devote almost entirely to the effect of the contemplated taxes upon certain societies holding property under certain conditions. There is, however, one matter of general interest on which I should be glad to have the explanation which the right hon. Gentleman the Chancellor of the Exchequer hinted we should have in this Budget speech when we came to the discussion in Committee. I refer to the question of valuation. If these taxes are imposed without hardship and uncertainty or possible inequaliy they must be imposed upon a clear and satisfactory scheme of valuation. Now the right hon. Gentleman lin his Budget speech spoke as to the difficulty that stood in the way of framing any such scheme of valuation. He said:—
These proposals necessarily involve a Complete reconstruction of the methods of value in property…The intensely complex character of British land tenure introduces a further complication… The existing valuation lists on at animal value basis (even if they represented true annual values, which. in many cases. they do not) would be of little use to the purpose of determining capital values—the basis of the new duties—and it will therefore be necessary to pro-v de for a complete valuation on a capital basis of the whole of the land in the United Kingdom.He went on to say that he did not propose to deal with the latter in his Budget speech, but he would reserve it for discussion in Committee. The Question was raised in Committee, and the right hon. Gentleman was asked to explain his scheme of valuation, and he said we should find it in the Finance Bill.
§ Mr. LLOYD-GEORGEWho asked that?
§ Mr. YOUNGERI asked it, for one.
§ Sir WILLIAM ANSONThe Noble Lord the Member for Thirsk (Viscount Helmsley) asked it, and I feel pretty certain the right hon. Gentleman said he would not go into any discussion on that matter then, that it was perfectly simple and that the whole machinery would appear in the Finance Bill. If the right hon. Gentleman looks at the Report he will find that it is very much as I say. What I am really anxious is that, having regard to the serious difficulty which the Chancellor of the Exchequer contemplated in the scheme of valuation, we should at some early date know something of what he is going to do. It would not be very satisfactory, after taxes were imposed, that a 1201 scheme of valuation should follow afterwards. We have had some experience of similar procedure before. Last year there was a scheme of old age pensions, and during the Recess the right hon. Gentleman instituted an inquiry as to the proper machinery to be used, and this year—and only this year—we are raising the money. I think it would be very regrettable that taxation which excites a feeling and a good deal of interest and considerable hardship were to be imposed, and that a scheme of valuation which is to settle everything and to reassure everybody were not brought into existence until the taxes were imposed and levied. That is the one matter of general interest to which I wish to call the attention of the Chancellor of the Exchequer. There is another matter: any scheme of valuation or any system of valuation ought to proceed on some unit of valuation. The hon. Member for Chelmsford pressed, in the Debates in Committee, the right hon. Gentleman to state what was that valuation, was it to be the property taken as a whole, or was it the county in which a particular piece of property was, or was it the parish, or was it a plot of land which might be of one value at one end and another value at another? The reason I am anxious to be clear upon this point is that I am interested not merely in the whole subject, but on behalf of certain societies who hold property under certain conditions. The colleges and old universities cannot let land except on conditions rigorously defined by statute. They cannot sell land or use their capital without the permission of the Board of Agriculture, and, what is more, the income of their property is all appropriated by statutes passed by the University Commissioners and approved by the Crown and Parliament:, and the income is so appropriated that except in the case of a very limited number no one has any interests in any increase in the value of the property, it merely goes to advance the academic scientific educational purposes for which the statutes have been introduced. Now with regard to this new valuation, I should like to call the Chancellor's attention to a concrete case. It is the case of a society to which I belong. In the year 1878 the income of that college—so far as it was derived from land apart from dividends on invested money—was derived entirely from agricultural land. In the year 1878 agricultural land was flourishing. Rents were high, and the University Commissioners. having regard to the large pre- 1202 sent, and, as they thought, permanent. income, apportioned out their funds according to their requirements. Since 1878 this agricultural land has diminished by more than one-half, and probably that which was worth £21,000 in 1878 now brings in no more than £10,000.
§ Mr. LIEF JONESWhere are these lands?
§ Sir WILLIAM ANSONI really do not think I need trouble the House with that. I shall be most happy to give the hon. Member all the particulars by and by, in the meantime about 20 years ago a college having property in Middlesex began to develop that property, and it has now come on to the point in the course of the last twenty years at which the total income from land amounts to three or four hundred pounds more than in 1878. I am speaking now on the Question of valuation and of what happened in the past. What happened in the past may very well happen again, and this is why:I want to be sure in regard to this question of valuation. Are you going to take the property which has increased in value and tax that without any reference to the property which has diminished in value? The Chancellor of the Exchequer will remember that one of the reasons he gave why he was prepared to impose this tax was that the increased value was usually due to the enterprise of the community or the neighbouring landowner. I have a great regard for the local authorities of Middlesex, and in our case we have always lived on good terms with our neighbours, but I attribute this increase in value to a competent agent and to expenditure on road-making of over £70,000 in order to obtain access and frontage. To complete our plans we have bought land where it was necessary to the extent of £30,000, and we have spent over £100,000 in the development of this property, and have consequently lost income from interest, and have every year to provide a. considerable sum for the replacement of capital. Ought not losses upon agricultural value to be set off against the increment from other causes, more particularly when that increment is due not merely to good fortune or the enterprise of the community or the enterprise of the neighbouring landlord, but when it is clue to the careful and liberal expenditure of the owner of the property?
I want to know will any allowance be made in this matter on account of this expenditure, and will the change in agricultural conditions which have depressed 1203 this property be taken into consideration? That is a fair question, I think, which turns upon what is the unit of valuation which the Chancellor of the Exchequer will take in estimating for this periodical charge. The energy expended in developing a certain portion of this property which has been purely our own energy has brought into possible building prospect a large and scattered property extending from Willesden to Edgware. About 1,500 acres of land are now let on tenancies from year to year, with a liability to be given up on short notice if required for building. Some of it may never be required for building, and it is what the Chancellor of the Exchequer would call undeveloped land, inasmuch as nowhere would the Board of Agriculture allow any part of it to be sold at less than £50 an acre, and they would probably insist upon a great deal more being asked for it. What I want to ask is, Why is it held that this land is not being used to the best advantage? I understand that one test in regard to undeveloped land is whether it is land which has not been used to the best advantage. We cannot use this land to any better advantage. The land is let for various agricultural purposes at the best rent we can get, and why should this land be taxed at £1, 30s., or £2 an acre when it cannot be devoted to any, better purpose?
Why is this tax imposed? I have studied carefully the reasons stated in the Budget speech, and one reason was that a grasping landlord was keeping out of use land that was urgently wanted by the community For the health and comfort of the inhabitants. There is no question there of the land being kept out of reach. The reasonable thing to do if the community is injured by the retention of the land would be to give the community power to take it over. There has been no suggestion of that kind. As to the land not being put to the best use, we are developing it in the best way we can. We have held this land for 500 years, and we have suffered many things in times past, but no Tudor or Stuart ever ventured to treat us like the Chancellor of the Exchequer. I am quite ready to make every acknowledgment to the Urban District Council of Willesden and the County Council of Middlesex for anything they have done in the matter, but I wish to point out that they are not going to be a penny richer for it, because the money will go into the Imperial Exchequer. I think if the community have done all this good they ought 1204 to get some benefit, but I deny that in this case the community has clone any good, or very little, at any rate, but I do not see that the Chancellor of the Exchequer intends to confer any advantage whatever upon them.
Let me take a concrete case which will show the way this proposal will work. I know of some land which is let for allotments belonging to my colleagues at Harlesden, and it is let at £4 6s. an acre. At the beginning of this year I was asked by persons interested in allotments whether they could not be bought at 25 years' purchase, or upon the agricultural value in order to retain them as allotments or open spaces. It so happens that a portion of this same land on which the allotments are let has been sold within the last 18 months for £1,000 an acre. But what would the Board of Agriculture have said if we had asked them to allow us to sell land at £110 an acre which any builder would give £1,000 an acre for? Here is land used for allotments which may at any moment come in for building, or be let at a building rent or sold for £1,000 an acre. We cannot develop it more than we have done, because the Board of Agriculture will not let us. and yet at the same time the Chancellor of the Exchequer is going to impose a tax of £2 an acre upon it.
§ Mr. LLOYD-GEORGEWhy?
§ Sir WILLIAM ANSONBecause some of the land is worth £1,000 an acre.
§ Mr. LLOYD-GEORGEBut is it worth that?
§ Sir WILLIAM ANSONWell, if it is, I do not think it will be sold for much less. I will, however, put it at £500 an acre; then you charge £1 an acre, or tax us at the rate of 30s. or £2 an acre on land which is developed to the utmost of our power, and when it is developed, as the Chancellor of the Exchequer will see, you will take 20 per cent. of the profit. He taxes this land because it is undeveloped, and directly it is developed he takes 20 per cent., and this in the case of a body who have not free control over the land, who cannot sell it without the consent of a Government Department, and cannot let it except on terms prescribed by statute. I point out these instances because I think they really show that even this form of taxation on undeveloped land—which it is almost impossible for anybody to define--will work very hardly on individuals and on society. It works 1205 particularly hard upon societies such as those which l have alluded to, who have not control over their land, and also upon individuals who will be at the mercy of some authority who will say that the land is capable of development, aria is therefore undeveloped at the present time.
Whether it is or is not used to the best advantage, arid whether it is or is not worth more than £50 an acre, all these things are left absolutely uncertain. They may be set forth in the Bill, and if they are we shall have a considerable amount of reading to do during the Recess. If they are not we shall have considerable discussion during the Committee Stage of the Bill. What is this money taken from? The right hon. Gentleman may think that this is a mere trifle, and that this is a hardship which may occur to anybody and not worth consideration in so large a scheme as he is putting before the House and the country. It is, however, large enough to embarrass a society who can only use their money for the purpose of the advancement of learning and education. I do not wish to trouble the right hon. Gentleman with particular details, but I know the extreme disappointment to the society to which I belong when, after having at last, by the development of this society, which I have described, discharged their obligation to the university, and having obtained fresh powers to go further, having proposals before them which they conceived would be of great advantage to the university and education generally, they are told it is quite impossible to consider any of these matters because the Chancellor of the Exchequer will take the whole of the available surplus by his Budget proposals. At a time when new fields of inquiry are being constantly opened and new branches of study developed, when there is a new and keen desire for education in all branches of life, is it desirable under these circumstances to put this heavy burden upon the advancement of knowledge and the spread of education? I speak for one college and for one university only, but, as the right hon. Gentleman knows, there are other colleges and other universities which will suffer from similar treatment. There is something else that I would remind the right hon. Gentleman than the taxation of undeveloped land. There is an infinitude of ungotten wealth in the brain of your people—of your half-educated people. It is a poor record for a Liberal Government and a Free Trade Budget to put this heavy burden on the spring of the sources of intellectual wealth 1206 and on the extension and diffusion of knowledge, which ought to be the first business of any Government to foster and promote.
§ Sir JOHN DICKSON-POYNDERIt must be in the mind of every Member of the House who is taking part in this Debate that, perhaps to an even greater degree than any other of the Budget Resolutions, the absence of any detailed information on Government proposals regarding land taxation reduces any well considered criticisms to necessarily very narrow limits. The little information which we necessarily possess with regard to details must limit the scope of our discussion. I admit that that is not the fault of the Government. It is rather due to the somewhat clumsy and obsolete system of procedure which for generations has characterised our method of dealing with the Finance Bill and our Budget proposal. I should have been glad if, under the circumstances, the Chancellor of the Exchequer had extended his admirable innovation which he made in his Budget speech with regard to the more specific proposals in the future, and have circulated a second Memorandum explaining his proposals. We have had long discussions on this Question, especially from hon. Gentlemen opposite, and I think that the whole tenor of their remarks has been focussed to the Question which is now under Debate. They have complained that land should be singled out for this taxation. In the remarks which I have to make I may have to express certain criticism in regard to this taxation. I cannot agree that land, under all conditions, at all times, and in all places, can be considered on the same footing as all other forms of investment. I do so for two reasons. In the first place, I think that I am the last person to say anything against the principle of the rights of property, but, at the same time, I must realise, as everybody else does, that you cannot divorce land from the social necessities of the population. Secondly, I think under certain conditions land offers at certain times great opportunities of making automatic profits than almost any other property. For these two reasons I should say that land is somewhat outside other forms of property, and should justify its inclusion in this year's scheme of taxation and at times of financial emergency. Let me come to the main proposals made by the Chancellor of the Exchequer with regard to the taxation of land. They are three in number, and I desire to approach them in an impersonal and unbiassed frame of 1207 mind. In the first place he proposes a tax of 10 per cent. on reversion; in the second place, 20 per cent. on the enhanced value on sale, death, or renewal of lease; and, thirdly, a halfpenny in the £ on undeveloped land and minerals. These are three distinct taxes, and deal with distinct kinds of land. As regards the reversion of 10 per cent. on the expiration of lease, I strongly support the proposal of the Chancellor of the Exchequer. I believe it to be a perfectly equitable charge, and one which, as time proceeds, will be found to be exceedingly profitable to the Exchequer.
