HC Deb 11 April 1912 vol 36 cc1418-21

This brings me to explain what are the powers of taxation which, under the new state of things, will be exercisable in Ireland so far as taxation is concerned. First of all, the Imperial Parliament will continue to tax the whole of the United Kingdom. Next, the Irish Parliament will have the power, first, to reduce or discontinue for Ireland any Imperial tax, with the result that, if it does, the Transferred Sum will be correspondingly reduced—that is to say, reduced by the amount of the diminished yield. Next the Irish Parliament will have power to impose Irish taxes of their own, whether by way of addition to Imperial taxes or otherwise, with the result that the taxes will be collected, as I have said, by Imperial officers, and the transferred sum will be correspondingly increased, that is to say, increased by the amount that the new increased taxation will yield. This latter power, the power of the Irish Parliament to add to Imperial taxes or to impose taxes of their own, is subject to certain restrictions. In the first place they cannot impose any Customs Duty except upon articles which are for the time being dutiable by way of Customs in the United Kingdom. Further, the Irish Parliament will not be able to add to any Imperial duty of Customs except on beer or spirits, or of Income Tax, or of Estate Duty, more than will produce a 10 per cent. increase. With regard to Excise their hands will be free.


Is the 10 per cent, on the yield or on the amount?


On the yield. In the event of differential Customs or Excise duties in the two countries the Bill provides for the necessary adjustments by way of rebate or countervailing duty. Further, there is another restriction on the taxing powers of the Irish Parliament. There are certain Stamp Duties, relating mainly to bills of exchange, policies of marine insurance, stock exchange transactions, letters of allotment, and other matters connected with joint stock companies, which are all enumerated in the Schedule, and which ought to be uniform throughout the United Kingdom; and these the Irish Parliament may not alter. Broadly stated, the effect will be this: Subject to the restrictions which I have mentioned, the Irish Parliament will have full power to devise new taxes; the Irish Parliament can reduce any tax, except the enumerated Stamp Duties, to any extent, and at the price of an equivalent diminution in the transferred sum. The Irish Parliament can freely add to all Excise Duties.

In regard to Customs, other than Customs Duties on beer and spirits, which follow the powers with regard to Excise, and with regard to Income Tax and Death Duty, they can add, but only to the extent of giving an additional yield of 10 per cent. On the other hand, from the Imperial side, the transferred sum remaining substantially the same, all growth in the receipts from Irish revenue, other than from taxes imposed by the Irish Parliament itself, will diminish and ultimately extinguish the deficit. To make what I have said more plain, suppose the Bill passes into law this year, let us see what will be the estimated balance sheet, as far as we can estimate it, first the Irish balance sheet, and then the Imperial balance sheet, in regard to this matter. Take the Irish balance sheet first. On the revenue side of the account, the Irish Government would receive the transferred sum of £6,350,000, and they will get, in addition, the Post Office receipts of £1,350,000, which, together, make a total revenue of £7,700,000. On the other hand, the expenditure on Irish services, that is excluding the reserved services, is £5,600,000, and the expenditure on the Post Office is £1,600,000, which makes a total expenditure of £7,200,000; and this will leave a margin for surplus of £500,000, there being thus £7,700,000 on each side.


Will the right hon. Gentleman say what the cost of the reserved services is?


Yes. That comes under the Imperial balance sheet, which I will now take. On the revenue side, there is the whole of the Irish revenue, except the Post Office, namely, £9,485,000, or, say, £9,500,000. Now take the expenditure. There is, first of all, the transferred sum, £6,350,000. Then there is Old Age Pensions, which is a reserved service, £2,660,000; then National Insurance—I am using round figures—£190,000; and Land Purchase, £616,000; then there is Constabulary, £1,380,000; and the Collection of Revenue, which is, roughly speaking, £300,000. This makes a total expenditure of some £11,500,000, which leaves a deficit of almost exactly £2,000,000. That is to say, the transferred sum, plus the cost of the reserved services, plus the collection of revenue, exceeds the Irish revenue, under the machinery of the Imperial Government, by about £2,000,000. That is the state of the account as far as the Imperial Revenue is concerned. The House will observe that the reserved services, roughly speaking, cost £5,000,000. The Irish revenue, retained by the Imperial Government over the transferred sum, is £3,000,000. The deficit, therefore, is £2,000,000, of which £1,500,000 represents the present excess of Irish expenditure over Irish revenue, and the remaining £500,000 represents the margin to which I have referred. Certain points, however, remain to be added. There will be a separate Irish Exchequer and Consolidated Fund, under the control of an Auditor-General, and a system of audit similar to the one which prevails in the United Kingdom, which will, among other things, secure what never existed in the old Irish Parliament, the responsibility of the Executive.