HC Deb 02 August 1912 vol 41 cc2532-9

It is hereby declared that where a person, who was entitled to the benefits of a substituted site value under Section two, Sub-section (3), of the Finance (1909–10) Act, 1910, as amended by Section two of the Revenue Act, 1911, has died before the provisional valuation in respect of which such substituted site value could have been claimed has been finally settled, the personal representative or executor of such person shall be entitled to such substituted site value, and it is further declared that where the original site value has been finally settled an application may be made for the purpose of giving effect to this provision within three months after the date of the passing of this Act, and the Commissioners shall, in such a case, alter the original site value as finally settled in such manner (if any) as may be necessary to give effect to the Amendment made by this provision, and, in cases where any amount has been paid on account of duty, the Commissioners shall make such repayment as may be necessary to adjust the amount paid to any alteration of value made in pursuance of this provision.


I beg to move, that the Clause be read a second time.

I think this Clause will be considered quite uncontroversial. Its object is merely to remove an inequality which exists in respect to claims for substituted site value by executors of a deceased owner. That inequality arises very largely from the necessary delay in making the land valuations. I recently addressed a question to the Chancellor of the Exchequer on the subject. I asked him— Whether—he is aware that it is the practice of the Commissioners of Inland Revenue to refuse an application under Section 2 of the Revenue Act. 1911, for substituted site value when made by the executors of a deceased owner who was not himself in a position to make the claim during his lifetime in consequence of the delay of the Commissioners in making the valuation required by the Finance (1909–10) Act, 1910: and whether he will give instructions for such applications to be considered as if made by the owner within the meaning of the Section? The answer I got was:— I am aware of the practice, which is in accordance with the law; and I will consider what can be done to obviate any inequality such as that indicated by the hon. Member."—[OFFICIAL REPORT, 22nd May, 1912, col.2044, Vol.XXXIII.] The position seems to be this. Section 2 of the Finance Act of 1910 empowers any owner to claim substituted site value in respect to sales made within twenty years of 30th April, 1909, and application for such substituted site value may be made by the owner, whether he was the actual purchaser of the land or not. Any owner for the time being may make the application. That Section was amended by Section 2 of the Revenue Act, 1911, which removed the time-limit of twenty years in the case of an owner who was the actual purchaser, and he must, under that Section, personally apply for substituted site value within three months of the passing of the Revenue Act, in the case of a valuation which has already been made, and within three months after the final valuation as regards any future valuation after the passing of the Revenue Act. This is the difficulty that arises now: If the owner died after the passing of the Finance Act of 1910, and before he had had an opportunity of claiming the substituted site value under the Revenue Act of 1911, the Inland Revenue Commissioners hold that his representatives could not exercise the right which had accrued to the deceased in his lifetime. That right undoubtedly had accrued to the owner, and the only reason he could not exercise the right was because the valuation had not been made. I am not finding any fault that the valuation had not been completed, because there has not been time to make it, but I think the Chancellor of the Exchequer will agree that the owner had not had an opportunity during his lifetime of exercising his privilege under Section 2 of the Revenue Act of 1911. He might have died within three months after the final valuation. The Act gives him three months within which to make the application. Of course, if he dies within the three months without having made it, the time not being sufficient, that right should accrue to his personal representatives. It is to remove that in- equality that I move this Clause. I should say that I am not quite satisfied with the Clause as drafted, and I have drafted another in these terms:—

"It is hereby declared that an application under Sub-section (3) of Section two of the Finance (1909–10) Act, 1910, as amended by Section two of the Revenue Act, 1911, may be made by the legal personal representatives of a deceased person who, but for his death, could have made an application under the above Sections.

Any application under this Section may be made within three months after the date of the passing of this Act, and the provisions of Sub-section (2) with regard to alteration of the original site value and the repayment of duty shall apply to an application made under this Section."

That is a shorter Clause which covers the point, and I think it is better than the one I have moved. I only mention that because I thought the Government might be willing to accept it.


The hon Gentleman has accurately stated the position in regard to this matter. He called my attention to this inequality some time ago, and, having considered it, I confess that I think his case is made out. Personally, I think we ought to try to find some way of dealing with the point, and in doing so we should consider whether an alteration cannot be effected within the four corners of the existing law without an Amendment of this Bill. I am advised that it can be done, and I have given instructions accordingly. What the hon. Member proposes to effect by this new Clause is the practice at the present moment. I forget when he called my attention to the matter.


It was on 22nd May last.