As regards the tax on the expiration of lease, I may say it is in effect an extension of the principle of the Death Duties on this kind of property. The owner of ground rents on the expiry of a lease becomes possessed not only of the land, but of the house that has been erected on that land. The house probably has been erected in most cases through the enterprise or capital of somebody else, and has been maintained by somebody else, and yet at the expiration of the lease it is at present handed over to the owner of the land. In other words, an owner who has been the recipient of a ground rent, say, of £5 or £10 is, at the expiration of that period, entitled by the present law to become the recipient of something like £50 or £60 a year, or even a much larger sum. It is, therefore, only right that. there should be a charge of 10 per cent. on such an owner before he comes into the enhanced capital value. I should like to point out to the Chancellor of the Exchequer a few particulars which I have no doubt will be found in the provisions of the Bill. I should like him to take certain cases into serious account. I would point out to the Chancellor of the Exchequer that in cases where the owner is only tenant for life under the Settled Lands Act due provision should be made to enable him to make a charge on the estate for such payment, and not be obliged to pay it himself out of his own income. I should like to point out a very important provision, which I hope will be taken into account, with reference to this proposed tax, and that is to protect the owner of such property who has bought the reversionary interest. There are many companies, many societies, and as many as 10,000 individuals, drawn from all classes of the community, who have bought the reversionary interest and have invested a large sum of money in the hope that in a few years' time they will come into the 1208 enhanced value. Let me take one case. as an illustration. A man has paid £800 for two houses with a ground rent of £8 15s. He has paid at the rate of 90 years' purchase. There are many such cases amongst the poorer classes of the community, wile. borrow money at 4 per cent. interest in order to pay for the property in a few years' time. In five years' time he hopes to come into a rack rent of £30 a house. If he had to pay on the whole tax he would have to pay 10 per cent. That would be he would have to pay in such a case—that is, if he had to pay on the whole—say, 10 per cent. on £1,300, say, £130. The only equitable way to treat such cases is merely to charge on the enhanced value that has accrued after he bought the ground rent at £400—merely charge him on the difference. With such provisions as I have outlined I believe this tax is a perfectly fair one. and that it will be found. when house property through the country has been properly registered, to be a reliable and profitable source of revenue to the State. I pass to the second tax, that. is, 20 per cent. on unearned increment, which is to take place either when property is sold or at death, or upon granting of a new lease. I hope that when this proposal comes for discussion in Committee, that the Chancellor of the Exchequer will be induced to reduce the 20 per cent. to 10 per cent., and thus make it coincide with the 10 per cent. charge on reversion. I do not see why 20 per cent. should be charged in this case and only 10 per cent. on reversion.
§ Mr. JOHN WARDWhy not make both charges 20 per cent.?
§ Sir JOHN DICKSON-POYNDERLet me say a word as to the proposal in regard to the duty on death. It seems to me very unfair that those who own property should pay twice over. I will take a concrete in -stance. A man whose property is worth £100,000 will, under the new proposal, have to pay in addition to 9 per cent. another 20 per cent. on increased value. It is unnecessary to make a double charge under that head. I come to the second point, that is the transfer and sale of the property. This appears to be an equitable charge, because there are many instances where owners of this class of property prefer to sell a few years before the property is actually ripe, and thereby escape the trouble of developing that property. The third point is that of a new lease. I hope that in this case it will he made quite clear in the Bill 1209 that this charge will be made on the ground of the lease only in cases where the land has undergone development, and that it will not apply to renewal of leases on agricultural property. I must say it is very difficult to get definite information as to the nature of the Budget proposals, and it is only by means of Debates of this character that we are able to elicit it. It appears to me that this tax applies to this class of property, and, on that assumption, I am pointing out that I think the limit of £50 per acre is too low. I should prefer to see it increased to £100.
If you once enter into the particular region of agricultural land, you will find yourself entangled in all kinds of complications. Under the present law, full compensation is given by the outgoing tenant to the incoming tenant, and, under existing Agricultural Holdings Acts, provision is taken that where there are unexhausted improvements, they shall be fully paid for; if you attach an additional tax to land which has been improved by the occupying tenant and is going to be paid for under the existing law, it seems to me you will be imposing an undue burden on both tenant and landlord—on the landlord directly and on the tenant indirectly. I would venture to say there are only three occasions during a man's lifetime in dealing with urban and semi-urban land in which you can with equity impose an additional tax to that he hears as an owner. The first is one to which I have already alluded, namely, on the expiration of the lease when the owner comes into the enjoyment of the rack rent. The second occasion is when he sells the land at an enhanced value in view of its prospective value for building, and thereby escapes the trouble of developing the land himself. The third occasion is when he has undertaken and completed a successful operation in converting the land from agricultural conditions to urban conditions; in other words, when land, which has been rented for agricultural purposes at about £3 or £5 per acre, has been laid out in budding sites and has had 18 or 19 houses built on each acre, each house bringing to the owner a rental of £3 or £4. The result of that operation is that he is receiving £60 or £70 per year per acre where formerly he only got from £3 to £5 per acre. Of course, due consideration will be given by the Chancellor of the Exchequer to all capital expenditure on roads, and in regard to the loss which accrues during the time of development. But, even taking that into account, it is a very profitable 1210 operation when successfully carried out — the conversion of land from rural to urban conditions, and if money is wanted for increased expenditure in the country it seems to me that those who are fortunate enough to own this particular type of property have sufficiently substantial shoulders to bear the additional burden.
I come next to the last proposition, that for a. tax on undeveloped land and minerals. I do not propose to detain the House at any length this afternoon in dealing with the proposal to tax undeveloped minerals. It is a matter which will require full discussion, and I think it is probable that the result of such discussion will be to show that it is clearly an unworkable scheme. When we conic to this tax we, are leaving the realms of reality and entering the regions of fancy and imagination. A proposal to place ½d. tax on undeveloped land is, I respectfully submit, unworkable in practice. At any rate in my judgment it is so. I suppose it has been included among the proposals embodied in this year's Budget as a kind of sop to Cerberus, in the nature of a compromise with those who are known as ardent land taxers. Land taxers have advocated throughout the country 1d. all round on land, whether agricultural or urban, and I have no doubt the Government at a very early stage detected on close examination of these complicated proposals that to put Id. on agricultural land would be not only unworkable but extremely injudicious. So they have adopted a half measure by proposing to put ½d. on urban and semi-urban land. I venture to believe that whatever party tries to pass such a proposal will find it very injurious to its interests, and I would say with all the force I can command to my own friends on this side of the House that a halfpenny tax on the capital value of so-called undeveloped land would in many instances almost extinguish the present agricultural rental of that land. Secondly, the owners of such property are an extremely numerous body. They are drawn from all classes in the community. It was said by the late Prime Minister in a speech delivered some years ago that he wanted to see England less a pleasure ground of the rich. I do not quarrel with the phrase, but it is equally true to say that this kind of land forms one of the staple investments of the poor.
One of the main objects of imposing this tax is, I believe, to free land more readily 1211 for building purposes, and to bring it into the market, and it is based on the hypothesis that at present land is being held up by recalcitrant owners in the neighbourhood of towns, and building is thereby discouraged and checked. I venture to assert such cases are not numerous, and that this hypothesis is fundamentally fallacious. I do not believe that, with possibly a few rare exceptions, there are many instances of this character either around London or in the neighbourhood of our provincial towns. If there are any, I should like to know where they are, and I venture to suggest that such cases could be, and ought to be, dealt with by existing compulsory powers of purchase, and if such powers are not sufficient, or if the procedure is too cumbrous, I should hope that in a measure which we are to be asked to pass this year adequate provisions will be inserted which will ensure that no landlord in the neighbourhood of a town shall obstinately or obdurately hold back land when wanted. I think that would be a fairer and far more effective way of dealing with this difficulty. It is my own experience that land - owners are found tumbling over each other in order to convert land from rural into urban conditions. It is obvious it should be so, human nature being what it is, because one can hardly conceive any owner who exists obstinately and obdurately contenting himself with an agricultural rental of £5 a year when by converting his land into urban conditions he could enjoy an enhanced rental of £50, £60, or £70 per year.
The present proposal suggests that a valuer shall actually gauge what land is ripe and what is not ripe for building purposes, and it is intended to put the tax of ½d. on the capital value of the former. I would ask how on earth is any valuer in the country to be able to forecast accurately or gauge the value of such property? What better test can there be, looking at this matter from a practical point of view, than the test of the owner, realising that he may increase his rental, either by developing his land himself or selling or leasing it to a builder to carry out the operation? Surely that is the best and only test by which one can tell if land is ripe for development. I will take two instances to illustrate my point. I will take orchard land in the suburbs of London now let at a rental of £5 per year. As by degrees, and it is by very slow degrees, that land is absorbed for building purposes, that its rental 1212 value has correspondingly gone up, and the result of the full operation is that something like It 19 houses have been placed on each acre, these houses bringing an annual sum to the owner of £3 10s. a year, so that instead of receiving £5 per year per acre by the time the building operation is completed he is getting £60 per year for each acre of that land. But if building is checked in that district, and he cannot go on with the operation, how is the valuer to fix the price of that land Undoubtedly, the capital price when the land was built upon would range from £1,000 to £1,200. In a few years' time little by little the land would be absorbed,. with the result that land adjacent would become worth the same amount of money. But what would be the result to the unfortunate owner who is getting £5 per year rent if he is to pay ½d. on the capital value of land which he cannot develop. because the district is not ripe for development? He would have to pay this½d. on the capital value, and it would represent 58s., or rather more than one-half of the amount he is receiving as rent, without taking into consideration the outgoings for existing rates, land tax and income tax. The other illustration to which I would draw attention is that of land bordering on some small growing provincial town. There are thousands of these cases in which agricultural land is let at 30s. per acre. When it is ripe for building the capital value of that land for sale is something between £400 and £500—quite a reasonable sum. What is the tax proposed to be put on the unfortunate owner of that land for which he is now receiving only 30s. a year? It amounts, in addition to existing rates and taxes, to something like 20s. 6d. out of his 30s. It is manifestly unfair. This class of land is not merely owned by rich land-owners, who derive their incomes from other classes of property, but it is owned in many cases by small county gentlemen, who derive their whole income from this class of property, and it is also owned by thousands of small tradesmen in the provincial towns who, when they have made a little money in business, invariably select this as the. surest and most stable form of investment certain to prove profitable in the future. I think it is a form of investment which we should be very reluctant to diseourage in any way among that class of people. I may be told that this land, until it is ripe, will not be charged, but my answer is, How can a valuer decide and discriminate? Now let me sum up this halfpenny 1213 tax on land in conclusion. It is, in my judgment, a proposal based upon theory but quite devoid of practical experience. It can only be applied in one of two ways. It can either be applied by indiscriminately placing a tax upon all suburban property and taking that as the unit, and in that way it will bring about the grossest injustice and it will injure many people, a great many very humble people in this country, as well as being very disastrous to any party that attempts it. It will either take that form, or else it will take the form of being fenced round with a whole host of exceptions. reservations, and exemptions, such as that this class of land is not ripe for building, and that this class should be ruled out, and if that is to be done it will be found that the staff which will have to be established to undertake such a work will cost so much in salaries that it will exceed the comparatively small sum of money which will be raised from the land. I hope we shall in the course of the discussion which is to take place thoroughly thresh out the Question, and I am sure the more it is debated in this House, quite judicially and unprejudicially, it will be found that this particular proposal for the imposition of a tax is unworkable, and would, if it is put into operation, not carry out the purpose for which it was intended. I am quite sure that an adequate sum of revenue could be raised on the three bases I have suggested—expiration, sale, or conversion from rural to urban conditions. It is upon these three lines you can equitably tax land, and I hope it will be upon them that land taxation will be ultimately approved by the majority of this House and embodied in the Finance Bill.
§ Sir JOHN RANDLESThe operation of the tax to which I wish to direct attention for a few minutes is alluded to in the last lines of the Resolution, which has reference more particularly to the proposed tax on minerals. The importance of this proposal is to be. estimated, not by the measure of the amount necessarily to be obtained from the tax, but by the disturbance and uncertainty which will arise in connection with the raw material of our greatest industries. We depend as much on our raw materials being a known quantity, as regards the cost of their production, almost as on any one feature of the trade. If there is uncertainty as to the incidence of a tax, it means that there will be trouble for those engaged in the industry. It has two or three bearings. In his speech the hon. Member for Merthyr 1214 pointed out the other day that it might operate by forcing into the market coal to such a large extent that there will be a glut, and the workers of coal would be very prejudicially affected by such a development. That is one danger, but the danger which I wish to speak of has reference not to coal—though I recognise how great its importance is in regard to that commodity—but in reference to iron ore. If it were a tax upon royalties I could understand it. If it were an Income Tax on the sums that were raised from royaltie I could understand it, but a tax on ungotten minerals may mean much or little. Under the present Administration I think it would mean much, and we must treat it as if it would mean much. Take the case of a royalty granted in regard to minerals, with the condition that the mine should be worked with the greatest advantage to the propery. The effect of this condition would be probably this, that a large area of royalty which was being worked to a certain extent, and in which the discovery of further mineral ore was being made, gradually would be forced to be worked uneconomically. It would be forced to be worked uneconomically. If this condition arose that the royalty owner, speaking to his lessee, would say, "Unless you work that mineral and get that mineral I shall have to pay this increased tax of a halfpenny, if you fail to work that mineral as I wish it to be worked, and as you say it is uneconomical, you will have to pay the tax," then the incidence of the tax would not fall upon the owner, but it would come down on the industry itself. The iron and steel manufacturer is the man who would have to bear that burden. I do not think that the Chancellor of the Exchequer intended to put a burden upon the iron and steel manufacturers of this country. If he does he means to put a burden upon one of our most hardly pressed industries,. and one which is the least able to bear, as the result of foreign competition, such an imposition. I should like, if we may, to have some of the points cleared up. In a speech the other day we were given to understand that about six pages of explanation in the Chancellor of the Exchequer's Budget speech were omitted on this point. I wonder if we might have those six pages of his speech with reference to this point, as I think it would be to our advantage. If the tax that is proposed to be levied is intended for the manufacturer, for the worker of minerals, it should be very much more easily and satisfactorily expressed— 1215 he would not like it, he would object to and fight it, but he could understand it. But it is the unknown which is the dangerous element. We do not see what you mean when you say ungotten minerals. We know that a mining expert will go and say on some estates that there are so many hundreds of thousands and millions of tons of minerals, which he regards as being In sight; because he thinks he is justified in saying that, a certain area is proved.
