HC Deb 21 September 1915 vol 74 cc350-2

I pass now to my next topic, the proposals for New Taxation. Many suggestions have been made to me which I have been unable to accept. I should like to say, however, that the fact that a great many of these suggestions are not included in my present proposals is not because the suggestions in themselves were bad—on the contrary, many of them were very good—but because there is a strict limit to the possible amount of taxation which can be imposed at one and the same time. The point which I particularly wish to impress on the Committee is as much a question of machinery as of anything else. Every new tax imposes a new burden upon the Board of Inland Revenue and on the office of Customs and Excise. They have a certain staff—an admirable staff, but necessarily limited in size—and we have to take care, unless our whole proposals for taxation are to prove a fiasco, that the duties thrown on the Board of Inland Revenue and on the Customs and Excise are duties which they can perform in the course of the financial year. The Committee will not forget that if the War proceeds there will be more War budgeting, particularly as it appears to have become the habit to introduce two Budgets a year, and I, or my successor, will then have an opportunity of incorporating some of the valuable suggestions which I have received. My present desire is to offer to the House only such proposals as I am advised are practicable, so that I am in the position of being able to assure the House that if the proposals are accepted the Departments will be able to give effect to them promptly and efficiently.

To obtain Revenue is now and always the first object of taxation. But at this time there are other objects which must not be left out of view. I am afraid that what I am going to say will satisfy neither the strict Free Trader nor the scientific Tariff Reformer. Both of them must put for the time being their fiscal theories upon one side. We have to tax now with objects beyond revenue, with objects which are purely temporary, and without regard to the permanent effect upon trade. We must look at the state of our foreign exchanges. We must discourage imports. Some of us think that, in ordinary circumstances, imports, if excessive, will necessarily be discouraged and exports will necessarily increase. But that is not true to-day. We cannot increase our exports, because our capital and labour are otherwise engaged. We have then to look upon the reduction of imports as an object in itself. Then we also have to have strict regard to the necessity of reducing consumption. If, then, we can by any means by taxation, at one and the same time restrict imports and reduce consumption, and bring in revenue, then I think for the moment, at any rate, we may be considered to have found an ideal system. There is also one other point before I come to the details of Taxation which I should like to mention. I have already said we must not do too much in Taxation, because it would cripple machinery. But we must also keep in view the necessity of not interfering with the trades which are most lucrative to us and upon which our exports depend. That is an object which must always be kept in mind, and I hope that the Committee, when it examines in detail the proposals I have to put forward, will be satisfied that the Government have kept all these objects strictly in view.

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