CLAUSE 1.—(Continuation of Customs duties imposed under 5 & 6 Geo. 5, c. 89, 9 & 10 Geo. 5, c. 32.)

HC Deb 16 June 1921 vol 143 cc647-709

The following duties of customs imposed by Part I of the Finance (No. 2) Act, 1915, shall, subject to the provisions of Section eight of the Finance Act, 1919 (which relates to Imperial preferential rates), continue to be charged, levied and paid in the case of the new import duties until the first day of May, nineteen hundred and twenty-two, and in the case of the other duties until the first day of August, nineteen hundred and twenty-two, that is to say:—

Duty.	Section of Act.
Increased duty on tea	1
Additional duties on dried fruit	8
New import duties	12

The CHAIRMAN

The first Amendment, in the name of the hon. and gallant Member for East Newcastle (Major Barnes), which proposes to leave out the words, "imposed by Part I of the Finance (No. 2) Act, 1915." is in Order, but I would point out that if it were moved and rejected, it might have a rather embarrassing effect on the subsequent discussion. It cannot be construed alone, and the consequential Amendments would fall with it. I would suggest to the hon. Member that he should proceed to move his second Amendment—to leave out the words, "subject to the provision of Section 8 of the Finance Act, 1919 (which relates to Imperial preferential rates) continue to." That Amendment will read by itself.

Major BARNES

You have been good enough to give us some idea of what is in your mind, and the only point I am not clear upon is this. We wish to raise a discussion on the question of the new import duties as a whole. There are certain Amendments dealing with the duty on tea, and also dealing with the duties on dried fruits. The point I would like to have made clear is whether, if this first Amendment is not moved, the effect of it will really be that we consent to the continuance of the new import duties, and it would not be possible on a later Amendment to raise a question as to these new import duties. Shall we, by dropping this Amendment, not be committed to their continuance in some degree?

The CHAIRMAN

It is quite true the Committee would be committed to some of the duties levied by the enactment of 1915. The duty on tea still can be taken when it is reached, and if it stands it will be possible to raise points later on on other duties. I do not think the hon. Member can be prejudiced by adopting that course.

Major BARNES

If that is your ruling I think the proper and most advisable course would be not to move this Amendment until we come to the duty on tea, as then we can deal with the duties seriatim.

The CHAIRMAN

I think the Committee should be fully advised of the consequences of that action. I understand some hon. Members wish to raise the question of Colonial Preference. After considering the matter and after consulting Mr. Speaker upon it, I have come to the conclusion that the only way by which this can be done is for the hon. and gallant Member to move his second Amendment.

Major BARNES

I beg to move, to leave out the words "subject to the provision of Section Eight of the Finance Act, 1919 (which relates to Imperial preferential rates), continue to".

All I am anxious to do is not to cut out the Debate on Colonial Preference. I do not propose in the remarks I am about to make to go into the question of preferential rates in so far as they apply to all the commodities that come under this provision. No doubt, other hon. Members who wish to take part in the discussion will raise questions as to the effect of these differential rates on motor cars, musical instruments, and so on, but I shall confine my remarks to the-way in which they work out in relation to the tea duty, and that will save me making references to the matter when I come to my own Amendment on the question of the tea duty. I would like to read to the House an extract from the "Financial Times" of 17th January, 1921, which deals with this question on the differential duties between British and foreign grown tea. These duties, or rather this differentiation, hit Java and Sumatra very hard, the plantations there being mostly British owned. This experiment in Tariff Reform is not very successful, and a tea broker writing to the "Financial Times" on the date mentioned, says: Prior to the introduction of the differential tariff, London was the distributing centre for China tea. Merchants used to bring the bulk of the season's exports from China to London, with a view to catering for the demand which existed in the United Kingdom, and also the Continental and other foreign market demand. The differential duty, penalising China tea to the extent of two pence a pound, has resulted in making that particular kind of China tea, which was suitable for Continental demand, absolutely useless for inclusion in low-priced blends for the home trade. The result of the loss of the alternative market for inclusion in home trade blends has been to cause the importation of this class of tea to entirely cease, leaving the Continental demand to be filled either direct from China or from Hamburg or Holland. Thus does London lose all this distributing trade. 4.0 P.M.

This quotation is hot only of interest and importance in dealing with the question of the duty on tea, but it also raises the question of the effect of these preferential duties. That which is true here will, doubtless, be true in other cases. In the first place, we are losing the actual trade in this particular commodity between these exporting countries and London, thus doing away with the means of livelihood of the people who are engaged in planting and distributing. You have a whole chain of people in this country whose employment is entirely destroyed by the operation of this duty. The Chancellor of the Exchequer may say that this is only a very small matter, but these are the days of small things, as we have been educated to believe in the Debates on the Safeguarding of Industries Bill. There are many matters which are regarded by the Government as worthy of protection, although, in fact, the amount of capital and labour involved is very samll. I do not, therefore, think that the Chancellor of the Exchequer can give me that answer. I would draw his attention to what is happening in this particular case. He has now passed away from the Board of Trade to the Exchequer, and he can take a different point of view. A loss of trade means a loss of income, and a loss of income means a loss of revenue. Viewing this matter purely from the point of view of revenue, no good turn is being served by the retention of the preferential duty on this commodity. I do not know whether the whole question of Imperial Preference is too sacred for the right hon. Gentleman to lay his hands upon it, but here is a case where a preferential duty is working injury to people of this country, and I hope that he may be able to give us some assurance that some modification will be made.

The CHAIRMAN

Before putting the Question, I presume the hon. and gallant Member, in the event of the Amendment being carried, will propose to reduce the Customs Duty to an extent which will prevent any more tax being levied, whether on Colonial or other products?

Major BARNES

indicated assent.