But it may be most disastrous to attempt to work on that ungotten mineral, at one time or another, in consequence of the ground and the faults and the geological strata, and it may be very well the case that by drifting you may get to the best place and work economically, but if you are going to put shafts clown, from known points to absolutely unknown ground, you are going to impose an enormous risk, which is not justified under the circumstances, and you are going to do work which is uneconomical, and which in certain cases may be disastrous, although on the other hand it may turn out all right. I may point out to the Chancellor of the Exchequer that he puts a burden under his Income Tax on these ungotten minerals, and I drew his attention the other day by way of question to the point of his charging the Income Tax on bore holes, which you put down in order to search for the minerals, for the ungotten ore in particular. If a mine-owner has an area on royalty and he is working in that area in order to discover where he has to proceed with his operations, if he sinks a bore hole, which costs him £1,000 or £1,500, unless he charges that to capital account he is at present charged Income Tax on that expenditure. It is a tax upon the industry, but it is not a fair tax upon it, because without the knowledge and the information given by that bore hole, it is impossible to work the royalty. But we have this Income Tax here levied upon his search for minerals, and then the Chancellor of the Exchequer is going to put the additional burden of this ½d. not only on mines but ungotten minerals. In addition to paying Income Tax for searching for the minerals it is proposed to put on an unknown amount on an unknown supply of minerals, which, in the opinion of one expert, may be great and in that of another may be. small, and we are to have this burden and this uncertainty attached to a large industry which is in severe competition at the present time with other industries, and we 1216 have had very little information about it. It is very difficult to say what this tax means. The other night, when we were just on this very point, the closure was applied at the very moment when we were going to get to know something, and the consequence is that we know very little about it; but if the Chancellor of the Exchequer will give us these six pages which he omitted from his Budget speech. —if he will give us plenty of time and give us this information and make it clear. I am sure he will find a better means of raising money than by putting a vague tax upon industry, which will be more of a menace to that industry than any other blow which could be dealt by the Chancellor of the Exchequer.
§ Mr. R. L. EVERETTI propose to say a few words as regards this proposed land tax from quite a different point of view from that of the hon. Member who preceded me. I wish to speak of the effect which that tax is likely to have upon the owners of land in the Eastern Counties, where I was born, have lived a long life. and with regard to the land of which possess a considerable amount of knowledge. As I understand from a statement made by the Chancellor of the Exchequer in a special interview reported in the "Westminster Gazette" what he proposes in regard to land is this:
The firs: is au increment tax. All the land in the Kingdom will be valued at its present value. That is the first operation If it increases in value subsequently then either at transfer or at death the proposal is that the State should sacure.20 per cent. upon that increment.I am sorry to say that in the part of England where I live during the last 30 years we have had a very painful experience of the decrement of land, not at all of its increment. I ant old enough to remember when the value of agricultural land was steadily and continuously rising. and that state of things lasted from 1853 to 1878. During that happy period, as I look back upon it, I pleasantly remember how every re-let of a farm was at an increase, every sale of land was at a considerably enhanced price for the freehold. and we believed that that was a permanent state of things, and so confident was the feeling at. that time that those who had money to lend on mortgage to put in trust looked upon the security of the land as the most absolute security that it was in their power to attain. If a man bought. land who was known not to he likely to pay for it himself the lawyers would almost run after him for the trustees to lend money on that land at 4 per 1217 cent. up to very nearly the whole value of the price given for the land. But I am sorry to say that beginning with the year 1879 there set in a. process exactly the reverse of that which I have spoken of. During the next 25 years we saw a steady, continuous, increasing downfall in the value of our agricultural land, and I speak within moderate bounds when I say that on an average in the county of Suffolk the value of land went down more than half—considerably more than half in many cases. I know a farm not very far from me which was bought in good times by a man to occupy at £8,000, and he occupied it with advantage to himself for several years, but he lived a little too long, into the times of fall in valuation, and when that farm, on his death, had to be sold, to the great loss of his family, it only realised £4,000, instead of £8,000. Another person, attracted by the low price, bought the farm and farmed it for several more years, but the price of agricultural produce kept going down, and in a few years he became bankrupt, and the farm had to be sold again. This time it made £800, having fallen in some 20 years from £8,000 to £800. There are numbers of cases like that in the counties of Suffolk and Essex. I was on the Royal Commission appointed to inquire into agricultural depression by Mr. Gladstone's Government in 1894. We reported in 1897 that, if the land in Ireland had been affected in the same way which land in Great Britain had, the capital value of the land of the United Kingdom had fallen to the extent of £1,000,000,000—an enormous sum. We all know that the rents which were fixed in Ireland, and which were supposed when they were fixed after the Act of 1880 to be as sure as income from Consols, could not be paid after a few years owing to the fall in prices of agricultural produce, and Parliament had to step in and allow a revaluation and a great reduction of rents.Now I look at how we are likely to be affected in the parts that I know by this proposed new legislation. I am thankful to say that in the last three or four years our land has begun to lift its head up a little. There has been some returning inclination to look at land as a thing fit to buy, and at the very low prices which it has sunk to there is some inclination now to buy it. Now comes this proposed blow from the Chancellor of the Exchequer to knock it down again, and to depress it as it has been so grievously depressed in the past. I have to do with several cases as an executor as well as on my own account 1218 where mortgaged land was left by the deceased, and the mortgage was a great deal more than the value of the land. In some of these cases I have been, as a trustee and executor, kindly considered by the mortgagees, and when it, became impossible for us to pay the amount of interest due they said, "Well, pay what you can," and I have been going on in regard to two cases that I have vividly in my memory like that where I have simply. taken the rent and paid the outgoings, repairs, insurance, and such like, and paid the balance to the mortgagees. A change in agriculture has taken place almost since this Government came into its power; it is a curious thing—a coincidence which I for one welcome, though I do not regard it as cause and effect at all. About the time this Government came into power agriculture began considerably to improve. We had better seasons, and we hoped that in a few years more under such improving circumstances the widows and the fatherless children with whom I am concerned in regard to these mortgaged farms would see their land come up to the value of the mortgage, and perhaps leave a surplus, so that there would be some income coming to them. It seems to me a most cruel thing, looking at the dreadful sufferings that we have endured during the 30 years of falling prices, that any legislation should be proposed to deprive us of any benefit of the rising values which there seems some prospect of our being able to obtain if legislation does not interfere with it.
I can assure the chancellor of the Exchequer, if he would consult a lawyer of any standing in the Eastern counties, he would find his office full of the most frightful cases of loss and ruin, which had been brought upon agricultural families without the least fault of their own by that long fall in prices which began about 1879, and continued without interruption until a few years ago—such a fall in prices as there is no precedent for in modern history. To me it seems intensely cruel that, when there is some sign of recovery the Government should step in to deprive these parties who have suffered so much from the full benefit of such recovery as there is. The land I possess I bought or inherited about 40 years ago. In regard to three-quarters of that land it is worth now, I suppose, about half what I gave for it, but there is a little on the edge of a growing town which has not lost its value, and in the next few years would probably 1219 rise in value. Am I to have to suffer the awful distresses and difficulties that I have been wrestling with for 30 years by the great fall in the value of three-quarters of my land, and then to have the Government step in when some of it is rising in value and take away one-fifth of the rise? To value the land at its to-day's value and deny the full benefit of its increase is practically robbery. If is far below the value it bore 20 or 30 years ago, and I believe the very circumstances which pulled down the value of that land have now been reversed, and there is a chance of it going up again, and surely we who have suffered so much in the fall are entitled to the full benefit of the rise if it comes.
Just a word as to the cause of that fall. Why was it that from 1853 to 1878 we had prices on the whole steadily rising? I can well remember when the Corn Laws were repealed, when Free Trade came in, everyone expected that agriculture was going to be ruined, but, as a matter of fact, instead of that—there were two or three very low years at the first—but beginning from 1853 in the next quarter of a century agriculture was looking up all the while, and that quarter of a century under Free Trade was a good deal more prosperous to agriculture than the 25 or 30 years during which the Corn Laws lasted. The explanation, I believe, is simple enough. Just at the very time the repeal of the Corn- Laws came into effect, which was in 1849, the great gold discoveries in California and Australia began, and in the next 20 or 25 years there was poured out from these new sources an amount of gold equal to the whole amount in the possession of mankind at the beginning of those years, and this raised the general level of prices, though not to the extent it would have done if gold alone had been the standard, raised them enough to more than make up for the decrease that the repeal of the recent Corn Laws had been bringing about. This fall was caused by an exactly reversed process. The fact that one nation after another has taken in hand to legislate against one of the two precious metals, throwing an increased burden upon the other—
§ Mr. SPEAKERI do not see how this arises.
§ Mr. EVERETTThat has been the cause of the depressing process which for more than a quarter of a century has been 1220 forcing prices down. But now there have begun such extraordinary new finds of gold as have never been paralleled in the history of mankind, and as they proceed, as there is every prospect that they will proceed, there seems a fair probability that they will lift up prices again to their old height, if not above it. I appeal to the Chancellor of the Exchequer that ha will not say to us that after the long agony with which we have wrestled for 30 years we shall be deprived of any accretion to that value which may come to us in the years which are now before us. It seems so hard that we should have to bear the whole of that decrement which we had nothing whatever to do in bringing about, and should be deprived of the value of any increment which may come to us. Anyone looking at it calmly, dispassionately, soberly and fairly must feel that it is an awfully hard thing that we should suffer all the loss and all the ruin from the falling prices, and be deprived of the full benefit of any rise which may come to pass. I hope the Chancellor of the Exchequer will well consider the proposals which he makes, and will not try to deprive us of' any portion of such increment as may come to our agricultural land.
§ Mr. REMNANTWith a great deal of what the hon. Member has said we can all agree. The speeches which have been made on the other side of the House, at all events, will show the Chancellor of the Exchequer that amongst his own followers. there are a good many who do not agree with all the suggestions which we have been allowed to see made in this House' in reference to this Budget. One of the remarks made by the hon. Baronet (Sir John Dickson-Poynder) very little can be said against. He said, in effect, that the interest of private owners of land will teach them the way to deal fairly with their property. He also said, towards the end of his speech, that the small man represents an enormous amount of the investment in the land of this country. He must have been thinking at that time of the London area which lie represented on the London County Council for some time, I am glad to say in his sane moments, when he was acting as a colleague of my own and representing the party on this side of the House. He must know that the London County Council, now 17 years ago, first of all suggested and voted a sum of £1,500 to prepare to map out a ground-plan of London. They did that, first of all, because it was the cry then—I am afraid it 1221 is the cry to-day—amongst a good many people that London was owned by five or six great ground landlords. We have had a circular postcard sent round by interested Leagues during the last few months which has repeated the fallacy that London is owned by only half-a-dozen great rich landlords, and that they draw enormous sums of money from the poor occupiers of the land in London. In 1892 we started this great ground plan for London. One would have thought that would not be a very difficult matter, and that it would easily and shortly have been completed for a small sum of money. We thought £1,500 would be sufficient to do it. Would the House be surprised to know that it is not finished to-day, 17 years afterwards, and that the £1,500 has grown into £15,000 Goodness knows what it will cost before it is finished. The four or five great landlords of London have grown into 31,000 holders of land, and there are 2,000 in regard to whom there are negotiations to-day. I am sorry that the Chancellor of the Exchequer has gone out of the House. That is a matter which I hope he will consider when he proposes to this House the beggarly sum of £50,000 for valuing the whole of the land of this country—an amount which is almost too ridiculous to be seriously considered. Everybody sympathises with the Chancellor of the Exchequer who has to raise money, especially when he has to increase taxes to which we may have become accustomed, for the purpose of financing further expenditure. But these proposed land taxes differ from all normal forms of taxation, because they seek to impose exceptional burdens upon people who have chosen that form of investment while in no way attempting to impose correlative burdens upon others who choose to take different forms for their investments. In my opinion, it is economically unsound and practically inexpedient to place one. form of property, like land, under special disability. I may allude to what happened last night, because it forms a concrete illustration of what I am saying. The hon. Member for Dulwich drew attention to the fact that the petrol tax was going to handicap one particular form of locomotion as against other forms of locomotion in this country. The same is true with regard to land. Why should land be treated exceptionally and selected for this taxation, thereby reducing its capital value and its attractiveness as an investment?
