NEW CLAUSE.—(Duty on Table Waters.) (Hansard, 28 June 1916)

§ Mr. GLYN-JONES
This Clause is rather quaintly worded. I must apologise for the association of water and milk, but I am not casting any reflection on milk. The House in a recent Act imposed a duty in the following terms:
"There shall as from the 1st day of May, 1916, be charged, levied, and paid upon all table waters as defined by this Section…"
certain duties. Then it goes on to say: "'Table Waters' for the purposes of this Act includes any aerated waters and any beverages sold or kept for sale in bottles other than…"
Then follow certain exceptions, which did not include milk. I pointed out at the time that beverages sold or kept in bottles did include milk, and that the best milk sold in London is sold in bottles. It is not denied that milk is a beverage or that it is sold in bottles; therefore it is a table water within the meaning of the Act. The words were deliberately adopted by the Government, although this was pointed out. I know the Chancellor of the Exchequer will say that the Board of Customs and Excise do not, in fact, make us pay 8d. a gallon on milk delivered in bottles. But that simply means that they are not carrying out the law of the land. [An HON. MEMBER: "Nonsense!"] It is not nonsense. I am sorry if the right hon. Gentleman thinks that I am wasting the time of the Committee. I leave the Committee to decide whether they think that no better 988 form of words can be adopted than one which includes milk when the House means table waters. As a matter of fact, as the Act stands, it says that there shall be charged on milk 8d. a gallon. With regard to distilled water the difficulty has arisen. It is, I suppose, an extremely rare thing for anybody to drink distilled water.

§ Sir A. MARKHAM
I always drink it.

§ Mr. GLYN-JONES
Then the hon. Baronet will perhaps agree that it is grossly unfair to add to the penalty of drinking distilled water that of having to pay 8d. a gallon for so doing. This is all very amusing to the Government no doubt, but when I am putting forward practical difficulties which occur in trade and industry I think that, at any rate, my point is deserving some consideration. At present the Board of Inland Revenue say that they do not know, and that they are considering what Regulations they shall apply to the distillers of distilled water. It is sold for use for photographic purposes, for breaking down spirits, and for use in medicine; and the distiller, when he sells it, does not know whether any of it —it is only an infinitesimal portion of it —will ever be drunk as a beverage. People who drink still water as a beverage usually take it aerated; if so, it comes within the terms of that definition. What I want to make quite clear is that distilled waters are not within this definition. There is no use in keeping still water here which it is not intended to tax. It does give rise to these difficulties, and at present pharmacists are being required to keep an account of the distilled water which they buy, or which they distil, in order to await the decision of the Board of Inland Revenue as to what tax they will have to put upon it. That surely is a state of things which the Government do not wish to continue, and I ask the House to say that what they intended to tax in the Finance Bill did not include milk or distilled water which is not aerated.

§ Mr. MONTAGU
My hon. Friend seems to have some objection to going home before eleven o'clock; he is enjoying the proceedings on the Finance Bill so much that he would like to continue here. He cannot pretend to this Committee that he has been labouring under the disadvantage of paying a tax on his milk and distilled water. He never thought of this Amendment in time to put it on the Paper. 989 It is the result of a brain wave at the last moment: of something which has suddenly occurred to him. These new duties in the Bill do not say anything about milk or distilled water, and suddenly it came to the hon. Member that there was an omission whilst he was listening to the hon. Member opposite talking about woods and forests, or something of the kind. What is his motive? Is there a babe going short of milk because some Customs official has demanded a tax upon it? Has any hon. Member been asked to pay a tax upon his milk or upon his distilled water?

§ Mr. GLYN-JONES
Distilled water!

§ Mr. MONTAGU
Distilled water when it is not a beverage?

§ Mr. GLYN-JONES
Yes.

§ Mr. MONTAGU
Nobody, at any rate, drinks distilled water, except, perhaps, the hon. Member for Mansfield, and he probably drinks it to help him to deal with the Super-tax, and not as a table water or beverage. The hon. Member who has just spoken says we are breaking the law if we do not tax milk; therefore he wants to put into the Bill some exemption for milk. As the House knows when they passed this tax, there is nothing harder in the world than to define in any Act of Parliament what we want to tax. The definition was admittedly faulty, but we knew what the House intended to tax, and it was not milk but what the Commissioners of Customs and Excise intended to tax. Distilled water is not a beverage except when it is used for breaking down spirits, and it is a beverage when aerated and appears under the names of Salutaris or Appolinaris.

