HC Deb 06 August 1912 vol 41 cc3115-23

It is hereby declared that for the purposes of Part I. of the Finance (1909–10) Act, 1910, Undeveloped Land Duty shall not be charged on the site value of any land which is bonâ fide used and occupied for the purpose of allotments, nursery, or market gardens.

Motion made and Question proposed, "That the Clause be read a second time."


I beg to move this new Clause. For the third year in succession, I have to move it. It is a genuine misfortune that this important Clause dealing with a large class in the community should not be reached until the eve of the adjournment at an early hour in the morning. I have looked up what I said last year, and what the Chancellor of the Exchequer said in reply to me, and I notice that he got me into a cleft stick very soon. I suggested that these taxes dealt very unfairly with market gardeners and those who work allotments. At the same time I rather rashly said that only £2,000 had been collected in respect to Undeveloped Land Duty. "Why did I complain of the tax," said the Chancellor of the Exchequer, "when it produced nothing." I can say that the tax went up this year to £28,947, and therefore it is more oppressive than it was last year, and I am sure the Chancellor of the Ex-chequed will be able to say that it will in future realise still more. I do not want to waste time upon arguments of that sort, but I want to appeal to the broad sense of justice of the Chancellor of the Exchequer and Members of this House. It is obvious that around every large city there must be building land which has a building value, actual or expected. When you come to take the value of the land, you will find cases; take a market gardener in my Division, ten miles from here, who has a plot. If you capitalise the value of that at £5 per acre at twenty-five years' purchase, you will get £125. At the same time that particular acre of land has a building value which is a great deal more than £125, something like £300 an acre. On that difference ½d. in the £ must be paid by somebody.

My contention is that where the building land has been bonâ fide used for a great industry, like market gardening, nurseries, or allotments, that id. should not be payable. I know there are Members of this House who have an obsession about taxation of land values. I make no appeal to them. If they take an omnibus for 7d. to this particular land, there they can see this market garden. According to them every market garden is owned by a marquis, and every plot of vacant land is held up by some speculator. As they take their drives, they see crowded streets, and they say that were these people allowed to use the vacant land to provide houses there would not be this overcrowding, and it would all be reformed if it were not opposed by some marquis. Now I want to make an earnest appeal to the impartial man who has no prejudices of that kind. I ask such men to come out to these lands and see for themselves how things are. You may see a little bit of land almost ripe for building purposes, and it is lying idle. It is not paying what it ought to pay to the local rates. But that is only a small proportion of the building land; the vast majority of it is well cultivated; it is put to the best possible use as market gardens or allotments.

Only a few weeks back I saw a piece of vacant land almost ripe for building growing thistles. Within 200 yards of that I saw a cricket and tennis ground with numbers of young people on it, and about 200 yards from that again I saw two acres of allotments. By what possible process of justice can you bring these three bits of land together? The vacant land of course has to pay the Undeveloped Land Duty. If that went to the relief of the rates of the district I would have nothing to say. There may be some justice in allowing the cricket and lawn tennis ground to escape; it may add something to the amenity of the district and make residence there more attractive, but even in that case it might be fairly said to these young people that they should go a little further out and pay 1d. or 2d. on the tram and allow this land to be built upon, so that people might get away from the slums into a more healthy spot. As a matter of fact the tennis ground escapes free. The allotment ground was equally crowded with people who were trying to get recreation, but that allotment is taxed. I say that is absolutely unjust. You may tax undeveloped land, if there is really a good case. If the community likes let it tax the cricket ground and the allotments; I mean the locality and not the Chancellor of the Exchequer. But in the present conditions the allotment should not be taxed, nor should land used for market gardens or for nurseries. These men work very hard and it is unfair to put a tax upon them. They have to face severe competition from abroad. I do not go about the country trying to make the Chancellor of the Exchequer popular, but if he wants to make himself popular let him take the tax off these market gardens and allotments. At any rate he will become more popular than he is at the present moment.


I beg to second the Motion.