Land bears an absolutely disproportionate amount of local taxation when you 1222 come to compare it with personal property. It is extremely difficult on such an occasion as this to enter into the subject in any detail. We must confine ourselves to generalities. That being so, I would like to ask the House to remember how strongly all the authorities that can be enumerated have protested against this assessment of the capital value of land which is the basis of the three proposed taxes. Not only has this method of taxation been condemned by our greatest economic authorities, such as Sir Robert Giffen, and by the only economists of note of whom the Progressive party in the London County Council can boast, Lord Farrer and Lord Hobhouse, but it has been condemned by practically all the expert authorities, such as the Surveyors' Institute and other similar bodies. The findings of official inquiries have been dead against this proposal. The findings of the Select Committee on Town Holdings which reported in 1891, and of the Royal Commision on Local Taxation which reported in 1901, were emphatically against this suggestion. On the other side I think it would be very hard to find any authority who would support the present proposal, and I say so in the face of the Lord Advocate, who, after all, has done more to mislead the country—I do not say it in a disagreeable or offensive sense—on this Question than anyone on the Front Bench opposite, and there have been a good many competitors for the honour. The Committee over which the Lord Advocate presided, and he did so with great fairness to everybody, dealt with the question of the taxation of land values. I was a member of that Committee, and perhaps I ought not to give my own opinion, because it may be considered in some way is biassed. But I may quote what was said by the hon. Member for West Aberdeenshire (Mr. J. M. Henderson). He said:—
This Bill was introduced on the recommendation of a Select Committee, and before he joined this House he always thought that a Select Committee was a Committee selected of open-minded men who would bring judicial minds to hear upon the evidence submitted to them, and according to that state of mind they would weigh the evidence submitted to them and so give their Report to the House. Since he had joined the House, however, he had learned something very different. This Committee consisted of fifteen members, one of whom retired and took no part in the proceedings. That reduced the number to fourteen, and of that fourteen eight were pledged up to their very eyes in support of this principle. Three of these included his Hon. friend the Solicitor-General for Scotland and the Hon. Member for South Edinburgh, both of whom are honorary vice-presidents of the League for the Taxation of Lund Values. That league was promoted for the promulgation of the doctrine of Henry George… What this Bill therefore was going to lead up to was nothing less than the carrying out of that doctrine of Henry George. Before that Committee they heal the 1223 evidence of the best surveyors and assessors from Edinburgh and Glasgow and from all over Scotland—men of the highest eminence, who gave them the most important evidence. He was hound to say that the whole weight of that evidence was against this principle, but the whole of it was brushed aside, and he assured the House that the Report was a condensed form of the evidence which was given by the present president, the late president, and another ex-president of this very league.That, I think I may say, is the only official inquiry that can he produced in support. of the present proposals of the Chancellor of the Exchequer. I wish to refer to the proposed assessment of capital value in relation to increment. In my opinion, if you are going to allow a tax on increment you are going to do a very unfair thing. You are going to cripple the work of numerous companies now engaged in the trade of developing land for building. It must be admitted that all interests in land, just as much as in Stock Exchange securities, are liable to fluctuations in value, and if you subject them to special taxation when there is a flow in value, and do not give them compensation when there is an ebb in value, although that ebb may be due in one place to the flow in another, it is hardly to be expected that any business man will accept that theory for a moment, especially when it is not suggested that that system should be applied to other forms of investment. Take the proposed taxation on reversions. What is that proposed tax? It must be a tax on freehold ground rents. Ground rents have been sold and purchased at prices to cover the whole value of the reversion, whether in the near future or in the distant future. The tax will make future ground rents not only unsaleable, but will strike, in my opinion, a very heavy blow at the whole class of persons belonging to the middle class and the working class who have invested in ground rents either directly or indirectly through insurance companies or other kindred institutions. I should like to ask the Prime Minister, if he were here, for a full explanation in justification of such a tax as this in view of what he said on 10th July, 1907, when he was Chancellor of the Exchequer. He said:—The present Prime Minister, when Chancellor of the Exchequer, speaking on 10th July, 1907, at the opening of new offices of the United Kingdom- Provident Institution, said: 'He believed that insurance companies both here and in Scotland were largely interested as investors in ground values, or what were called in Scotland fen duties or ground annuals, and securities of that type, and he imagined that there was a certain amount of apprehension among investors of that class of security as to the possible effects on their investments of prospective or projected legislation. He thought that they need be under no apprehension whatever on the subject. So far as he was acquainted with 1224 the facts—and he supposed he ought to know—in any legislation which was likely to be proposed in regard to matters of that kind they might be certain that existing contracts would be rigidly respected as sacred. There was no intention under any pretext of public policy or otherwise to rip up obligations which had been incurred in good faith and for value. Legislation must proceed with that for its starting-point and underlying assumption.'I venture to say in view of that statement, and various other statements made by hon. and right hon. Gentlemen opposite, that the feeling of apprehension is growing as to the insecurity which will be meted out to those who invest in a form of property which is popular, and which will always remain popular, in this country. If these proposals are carried out they will do an injustice to a vast number of people in this country. As regards the last point in this Resolution, namely, the tax on undeveloped land and ungotton minerals, I venture to say with respect to undeveloped land that any practical man who has had experience in the management of land will tell the Government that it will have just the opposite effect to what the Government expect. Instead of assisting the development of land it will check it, and you will drive away by this new taxation those who have hitherto undertaken to lay out suburban areas. As soon as the tax is imposed land will cease to be laid out for building. Those who still buy land for building purposes will demand and expect naturally that they should get higher interest for the greater risks run. Certainly the change will not tend to carry out what the Government profess to be the main object of the legislation. Of all the fallacies that ever entered into the minds of men there are none perhaps more ridiculous than this idea, that in the case of land, and land alone, you can assist progress by clapping on heavy taxes, by driving away the prudent investor, and by subjecting such person as may still be willing to develop into exceptional risks and disabilities. I would appeal even at this late hour, before the Budget Bill is brought in, to the Chancellor of the Ex,- chequer to reconsider this idea of his. He has fairly and squarely asked all through that if we have any appeal to make to him and any points to bring before him to do so, and he has said that he has still an open mind. All I ask him is to show that he still has an open mind, and what has been said to-day may influence him to drop this proposed taxation of land, which will have, in my opinion, very different effects from those which he thinks will result.
§ The CHANCELLOR of the EXCHEQUER (Mr. Lloyd-George)The appeal of the right hon. Gentleman who has just sat down was a double-barrelled one. On the one hand he asked that I should preserve an open mind, and on the other that I should drop this part of the Bill. These two things are by no means the same, and I think he will find that what has been said will have the effect of strengthening my conviction that the proposals of the Bill are sound. However, I promise that as far as I am concerned I shall certainly preserve an open mind for full discussion with regard to any grievance that may be submitted for my consideration. I only get up now to clear up one or two misconceptions, and in doing so I can partly anticipate the introduction of the Bill, which cannot now be delayed beyond a day or two. Before the end of this week the Bill will be in the hands of Members. [Cries of "To-morrow."] Today is one day, to-morrow is another. When the Bill is examined it will clear up a great many misconceptions that seem to have arisen in the minds of Members, of which I do not, complain. They are inevitable from a discussion under such conditions as are imposed on us by the rules of the House. I could not possibly have outlined every proposition of the Bill within any kind of compass that would have been tolerable by the House of Commons. I made great demands on the patience of hon. Members, and could not have trespassed at greater length in order to explain details which will be perfectly clear when the Bill is produced. I think when the Bill is produced it will enable hon. Members to enjoy their holidays without, any of the anxieties which seem to worry some of my hon. Friends. With regard to the provisions of the Bill, these things are not nearly so terrible when we examine them closely as when we appeal to our imaginations to see what will be included in them. Naturally hon. Members opposite exaggerate every prospective change brought in by a Liberal Government, but when they see the machine itself they will find it a very workable one, and it is not so very dangerous as they seem to anticipate. My hon. Friend (Mr. Remnant) was very gloomy as to the prospect of land development. What he forgets is this: Land is increasing in value, and the prospect of an increase is an element in the present valuation or market value.
§ Mr. PRETYMANThat would be equally an element in future valuation.
§ Mr. LLOYD-GEORGEOf course, the tax will diminish the increment accordingly, but the hon. Gentleman does not seem to know the basis of the valuation, and I want my hon. Friend (Mr. Pretyman) to remember what the money is for. He, I believe, lives in the East of England, and I want the money to protect him from the Continental invasion. To a certain extent the value of any land is something worse than it was before that, and we must take it into account when we remember that every penny of the increase of tax makes his home and his land more secure. I will now come to deal with the point referred to by the hon. Gentleman the Member for Oxford University (Sir William Anson), and he raised two or three questions of very considerable practical moment. I think he will find them cleared up in the Bill. But I can anticipate the production of the Bill in order to relieve his anxieties on the spot. He was rather troubled about the money that was spent by his college on the development of land in the Willesden district, and he was afraid that by the proposals of the Finance Bill the college would be taxed on the money which had been spent on developments. He will find that all the money spent on development will be deducted before the valuation has been arrived at. If the college sent £70,000 or £100,000 on improvement, I think it would be a monstrous thing if a tax were imposed on the money spent by it on the improvement of its property. [An HON. MEMBER: "Is there any limit of time?"] There is no limit of time. Credit is given for all the money spent on the improvement of the property. The hon. Member seems to think that I have been rather too liberal there. That is exactly what I thought. Once he becomes acquainted with the real conditions of my Bill he will be rather disposed to agree with me. Then, I think, hon. Members opposite have an exaggerated idea of the effect of the valuation. Take this case: Here is a plot of ground which will be sold for £1,000. Therefore the hon. Member thinks that all the other land we have got in the immediate vicinity of that will be valued at £1,000. I have not said that that would be justified by anything in the Valuation Bill. I know the hon. Gentleman (Mr. Pretyman) has had some experience of valuation under the Land Clauses 1227 Act. I should hope those are not exactly the principles that will be applied here, though those are the principles that are applied by land-owners selling land. They are not the principles which the Government apply in valuing land for taxation.
§ Mr. JOHN WARDWhy not?
§ Mr. LLOYD-GEORGEBecause I think it is an exaggerated valuation. We propose to proceed on principles of stricter equity. What has to be taken into account is this—the whole of the land available in the neighbourhood. We cannot pick out a piece of land, and say that is sold for £2,000, and therefore all the land in that neighbourhood is worth £2,000. That is not the way land is valued either here or in any other part of the world for valuation purposes. I should be very much surprised that land in that neighbourhood would be worth more than £200 or £300. I am not for one expressing any opinion on that, but the whole of the land should be taken and the number of years it would take to liquidate. All that has got to be taken into account.
§ Mr. PRETYMANOver what area?
§ Mr. LLOYD-GEORGEThat is a question which the valuer must take into account. The hon. and gallant Gentleman (Mr. Pretyman) had some experience of valuation, and I can assure him that his method, the Rosyth method of valuation, is not the method that we propose to apply. We shall simply take into account, not the fact that one piece of ground fetches so much, but the real market value, taking into account the number of years which must pass by before you can convert the whole of that land into building land. That is the way it is applied in every country in the world, and there will be no exception in this country. Take this particular Willesden property. The hon. and learned Gentleman (Sir W. Anson) said they were receiving something like £4 7s. 6d. per acre for this property, under allotments. Of course, there is an element there of value which is attributable to the act that it is near an aggregation of people, but we do not propose to tax any value which is agricultural. The tax is only in respect of the value over and above its agricultural value. What would that amount to? Suppose it fetched about £200 to £300 an acre, the college on Which the hon. and learned Gentleman is 1228 interested would pay about 6s. an acre. They are receiving £4 6s. an acre. That is not due to the particular quality of the soil. If it. were far removed from town I do not suppose they would get more than about £1 an acre or 30s. an acre, if it were fairly good land. So they are getting £2 or £3 an acre more than its real agricultural value because they are near a town. They are only called on to pay 6s. an acre for the building value over and above the agricultural value. The hon. Gentleman compared us very unfavourably with the Stuarts and the Tudors, with their rapacity and their greed. I do not recognise Tudor principles there. I cannot imagine any Tudor, when he started on his confiscation, taking 6s. and leaving £4 to the college. I can scarcely even imagine him leaving the Os. But if he did leave anything, I think he would leave the 6s. and take the £4. That is much more like Tudor principles. But all that is now proposed is that whatever value there is over and above the agricultural value should be taxed at the rate of ½d. for its capital value. That is not a very rapacious proposal. I think the hon. Gentleman will recognise that I do not think that his college will suffer very seriously in the Willesden district. I agree with him in thinking that it would be a pity to impose any great burden on great educational institutions; but he would not contend for a moment that because his college owns property therefore it should escape taxation altogether. He has not contended that. Property tax is paid at the present moment, and I only propose in the present case that of this very moderate property tax, which in the aggregate does not amount to very much in the whole Kingdom, the college should bear a fair share, and I think he will recognise when he sees the Bill that it is not a very extravagant or very aggressive charge which is made upon him. I think that deals with the points raised by the hon. Gentleman. Now I come to the question raised by my hon. Friend the Member for Chippenham (Sir J. Dickson-Poynder). I do not think he can have followed very closely the discussions which have taken place, otherwise he would not have reached the conclusion which he seems to have formed. For instance, he is under the impression that the proposal is that there may be a charge of 29 per cent. on the land and any increment of land in the event of death, and that the scale of Death Duties may be raised from 9 per cent. to 29 per cent. in respect of the value. That depends purely on the incre- 1229 merit, and not on the whole property. It is not to be 29 per cent. on the whole property, apart from the increment of value.