Sir WILLTAM BARTON

There is a strong case for the reconsideration of this matter. Whatever may be the opinion of hon. Members about Preference, it works out in relation to tea in a manner which I am quite sure was never contemplated. Wherever you have a preference, necessarily you have a discrimination against somebody, and in this case it is found to work very injuriously. It seems an almost needless thing that there should be a preference on tea; at all, because of all the tea that comes into this country something over 90 per cent. comes from India, and the preference, so far as India is concerned, is almost of no value. In practice it really means a concession to the consumers of tea in this country. This preference discriminated against two countries, one being China and the other Java. The extraordinary feature of the case is that both those countries exercise no discrimination against us. They have no preferential duties. Both of them go in for taxation for revenue purposes only, and, indeed, they have offered great advantages to our country. There is no doubt that in China they do resent this discrimination, in view of the fact that they have never in any way discriminated against us. The matter is even more serious in the case of Java. Nominally, Java is a Dutch possession, but, although nominally it is a Dutch possession, it was, I believe, exchanged for Ceylon, the bargain being that if the time ever came when Holland could not administer it it would be returned to this country. Its administration by Holland has been on the lines of absolute equality, the Dutch themselves claiming no privilege in their Colony, just as in the past we have claimed no privilege in our Colony. As a matter of fact, Java to-day is one of the richest countries in the world, and has become a most valuable British market. It seems to me a dangerous thing to bring in discrimination against two countries who have never discriminated against us, and whose trade is very valuable to this country. The Government—putting aside the sentimental consideration of Colonial Preference—should look at it from the point of view of the broad general principle of what is best for the trade of the country as a whole, what will tend to enrich the country, and what will tend to impoverish it. I am sure, if the matter be looked into, that this preference will be found to be of no value to India, to discriminate against two of our best friends, and, consequently, to be of no advantage to us whatever.

Sir WILLIAM PEARCE

I want to call attention to the question of Colonial preference on industrial alcohol.

The CHAIRMAN

I do not think that industrial alcohol is one of the articles on which an increase duty was imposed by the Finance Act, 1919.

Sir W. PEARCE

Are you, Sir, quite sure that is so? There is a Colonial preference of 2s. 6d. per gallon imposed on industrial alcohol.

The CHAIRMAN

It is not one of the articles dealt with in this Clause and is not covered by the words of the Clause.

Sir W. PEARCE

It is a point of some importance. Can you inform us where it would be possible to bring it in?

The CHAIRMAN

I presume it may come in as an Amendment to the duties on spirits.

Captain W. BENN

There are one or two new considerations which come into our Debate to-day which were not present when we discussed this subject last year. I understand that the view of the Government—it has always seemed very offensive to the real spirit of Empire—is that by some cash arrangement of this kind you can unite the Dominions to this country, the Dominions which were so gloriously united to us by more enduring ties during the War. The case of the Government is that if it be not necessary it is at least desirable to have some money basis as the real enduring foundation of the Imperial races. If that be so, we must examine it on that basis and ask what exactly the Government are doing, because the position has been largely modified by the Safeguarding of Industries Bill. Take the extreme irregularity of the operation of this preference. First of all, certain duties which happened to be on the Statute Book before the operation of preference were selected. They were the duties imposed by Mr. McKenna in 1915 and also certain duties., such as the Tea Duty, which were already part of our fiscal system. Therefore a large number of Colonial producers, who might have desired to have the advantage and whose goodwill, if it could be obtained by any such means, would be of great importance, were entirely left out in the cold by the system proposed by the Government. Mr. Joseph Chamberlain was quite right when he pointed out that to make such a system effective you must have a tax on raw materials and food.

The first complaint made was that the operation of the preference was extremely irregular and unlikely to excite anything but irritation in the minds of the persons whom it was intended to benefit. It was, however, given. On those duties—I am speaking for the moment of the McKenna duties—a preference of one-third was given. The Dominion exporters pay, roughly, 22 per cent., whereas other exporters or consumers in this country pay 33 per cent. The Dominion exporters, therefore, had a rebate of one-third of the duty. Another tariff has been imposed in connection with the key industries. Certain articles are to be protected in this country by a duty of one-third. The duty is entirely remitted for the Colonial exporter. The man who really wants the preference, the man producing wool or food of some kind, gets nothing; the man producing cinema films, watches, or clocks gets a rebate of one-third, and the man producing any of the articles mentioned in the Schedule to the Key Industries Bill gets the whole of the duty remitted—so irregular is the operation of the right hon. Gentleman's tariff! At the same time that the Government pre- tend that some money consideration of this kind can solidify the Empire, they propose a Bill which is going to impose a duty of 33⅓ per cent. on a large number of the imports which come to us from other parts of the Empire. Under Part II of the Safeguarding of Industries Bill, they are imposing a duty of one-third of the value upon things like hides from India and upon commodities from other parts of the Empire, when the Board of Trade deems that it can be shown that certain conditions are being fulfilled. It is unfortunate, if we are to be turned into a protectionist country —which, of course, we are rapidly becoming —[HON. MEMBERS: "Hear, hear!"]— I am well aware that the majority behind the Government is a protectionist majority. That is not news to us, and I am glad to find that it is confirmed by the Government's followers. But I can say, although I have no sympathy with protectionist theory, that it would be desirable to have some scientific, balanced, thought-out tariff, instead of one made up by hops and jumps and bits and scraps in the way that the present tariff is concocted. As I have pointed out, this preference works in an irregular way. Different rates are charged on different articles, and some, which are the most important, get no preference whatever. At the time when it is being given with the object which the Government have announced, they are proposing, so far from assisting the producers in the Dominions, to lay on the goods which they send to this country a heavy duty.

The CHANCELLOR of the EXCHEQUER (Sir Robert Horne)

indicated dissent.

Captain BENN

I think the Chancellor of the Exchequer will not deny that in India, where the currency is at a discount as compared with ours, a duty of 33⅓ per cent. could be imposed at his order.

Mr. BIGLAND

It is not likely.

Captain BENN

I am talking about the powers which the Government have in the Bills that they are passing. How they will use them each of us must judge according to his experience of the operations of the Government in the past. So far from there being any reality or pretence that we are sacrificing something of our own to give a money benefit to the Dominions, the fact is that what we are giving is casual, irregular, and unsatisfactory, and we are imposing on these very Dominions a heavy tax which the exporters there or the importers in this country will have to meet.

Mr. KILEY

Before we come to a decision on this Amendment, we should be glad to know what return is being received from this preference. One is aware that certain Colonies, whatever duties they impose, do give a preference to goods which are imported from Great Britain, and one wonders to what extent this obligation is responded to by all the powers that levy tolls upon the importation of British goods. It would be a great help to us, before we vote on this matter, to know whether all our Colonies are responding to the generous treatment which they are receiving from us.