A very few days after that the present practice was established, and therefore this Amendment is quite unnecessary. The hon. Gentleman admits that the Amendment he has moved is capable of improvement for the purpose of carrying out his idea. The inclusion of the Amendment in the Bill might conceivably—although I express no opinion on the subject—take the Bill out of the category of Money Bills. I hope the hon. Member will be satisfied with the statement I have made.


What does the right hon. Gentleman mean by taking it out of the category of Money Bills? Does he mean that might happen under the wretched Parliament Act? [An HON. MEMBER: "Why 'wretched'?"] I hope the hon. Member will not withdraw the Amendment. I think it is desirable that it should be passed. The right hon. Gentleman says, "I agree that a grievance exists."




Well, he says, "I agree it did exist." It does not exist now because the autocratic Chancellor does not insist upon enforcing the law as it stands. I protest against that system of revenue legislation. I know that the Treasury is fond of it, but it is grossly unjust. What they are fond of doing is to take extreme power, which gives them a large reserve of power in the background which they can use to oppress an individual who may cause them trouble, or to raise additional revenue on a special occasion. It runs right through the whole of the taxes. I do not pretend to be familiar with this particular inequality. It is the Chancellor's answer that seems to me to make it absolutely essential that some such new Clause as that proposed should be put in the Bill. If he is not satisfied with the drafting, let him draft another. As to the other ground of objection, if it is the right hon. Gentleman's desire to preserve to the Treasury the power to exercise on an emergency the right which the Statute gives them, I maintain that that is a most portentious proposal. As to the suggestion that the inclusion of the Amendment in the Bill might prevent it being regarded as a Money Bill, I think it is exceedingly doubtful whether the Amendment put in on the proposal of the Secretary to the Treasury has not removed it out of the category of Money Bills already. But that is not a matter for us to consider. It is for us to say what is just and proper. If that is the only objection the Government have to the Amendment, I trust my hon. Friend will go to a Division.


The Chancellor of the Exchequer has admitted that as a matter of fact the law as it exists actually caused a grievance until he altered the practice in relation to its administration. I submit that the alteration of the practice was without any justification in law. He was perfectly right when he stated in his answer on 22nd May that the only person who could claim exemption was the owner at the time of the application. It was of the essence of the case in claiming the substituted site value that it should be done in accordance with the terms of the Statute, and that a person who had had a transfer made to him could not claim. That really excluded the executors of a deceased person from making an application. That was an omission in the drafting of the original Statute. Now the Chancellor of the Exchequer proposes to remedy that error not by an Amendment, but by an illegal practice on the part of the Inland Revenue Commisioners. They have no right to do it. It may be the proper course to take, but I submit it is a dangerous doctrine that the Inland Revenue Commissioners should administer the law as they think fit, and not in accordance with the Statutes framed by this House. What is the reason they give for it? They say, "We are afraid, if we amend the law, this would bring the Finance Bill of the year outside the scope of the Parliament Act." They claim to themselves in their administration to dispense justice as they think fit, merely because they do not wish to run the risk of taking the Finance Bill outside the purview of the Parliament Act. That itself is a curious admission. Whether Mr. Speaker would rule that the Bill, if this Amendment were introduced, was not a Money Bill, nobody can tell. If an Amendment of the Valuation Clauses in the original Bill is not a proper matter for a Finance Bill, it is perfectly clear that the original Clauses were not proper matters for a Finance Bill. The Chancellor of the Exchequer is now afraid that the whole of the Valuation Clauses in the Bill of 1909–10 were improperly put into that measure, and on that ground he resists this Amendment. May I remind the right hon. Gentleman of what he himself stated? He said himself, "I quite recognise in dealing with the land system in this country I am dealing with an intricate and complicated matter, and from time to time if questions may come before me which have never arisen I will always give attention to them and rectify them." In this case he refuses to rectify it in the only proper way by legislation, but proposes to do it by mere administration.


I wish to ask the Solicitor-General does he say that the law at present allows this claim to be made by executors or not? That is really the whole question. If the law does not allow the claim to be made by the executors, it is quite improper that the Treasury should do anything inconsistent with Statute law, and in those circumstances, apart from what the Chancellor of the Exchequer has said, with which I do not wish to find any fault, it is absolutely necessary that if not the very words at least the substance of this Amendment should be adopted.