As regards the product of the tax, no doubt the yield of the Undeveloped Land Duty has not been very high but it is oppressive from the point of view of these holders of allotments and market gardens. The landlord is not liable to pay taxes on it if he uses it for any other trade business or industry excepting agriculture. Therefore it is a specially penal clause upon agriculture carried on by these people outside the towns. It is a tax on the business of the horticulturist and market gardener and it is a tax upon food. It singles out the agriculturist and the horticulturist and I want to make an appeal to the Chancellor of the Exchequer to give exemption to these classes which would not cost much to the Exchequer but would give great relief to these deserving and industrious people.


Three times I have had to resist this particular Amendment, and I cannot flatter myself I have anything new to say on the subject, although I have not looked up my former utterances. The hon. Gentleman who moved this new Clause gave the House to assume that no concessions at all had been made under this Act for market gardens, and the hon. Gentleman who seconded said this was a penal tax upon market gardeners. So far from that being the case, the Act as it stands at present exempts the full agricultural value of the market garden from any Undeveloped Land Tax at all, and the. only case in which the Undeveloped Land Tax arises is when the building value is greater than the full agricultural value of the place as a market garden, and then the Tax is only a halfpenny in the £ for the excess over the full agricultural value. The hon. Gentleman might have mentioned that the tax is a tax on the landlord and not on the tenant, and the landlord who is deriving a specially large rent for his land owing to its proximity to the town. He also omitted to mention that we have been so careful of the interests of the small owner in the matter that in the case of any land owned by a small owner less than £500 in value it is altogether exempted from the Undeveloped Land Duty. Of course, there are two fundamental objections to the Amendment. The first is that it opens unlimited opportunity for the deliberate evasion of the tax. A man who has a site in the midst of a city worth many thousands of pounds per acre, and who is waiting for that site to ripen, has only to convert it into an allotment or make some plantation of vegetables in order immediately to get out of the tax altogether. [An HON. MEMBER: "Bonâ fide."] He will have no difficulty in proving his bona fides. The second reason is the reason which is fundamental to this Undeveloped Land Tax, that it is imposed on capital values which are increasing in the neighbourhood of a town in which the landlord allows his land to increase in value and contributes nothing either to the rates or the taxes for that increase in value.


It may be or may not be.


In the great majority of cases it is in that particular belt, which the hon. Gentleman has described, in the neighbourhood of a town where artificial values have been heaped up owing to the town spreading out to market gardens and ultimately absorbing them. Therefore, I think the right hon. Gentleman will recognise that in each case belts in the neighbourhood of towns are being greatly increased in value and accordingly come under the Undeveloped Land Tax. Under these conditions it is a tax which is being laid on an increasing capital value owing to the development of the town, and which would otherwise pay nothing either to the Imperial Exchequer or to the town which is making this progress. Under these circumstances I think this is one of the fairest and most just taxes ever imposed.


The right hon. Gentleman has not made a single statement which is not open to dispute, and even to disproof. There is nothing in the Act as to any necessity for this land to increase in value in order to become taxable. It may have been stationary in value for many years, and may be so for many years to come, and yet is liable for the tax. I could go through all his other statements in the same way if it were not for the time of the morning.


I should like to say a few words as representing perhaps the largest market garden constituency in the kingdom, namely, Brentford. I venture to suggest to the Government that market gardens are of the highest forms of development. The object of the Undeveloped Land Tax was to secure the highest development of the land, and I venture to suggest from an economic point of view, and from the point of view of employment, market gardens and allotments are really much more beneficial to the real development of land for the State even than buildings. That may be possibly the case in the belts surrounding our large cities, and if the Chancellor of the Exchequer or the Secretary to the Treasury would go down to Brentford and Hounslow he would see there that intensive form of cultivation which is quite as high a development as building cheap cottages to which use this land would be put. I remember that one suggestion, made during the Debates of 1909, was that this tax might possibly have the effect of diverting land from allotments to building land.