Sir R. HORNE

The character of this discussion reveals the fact that a matter which is now threadbare through very frequent controversy has not produced during the last year any new ideas on the part of those who take exception to this particular form of tax. I should like to say one word about the idea of Imperial Preference in general. My hon. and gallant Friend (Captain Benn) says it is our desire to put the connections of Empire purely on a cash basis. Nothing, of course, could be further from the truth than that suggestion. We are just as ardent as he in our devotion to those great sentiments and traditions which unite all the various parts of this Empire, and I think it would be peculiarly unfortunate, at a time when the representatives of the Dominions and Colonies have assembled in the very centre of the Empire, if anything were done by this House which would indicate that we were in any way departing from the indications we have given that we are not merely anxious to keep the bonds of sentiment tight and firm, but also that we should be able to assist each other in the affairs of our daily life and in the trade and commerce which we carry on throughout the world. One used to hear attacks made upon the theory of Imperial Preference on the ground that it could never be granted except by doing injury to our own trade at home, or in some way putting an additional burden on the British taxpayer. The topic of discussion to-day is a particularly unfortunate one for my hon. Friends opposite when they seek to attack the theory of Imperial Preference. The hon. and gallant Member (Major Barnes) has sought to point out some infinitesimal portion of the tea trade which in some way is damaged by the Imperial Preference which is granted. In point of fact, the preference granted upon tea inures to the benefit of everyone who drinks tea in this country, The effect of it is that it lets off 90 per cent. of our importation of tea in the year to the extent of 2d. a lb., and, since the proportion which comes in under preference is so large, the real effect is that it reduces, on a commodity with regard to which there is no competitive production at home, the actual price of tea over the whole bulk consumed by 2d. a lb. In this case, at least, therefore, it can never be suggested that any injury is being done to anyone in this country by the granting of this preference. On the other hand, it can be maintained with great force and confidence that everyone gains by what is done.

Let me refer for a moment to what the hon. and gallant Member (Major Barnes) mentioned with regard to Java and China tea. His case is that these cheap teas, which come here for the purpose of being blended with other teas and of being thereafter exported, are in some way injured by the granting of a preference to the tea which comes from our great Dominions and Colonies. There could be no greater misapprehension than to suppose that to be true. In so far as these teas come here for the purpose of being blended, they can be blended in bond with the other teas, and need never pay duty at all. Accordingly, so far as regards the export trade in Wended teas which has hitherto been carried on in this country, there is no possible injury that can be suffered by the particular trade to which the hon. and gallant Member refers. I think that if my hon. and gallant Friend will pursue his investigations further, he will find that such injury as the trade of Java and China has suffered has been due, not at all to the action of this preference, but really to the fact that in recent times there has been much less tea produced in those countries. The tea trade has been rather hardly hit in many places, and we have had a lower production that we have previously experienced, with the result that not so much of that tea has been drunk in this country. It has nothing whatever to do with the question of the preference granted to our brethren across the seas. I think that those are all the considerations which have been raised from the Benches opposite, and I hope the Committee will reject the Amendment.

Major BARNES

The Chancellor of the Exchequer suggested that I might have pursued my investigations further. Before dealing with that point, may I say that I think he has found a novel way of defending Imperial Preference in saying that, by giving Imperial Preference you confer a benefit upon the people at home by the difference between the commodities on which the preference is not granted and those on which it is. For example, you put 1s. a pound on tea, and take 2d. off in the case of tea that comes into this country from our Dominions abroad, and to that extent the right hon. Gentleman's argument is that you benefit the people at home. Of course, from that point of view the argument seems to be unanswerable, but what we on this side suspect is that, if it had not been for the purpose of putting that 2d. on, you would never have put on Is. Your original tax would have been 10d. Therefore, with a 10d. tax, we should not only have enjoyed the tea from our Dominions, but also the tea from China as well. On the line of argument adopted by the Chancellor of the Exchequer, why not put a 2s. tax on tea, and give a preference of 1s. 2d., and then point to the advantages which the Home consumer is enjoying in not having to pay that 1s. 2d.? I think that the Chancellor of the Exchequer, on reflection, will agree that the argument he has put forward is not entitled to very much consideration.

On the question of China tea, I think he has rather missed the point. The point is that China tea, which used to come to this country for the purpose of being blended with other teas for export abroad, is almost a vanishing quantity now. What are the figures? The figures which I have here are taken from the "Financial Times"—an unimpeachable source—and they show that the shipments to London of black tea from Shanghai and Foochow, for the season to the end of last November, were only 782,000 lbs., while they amounted to nearly 10,000,000 lbs. the year before. An import of 10,000,000 lbs. has dropped to less than 1,000,000 lbs., but that is nothing at all to the Chancellor of the Exchequer. He says it is infinitesimal. That, however, is not the Whole case. The case is that that 10,000,000 lbs. was not going to be exported merely as 10,000,000 lbs., but was going to be blended with a very much larger quantity of tea which would then have been exported. What is happening, therefore, in this country, affects the re-export, not of 10,000,000 lbs., but of the whole bulk of the tea of which that 10,000,000 lbs. forms only a small fraction. That is what is happening under the preferential duty. It is a matter of no concern at all to the Chancellor of the Exchequer. He is content to see that industry come to what is described in the "Financial Times" as an entirely vanishing point. It appears to me, that if that be the view taken by the Chancellor of the Exchequer of this country with regard to a British trade which has been built up over a very great number of years— because this tea trade of ours is not a matter of last year or the year before, but is a century old—if the Chancellor of the Exchequer of this country regards the vanishing of a century-old trade with equanimity and as infinitesimal, it will not encourage the business world to look upon his appointment with pleasure.