Nobody can say that in these matters a lawyer's opinion is beyond challenge, and I claim no such inspiration. But it does appear to the Attorney-General

and myself that when one considers the joint effect of the relative Sections in the Finance Act of 1909–10 and the Revenue Act of 1911 it would be a very strained and artificial construction to say in reference to an estate that the continued existence in life of the owner should be essential in order that this relief should really be available to an estate. We take the view that that is a construction so strained that we could not adopt it.

Question put, "That the proposed Clause be read a second time."

The Committee divided: Ayes, 153; Noes, 206.

Division No. 191.] AYES. [1.30 p.m.
Agg-Gardner, James Tynte Fletcher, John Samuel (Hampstead) Orde-Powlett, Hon. w. G. A.
Amery, L. C. M. S. Foster, Philip Staveley Paget, Almeric Hugh
Archer-Shee, Major M. Gardner, Ernest Parkes, Ebenezer
Ashley, Wilfrid W. Gastrell, Major W. Houghton Pease, Herbert Pike (Darlington)
Bagot, Lieut.-Colonel J. Gibbs, Arthur Abraham Peel, Capt. R. F. (Woodbridge)
Baird, John Lawrence Gilmour, Captain John Peel, Hon. W. R. W. (Taunton)
Banbury, Sir Frederick George Goldsmith, Frank Perkins, Walter Frank
Banner, John S. Harmood- Gordon, John (Londonderry, South) Peto, Basil Edward
Baring, Maj. Hon. Guy V. (Winchester) Goulding, Edward Alfred Pole-Carew, Sir R.
Barnston, Harry Grant, J. A. Pollock, Ernest Murray
Barrie, H. T Greene, Walter Raymond Pretyman, Ernest George
Bathurst, Hon. Allen B. (Glous., E.) Gretton, John Price, C. E. (Edinburgh, Central)
Bathurst, Charles (Wilts, Wilton) Gwynne, R. S. (Sussex, Eastbourne) Pryce-Jones, Colonel E.
Beach, Hon. Michael Hugh Hicks Haddock, George Bahr Quilter, Sir William Eley C.
Beckett, Hon. Gervase Hamersley, Alfred St. George Rawlinson, John Frederick Peel
Benn, Arthur Shirley (Plymouth) Harris, Henry Percy Remnant, James Farquharson
Bennett-Goldney, Francis Henderson, Major H. (Berkshire) Rolleston, Sir John
Bentinck, Lord Henry Cavendish Herbert, Hon. A. (Somerset, S.) Ronaldshay, Earl of
Bird, Alfred Hewins, William Albert Samuel Royds, Edmund
Boles, Lieut.-Col. Dennis Fortescue Hickman, Colonel Thomas E. Rutherford, John (Lancs., Darwen)
Boscawen, Sir Arthur Griffith Hill, Sir Clement L. (Shrewsbury) Salter, Arthur Clavell
Boyle, W. Lewis (Norfolk, Mid) Hills, John Waller Samuel, Sir Harry (Norwood)
Boyton, James Hill-Wood, Samuel Sanders, Robert A.
Bridgeman, William Clive Hohler, Gerald Fitzroy Sandys, G. J. (Somerset, Wells)
Bull, Sir William James Hope, Harry (Bute) Smith, Rt. Hon. F. E. (L'p'l, Walton)
Burn, Col. C. R. Hope, James Fitzalan (Sheffield) Smith, Harold (Warrington)
Campion, W. R. Houston, Robert Paterson Spear, Sir John Ward
Cassel, Felix Hunter, Sir Charles Rodk. (Bath) Stanier, Beville
Cator, John Jackson, Sir John Starkey, John Ralph
Cautley, Henry Strother Jardine, Ernest (Somerset, East) Staveley-Hill, Henry (Staffordshire)
Cave, George Kerr-Smiley, Peter Kerr Steel-Maitland, A. D.
Chamberlain, Rt. Hon. J. A. (Worc'r.) Kerry, Earl of Sykes, Mark (Hull, Central)
Chambers, James Kinloch-Cooke, Sir Clement Talbot, Lord Edmund
Clay, Captain H. H. Spender Kyffin-Taylor, G. Thynne, Lord Alexander