I will give one instance in my own personal knowledge where this has occurred. A series of allotments were promoted to the great benefit of the labouring population near a town upon land which was worth for building purposes £500 per acre and could have been sold at that price. The Undeveloped Land Tax upon that would be about £1 an acre annually. That land was let for allotments at £1 an acre, and I had the honour of collecting the rents. The owner was faced with this position, that if he continued to let his land in allotments to the great benefit of the labouring population of the town he would have to pay the whole of his rent in Undeveloped Land Tax. What was the result? I was bound to advise him: "You must get rid of these allotments and drive these working men further out of the town so that they will have to go to their allotments by tram or tramp it, and you must put up the land for building purposes." That is exactly what has happened. The labouring population in this instance—and I am quite willing to give the name of the owner—has been driven further out, and the land has been sold for building purposes. The owner of the land benefits and the working population in that town are the only people who suffer. I venture to suggest that instances of that kind can doubtless be multiplied many hundredfold throughout the country, and I therefore think the Chancellor of the Exchequer might give a little more attention to this Clause than the Secretary to the Treasury seems to have done.


Just one word, especially in view of the statement made by the hon. Gentleman who has just addressed the House with reference to the constituency he represents. I know personally a gentleman interested in building operations who was offered a very big price for some of that land which is being held up at the present time. I could give the hon. Member privately some definite information and facts relating to what I am now speaking about. I can give him a case in point concerning one of the very market gardens he may have in his mind where offers have been made, owing to the-fact that land is required for building purposes, of as much as £50 and £56 for a plot of land only seventy-five feet deep and nine feet frontage, and you will see what an enormous value that land has obtained owing to the development and crowding of houses. Yet the owner holds it up because he hopes to get considerably more. I should have thought that that was the kind of land that really ought to have the tax placed upon it.


I want to point out one instance of what I can only term the absurd way in which this Undeveloped Land Tax operates at present. The case-I want to point out is not a playground open to the public, but a lawn tennis ground run for a profit.


Lawn tennis grounds-do not arise under this Clause.


I was only mentioning that as a contrast to the allotment ground which is taxed, and if I cannot make the point as to what is not taxed in order to show that allotments ought not to be taxed, it is impossible, of course, for me to give the illustration I wish. It seemed to me that it is entirely to the point. However, I have said all I wished to indicate, namely, that it is not only ground to which the public have access that is not taxed, but even a lawn tennis ground run at a profit. I do not complain that it is exempt, but if such a thing as that is exempt it is surely right to exempt land which is utilised for the very best possible purpose, and to tax it in this way seems to me the most absurd thing that can possibly be imagined. Therefore, I cannot imagine a stronger case than there is for this particular Amendment, and it is impossible to conceive of any really valid reason why it should not be adopted. The only argument used from the Treasury Bench was that the whole agricultural value of the land would be exempt. The whole point of my hon. Friend the Member for Enfield was, however, that the figures he gave did calculate the full agricultural value, and he was only dealing with extra value.


All the arguments used from the other side in favour of this further exemption from Undeveloped Building Land Tax are really arguments against exemptions which have already been made. If and when this further exemption is granted hon. Members opposite will, I have no doubt, find just as many more forms of agricultural land in respect of which further exemptions should also be granted. All these difficulties—and I admit they exist—would be swept away if instead of the tax falling

only on one particular kind of land, you had a tax generally on all land.


I wish, to say one word in support of the Clause, and to point out two fallacies underlying the arguments which we have heard from, the Government upon it. The first is that all land which has a potential building value could be and must be built upon. It is ridiculous to suppose that that works, out in practice, because although large plots of land may have a potential building value, it is obvious that you cannot proceed to build on them all at the same time. They must wait until the time is ripe for dealing with them. The second fallacy is this. The principle we were told on which this Undeveloped Land Tax is levied is that the owner of the land is not doing the best he could with it, and it ought to be used for the greater good of the community. But I submit it is an entire fallacy to suppose that if you want to get the best use out of a piece of land you must necessarily put buildings on it. In my own Constituency I should say there is not a piece of land left which is capable of being built on, and if there were only a few allotments there it would be a perfect God-send to the place. If the whole policy of the Government in levying this tax and in declining to listen to the proposal to insert the very reasonable Clause now submitted, is to drive every piece of land into the building market, then I say the ultimate result will be the creation of great areas of slums. I contend that such an object is not so good as one which aims at developing land for market gardens, and particularly for intensive culture.

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

The House divided: Ayes, 75; Noes, 163.