Sir J. D. REES

I cannot help thinking that the tea producers would accept the line taken by the Chancellor of the Exchequer in this matter. My hon. and gallant Friend (Major Barnes) has given some figures, which, no doubt, are the latest figures and correct; but it does not at all follow that they are the result of this preference. The tea trade, like everything else, has been in a thoroughly dis-organised state. The condition of Southern China is notoriously one approaching anarchy. There is fighting between one province and another, and, when everyone is fighting, tea is not grown as regularly and as well as usual. More than that, the consumption of China tea has been, within my recollection, a decreasing quantity for many years. Nor, again, is 10,000,000 lbs—if it was 10,000,000 lbs. last year—which has now been reduced to under 1,000,000 lbs., a very large figure. It is only that number of pounds, and is not really a very large quantity compared with the total tea crop. Nor can I at all understand the tender- ness of my hon. Friends towards Java. What does it matter to us if Java is slightly prejudiced by this duty?

Major BARNES

British capital is invested there.

Sir J. D. REES

I have not the figures by me, but I do know that Java is fast becoming an effective competitor, after its degree, with British-grown tea. Therefore, if this Measure does slightly advantage British tea in that competition and enable it to maintain the almost pre-eminent position that-it ought to have, I cannot understand why that should be any matter of regret to any Member of this House.

Mr. KILEY

The Chancellor did not favour the Committee with any information on the point to which I called his attention. Has there been any satisfactory result from this great generosity on our part in giving these preferential duties to our Dominions? Has there been any increased return, or any return, from any of our Possessions which have received this bounty? Have they given a similar return on the British goods which they import? I should also like to know if the right hon. Gentleman could give any information as to the general working of these preferential duties? What, for instance, will be the result to the sugar concern in which the Government has invested so much money, and in which they are guaranteeing a dividend to the shareholders?

The CHAIRMAN

We are not concerned with that matter upon this Amendment.

Mr. KILEY

The point I was trying to lead up to was this: We are giving a preference to certain of our Possessions who send us sugar. The Government themselves have entered into the sugar production business, and they or their investors will be at a disadvantage because those who have invested their capital in our Dominions will pay a less duty under the preference than a British investor who has invested money in his own country will do. I should like to know what the result will be, or if the right hon. Gentleman contemplates taking any action in that or any similar direction? It would be very useful if the right hon. Gentleman could give us some information as to how these preferences worked in a general way.

Sir R. HORNE

I should be very glad to give any information about sugar, but quite obviously it does not arise under this Amendment at all, and it would be quite out of order to deal with the matter. I had some difficulty in understanding the hon. Member's question. I am now rather astonished to realise that he has never heard the fact that for years we have been enjoying preferences from our

Dominions which we are only now very tardily reciprocating. He may very easily make the inquiry for himself. I would not presume to detain the House while I explain what the preferences really are.

Mr. KILEY

Have any other of our Dominions which before had not given us a preference given us preferences since that period? That is the question I asked.

Question put, "That the words proposed to be left out stand part of the Clause."

The Committee divided: Ayes, 174; Noes, 64.