Clive, Percy Archer Larmor, Sir J. Tobin, Alfred Aspinall
Clyde, James Avon Law, Rt. Hon. A. Bonar (Bootle) Touche, George Alexander
Cotton, William Francis Lewisham, Viscount Valentia, Viscount
Craig, Charles Curtis (Antrim, S.) Locker-Lampson, G. (Salisbury) Walrond, Hon. Lionel
Craig, Captain James (Down, E.) Lonsdale, Sir John Brownlee Ward, A. S. (Herts, Watford)
Craig, Norman (Kent, Thanet) Lowe, Sir F, W. (Birm., Edgbaston) Warde, Colonel C. E. (Kent, Mid)
Cripps, Sir Charles Alfred Lyttelton, Hon. J. C. (Droltwich) Wheler, Granville C. H.
Dalrymple, Viscount MacCaw, Wm. J. MacGeagh White, Major G. D. (Lancs., Southport)
Dalziel, Davison (Brixton) Macmaster, Donald Willoughby, Major Hon. Claude
Denniss, E. R. B. McNeill, Ronald (Kent, St. Augustine's) Winterton, Earl
Dixon, Charles Harvey (Boston) Magnus, Sir Philip Wolmer, Viscount
Duke, Henry Edward Malcolm, Ian Worthington-Evans, L.
Eyres-Monsell, B. M. Mason, James F. (Windsor) Wright, Henry Fitzherbert
Faber, George D. (Clapham) Middlemore, John Throgmorton Yate, Col. C. E.
Faber, Capt. W. V. (Hants, W.) Morrison-Bell, Capt. E. F. (Ashburton) Younger, Sir George
Fetherstonhaugh, Godfrey Newman, John R. P.
Finlay, Rt. Hon. Sir Robert Newton, Harry Kottingham TELLERS FOR THE AYES.—Lord Robert Cecil and Viscount Helmsley.
Fitzroy, Hon. Edward A. Nicholson, William G. (Petersfield)
Abraham, William (Dublin Harbour) Allen, Arthur A. (Dumbarton) Baker, Harold T. (Accrington)
Acland, Francis Dyke Allen, Rt. Hon. Charles P. (Stroud) Baker, Joseph Allen (Finsbury, E.)
Addison, Dr. Christopher Armitage, Robert Benn, W. (T. H'mts., St. George)
Alden, Percy Arnold, Sydney Bentham, George J.
Birrell, Rt. Hon. Augustine Hobhouse, Rt. Hon. Charles E. H. O'Grady, James
Black, Arthur W. Hogge, James Myles O'Kelly, Edward P. (Wicklow, W.)
Boland, John Pius Holt, Richard Durning O'Malley, William
Booth, Frederick Handel Hope, John Deans (Haddington) O'Neill, Dr. Charles (Armagh, S.)
Boyle, Daniel (Mayo, North) Horne, C. Silvester (Ipswich) O'Shaughnessy, P. J.
Brace, William B. Howard, Hon. Geoffrey O'Shee, James John
Brady, Patrick Joseph Hughes, Spencer Leigh O'Suillvan, Timothy
Brocklehurst, William B. Jones, Rt.Hon.Sir D.Brynmor (Sw'nsea) Outhwaite, R. L.
Burke, E. Haviland- Jones, Edgar R. (Merthyr Tydvil) Palmer, Godfrey Mark
Burns, Rt. Hon. John Jones, H. Haydn (Merioneth) Parker, James (Halifax)
Buxton, Noel (Norfolk, North) Jones, William (Carnarvonshire) Pearce, Robert (Staffs, Leek)
Byles, Sir William Pollard Jowett, Frederick William Pease, Rt. Hon. Joseph A. (Rotherham)
Carr-Gomm, H. W. Joyce, Michael Phillips, John (Longford, S.)
Chancellor, Henry George Keating, Matthew Pointer, Joseph
Clancy, John Joseph Kellaway, Frederick George Ponsonby, Arthur A. W. H.
Clough, William Kelly, Edward Power, Patrick Joseph
Collins, Stephen (Lambeth) Kilbride, Denis Primrose, Hon. Neil James
Condon, Thomas Joseph King, Joseph (Somerset, North) Pringle, William M. R.
Cornwall, Sir Edwin A. Lambert, Richard (Wilts, Cricklade) Radford, G. H.
Crawshay-Williams, Eliot Lardner, James Carrige Rushe Raffan, Peter Wilson
Crumley, Patrick Law, Hugh A. (Donegal, W.) Rea, Walter Russell (Scarborough)