Division No. 210.] AYES. [1.28 a.m.
Agg-Gardner, James Tynte Cassel, Felix Kerry, Earl of
Anson, Rt. Hon. Sir William R. Cator, John Kyffin-Taylor, Gerid
Archer-Shee, Major Martin Cecil, Evelyn (Aston Manor) Lewiaham, Viscount
Ashley, Wilfrid W. Cecil, Lord Hugh (Oxlord University) Lloyd, George Ambrose
Baird, John Lawrence Chamberlain, Rt. Hon. J. A. (Worc.) Locker-Lampson, G. (Salisbury)'
Baker, Sir Randolf L. (Dorset, N.) Chambers, James Mackinder, Haltord J.
Balcarres, Lord Clive, Captain Percy Archer Macmaster, Donald
Banbury, Sir Frederick George Eyrea-Monsell, Bo Item M. Malcolm, Ian
Barlow, Montague (Salford, S.) Gibbs, George Abraham Mills, Hon. Charles Thomas
Barnston, Harry Glazebrook, Philip K. Morrison-Bell, Maj. A. (Honiton)
Bathurst, Charles (Wilts, Wilton) Goldsmith, Frank Neville, Reginald J. Neville
Beach, Hon. Michael Hugh Hicks Grant, James Augustus Newdegate, F. A.
Benn, Arthur Shirley (Plymouth) Gretton, John Newton, Harry Kottingham
Bennett-Goldney, Francis Gwynne, R. S. (Sussex, Eastbourne) Peel, Capt. R. F. (Woodbridge)
Boies, Lieut.-Colonel Dennis F. Henderson, Major H. (Berkshire) Peel, Hon. W. R. W. (Taunton)
Boyton, James Hewins, William Albert Samuel Peto, Basll Edward
Bridgeman, William Cllve Hill, Sir Clement L. (Shrewsbury) Pollock, Ernest Murray
Burn, Col. Charles Rosdew Hope, James Fitzalan (Sheffield) Pryce-Jones, Col. Edward
Rawson, Col. Richard H. Starkey, John Ralph White, Maj. G. D. (Lanes, Southport)
Roberts, S. (Sheffield, Ecclesall) Staveley-Hill, Henry Willoughby, Maj. Hon. Claud
Rolleston, Sir John Sykes, Alan John (Knutsford) Winterton, Earl
Ronaldshay, Earl of Talbot, Lord Edmund Worthington-Evans, Laming
Royds, Edmund Thynne, Lord Alexander Younger, Sir George
Rutherford, Watson (Liverpool) Touche, George Alexander TELLERS FOR THE AYES.—Mr.
Sanders, Robert Arthur Walrond, Hon. Lionel Newman and Mr. Joynson-Hicks.
Stanier, Beville Wheler, Granville C. H.
Abraham, William (Dublin Harbour) Harvey, W. E. (Derbyshire, N.E.) O'Grady, James
Acland, Francis Dyke Havelock-Allan, Sir Henry O'Kelly, E. P. (Wicklow, W.)
Adamson, William Hayden, John Patrick O'Malley, William
Armitage, Robert Henderson, Arthur (Durham) O'Neill, Dr. Charles (Armagh, S.)
Baker, Harold T. (Accrington) Henry, Sir Charles S. O'Shaughnessy, P. J.
Barnes, George N. Higham, John Sharp O'Shee, James John
Benn, W. (Tower Hamlets, S. Geo.) Hobhouse, Rt. Hon. Charles E. H. O'Sulllvan, Timothy
Bentham, George Jackson Hogge, James Myles Outhwaite, Robert Leonard
Boland, John Plus Howard, Hon. Geoffrey W. A. Palmer, Godfrey Mark
Booth, Frederick Handel Hughes, Spencer Leigh Parker, James (Halifax)
Bowerman, Charles W. Isaacs, Rt. Hon. Sir Rufus Phillips, John (Longford, S.)
Boyle, Daniel (Mayo, North) John, Edward Thomas Pointer, Joseph
Brady, Patrick Joseph Jones, Edgar R. (Merthyr Tydvil) Ponsonby, Arthur A. W. H.
Brocklehurst, William B. Jones, Henry Haydn (Merioneth) Power, Patrick Joseph