Division No. 167.]	AYES.	[4.35 p.m.
Agg-Gardner, Sir James Tynte	Fell, Sir Arthur	Molson, Major John Elsdale
Ainsworth, Captain Charles	FitzRoy, Captain Hon. Edward A.	Moreing, Captain Algernon H.
Allen, Lieut.-Colonel William James	Flannery, Sir James Fortescue	Morris, Richard
Amery, Leopold C. M. S.	Forrest, Walter	Murray, William (Dumfries)
Astbury, Lieut.-Com. Frederick W.	Foxcroft, Captain Charles Talbot	Neal, Arthur
Bagley, Captain E. Ashton	Gange, E. Stanley	Newman, Sir R. H. S. D. L. (Exeter)
Baird, Sir John Lawrence	Gardiner, James	Nicholson, William G. (Petersfield)
Baldwin, Rt. Hon. Stanley	Gee, Captain Robert	Oman, Sir Charles William C.
Balfour, Rt. Hon. A. J. (City of Lon.)	Gibbs, Colonel George Abraham	Ormsby-Gore, Hon. William
Banbury, Rt. Hon. Sir Frederick G.	Gilbert, James Daniel	Pearce, Sir William
Barnett, Major Richard W.	Gilmour, Lieut.-Colonel Sir John	Pease, Rt. Hon. Herbert Pike
Barnston, Major Harry	Gould, James C.	Pinkham, Lieut.-Colonel Charles
Barrand, A. R.	Greenwood, Colonel Sir Hamar	Pownall, Lieut.-Colonel Assheton
Beauchamp, Sir Edward	Greenwood, William (Stockport)	Prescott, Major W. H.
Bell, Lieut.-Col. w. C. H. (Devizes)	Greig, Colonel James William	Pretyman, Rt. Hon. Ernest G.
Bellairs, Commander Carlyon W.	Gretton, Colonel John	Purchase, H. G.
Bennett, Sir Thomas Jewell	Hacking, Captain Douglas H.	Raeburn, Sir William H.
Bigland, Alfred	Hailwood, Augustine	Ratcliffe, Henry Butler
Birchall, Major J. Dearman	Harris, Sir Henry Percy	Raw, Lieutenant-Colonel Dr. N.
Bird, Sir A. (Wolverhampton, West)	Hennessy, Major J. R. G.	Rees, Sir J. D. (Nottingham, East)
Bird, Sir William B. M. (Chichester)	Henry, Denis S. (Londonderry, S.)	Roberts, Sir S. (Sheffield, Ecclesall)
Bowyer, Captain G. W. E.	Herbert, Dennis (Hertford, Watford)	Rodger, A. K.
Brown, Major D. C.	Hills, Major John Waller	Samuel, A. M. (Surrey, Farnham)
Buchanan, Lieut.-Colonel A. L. H.	Hinds, John	Seager, Sir William
Buckley, Lieut.-Colonel A.	Hoare, Lieut.-Colonel Sir S. J. G.	Seddon, J. A.
Bull, Rt. Hon. Sir William James	Holbrook, Sir Arthur Richard	Shaw, Capt. William T. (Forfar)
Burdon, Colonel Rowland	Hope, Sir H. (Stirling & Cl'ckm'nn'n,W.)	Simm, M. T.
Butcher, Sir John George	Hopkins, John W. W.	Sprot, Colonel Sir Alexander
Campbell, J. D. G.	Hopkinson, A. (Lancaster, Mossley)	Stanier, Captain Sir Beville
Cautley, Henry Strother	Horne, Sir R. S. (Glasgow, Hillhead)	Stanton, Charles Butt
Chadwick, Sir Robert Burton	Hotchkin, Captain Stafford Vere	Stephenson, Lieut.-Colonel H. K
Chamberlain, Rt. Hn. J. A. (Birm. W.)	Hurd, Percy A.	Stewart, Gershom
Chamberlain, N. (Birm., Ladywood)	Hurst, Lieut.-Colonel Gerald B.	Sturrock, J. Leng
Cheyne, Sir William Watson	Inskip, Thomas Walker H.	Sugden, W. H.
Clough, Robert	James, Lieut.-Colonel Hon. Cuthbert	Surtees, Brigadier-General H. C.
Cobb, Sir Cyril	Jesson, C.	Taylor, J.
Cockerill, Brigadier-General G. K.	Jones, J. T. (Carmarthen, Llanelly)	Thomson, F. C. (Aberdeen, South)
Cohen, Major J. Brunel	Kelley, Major Fred (Rotherham)	Thomson, T. (Middlesbrough, West)
Colfox, Major Wm. Phillips	Kidd, James	Turton, Edmund Russborough
Colvin, Brig.-General Richard Beale	King, Captain Henry Douglas	Walters, Rt. Hon. Sir John Tudor
Conway, Sir W. Martin	Larmor, Sir Joseph	Walton, J. (York, W. R., Don Valley)
Coote, Colin Reith (Isle of Ely)	Law, Alfred J. (Rochdale)	Ward, Col. L. (Kingston-upon-Hull)
Cope, Major William	Lewis, Rt. Hon. J. H. (Univ., Wales)	Watson, Captain John Bertrand
Craig, Capt. C. C. (Antrim, South)	Lloyd-Greame, Sir P.	Wheler, Col. Granville C. H.
Craik, Rt. Hon. Sir Henry	Locker-Lampson, Com. O. (H'tingd'n)	Willey, Lieut.-Colonel F. V.
Croft, Lieut.-Colonel Henry Page	Lorden, John William	Williams, C. (Tavistock)
Curzon, Captain Viscount	Lowther, Major C. (Cumberland, N.)	Williamson, Rt. Hon. Sir Archibald
Davies, Alfred Thomas (Lincoln)	Lowther, Maj.-Gen. Sir H.C. (P'nrith)	Wills, Lt.-Col. Sir Gilbert Alan H.
Davies, Sir David Sanders (Denbigh)	M'Donald, Dr. Bouverie F. P.	Wilson-Fox, Henry
Davies, Sir Joseph (Chester, Crewe)	McLaren, Robert (Lanark, Northern)	Wise, Frederick
Davies, Thomas (Cirencester)	McMicking, Major Gilbert	Wood, Hon. Edward F. L. (Ripon)
Davison, Sir W. H. (Kensington, S.)	McNeill, Ronald (Kent, Canterbury)	Wood, Sir H. K. (Woolwich, West)
Dawes, James Arthur	Magnus, Sir Philip	Yeo, Sir Alfred William
Denniss, Edmund R. B. (Oldham)	Maitland, Sir Arthur D. Steel-	Young, E. H. (Norwich)
Dockrell. Sir Maurice	Malone, Major P. B. (Tottenham, S.)	Younger, Sir George
Doyle, N. Grattan	Marriott, John Arthur Ransome
Du Pre, Colonel William Baring	Matthews, David	TELLERS FOR THE AYES.—
Edwards, Major J. (Aberavon)	Mildmay, Colonel Rt. Hon. F. B.	Colonel Leslie Wilson and Mr.
Elliot, Capt. Walter E. (Lanark)	Mitchell, William Lane	Parker.
Falle, Major Sir Bertram Godfray
NOES.
Adamson, Rt. Hon. William	Halls, Walter	Rendall, Athelstan
Asquith, Rt. Hon. Herbert Henry	Hallas, Eldred	Richardson, R. (Houghton-le-Spring)
Barker, G. (Monmouth, Abertillery)	Hartshorn, Vernon	Roberts, Frederick O. (W. Bromwich)
Benn, Captain Wedgwood (Leith)	Hayday, Arthur	Robertson, John
Bowerman, Rt. Hon. Charles W.	Hayward, Evan	Rose, Frank H.
Bromfield, William	Henderson, Rt. Hon. A. (Widnes)	Sexton, James
Brown, James (Ayr and Bute)	Hirst, G. H.	Shaw, Thomas (Preston)
Cairns, John	Hogge, James Myles	Short, Alfred (Wednesbury)
Carter, W. (Nottingham, Mansfield)	Irving, Dan	Sitch, Charles H.
Clynes, Rt. Hon. John R	Jones, J. J. (West Ham, Silvertown)	Spencer, George A.
Davies, A. (Lancaster, Clitheroe)	Kennedy, Thomas	Spoor, B. G.
Edwards, C. (Monmouth, Bedwellty)	Lawson, John James	Thorne, W. (West Ham, Plaistow)
Edwards, G. (Norfolk, South)	Lunn, William	Walsh, Stephen (Lancaster, Ince)
Galbraith, Samuel	Maclean, Neil (Glasgow, Govan)	Waterson, A. E.
Gillis, William	MacVeagh, Jeremiah	Wedgwood, Colonel Josiah C.
Glanville, Harold James	Morgan, Major D. Watts	Wignall, James
Graham, R. (Nelson and Colne)	Murray, Hon. A. C. (Aberdeen)	Wilkie, Alexander
Graham, W. (Edinburgh, Central)	Newbould, Alfred Ernest	Williams, Aneurin (Durham, Consett)
Griffiths, T. (Monmouth, Pontypool)	O'Grady, James	Wilson, Rt. Hon. J. W. (Stourbridge)
Grundy, T. W.	Parkinson, John Allen (Wigan)	Wilson, W. Tyson (Westhoughton)
Guest, J. (York, W.R., Hemsworth)	Raffan, Peter Wilson
Hall, F. (York, W. R., Normanton)	Rees, Capt. J. Tudor- (Barnstaple)	TELLERS FOR THE NOES.—
		Major Barnes and Mr. Kiley.

The CHAIRMAN

called on Mr. Neil Maclean.