§ Mr. COWAN
Still Salutaris is sold.

§ Mr. MONTAGU
As a table water. Then it will be taxed. There has been no case of abuse. If you tinker with this definition, I am perfectly certain you will not improve it. I am quite convinced that if the hon. Member takes the trouble the next time he comes down here he will be able to discover some other thing that has not been included, or that should have been included or excluded, and he can put down a manuscript Amendment which will prove just as amusing to the Committee as his effort has been before the Committee to-night.

§ Mr. GLYN-JONES
I am quite sure that, on reflection, the right hon. Gentleman will realise that he is treating me in a grossly unfair way. He knows perfectly well that in this matter I am speaking as the mouthpiece of a Committee set up with his knowledge and with the knowledge of the Chancellor of the Exchequer, and as representing the trade, to deal with it, and I am not raising frivolous points, as he will find out in the administration of the Act, when I tell him that letters have passed between the Committee, of which I am chairman, and the Commissioners of Customs and Excise, on this matter of distilled waters, and that they say the position is doubtful. I think he will see that, at any rate, he might have treated the matter more fairly. As a matter of fact the reason this Amendment was not put on the Paper was that the Government gave the trade distinctly to understand that no Amendments dealing with this matter could be dealt with in this Bill. Suddenly, however, thy bring in a Clause to avoid bringing in another Finance Bill, and thus we have got to put in manuscript Amendments in this way. I am quite sure that if the right hon. Gentleman had consulted his own advisers and the Commissioners themselves they would have said that this distilled water matter had given them considerable difficulty. Ho now says distilled water is not a beverage if not aerated. That is my Amendment. Why cannot he say in the Bill that distilled water non-aerated shall not pay the duty? On the Report stage I will again raise it, and put it on the Amendment Paper, so that the right hon. Gentleman shall not be taken by surprise.

§ Colonel GRETTON
I tried to call the attention of the Committee and the Government to this very important point about distilled water last year. It is really a commercial matter, and I hope the Government will not treat it with contumely, but will endeavour to deal with the difficulty which has arisen. Distilled water as a beverage is particularly nasty. A very large quantity of distiled water is used in commercial processes of chemistry and so forth, and there is always this doubt. If the Government do not mean to tax it, why cannot they say so?

§ Mr. MONTAGU
It is in the Bill.

§ Colonel GRETTON
This difficulty has arisen in practice. The officials of the Government apparently do not understand 991 what the Government desire, or what the House has put in the Bill. I hope this matter will have been adjusted when we come to the Report stage. I am only asking that it should not be treated as if unworthy of consideration.

§ Mr. MONTAGU
The hon. Member is quite wrong. "'Table waters ' for the purposes of this Act, includes any aerated waters other than, etc." Now distilled water used for manufacturing purposes is not an aerated water. It also includes "any beverages sold or kept for sale in bottles," and that is all it includes. Distilled water used for manufacturing purposes is not a beverage sold in bottles. The hon. Member is very angry, but there is no grievance.

§ Mr. POLLOCK
Might I reinforce the argument and point out the language as it stands? Surely milk is excluded, because one of the exceptions includes other "liquors intended to be consumed only in a diluted form." I always wish to assist my right hon. Friend, and if he wishes to adhere to the terms of the Act he has obviously excluded milk.

§ Mr. T. C. TAYLOR
The right hon. Gentleman has said many things about my hon. Friend, but I think he has been a little too supercilious. He knows very well my hon. Friend is bringing up a substantial point.

§ Mr. MONTAGU
I did not. I deny that entirely.

§ Mr. TAYLOR
Then I will try to show it is. We have just had another joke from the hon. and learned Member opposite at the expense of my hon. Friend about milk. The actual literal meaning of this Clause does include milk. That is undeniable. Over and over again cases have come into Court, and someone has said—the solicitor for the defence perhaps—"Oh, this law was never intended to include so-and-so," and the magistrate has held that he is bound by the letter of the Act. It is not for a Minister of the Crown to sneer at my hon. Friend who has tried to put the Government right, for even the Government is not always right. Therefore, I think it is not beneath the dignity of the Government to accept the Amendment put forward, I 992 believe in perfect good faith, and which will make literally correct what the Government say they mean.