Cullinan, John Lawson, Sir W. (Cumb'rld, Cockerm'th) Reddy, Michael
Dalziel, Rt. Hon. Sir J. H. (Kirkcaldy) Leach, Charles Redmond, John E. (Waterford)
Dawes, James Arthur Lewis, John Herbert Redmond, William (Clare, E.)
De Forest, Baron Lough, Rt. Hon. Thomas Richardson, Albion (Peckham)
Delany, William Lundon, T. Richardson, Thomas (Whitehaven)
Denman, Hon. Richard Douglas Lyell, Charles Henry Roberts, C. H. (Lincoln)
Devlin, Joseph Lynch, Arthur Alfred Roberts, George (Norwich)
Dickinson, W. H. (St. Pancras, N) Macdonald, J. R. (Leicester) Robertson, Sir G. Scott (Bradford)
Dillon, John Macdonald, J. M. (Falkirk Burghs) Roch, Walter F. (Pembroke)
Donelan, Captain A. MacGhee, Richard Roche, Augustine (Louth)
Duffy, William J. Maclean, Donald Roe, Sir Thomas
Edwards, John Hugh (Glamorgan, Mid) Macnamara, Rt. Hon. Dr. T. J. Samuel, Rt. Hon. H. L. (Cleveland)
Elibank, Rt. Hon. Master of MacNeill, John G. S. (Donegal, South) Samuel, J. (Stockton-on-Tees)
Esmonde, Dr. John (Tipperary, N.) Macpherson, James Ian Scanlan, Thomas
Esmonde, Sir Thomas (Wexford, N.) MacVeagh, Jeremiah Scott, A. MacCallum (Glas., Bridgeton)
Essex, Richard Walter McCallum, Sir John M. Seely, Rt. Hon. Colonel J. E.
Farrell, James Patrick M'Laren, Hon.F.W.S. (Lincs.,Spalding) Sheehy, David
Ffrench, Peter Marshall, Arthur Harold Sherwell, Arthur James
Field, William Mason, David M. (Coventry) Shortt, Edward
Fitzgibbon, John Masterman, Rt. Hon. C. F. G. Simon, Sir John Allsebrook
Flavin, Michael Joseph Meagher, Michael Smith, Albert (Lancs., Clitheroe)
George, Rt. Hon. D. Lloyd Meehan, Francis E. (Leitrim, N.) Smyth, Thomas F. (Leitrim, S.)
Gill, Alfred Henry Molloy, Michael Sutherland, John E.
Gladstone, W. G. C. Molteno, Percy Alport Taylor, Theodore C. (Radcliffe)
Goddard, Sir Daniel Ford Mond, Sir Alfred Tennant, Harold John
Greig, Colonel James William Mooney, John J. Thorne, G. R. (Wolverhampton)
Grey, Rt. Hon. Sir Edward Morgan, George Hay Thorne, William (West Ham)
Guest, Major Hon. C. H. C. (Pembroke) Morrell, Philip Ure, Rt. Hon. Alexander
Guest, Hon. Frederick E. (Dorset, E.) Morison, Hector Wadsworth, John
Hackett, John Morton, Alpheus Cleophas Walters, Sir John Tudor
Hall, F. (Yorks Normanton) Muldoon, John Ward, John (Stoke-upon-Trent)
Hancock, John George Munro, Robert wardle, G. J.
Harcourt, Rt. Hon. Lewis (Rossendale) Murray, Capt. Hon. Arthur C. Wedgwood, Josiah C.
Harcourt Robert V. (Montrose) Nannetti, Joseph P. White, J. Dundas (Glasgow, Tradeston)
Hardle, J. Keir (Merthyr Tydvil) Neilson, Francis Wiles, Thomas
Harmsworth, Cecil (Luton, Beds.) Nicholson, Sir Charles N. (Doncaster) Wilkie, Alexander
Harvey, T. E. (Leeds, West) Nolan, Joseph Williams, John (Glamorgan)
Harvey, W. E. (Derbyshire, N.E.) Norman, Sir Henry Williamson, Sir Archibald
Havelock-Allan, Sir Henry Nugent, Sir Walter Richard Wilson, Hon. G. G. (Hull, W.)
Hayden, John Patrick O'Brien, Patrick (Kilkenny) Wilson, W. T. (Westhoughton)
Hayward, Evan O'Connor, John (Kildare, N.) Wood, Rt. Hon. T. McKinnon (Glas.)
Helme, Sir Norval Watson O'Connor, T. P. (Liverpool) Yoxall, Sir James Henry
Henderson, Arthur (Durham) O'Doherty, Philip
Higham, John Sharp O'Donnell, Thomas TELLERS FOR THE NOES—Mr. Illingworth and Mr. Gulland.
Hinds, John O'Dowd, John