Major BARNES

I understood that the discussion we have just had was not going to preclude the discussion of the following Amendments. Do I understand that you are passing over all the intervening Amendments?

The CHAIRMAN

The third Amendment has been covered by the last discussion, and the fourth was dependent on the first. I thought I made that clear at the time. The hon. and gallant Gentleman asked me whether detailed consideration of these different Import Duties would be in order, and I said it would.

Mr. NEIL MACLEAN

I beg to move, to leave out the words Increased duty on tea 1. This is the third time I have tried to have the duties upon tea entirely repealed. At present it is even more important than it was upon previous occasions when I moved similar Amendments. There is considerable distress up and down the country among working people generally, who have in the main to depend upon tea as one of the beverages they consume in the home, and the duty that is imposed at present is a very great hardship upon those people. The duty as it stands is 10d. per lb. upon Empire-grown tea and 1s. per lb. upon any foreign tea. The cheapest tea can be had to-day at, roughly, 2s. per lb. That means, if it is a foreign tea, that we are paying as tax practically 50 per cent. of the purchase price. That is too severe an imposition to place upon the class of people who purchase the cheapest quality of tea. A tax of 50 per cent. is a tax which no other section of the community is called upon to pay, and the higher the price of the tea goes the less is the proportion which the purchaser pays in tax. If the tea is 4s. a lb., as many teas are, the purchaser, if it is foreign tea, is paying only 25 per cent. of tax, whereas in the cheaper tea the purchaser pays 50 per cent. in taxation. Yesterday a big lock-out which would affect 1,500,000 people was averted; it was to have taken place this morning. Up and down the country there are from 4,500,000 to 5,000,000 people out of work. We have distress over the whole country, and yet that class of people, the purchasers of the cheaper qualities of tea, are the individuals to whom you are offering no concession in this Finance Bill. You have scrapped the Excess Profits Duty, you have given a concession to the merchants. You have given a concession to the manufacturers. You have wiped out a duty which they have contended was a great hardship upon production and upon the development of trade. Last year the late Chancellor of the Exchequer went so far as to give a very large concession to the landowners. He abolished the Land Taxes, and announced that if claims were made he would hand back to those landowners who have paid the Land Tax the taxes that have been paid by them. Landowners, manufacturers and merchants have all received concessions from the Chancellor of the Exchequer. In the face of the present economic upheaval, and of the poverty and distress in most industrial districts, is it not time that in the granting of concessions something might be done in these days of high prices to ameloriate somewhat the lot of the working classes?

I can anticipate the answer which the Chancellor of the Exchequer will give. He will say that it is necessary for the purpose of revenue to keep this tax at the present figure, which is very much in excess of the charge in pre-War times. There are other things which might be taxed. There are other avenues from which revenue could be raised. Surely it is not beyond the wit of the Chancellor of the Exchequer, with all the experience of past Chancellors of the Exchequer, and with his own personal knowledge of the conditions in industry, to fashion a Budget that will place the taxation of the country upon the shoulders of those best able to bear that burden. So far as I can discover from reading the Finance Bill, it is again the bottom dog that is called upon to bear the heaviest part of the burden. You have placed the merchants of the country in their pre-War position, so far as the Excess Profits Duty goes, and you have placed the landlords in the position they occupied prior to the Land Duties Act.

Major WHELER

I cannot accept that statement. It is absolutely incorrect. The Income Tax on the land has been increased six times.

The CHAIRMAN

That is not a point of Order. If the hon. Member gives way, the hon. Member can make an explanation.

Mr. MACLEAN

Those who have listened to me on previous Finance Bills know my views of taxation. I am in favour of direct taxation only, and the abolition of all indirect taxation. When I said that the landlords had been relieved of taxation and placed in their pre-War position, I made it perfectly clear that they had been relieved of that part of taxation which had been imposed upon them by a Budget prior to the War, namely, the Land Duties.

Colonel Sir J. GREIG

Is not the hon. Member aware that the Land Duties were found to be illegal and, therefore, impossible?

Mr. MACLEAN

I am not concerned at the moment whether the Land Duties were illegal or not.

The CHAIRMAN

These arguments are irregular. The hon. Member is justified in referring to the Land Duties by way of illustration, but it is not in order on either side to debate them.

Mr. MACLEAN

I do not intend to debate them. I was using them as an illustration of what has been done for a certain section of the community by the Chancellor of the Exchequer and previous Chancellors of the Exchequer.

Sir J. GREIG

indicated dissent.

Mr. MACLEAN

The hon. Member shakes his head. Shaking his head may indicate his opinion, but it does not alter the facts. I am putting before the Chancellor of the Exchequer a claim for justice for the working classes, and, indeed, all classes in connection with the Tea Duty. The Tea Duty does not bring in such a great sum of money, compared with the grand total drawn from taxation, and it would be perfectly easy and simple for the Chancellor of the Exchequer to devise some scheme whereby the amount he proposes to raise by the Tea Duty can be raised by imposing taxation on some other commodity, or some other source of revenue.

Sir J. D. REES

The Income Tax, I suppose.

Mr. MACLEAN

Well, the Income Tax. Put it on something other than the food of the people. We have differences of opinion as to the cost of living whether the figures submitted by Government Departments are correct or incorrect. At the same time we have the domestic budget of the working classes very heavy to-day. The Labour party's appeal for the withdrawal of the Tea Duty is not an appeal for a withdrawal which would affect only one class in the community, but all classes, but most of all the working class, which has had fewer concessions and less consideration during the last seven years from the Chancellor of the Exchequer than any section of the community.