Burke, E. Haviland- Jones, William (Carnarvonshire) Price, C. E. (Edinburgh, Central)
Burns, Rt. Hon. John Jowett, Frederick William Price, Sir Robert J. (Norfolk, E.)
Bytes, Sir William Pollard Joyce, Michael Primrose, Hon. Nell James
Carr-Gomm, H. W. Keating, Matthew Pringle, William M. R.
Clancy, John Joseph Kellaway, Frederick George Raffan, Peter Wilson
Clough, William Kennedy, Vincent Paul Rea, Rt. Hon. Russell (S. Shields)
Clynes, John R. Kilbride, Denis Reddy, Michael
Collins, Godfrey P. (Greenock) King, Joseph Redmond, John E. (Waterford)
Condon, Thomas Joseph Lambert, Rt. Hon. G. (Devon, Molton) Redmond, William (Clare, E.)
Cory, Sir Clifford John Lambert, Richard (Wilts, Cricklade) Richards, Thomas
Cotton, William Francis Lardner, James C. R. Roberts, Charles H. (Lincoln)
Crumley, Patrick Law, Hugh Alex. (Donegal, W.) Roberts, George H. (Norwich)
Cullinan, John Lewis, John Herbert Robertson, John M. (Tyneside)
Dawes, James Arthur Lundon, Thomas Roche, M. Augustine (Louth, N.)
De Forest, Baron Lynch, Arthur Alfred Rowlands, James
Delany, William Macdonald, J. R. (Leicester) Samuel, Rt. Hon. H. L. (Cleveland)
Denman, Hon. Richard Douglas Macdonald, J. M. (Falkirk Burghs) Scanlan, Thomas
Devlin, Joseph Macnamara, Rt. Hon. Dr. T. J. Seely, Rt. Hon. Col.
Dillon, John MacNeill, J. G. Swift (Donegal, S.) Sheehy, David
Donelan, Captain A. Macpherson, James Ian Shortt, Edward
Duffy, William J. MacVeagh, Jeremiah Simon, Sir John Allsebrook
Duncan, C. (Barrow-in-Furness) McKenna, Rt, Hon. Reginald Smith, Albert (Lanes, Ciltheroe)
Duncan, J. Hastings (York, Otley) Markham, Sir Arthur Basil Smyth, Thomas F. (Leitrim, S.)
Elibank, Rt. Hon. Master of Marks, Sir George Croydon Stanley, Albert (Staffs, N.W.)
Esmonde, Dr. J. (Tipperary, N.) Marshall, Arthur Harold Sutton, John E.
Esmonde, Sir T. (Wexford, N.) Mason, David M. (Coventry) Taylor, John W. (Durham)
Farrell, James Patrick Masterman, Rt. Hon. C. F. G. Tennant, Harold John
French, Peter Meehan, Francis E. (Leltrim, N.) Thorne, G. R. (Wolverhampton)
Field, William Molloy, Michael Trevelyan, Charles Philips
Fiennos, Hon. Eustace Edward Mooney, John J. Ure, Rt. Hon. Alexander
Flavin, Michael Joseph Morgan, George Hay Wadsworth, John
George, Rt. Hon. David Lloyd Morison, Hector Ward, John (Stoke-upon-Trent)
Gill, Alfred Henry Muldoon, John Webb, Henry
Glanville, Harold James Munro, Robert Wedgwood, Josiah C.
Greenwood, G. G. (Peterborough) Murray, Capt. Hon. Arthur C. White, James Dundas (Glasgow)
Greig, Col. James William Nannetti, Joseph P. White, Patrick (Meath, North)
Grey, Rt. Hon. Sir Edward Nolan, Joseph Wilkle, Alexander
Hackett, John O'Brien, Patrick (Kilkenny) Wilson, W. T. (Westhoughton)
Hancock, John George O'Connor, John (Kildare, N.)
Harcourt, Robert V. (Montrose) O'Doherty, Philip TELLERS FOR THE NOES.—Mr.
Harmsworth, C. B. (Beds, Luton) O'Donnell, Thomas Illingworth and Mr. Gulland.
Harvey, T. E. (Leeds, West)