§ Sir J. DICKSON-POYNDERWill not the valuation of the Death Duty be based on the full value at death, taking into consideration any increment that has occurred?
§ Mr. LLOYD-GEORGEThe 20 per cent. will not be on the full valuation, but purely on the increment, and therefore it will not be 29 per cent. on the whole value.
§ Sir J. DICKSON-POYNDERIt will be 29 per cent. on the particular portion of the land.
§ Mr. LLOYD-GEORGEWhat my hon. Friend put before the Committee was that there was a 29 per cent. charge on a £100,000 estate. The charge will be purely a charge on the increment, and on the increment alone. Another point which was raised by my hon. Friend should be made clear. He took the agricultural land of the value of £50, but whatever is the value of agricultural land it is not taxed at all. We only tax the value over and above the agricultural value.
§ Mr. CHIOZZA MONEYIs the agricultural value in the first place deducted from all land?
§ Mr. LLOYD-GEORGEThe agricultural value is deducted.
§ Mr. HAROLD COXWhat about accommodation land?
§ Mr. LLOYD-GEORGEWhatever the agricultural value may be, it is deducted as it would be in the case put by the hon. and learned Gentleman where the agricultural value is £4 Os. Then there comes the question of ungotten minerals. My hon. Friend says that you cannot value ungotten minerals. Does he realise chat they are being valued at the present moment, even for purposes of taxation? I ventured to make that statement in the course of the Debate a week ago, when the right hon. Gentleman the Member for Dublin University contradicted me. I thought that being an old Law Officer of the Crown he would not have contradicted me without having some authority. I have since looked into the matter, and I find that in every case where you have got the land upon a coal seam, the ungotten minerals are invariably valued for the purpose of the Death Duties. I have looked into two or three special cases, and 1230 I find that there is always a value placed on ungotten minerals on a seam.
§ Mr. LYTTELTONWhen unopened?
§ Mr. LLOYD-GEORGECertainly.
§ Mr. PRETYMANWhen that seam is not being worked?
§ Mr. LLOYD-GEORGEI say when the land is known to be on a seam.
§ Mr. PRETYMANOn a seam that is being worked?
§ Mr. LLOYD-GEORGEI beg the hon. and gallant Gentleman's pardon. That was not the point. The point made was that you cannot value ungotten minerals.
§ Mr. PRETYMANIn defence of my right hon. Friend I may say that I happened to notice very carefully what he said, and the point he made, as I recollect it, was clearly this, that the valuation was not made except in cases where the mineral scam in question was being worked not necessarily on the particular property, but in the immediate vicinity.
§ Mr. LLOYD-GEORGEI am not depending on my memory at all; I have looked the matter up. The right hon. Gentleman simply contradicted me point blank when I said there was a valuation of undeveloped minerals for the purpose of the Death Duties. He said it was not done. I have looked it up since. It is of no use wrangling as to what was said. The question is what are the real facts? The real facts are these, that in any coalfield there can be a valuation of ungotten minerals on the seam. If you are in any part where there is no coal and where there is no coal being worked, when you present your accounts for the Death Duties no value is put upon it, even if it is suspected there is coal. But if you are in a coalfield, say, in South Wales, in Yorkshire or in Lancashire, known to have coal seams—because you can always follow the seams, you can make maps of them—In that case there is always a value put on the ungotten minerals. An hon. Friend of mine, who is a solicitor, told me that he had been passing accounts within the last few weeks somewhere within the coalfield area, where it was known that there must be coal under the property, and he put a value on the ungotten minerals there. We propose that the same rule should apply in the taxation of ungotten minerals as already applies in the case of the Death Duties. I 1231 do not think my hon. Friend would have any difficulty at all in valuing the ungotten minerals. He can easily find valuers who would tell him the value of the property. There is really no difficulty at all in valuing whether for the purposes of taxation or for the purpose of barter and sale. It is very well known that valuations are conducted in every coalfield throughout Great Britain, and to say that they cannot be done is to contradict the experience of every man who has carried on that business in particular parts of the country. I think I have dealt with all the points of detail which have been put to me during the discussion. In the course of the next 48 hours I hope the Bill will be in the hands of Members, and that all these matters will be cleared up, and that the misconceptions which I am afraid are in the minds of several hon. Members will also be cleared and their anxieties allayed. Agricultural land, for the purpose of taxation, is to be treated as undeveloped land. It will only be taxed when it has got a building value over and above its agricultural value. Then when it comes to a question of increment and a question of ungotten minerals the machinery of the Bill I think is perfectly simple. I fully assent to the proposition with which the hon. and learned Member for Oxford University opened his remarks when he said that it was most important that we should not impose taxes first, leaving the scheme of valuation to follow. I agree it is essential that a scheme of valuation should be incorporated in the Bill. In fact, it would be impossible to value fairly unless you got the method of valuation and not merely the proposition for the tax, and for that reason we so completely assent to that proposition that we have got the machinery for valuation incorporated in the Bill itself.
§ Mr. S. H. BUTCHERI still feel very much in the dark as to the effect of the undeveloped land tax upon the property of colleges and universities. It seems to me that in two ways this tax will hurt the universities. In the first place, this applies to universities more than to schools. It will hurt them as regards the land in Cambridge, and, I presume, in Oxford also, which is at present not built upon, and which has not been built upon in order that a space may be left clear for University extension and other purposes. Take Cambridge, for instance. There you have the Botanic Gardens; and there is a 1232 considerable amount of land which is adjoining building land, and now let in allotments, which has been reserved in order that the University may expand and extend itself in those directions. There are also the college gardens. There are the various fields for cricket, lawn tennis, and other forms of athletics, and all these undoubtedly would be valued as building land if they were not wanted for University or college purposes. I believe there are several great schools in the country which would be hit in precisely the same way. I will not go into the details, but I take the case of a school like Harrow. I believe in recent years no less than £80,000 was contributed by old Harrovians for the express purpose of preventing buildings being erected up to the walls of the school, and in order to preserve an open space. Similarly in regard to Dulwich College, of which we shall hear a great deal more during the Committee stage. The case of Dulwich, it seems to me, is a strong one. Here are schools which have been attempting in the interests, not of the schools themselves, but of the whole community around, to keep certain open spaces, and surely for a Government that professes to have as its object the retention of open spaces in the neighbourhood of great cities, and to have recreation grounds for the poorer persons of the community to preserve health, and to afford Longs or breathing spaces, it is an inconsistency to put on land a tax which would have this damaging effect upon others who do not happen to belong to the very poorest classes of the towns. That is one of the ways in which this tax will effect the colleges and universities. There is the other case, which, I believe, was referred to by my hon. Friend the Member for Oxford. It is the case of undeveloped land, not at Oxford or Cambridge itself, but in the neighbourhood of some large town. I was much relieved to hear the Chancellor of the Exchequer say that it is not proposed that the capital expended in developing land should be subject to taxation. That I understand is to be exempted from taxation. But I do not in the least know what the Chancellor of the Exchequer means when he says, on the one hand, that agricultural land is not t' be taxed at all as agricultural land, but that agricultural land in the neighbourhood of large tow ns, which has a prospective value as building land, is to be taxed. Do I understand the Chancellor of the Exchequer that such land is to be subject to a tax?
§ Mr. LLOYD-GEORGEWhere the value is over and above its agricultural value.
§ Mr. BUTCHERIt will depend on the basis of valuation, and it will be extremely difficult to take any other basis of valuation than what has been the average price paid for the adjoining land which has been already bought for building purposes. I think the Chancellor of the Exchequer must be aware that in other countries where this principle has been adopted—I am told, at least--that in practice the value placed upon such land is the average value that the land has fetched in the open market for building purposes. I think we may assume that unless there is some exception in the Bill on account of this particular difficulty that the same practice will be provided for in the Bill. Let me take an illustration from a college in Cambridge. In this particular case there is an estate of 1,100 acres belonging to a Cambridge college which is in the neighbourhood of a large town. Portions of this estate have been already sold, and the remainder of the estate let at an average for agricultural purposes of 28s. per acre. Supposing the average price obtained for those portions of the estate is to be taken as the basis for the valuation of the whole estate, the result would be a tax of over £400 on an actual gross rental of under £1,600. That is the way in which at first sight it looks as if it must work out. I do not know how far the valuers will be able to devise some more equitable scheme. I confess it seems to me that it will impose an extremely onerous burden upon learning and education.
I am taking this not as an extreme case. The Chancellor of the Exchequer has throughout this Debate charged us with bringing forward only the extreme cases. This is one of the most moderate cases, and I believe it will be found to be the same in the cases of other colleges or universities established in the neighbourhood of large towns. Another fact to be remembered is that colleges and universities not stand in the same position as ordinary private land-owners do to their estates. It has been the policy of the Legislature to put them under a rather strict state of control. They cannot sell except with the consent of the Board of Agriculture, and when they do sell the purchase money has to be paid to the Board and invested in the name of the Beard until it can be laid out again for the purchase of land. The leasing powers of those corporations are also limited by 1234 taxes in the same way as those of tenants for life. Since the Legislature has adopted a certain definite policy as regards the lands of those corporations and has required them in disposing of their land to have regard not to the interests of the moment, but to the interests of posterity, they have often sacrificed an immediate increase in the value of their property in order to secure that future increment. If the Legislature now decides that on all future increment a heavy tax shall be raised we should object to it; but, still, it would be part of a conceivable policy. If the Government imposed a present tax in respect of future increment it will be simply fining present members of the corporation for having performed their public duties and for having carried out the policy of the State.
§ Mr. JOHN HENDERSON (Aberdeen,. W.)In discussing these questions we are always told to wait for the Bill, and when we get the Bill I expect we will be told we are only discussing details. With regard to the principle of the Increment Tax, I would remind the House that in February of last year I quoted John Stuart Mill upon this very question, and pointed out where he recommended this Increment Tax more than 50 years ago. I then said that I had no doubt those were the proper lines upon which ultimate legislation would be founded, and so it has now appeared. With regard to the Increment Tax, I have not the slightest doubt that if John Stuart Mill's proposal had been adopted 50 years ago we would have realised an enormous sum of money for the Exchequer. It may not be too late now, but I do not think that we will get so much money from town advances. Subject to a reasonable and careful and just administration, I think there is nothing wrong about the Increment Tax; but the Increment Tax is the policy of John Stuart Mill, and what I want to know is whose policy the halfpenny tax is. What economist has ever recommended such a taxi I know of no economist except the "Daily Chronicle" and the "Daily News" and the hon. Member for Newcastle-under-Lyme (Mr. J. C. Wedgwood). The folly of this tax is that it lies athwart the Increment Tax, as it is on developable land the increment is to be raised. The increment may not come for 10 or 12 or 20 years, but all the time you are biting away at it, taking so much of taxes until the increment comes, and then you must allow them to be deducted. The fatal objection to this tax is this, that it is the 1235 first annual tax which has ever been proposed in this country on capital value. The capital value on the Death Duties is, as the Chancellor admitted, once in a generation.
The evil of a capital tax is this: that the first holder pays the whole of that tax in capitalised form. I will give an example. Suppose the Chancellor and I had arranged a deal for £1,000 worth of land. This tax is put on, and I go to him and say, "I cannot give you £1,000 because the Government has stepped in and they have become one-part owner, and therefore I must capitalise this tax, and I shall only give you £900." I have got the property for £900 and I have got the tax for 25 years in my pocket, and I am free of the tax. Thus the original owner has to pay the whole of it. We are talking a good deal at disadvantage, I admit, without the Bill, but in his Budget speech the Chancellor of the Exchequer spoke of an acre of land for a pleasure garden. An acre where? In the City of London? In Kingston? In Richmond? In Guildford? Or at the seaside? Why, in those instances there will be no comparison in value. You are going to say to a man: "You shall have an acre, and no more." I will illustrate it with a personal case, because there is nothing interests us so much as the misfortunes of our friends. I have bought, we will say, a piece of land two acres in extent in the neighbourhood of London. I build a house on it, and it is laid out. I may be paying on those two acres, with a valuation of £1,000 an acre, 8s. or 9s. rates and taxes upon that value. Now, is the Government going to come and say on the additional acre which you ought not to have you are going to pay another five per cent., which is equal to another]s. 0?,d. in the pound. Is that just?