Mr. MARRIOTT

Many Members of the Committee will feel that the speech of the hon. Member is the sort of speech which fills one with despair. I do not suggest that it is a speech that we have not heard before. It is a hardy annual, but it fills one with despair all the same. The substance of the speech was that this particular tax falls with exceptional heaviness on the particular section of the community represented by the hon. Member. That is admitted. He also says that this tax is falling upon them at the moment when everything should be done to lower the cost of their living as far as possible. We also admit that. We admit that the moment is one of great gravity in social and in industrial affairs. All this is common ground between the hon. Gentleman and ourselves, but we join issue with him from this point. Does he suggest that no portion of the taxation of the country should fall upon the class for whom he is speaking? That is the effect of his speech. There are very few taxes which at the present time fall upon that class. There is almost entire exemption from taxation for people who do not drink, who do not smoke, and who do not drink tea. From them hardly any taxation is taken. The hon. Member asks us to repeal the Tea Duty. Will he point out to the Committee what taxation is left to that class if this duty is repealed in the way that he desires? He says that every other class of the community has been treated with far greater generosity. He says that the Chancellor of the Exchequer has repealed the Land Duties. Why? First of all, because they were discovered to be illegal, and, secondly, because it was discovered that they were costing more to collect than the revenue derived from them. Surely, hon. Gentlemen opposite do not propose to continue a tax merely for the sake of taxation. We impose taxation for the sake of revenue and for no other purpose, I hope, generally speaking. When you discover that a tax is costing more to collect than it yields, and that it involves no benefit, but a deficit, to the State—

The CHAIRMAN

The hon. Member is pursuing the subject too far.

Mr. MARRIOTT

The hon. Member opposite used the Land Duties for the purpose of illustration, and it is for the same purpose of illustration that I am endeavouring to use them.

The CHAIRMAN

I allowed the hon. Member to go on for that purpose only.

5.0 P.M

Mr. MARRIOTT

I will leave the subject and return to my main point, which is that if the Amendment be carried the effect must be to throw additional taxation on some other element in the Budget. We are entitled to ask the hon. Member what he proposes to do, where he proposes to get his revenue. He wants one item of revenue which falls upon the class for which he is entitled to speak to be deleted from the Finance Bill. It is desirable to maintain the Tea Duty, for two reasons. First, because tea is a revenue-producing tax; second, it is one of the very few taxes in the whole Budget which are borne by a very considerable section of the people.

Sir J. D. REES

My hon. Friend described this as a hardy annual. I have frequently applied the same epithet to it, but I think it has lived to become a foolhardy annual. I am in a somewhat difficult position. Unlike my hon. Friend behind me, who always demolishes these cases with arguments drawn from political economy, I would like to see this duty reduced, and I would like to see all the excise list reduced. As one who is interested in the production of tea I would like to see a reduction in the tea duty. That is why I resent the untenable impossible arguments which put off for an indefinite period a consummation which I would like to see brought about. My hon. Friend enlarged upon his solution, treated it as everybody else has done during the last 16 years, and hung upon it a discourse upon direct and indirect taxation; but I would suggest that this has been done so often before that it has become a positive outrage in the consumption of Parliamentary time. The whole of that argument is advanced without the smallest regard to elementary justice. The hon. Gentleman does not even remember that the direct taxpayer also pays indirect taxation and that the tea duty is almost the only contribution to the revenue made by those miserable melancholy individuals who neither drink nor smoke nor indulge in any of the pleasures of life. He said that the tea duty was the heaviest in relation to the value of the product that is imposed in this country, but that is not true. Tobacco is infinitely more heavily taxed.

Mr. MACLEAN

I was not comparing the duty paid on tea with the duties paid on other commodities. I was explaining how the duty paid on the cheapest quality of tea differs in proportion from that paid on the higher and more excellent quality of tea.

Sir J. D. REES

Those whom the hon. Gentleman claims more particularly to represent, whom I think I represent as well as he, at any rate as sincerely as he, are getting their tea at the most extraordinarily cheap rates. They are getting it at half the price at which it is produced. Yet the hon. Gentleman reproduces this foolhardy annual this year. He does not take into account that the whole production of tea is in a state of seething confusion with agitators going round among the coolies—who are getting twice as much as they did before—and introducing trade unions and other institutions of Western civilisation. This is very unfortunate seeing that tea is being sold at a ruinous loss. My hon. Friend has only got to look at those concoctions, as he would call them, the reports of tea companies and the speeches of those concerned, and he will see that the producers of tea, if they have a continuation of years like this, will be reduced in a short time to absolute ruin. Yet he makes all these statements about the Land Tax and distress in this country. There is distress in this country, and I cannot but remind my hon. Friend of how much of it is created by those who are suffering who might be exempted from the sufferings which they have enforced upon themselves.

I beseech my hon. Friend not to be drawn away by the ancient clap-trap about the breakfast table as if there were some particular merit about having a free breakfast. I would much rather have a free lunch or a free dinner. Unless my hon. Friend is going to escape all taxation of every sort he must make up his mind to pay his little bit upon the tea and not put still more on the breaking back of the Income Tax payer. There is no way out of it. I would suggest that some of that tenderness displayed over there just now towards Java should be transferred to the Empire producers of tea and our Indian fellow subjects to whom the industry gives employment. Let us have a little general good feeling and not anything savouring of spiteful discrimination against a product grown in British territory, by British capital and consumed by British stomachs. I do not understand this kind of sympathy with Java for instance—the Dutch—as if we did not understand that, In matters of commerce, the fault of the Dutch Is in giving too little and asking too much. I would suggest to my hon. Friend in perfect good faith and good temper and good feeling that this foolhardy Resolution might be buried this year and resuscitated some year when there is a little more prosperity not only for the people of this country, but also for those who are working at a loss to supply us with tea.

Mr. W. GRAHAM

I am sure the House has enjoyed the speech to which we have just listened. But hon. Members will admit that the subject demands a little more serious attention than apparently the hon. Member is prepared to give to it.

Sir J. D. REES

May I ask my hon. Friend whether he thinks that sincerity is synonymous with solemnity?

Mr. GRAHAM

Not in the least. Personally I enjoyed the speech thoroughly, but it is difficult for some of us, even though we may appreciate humour in every form, to fail to realise the pressure of indirect taxation at present upon the poor of this country. It is true that this tea duty has been debated in this House over and over again.

Sir F. LOWE

Every Session.

Mr. GRAHAM

It is also true that we are confronted every year with the duty of trying to ascertain what exactly is the burden of direct and indirect taxation. The hon. Member for Oxford (Mr. Marriott) appeared to suggest that we on this side proposed that people of a certain class should pay no indirect or indeed any taxation at all. We make no proposal of that kind. Many of us argue that we should bring direct taxation within the reach of practically every member of the community for the purpose of getting that stability in the State which very often it is difficult to get at present, and also for the purpose of bringing home to individuals some sense of responsibility so far as national organisation is concerned. But we have always tried to do that in a direct way. Do not widen indirect taxation, of which the tea duty is one illustration, and above all, every year when the Budget comes along try to look at the circumstances which confront the people when you are imposing a fresh or continuing an old burden so far as they are concerned.