I will take a case say in Kingston Hill. Here you have beautiful houses abutting on Richmond Park. Is that development land? There are say three acres or two acres, or sometimes four. It is land that cannot possibly be built on, unless a man pulls down his house. You cannot say to a man in that position, "You shall pay taxes and rates on the whole lot, and, in addition, on your extra two or three acres you have got to pay five per cent, because you might possibly build upon this land." The only way he could possibly do so would be to destroy a house worth probably five or six thousand pounds. Take another instance, where you have land in juxtaposi 1236 tion to a road, and which can be built upon. Are you to say to one man, because he has a wall and cannot get access, he is not to pay, and to another man, because there is a road passing he is free to build, and must pay? The hon. Member for Oxford University (Mr. Butcher) spoke of a case of 1,100 acres which he said was in the vicinity of a town. When a valuer comes to value that land—we will assume it is all prospectively possible building land—he has got to take into account that that city or town might develop at the rate of three acres, or five or ten a year. Therefore it might take a hundred years before any particular spot the valuer might pick out would be worth the money. That is another evil of the tax; you are going to tax a man on a contingent reversion. You are going to say to him—" Here is a piece of land for which you are getting £3 an acre just now, and you know very well that in five or 10 or 20 years' time that possibly may be worth £1,000 per acre." That is a contingent reversion for which he might come in; but that land, I maintain, is not worth one penny piece more than the rent which it at present yields. I know that a speculator may say, "I will give you £200 for it on the chance of keeping it for all these years;" but are we prepared to pass a Bill which will tax a man upon a speculative value which he may never receive simply because somebody will speculate? I know what lies at the back of the mind of some of those men who have been strongly urging this tax upon the Chancellor of the Exchequer. The proposal originates from the League for the Taxation of Land Values. These people have had a wonderful and chequered existence. They did not pay any attention to John Stuart Mill 50 years ago; they did not exist. But when another economist, or a caricaturist of economy, called Henry George came along, in Glasgow they founded a sect. There was a baillie here and a provost there; they called themselves land restorationists, single taxers, and one name after another; and at last they got one or two respectable men to join them. They have had Bill after Bill, every one of which was directed at getting at the feu duties and ground rents. The one great feature about this proposal is that the Chancellor of the Exchequer has shut down the door upon that. He says that in reckoning your increment you shall be entitled to take the full value, and only on the increment shall you get a tax. That 1237 is quite right; but these people have tried to achieve their object for 20 years, viz., to get the feu duties. They have never failed to bring in a Bill, and so keen have they been that, when defeated in one place, they rushed to another. In their despair they had a meeting here before the adjournment, when they made an appeal to the Chancellor of the Exchequer, "For Heaven's sake put a tax on land values. If we cannot get it in any other way put it in your Budget. Let us get it somehow—anyhow." That is the genesis of this halfpenny tax. It is thrown as a sop to the Lord Advocate.
The underlying idea is that land is held up. The Chancellor of the Exchequer has referred to the Royal Commission. I wish he would read very thoroughly the evidence there given. He would find that the principal witnesses stated that the difficulty was not to prevent land being held up, but to keep it out of the market. That is quite true. Any man who walks round London or the outskirts of any town cannot fail to be impressed by the enormous waste of money in making roads and streets. The case of Willesden has been cited. Forty years ago some land there was laid out in streets at large cost, but nobody took r he property. There was a house built here and a house built there, but they appeared horribly derelict, and the property looked so awful that the adjacent owners could not sell their land. It was not until 20 years afterwards that people began to build. The President of the Board of Trade has taken up this idea somehow or other. Of course we are not surprised at that. But what he says is this—and the House should note that this is the stock argument, and I want to blow it to pieces: "How can there be so many vacant houses when we know that there are 120.009 men in Glasgow living in single rooms?" You might just as well say that, there are 120,000 men who have not champagne every day for dinner. What is the reason? Insufficiency of means. Let me put it in a nutshell. I have not got it to offer, but if I had it, and I were to offer the Chancellor of the Exchequer, or the Lord Advocate, or any Leaguer, 10 acres of land in the vicinity of London for nothing on condition that they expended the necessary capital to build houses to house these people—houses built according to the specification of the district surveyor and the requirements of the sanitary inspector —and took such rents as these people could give, would he do it? There is no housing 1238 question with the rich, or the middle classes, or the men who can afford to pay £20 a year in rent. There are thousands of houses in every town in England and Scotland ranging from £10 rental, or even lower, vacant. The meaning of it is that these poor men do not earn enough to pay for a decent shelter to cover them. Certain trustees have built a house in the East End, and have had no less than a thousand applications for rooms at 2s. 6d. for one room and 5s. for two rooms. But the land has been given as a charity, they have built the house, and what do they expect? They expect a return of 1½ per cent., which they are to put aside for reparation. It is idle, stupid, and foolish to instance that fact as a proof that land is held up. The evidence given by Mr. Harper, the Statistical Officer of the County Council, is that there are hundreds of houses in every suburb round London which could be bought for less than the mortgage money, thus wiping out the value of the land.
To return to the tax of a halfpenny. The Chancellor of the Exchequer, when he tries to get that tax, will have trouble and difficulty. As a practical man, I assure him that it is absolutely impossible without doing rank injustice. You take your model from Germany. Germany has adopted the increment tax, but she has not adopted such a stupid tax as this. It will be found to be absolutely unworkable. More than that, it is grossly unjust to single out any particular class of property to fix a tax upon it and leave out all other classes. The Chancellor of the Exchequer has said that he is not going to put agricultural land under the same tax. I am not at all sure that he is right. I take a long view of things, and I believe firmly that 20 years hence agricultural land will be very much increased in value as compared with to-day. We have wheat and other produce rising as other countries absorb more of their own produce, and I should not be at all surprised to find that agricultural land will rise considerably more proportionately and in volume than town land. However, be that as it may, the objection I take is that this proposal throws the whole cost of the tax capitalised upon the first owner, and if he is a poor man he will have to bear the whole brunt. I think it is a most unjust tax. John Stuart Mill, whose policy you are following in regard to the increment tax, in the very same chapter uses these words in regard to this particular tax:—
Future buyers would acquire land and securities at a reduction. of price equivalent to the peculiar tax, 1239 which tax they would therefore escape from paying, while the original possessors would remain hurthened with it even after parting with the property, since they would have sold their land at a loss of value equivalent to the fee simple of the tax.He adds this, with which I am entirely in sympathy:—Its imposition would thus be tantamount to the confiscation for public uses of a percentage of their property equal to the percentage laid on their income by the tax. That such a proposition should find any favour is a striking instance of the want of conscience in matters of taxation resulting from the absence of any fixed principles in the public mind, and of any indication of a sense of justice on the subject in the general conduct of the Governments. Should the scheme ever enlist a large party in its support, the fact would indicate a laxity of pecuniary integrity in national affairs scarcely inferior to repudiation.
§ The ATTORNEY - GENERAL (Sir William Robson)We have reached so late a stage in the discussion of these Resolutions that I am sure the House will desire that every speaker now should be as brief as possible. I think, however, that the speech of my hon. Friend the Member for Aberdeen (Mr. J. M. Henderson) who, on all questions, and particularly on the land question, never speaks without assisting the Debate and instructing the House, is worthy of some immediate observations by way of reply. I do not like to tell my hon. Friend, because it has been said so often, that he might wait a little longer for the Bill before he discusses the Chancellor of the Exchequer's references to two acres attached to a house: [" One acre."] One acre for present purposes. No doubt when land comes to be treated as undeveloped, it is desirable that we should not bring within the area of taxation small plots of land round houses. If, however, you have land round a house, which my hon. Friend supposes would have no value at all, and would be incapable of further development unless the house were pulled down, a valuer is not likely to charge a very considerable undeveloped land tax under such circumstances. A valuer has to take into account everything which affects the value. All these extreme cases are really put forward on the supposition that a valuer is not going to exercise ordinary sense, and that he is going to put on a value without having regard to all the things which he ought to take into account. I venture to say that if a valuer so acted he would very soon cease to be employed, either by private persons or by public authorities.
Allowance will have to be made in every ease for the judgment, experience, and discretion of the valuer. If fair reliance 1240 is placed upon that, a great many of the hard cases will disappear. Once the valuer sets to work they will never be heard of again. There has never been; as my right hon. Friend pointed out the other day in the speech which he delivered on the introduction of the Death Duties, any tax, particularly any new tax, introduced without the most alarming apprehensions being felt as to how it would work. Yet, taxes have worked easily enough. We know quite well in the case of these land taxes that we are under a disadvantage both in introducing the Bill and in predicting its precise effect. We have not got in the case of these three taxes that body of practical experience which is possessed by the great civil servants after many years' working of taxes. In dealing with the Death Duties, the Stamp Duties, and the Licence Duty, we have got civil servants who are without party feeling, who desire only to carry out fairly, loyally, and practically; the wishes and the commands of their superiors, and who are of enormous assistance to those who are engaged in devising machinery. We recognise frankly and freely in these three taxes we do not possess that valued assistance.
Therefore, to be perfectly frank about it—we anticipate that some difficulty must attend the introduction of the new taxes. But we have taken one precaution, which, we think, will minimise, if not prevent anything like substantial injustice. Some degree of inequality you must have. We have made the tax in each case a very small amount. I know that in the one case. it is said: "Oh, but you are taking a 20 per cent. tax." That is a very inaccurate, and very misleading, description. Who can say that this tax is not a fit subject-matter for taxation'? What better subject-matter can you have for a tax than property which a man comes into possession of without having earned it; and, what is more, without having expected it ! I say that you will not anywhere in the whole range of taxation find a tax which is in principle more just. You may say there are difficulties in the machinery. These are matters for adjustment. But on the question of principle, the case for this tax is unanswerable. My hon. Friend the Member for Aberdeen (Mr. J. M. Henderson) referred to undeveloped land. There, again, you have a tax which according to expert testimony is not likely to yield much.
§ Mr. AUSTEN CHAMBERLAINHave you any estimate?
§ Sir W. ROBSONWe have the estimate of the Chancellor of the Exchequer—the estimate of the total of the three taxes. I think the right hon. Gentleman will know that my tight hon. Friend has indicated the estimate when dealing with these taxes.
§ Mr. AUSTEN CHAMBERLAINOnly for one year.
§ Sir W. ROBSONWell, I cannot read my right hon. Friend's Budget speech over again. I do not think it will ever yield any great amount at all. It will yield a useful amount. But, whether it be much or little, there never was a tax proposed in any Budget more just—more essentially just. My hon. Friend has spoken of 120,000 people in Glasgow who are compelled to:inhabit single-roomed tenements. Does anybody suppose that that number of persons are living under such conditions unless it be that houses are more difficult to procure—
§ Mr. REMNANTThere are 40,000 unoccupied tenements to-day.
§ Sir W. ROBSONWe also hear that land is not held up, yet it is rising from a value of £100 per acre to a value of £1,000 per acre. We are continually assured that it is not held up, that there is a perfectly open market for it. Of course there is—.at the price ! Is there nothing in the nature of holding-up in a state of things where you have a rise in the value of land of 100 times its capital value? Does not that show a most urgent need by the community for one of the vital necessities of life? Does not that by itself show the facts of the case? It needs no argument. You only want the simple fact. It is quite unnecessary with such a fact to argue at any great length whether you have that enormous increment of value or not. You have evidence about which there can be no dispute—that one of the most essential needs of the community has reached a famine price. I venture to say that a tax upon that condition of things—upon the holding-up which admits of that enormous increase of value—is a just tax. Where do you find any subject-matter which may more properly bear some deduction for the sake of the public necessity? You will not find anything in the whole range of schemes of taxation put forward by the opposite sides of this House, either in Tariff Reform or in Free Trade taxation, which may be more fairly made a source of revenue for the public service than this particular kind of property.
1242 I have heard slavery described by a great orator as "The sum of all the villainies." I venture to say that overcrowding might be described as "the sum of all social evils." There is no one who knows anything of work in the crowded quarters of our great cities that does not feel that this tax—fiscal questions apart—is absolutely essential.
§ Mr. REMNANTThere is 50 per cent. less than in America.
§ Sir W. ROBSONIf we have less overcrowding than in America all I can say is that it is very bad for America.
§ Mr. REMNANTThey have the system that you propose.
§ Sir W. ROBSONWe have too much overcrowding in England. I wonder how anyone can seriously suggest—whether amateur or other kind of economist—that the price of land is not an important element in the cost of a house, that the cost of a house is not an important element in the rent, and that the rent is not a very strong reason why you should have scores of thousands of people living in our great cities under conditions which are too horrible to describe. One talks about 120,000 people living in single-room tenements. It is a figure, a statistic, a sort of phrase which rolls easily off the tongue. What does it mean to the people who are living under it; to the growing boys and girls in those districts? I venture to say that anything we can do, whether by fiscal or other means, that will bring land more rapidly and more cheaply into the market, and will lessen the cost of producing houses will be a public benefit, all these questions apart.
§ Mr. A. J. BALFOURThe right hon. Gentleman when he got up told us that late as the hour was he thought it was necessary to reply to the speech—the very able speech—delivered by the hon. Member for Aberdeen. I therefore listened with profound and respectful attention to see the reply he gave. But the right hon. Gentleman, overcome with unexpected modesty, sat down before he came to that part of his speech. He never attempted to reply. For instance, there was, I would remind him, one argument—an argument I do not mean to develop—put with great lucidity and force by the hon. Member for Aberdeen, who backed it up with arguments from that amateur economist, John Stuart Mill ! The hon. Member for Aberdeen pointed out the peculiarity of the tax, to which he was 1243 alluding, was that it fell upon the owner for the moment, and that succeeding owners escaped. That is a very simple argument. What had the right hon. Gentleman to say upon that point? He got up to reply to the hon. Member for Aberdeen. Why did he not reply to that? The right hon. and learned Gentleman dealt with overcrowding in the towns, and extracted from all the perorations that had reference to that difficult subject, the quintessence of vapid declamation. Observe what the right hon. and learned Gentleman's argument drives us to. It has been alleged—the old allegation was—that in some of our great towns there were selfish land-owners who held up the land and forced prices up beyond their natural and market value. [An HON. MEMBER: "True." It was pointed out that such cases, though they might exist, had not been actually brought before us; and that though there are probably some, that there are not a great many of them. It was not said that it was this landlord or that who had illegitimately held up the land. It was every landlord who sells land 'near a town for £1,000 an acre; because the hon. and learned Gentleman said: "Is not that a proof that land is being held up, is not that a fact, is not that evidence? We do not need argument." Certainly no argument was given. The right hon. Gentleman said no argument was needed to show that if land went for a much larger price for building than for agricultural purposes that that resulted, and could only result, from illegitimate action on the part of the holder. That brings under his condemnation every single owner of land in the country. It brings under condemnation the colleges of Oxford and Cambridge; Dulwich College—of which we have heard so much lately—the Crown; Woods and Forests; the Corporations; the London County Council—every single owner of land, public or private.
Every single owner of land, public or private, collies under the condemnation of the hon. and learned Gentleman. He says they are all holding up this land illegitimately and the existing owners require to he robbed in order to put things right. [Ministerial cries of "No, no."] How does the hon. and learned Gentleman meet the argument put forward, not for the first time by the hon. Member for West Aberdeenshire (Mr. J. M. Henderson), and put forward by him with great force, when the hon. Member pointed out that in every big town at this moment there were a large 1244 number of houses waiting for occupants? Are they illegitimately held up by the owners? Is that a greedy landlord exacting rent to which he has no right? The hon. and learned Gentleman really, when he comes down here, should try to deal with things in a business spirit. How does he deal with them. With a proposal which is going to affect gigantic interests, a proposal which is going to affect rich and poor, corporation and private individual, educational establishments and national property itself, the hon. and learned Gentleman when he comes to deal with these matters can only give us these platitudes and exaggerations which will not bear an. instant's examination.
I have only one other observation to. make, and it is this. One great evil—and I think it will be admitted to be an evil by those who rely upon the tax—one great evil in these proposals of the Government is that they spread a serious want of confidence over the whole of one great class of property and security. That is obvious. No human being doubts it, even the Socialists themselves do not doubt that these particular proposals of the Government, however much they may be modified in the course of our Committee by discussion, have created that insecurity. That being the evil which the Government has got to face, and being inherent in the very nature of their proposals and following from them), what does the hon. and learned Gentleman do to diminish it? He tells us this is a very small tax, so insignificant that whatever injustices may be done are almost negligible. This, in the yin, of the Government, is to be the beginning of the way in which they are going to deal with present owners of this particular kind of property, and when the hon. and learned Gentleman and his successors want more money they will say: "In 1909 we started this new and admirable system. We put on a perfectly trifling tax at first —29 per cent. or so "—no, it was not as much as 29 per cent., it was something less than 29 per cent.—" and now when the State is really in want of money we may tax the existing owners of this particular kind of property in some more reasonable fashion." Is that the way to deal with all that vast interest which has legitimately grown up under the shadow of our law? Is that the way to deal with the vast number of people and associations and insurance companies and provident and friendly societies and building societies? Is that the way to deal with the property in land which was bought 1245 by money on mortgage for the purpose of development? Is that the way to deal with the people who have purchased reversions? A more reckless method of dealing with great interests I have never seen in this country, and, while I am bound to say the Chancellor of the Exchequer in his speeches tries to minimise as far as possible the effects of his Budget, and by kindly expressions endeavours to make us forget what the Budget really contains, his hon. and learned Friend, who is going to support him in all future discussions, takes care not merely to remind us what the Budget contains but what other Budgets brought forward by himself and his friends are likely to contain in the future.
§ Mr. W. P. BYLESI would like to remind the House that there have been speeches made from this side of the House in particular assailing the policy contained in the proposals of the right hon. Gentleman the Chancellor of the Exchequer. My right hon. Friend is undoubtedly perfectly well able to take care of himself, but, seeing that there have been amongst his supporters some who have offered some criticism upon his proposals, I should like to assure him and the House that in me he has, at any rate, one whole-hearted and encouraging supporter. I am quite certain there are a great many more who have not spoken as yet. The hon. Baronet (Sir John Randles) opposite made a particular attack upon this proposal, as also, I think, did the hon. Member for Aberdeenshire (Mr. J. M. Henderson) of ½d. duty on undeveloped land. The hon. Baronet said this was a sop to the land-taxer, and the hon. Member for East Aberdeenshire put the same view. Therefore I wish to say whether it is a sop or not we are very glad to get it, for we regard it as a recognition of patient, laborious, and prolonged agitation in favour of an element of justice in our taxation. To my mind, of all the proposals made this one is the most just. I cannot follow the reasoning of those Gentlemen who have opposed it. It appears to me that if one individual member of the community takes away from the use and from the profit of the community for his own use and profit say 100 acres of land, it is a very reasonable thing indeed to ask him to pay to the community an acknowledgment of 4s. 2d. a year for that. That is all we do. All these supposed entanglements and difficulties I believe will vanish like the morning mist when we come to discuss the Question in Committee. The hon. 1246 Baronet was also very anxious about the Death Duties upon those who leave land. I have been astonished at the tenderness shown in this House for the dead man. I do not see that a man who has enjoyed his. property all his life is forced by death to lay it down without any further interest in it--why we should be very careful to protect the interests of those who come after him. If we are to pay our taxes after we are dead surely that will be the most agreeable way to pay our contribution.
There is one other point on which I want to dwell for a moment. The hon. Member for Holborn (Mr. Remnant) asked why land should be exceptionally treated. We have been told over and over again that land differs from other forms of property. It was asked why a man who put his money in land should have a further tax put upon him while his brother who invested his money in some other enterprise should be free from that tax. I will give two reasons which I think are absolutely. conclusive why land differs entirely and essentially from every other kind of property whatsoever. The first is because it is rigidly and absolutely limited in quantity. You cannot make it any more and you cannot make it any less. 'Taxation cannot do it. That is riot so with anything else except land. If you tax houses you will have fewer houses, if you tax whisky the temperance people rejoice because less whisky will be drunk. If you put on a Tariff Reform tax, as the Tariff Reformers-will when they come in, and tax bread, the poor will have less bread. If it is proposed to put a tax on bachelors, that is in order to make them marry and remain bachelors no longer. If you propose to relieve a man from Income Tax for every child under 16, that is in order that the birth-rate may be stimulated, and so on with everything in existence except land. You cannot make it less, you cannot make it more, however much you may tax it. It is free from that one drawback common to all other taxation, and more than that, while the taxation of everything else but land makes it dearer, the taxation of land makes it cheaper. That is why the possessors of land protest against this taxation, because it will cheapen land, and that is why we approve of it, because it will bring land into the market. You will then have all the more land available for the labourer who is waiting to be employed.
One other instance, equally sufficient, and, perhaps, more important, why land stands out from every form of property is that it is absolutely necessary to the life 1247 of man. I think myself the Chancellor of the Exchequer is too little like a Tudor. I am sorry he exempted agricultural land, because all classes of land are the same in principle. We all live upon the land and must work upon it. A few thousands hold land as landlords, but there are many landless millions who would be glad to have some, but these landless millions are absolutely at the mercy of the few favoured who own land. The other day there was a corner in wheat in Chicago, and public opinion condemned the speculator who had been husbanding the precious grain and keeping it from the people. That was because it was alleged to be a necessary of life, but it is only in a very limited sense that wheat is a necessary of life. There are large populations who live upon rice, and others live on chestnuts and bananas. On the other hand land is an absolute necessity because no man can live without it, and it is as necessary to human life as water is to the life of a fish. Land is the parent of all monopolies, and I hail this Budget as an historic Budget. A year ago we were laboriously trying to recover for the State a very small part of an important monopoly, and now we are endeavouring for the first time to recover the monopoly of the land. I promise an ungrudging support to the Chancellor of the Exchequer's Budget, which contains for the first time a reform of the Land Laws.
§ Mr. T. SUMMERBELLI want to say a word or two as one who is not a landlord, and as one who has no interest in land revenue. I am one of the unfortunate millions who do not possess any land owing to the legislation of this House many years ago. I support the Chancellor of the Exchequer in the departure he is making, which I think is in the right direction, namely, that of restoring an interest which was taken away from the people by Parliament many many years ago. The hon. Member for West Aberdeenshire (Mr. J. M. Henderson) said there were thousands of people in Glasgow living in one-room tenements, and that the same thing could be found in other large towns in the country. That is due to two reasons, and one of them is the economic one. The economic one is due to the fact that the land was taken away from the people by Parliament centuries ago. In the next place you have the land lying idle, and a tax upon it will force it into the market, 1248 and this will create a healthy competition in regard to building sites, and will bring down rents. The hon. Member (Mr. Remnant) stated that few people in London were receiving much money from ground rents. I was very much surprised at the statement, because here I have the figures which prove that the Duke of Westminster, the Duke of Bedford, Earl Cadogan, Duke of Norfolk, Lord Northampton, the Duke of Portland. and others are getting £20,000,000 every year in the shape of rent from the users of land. We are told that the prices are going up as the leases fall in, and to tell us that we have no right to tap this increment, whch is not created by the landowner, is to make a statement which I hope will not carry weight in this House.
Everybody knows that the benefit of muuicipal expenditure, whether in regard to trams or anything else, is always pocketed by the landowner. I notice in this House that whenever we get discussing the land question we have a keen Debate. I have been reading up this subject, and I find that for the past 50 years:n these Debates it has been the same story year in and year out, namely, that the land of the country is not paying, and hon. Members have been everlastingly appealing to the House to give additional relief to the landlords. When the Agricultural Rates Bill was made permanent it saddled £2,000,000 a year more upon the people in the towns, and in every attempt that has been made in this direction I find that the landlords got relief. If you go back to the year 1817 you will find the land has been relieved of taxation bit by bit, and the burden of taxation has been gradually transferred from the shoulders of the landowner through the assistance of Parliament to the people in towns, who are now paying 84 per cent. of the taxes, as against land 66.66 per cent., and other property:33.33 per cent. about 90 years ago. I think it is time that an attempt was made to make the landowners pay more in the future than they have done in the past. With regard to increment, it has been said that the landlord should also be relieved in regard to decrement. I think I have already proved that it has been relief for decrement for the past 100 years, and the land-owners have been getting relief all that time. I hope the Chancellor of the Exchequer will not give way, but will adhere to this tax. I agree that land has gone out of cultivation,. but the excuse 1249 given has always been that the landowners could not make it pay, and they have frequently appealed for relief, and they got relief year after year, yet land is still going out of cultivation. To my mind the policy now proposed is a just one, and will be most beneficial in its. effect.
§ Mr. W. W. RUTHERFORD (Liverpool)I want to put three very short questions. My first is in regard to the valuation. The whole bases of these taxes are to depend upon some valuation. We have been told that all improvements are to be excluded which have been made by the owner during the whole time and then the agricultural value is to be deducted. I want to know what is left. The Chancellor of the Exchequer attempted to assuage our anxiety by saying that this valuation is going to he a very small one. That is just what will make the tax a large one, because the increment is what is going to be paid upon, and that is the difference between a low valuation now made and the price which is subsequently realised.
My second question is in regard to the lease involved in the second part of this Resolution which has scarcely been referred to up to the present. If a man wakes a favourable lease to a tenant on the expiration of that lease the benefit to him is greater than if he had made a rack-rented lease because he is resuming a larger value in consequence of the dropping of the lease. If that is correct no landlord will make a favourable lease on any terms to a tenant because the only effect would be that on the dropping of that lease he would have a larger tax to pay. The third question is with regard to the carrying out of this tax from a practi-
§ cal point of view. I think I am justified is asking this question, because I have had 25 years' experience in the kind of business involved in a question of this sort. No tax on land can be collected in this country, or in any other country, unless it is constituted a blot on the title. If you do that every person is bound to see that the tax has been duly paid. Unless that is carried out in the Bill which we are going to get later on it will be impossible to collect this tax on land.
§ To-day, we know that when valuations have to be taken in regard to ungotterr minerals when questions of this kind are involved it takes on the average a year to get those matters through Somerset House, and I have known cases which have taken over two years. It does not matter whether the duty is 5s. or £500 the difficulty is just the same. If these taxes are made a blot on the title, and if it is going to he all this trouble to find out the exact amount to be paid in the case of every bit of land considerable delay will be the result. There are only two alternatives, and one is that these taxes will not be paid, but will be evaded in every turn under this system. If they are made blots on the title, the burden on the community, and the difficulty of transferring and ascertaining the amount will be practically insuperable, and the cost will be out of all proportion to the sum of money which the Chancellor of the Exchequer has endeavoured to indicate would result from these taxes. I am obliged to the House for allowing me to put these three short points.
§ Question put, "That this House doth agree with the Committee in the said Resolution."
§ The House divided: Ayes, 256; Noes, 113.
1253| Division No. 135.] | AYES. | [7.15 p.m. |
| Abraham, W. (Cork. N.E.) | Bennett. E N. | Cherry, Rt. Hon. R. R. |
| Abraham, William (Rhondda) | Berridge, T. H. D. | Churchill, Rt. Hon. Winston S. |
| Acland, Francis Dyke | Bethell, Sir J. H. (Essex, Romford) | Cleland, J. W. |
| Adkins. W. Ryland D. | Bethell, T. R. (Essex, Maldon) | Clough, William |
| Alden, Percy | Bowerman, C. W. | Clynes, J. R. |
| Allen, A. Acland (Christchurch) | Bramsdon, T A. | Cobbold, Felix Thornley |
| Alien. Charles P. (Stroud) | Branch, James | Collins, Stephen (Lambeth) |
| Armitage, R. | Brigq, John | Collins, Sir Wm. J. (St. Pancras, W.) |
| Armstrong. W. C. Heaton | Brooke, Stopford | Corbett, C. H. (Sussex, E. Grinstead) |
| Ashton, Thomas Gair | Brunner, J. F. L. (Lanes, Leigh) | Cornwall, Sir Edwin A. |
| Asquith, Rt. Hon. Herbert Henry | Bryce, J. Annan | Cotton, Sir H. J. S. |
| Astbury, John Meir. | Buckmaster, Stanley O. | Crooks, William |
| Balfour, Robert (Lanark) | Burns, Rt. Hon. John | Crossley, William J. |
| Baring, Godfrey (Isle of Wight) | Burt. Rt. Hon Thomas | Dalziel, Sir James Henry |
| Barlow, Sir John E. (Somerset) | Buxton, Rt. Hon. Sydney Charles | Davies, Ellis William (Eifion) |
| Barlow, Percy (Bedford) | Byles, William Pollard | Davies, Timothy (Fulham) |
| Barran, Rowland Hirst | Cameron, Robert | Davies, Sir W. Howell (Bristol, S.) |
| Barry, Redmond J. (Tyrone, N.) | Carr-Gomm. H. W. | Dewar, Sir J. A. (Inverness-sh.) |
| Beale, W. P. | Causton, Rt. Hon. Richard Knight | Dickinson. W. R. (St. Pancras, N.) |
| Beaumont, Hon. Hubert | Cawley, Sir Frederick | Dickson-Poynder, Sir John P. |
| Bell Richard | Channing, Sir Francis Allston | Dilke, Rt. Hon. Sir Charles |
| Bellairs, Carlyon | Cheetham, John Frederick | Duckworth, Sir James |
| Duncan, C. (Barrow-In-Furness) | Lever, W. H. (Cheshire, Wirral) | Rose, Charles Day |
| Duncan, J. Hastings (York, Otley) | Levy, Sir Maurice | Rowlands, J. |
| Dunn, A. Edward (Camborne) | Lewis, John Herbert | Russell, Rt. Hon. T. W. |
| Dunne, Major E. Martin (Walsall) | Lloyd-George, Rt. Hon. David | Rutherford, V. H. (Brentford) |
| Edwards, Enoch (Hanley) | Lough, Rt. Hon. Thomas | Samuel, Rt. Hon. H. L. (Cleveland) |
| Edwards, Sir Francis (Radnor) | Luttrell, Hugh Fownes | Scarisbrick, T. T L. |
| Essex, R. W. | Macdonald, J. R. (Leicester) | Schwann, C. Duncan (Hyde) |
| Esslemont, George Birnie | Macdonald, J. M (Falkirk Burghs) | Scott, A. H. (Ashton-under-Lyne) |
| Evans, Sir S. T. | Mackarness, Frederick C. | Sears, J. E. |
| Faber, G. H. (Boston) | Maclean, Donald | Seaverns, J. H. |
| Falconer, J. | MacNeill, John Gordon Swift | Seely, Colonel |
| Fenwick, Charles | Macpherson, J. T. | Shaw, Sir Charles E. (Stafford) |
| Ferens, T. R. | M'Callum, John M. | Sherwell, Arthur James |
| Firench, Peter | M'Laren, H. D. (Stafford, W.) | Shipman, Dr. John G. |
| Findlay, Alexander | Maddison, Frederick | Silcock, Thomas Ball |
| Gill A. H. | Mallet, Charles E | Smeaton, Donald Mackenzie |
| Gladstone, Rt. Hon. Herbert John | Manfield, Harry (Northants) | Snowden, P. |
| Glen-Coats, Sir T. (Renfrew, W.) | Markham, Arthur Basil | Soames, Arthur Wellesley |
| Goddard, Sir Daniel Ford | Marks, G. Croydon (Launceston) | Spicer, Sir Albert |
| Gooch, George Peabody (Bath) | Marnham, F. J. | Stanley, Hon. A. Lyulph (Cheshire) |
| Greenwood, G. (Peterborough) | Massie, J. | Steadman, W. C. |
| Greenwood, Hamar (York) | Masterman, C. F. G. | Stewart-Smith, D. (Kendal) |
| Grey. Rt. Hon. Sir Edward | Menzies, Walter | Strauss, E. A. (Abingdon) |
| Harcourt, Rt Hon. L. (Rossendale) | Micklem, Nathaniel | Summerbell, T. |
| Harcourt, Robert V. (Montrose) | Molteno, Percy Aiport | Sutherland, J. E. |
| Hardie, J. Keir (Merthyr Tydvil) | Mond, A. | Taylor, John W. (Durham) |
| Harmsworth, Cecil B. (Worcester) | Morgan, G. Hay (Cornwall) | Tennant, H. J. (Berwickshire) |
| Harmsworth, R. L. (Caithness-sh.) | Morgan, J. Lloyd (Carmarthen) | Thomas, Abel (Carmarthen, E.) |
| Harvey, W. E. (Derbyshire, N.E.) | Morse, L. L. | Thomas, Sir A. (Glamorgan, E.) |
| Harwood, George | Morton, Alpheus Cleophas | Thomasson, Franklin |
| Haslam, James (Derbyshire) | Murray, Capt. Hon. A. C. (Kincard) | Thorne, G. R. (Wolverhampton) |
| Haworth, Arthur A. | Myer, Horatio | Tomkinson, James |
| Hedges, A. Paget | Napier, T. B. | Trevelyan, Charles Philips |
| Helene, Norval Watson | Newnes, F. (Notts, Bassetlaw) | Ure, Rt. Hon. Alexander |
| Henderson, Arthur (Durham) | Nicholls, George | Verney, F. W. |
| Henderson, J. McD. (A'deen, W.) | Nicholson, Charles N. (Doncaster) | Villiers, Ernest Amherst |
| Henry, Charles S. | Norton, Captain Cecil William | Vivian, Henry |
| Higham, John Sharp | Nugent, Sir Walter Richard | Walton, Joseph |
| Hobart, Sir Robert | Nussey, Thomas Willans | Ward, John (Stoke-upon-Trent) |
| Hobhouse, Charles E. H. | Nuttall, Harry | Wardle, George J. |
| Hodge, John | O'Connor, John (Kildare, N.) | Wason, Rt. Hon. E. (Clackmannan) |
| Holland, Sir William Henry | O'Connor, T. P. (Liverpool) | Wason, John Cathcart (Orkney) |
| Holt, Richard Durning | O'Donnell, C. J (Walworth) | Waterlow, D. S. |
| Hooper, A. G. | Parker, James (Halifax) | Watt, Henry A. |
| Horridge, Thomas Gardner | Partington, Oswald | Wedgwood, Josiah C. |
| Hudson, Walter | Pearce, Robert (Staffs, Leek) | Weir, James Galloway |
| Hutton, Alfred Eddison | Philipps, Owen C. (Pembroke) | White, Sir George (Norfolk) |
| Illingworth, Percy H. | Pointer, J. | White, J. Dundas (Dumbartonshire) |
| Isaacs, Rufus Daniel | Pollard, Dr. G. H. | Whitley, John Henry (Halifax) |
| Jardine, Sir J. | Ponsonby, Arthur A. W. H. | Wilkie, Alexander |
| Jenkins, J. | Price, C. E. (Edinburgh, Central) | Williams, J. (Glamorgan) |
| Johnson, John (Gateshead) | Price, Sir Robert J. (Norfolk, E.) | Williamson, A. |
| Jones, Leif (Appleby) | Priestley, Arthur (Grantham) | Wilson, Hon. G. G. (Hull, W.) |
| Jones, William (Carnarvonshire) | Priestley, W. E. B. (Bradford. E.) | Wilson, Henry J. (York, W.R.) |
| Joyce, Michael | Radford, G. H. | Wilson, John (Durham, Mid) |
| Kearley, Sir Hudson E. | Rea, Walter Russell (Scarborough) | Wilson, P. W. (St. Pancras, S.) |
| Kekewich, Sir George | Richards, Thomas (W. Monmouth) | Wilson, W. T. (Westhoughton) |
| Laidlaw, Robert | Richards, T. F. (Wolverhampton, W.) | Winfrey, R. |
| Lamb, Edmund G. (Leominster) | Roberts, Charles H. (Lincoln) | Wood, T. M'Kinnon |
| Lamb, Ernest H. (Rochester) | Roberts, G. H. (Norwich) | Yoxall, James Henry |
| Lambert, George | Robinson, S. | TELLERS FOR THE AYES.—Mr. |
| Lamont, Norman | Robson, Sir William Snowdon | Joseph Pease and the Master of Elibank. |
| Layland-Barrett, Sir Francis | Roch, Walter F. (Pembroke) | |
| Lehmann, R. C. | Roe, Sir Thomas | |
| Lever, A. Levy, (Essex, Harwich) | Rogers, F. E. Newman | |
| NOES. | ||
| Anson, Sir William Reynell | Bull, Sir William James | Craig, Charles Curtis (Antrim, S.) |
| Arkwright, John Stanhope | Burdett-Coutts, W. | Craig, Captain James (Down, E.) |
| Ashley, W. W. | Butcher, Samuel Henry | Craik, Sir Henry |
| Balcarres, Lord | Carlile, E. Hildred | Dairymple, Viscount |
| Baldwin, Stanley | Carson, Rt. Hon. Sir Edward H. | Dickson, Rt. Hon. C. Scott- |
| Balfour, Rt. Hon. A. J. (City, Lend.) | Castlereagh, Viscount | Doughty, Sir George |
| Banbury, Sir Frederick George | Cecil, Evelyn (Aston Manor) | Douglas, Rt. Hon. A. Akers |
| Banner, John S. Harmood- | Cecil, Lord R. (Marylebone, E.) | Everett, R. Lacey |
| Baring, Captain Hon. G. (Winchester) | Chamberlain, Rt. Hon. J. A. (Worc'r.) | Faber, George Denison (York) |
| Barrie, H. T. (Londonderry, N.) | Chance, Frederick William | Faber, Capt. W. V. (Hants, W.) |
| Beck, A. Cecil | Clark, George Smith | Fletcher, J. S. |
| Beckett, Hon. Gervase | Clive, Percy Archer | Forster, Henry William |
| Bignold, Sir Arthur | Clyde, J. A. | Foster, P. S. |
| Bowles, G. Stewart | Coates, Major E. F. (Lewisham) | Gardner, Ernest |
| Bridgeman, W. Clive | Cochrane, Hon. Thomas H. A. E. | Gooch, Henry Cubltt (Peckham) |
| Brotherton, Edward Allen | Cox, Harold | Gordon, J. |
| Goulding, Edward Alfred | Mason, James F. (Windsor) | Sandys, Col. Thos. Myles |
| Gretton, John | Meysey Thompson, E. C | Sheffield, Sir Berkeley George D. |
| Hamilton, Marquis of | Middlemore, John Throgmorton | Smith, Abel H. (Hertford, East) |
| Harrison-Broadley, H. B. | Mildmay, Francis Bingham | Stanley, Hon. Arthur (Ormskirk) |
| Hay, Hon. Claude George | Morpeth, Viscount | Starkey, John R. |
| Hazleton, Richard | Morrison-Bell, Captain | Stone, Sir Benjamin |
| Helmsley, Viscount | Newdegate, F A. | Talbot, Lord E. (Chichester) |
| Hill, Sir Clement | Oddy, John James | Talbot, Rt. Hon. J. G. (Oxford Univ.) |
| Hope, James Fitzalan (Sheffield) | Parker, Sir Gilbert (Gravesend) | Thornton, Percy M. |
| Houston, Robert Paterson | Parkes, Ebenezer | Tuke, Sir John Batty |
| Hunt, Rowland | Pease, Herbert Pike (Darlington) | Walker, Col. W. H. (Lancashire) |
| Kennaway, Rt. Hon. Sir John H. | Peel, Hon. W. R. W. | Warde, Col. C. E. (Kent, Mid) |
| Kerry. Earl of | Pretyman, E. G. | Whitbread, S. Howard |
| Keswick, William | Randles, Sir John Scurrah | Williams, Col. R. (Dorset, W.) |
| Lambton, Hon. Frederick Wm. | Ratcliff, Major R. F. | Willoughby de Eresby, Lord |
| Lane-Fox, G. R. | Rawlinson, John Frederick Peel | Wilson, A. Stanley (York, E.R.) |
| Lee, Arthur H. (Hants, Fareham) | Remnant, James Farquharson | Wortley, Rt. Hon. C. B. Stuart- |
| Lockwood, Rt. Hon. Lt.-Col. A. R. | Renwick, George | Wyndham, Rt. Hon. George |
| Long, Col. Charles W. (Evesham) | Roberts, S. (Sheffield, Ecclesall) | Younger, George |
| Lyttelton, Rt. Hon. Alfred | Ronaldshay, Earl of | TELLERS FOR THE NOES.—Sir |
| MacCaw, Wm J MacGeagh | Ropner, Colonel Sir Robert | A. Acland-Hood and Viscount Valentia. |
| M`Calmont, Col. James | Rutherford, W. W. (Liverpool) | |
| Magnus, Sir Philip | Salter, Arthur Clavell |
§ Resolution [10th May] reported,