I suggest that it is relevant at present to appeal to the Chancellor of the Exchequer in the light of existing conditions in this country. There are many millions of people unemployed, or partly employed. There is no doubt that the burden of indirect taxation, according to every expert who has investigated the problem, is very heavy indeed in many homes in the country. Let it be admitted that where wages are coining down, in terms of the sliding scale based on the cost of living, a part of the argument for a remission of these duties will tend to disappear. Apart from any argument of that kind, there are millions of homes which have suffered substantial loss which have very little hope of recovery in the near future. In times like these it becomes a kind of national investment to ascertain whether you cannot remit a little of our indirect taxation. We are immediately asked where are we to find the money? I suggest that it will be possible this afternoon to remit a considerable part of the Tea Duty, not by imposing any kind of extra taxation, but by merely calling upon the direct taxpayer under the Income Tax laws as they now stand to do their duty by the State.

Experts have pointed out that we are losing at least from £5,000,000 to £10,000,000 a year by the evasion of Income Tax and other burdens of that kind. I think personally from all the investigations that have been made that we are losing a great deal more. Would it be too much to suggest that we might remit a very large portion of this Tea Duty and make that go as far as we can by asking these direct taxpayers to do their duty, which, after all, is a measure of justice to the other direct taxpayers, and so provide the money which is necessary? If we do not try in the present grave social emergency to ease this burden of indirect taxation we are simply going to pay for impaired physique and lower efficiency by all manner of local assessments and public measures of other kinds which I think, in part, this country would have avoided by remitting a little of our indirect taxation. I suggest respectfully that therein lies some method of dealing with this question and giving a little social ease in these difficult times.

Sir R. HORNE

I do not propose to dissent from what my hon. Friend opposite has said in his speech to the Committee with regard to the burden which the Tea Duty imposes upon a large section of the community. Quite candidly if I were in a position to propose a reduction of the Tea Duty I would have done so. I am entirely in agreement with those who desire to reduce so far as possible the burden which falls upon those who to-day are suffering privation owing to the depressed conditions of trade and the high cost of living. I have made inquiry as to the difference which a full remission of the tax upon tea would make on the figures of the cost of living, and I find that on the 125 per cent. by which the pre-War cost of living is now exceeded the shilling Tea Duty would make a difference of only four points. Therefore, it cannot be said that it assumes any very large proportions. While agreeing with the general proposition that it would be better to have a lower duty upon tea—you can never remit it altogether—I do not at all accept the statement that the burden has been steadily increased on the "bottom dog" while relief has been given in the case of those who are better off. A moment's scrutiny of the actual figures of direct and indirect taxation will show that that is a complete misapprehension. Go back no further than 1905. You will find that the taxation then raised in this country was practically half and half by direct and indirect taxation. Direct taxation, however, gradually increased up to the point at which the War broke out. It increased still more during the War, and to-day, of the whole taxation of the country, 62.3 per cent. is paid by direct taxation and only 37.7 per cent. paid by indirect taxation.

Mr. SPENCER

Is the right hon. Gentleman including Excess Profits Duty as direct taxation?

Sir R. HORNE

No, I am leaving it out entirely. I wish to reply still further upon the particular point made as to the action said to be taken by this Government in relieving other people and not relieving the working class who pay the Tea Duty. An hon. Member said, "You have relieved Excess Profits Duty." Excess Profits Duty would to-day be yielding very little, if anything at all. If the hon. Member studies the Amendments to this Bill on the Paper, he will find that the Amendments with regard to Excess Profits Duty are designed, not to closing it down sooner, but to continuing it to a later period. Why? Because people have been realising such enormous losses in recent times that they wish to put them against the taxes they paid previously. Accordingly, so far from Excess Profits Duty being in that sense a relief to the community, in point of fact, if the State had carried it on there would have been a loss to the Exchequer. My hon. Friend referred also to Land Duties. The explanation is simple. They were costing more than they were yielding. Neither of these things can be called, in any sense, a relief to the rich. I come to the critical point of the whole matter. This Tea Duty yields £16,000,000 a year. If I were to surrender it, it would cost £12,000,000 this year and £16,000,000 in a full year. Quite frankly, I cannot afford to do it. The hon. Member for Central Edinburgh (Mr. W. Graham) has put forward a suggestion that we might do something in mitigation of the duties, but he did not agree that the Tea Duty should be taken off altogether. He suggested filling up the gap by taking means to prevent a certain amount of evasion of Income Tax which goes on now. I entirely agree with him that we must take means to collect all the tax which is due. We must take far more stringent measures to prevent the evasion which undoubtedly goes on. As he said, it is due to the other taxpayers of the country that we should take that action. But it is obvious that we cannot do it this year. So far as the present year's Budget is concerned, we should gain no relief from taking any such measure as he suggested. That task lies before us. Accordingly, for this year his suggestion affords no relief at all. In all the circumstances, I am sure the Committee will well understand that it is impossible for me to accept the Amendment.

Mr. T. GRIFFITHS

I was surprised to hear the Chancellor of the Exchequer say that he could not take any steps this year to deal with those people who evade Income Tax.

Sir R. HORNE

The hon. Member must not misunderstand what I said. The hon. Member for Central Edinburgh understands me. We take every means at our disposal at the present time, and we use it to the utmost, but it is the exceptional measures being considered by the Royal Commission to which my hon. Friend referred.

Mr. GRIFFITHS

Is it not possible for the Chancellor of the Exchequer to put some kind of Resolution in the present Finance Bill? Let it be clearly understood that working men know that this evasion is going on. They themselves are checked and scrutinised very carefully in the offices and by the supervisors in the different districts, and they have no opportunity of evading Income Tax. We know that there is a great deal of evasion in so far as the—

Mr. INSKIP

On a point of Order. Is it in order to discuss evasion of the Income Tax on this Amendment?

Mr. GRIFFITHS

We have made a suggestion that the Tea Tax be reduced and that the money be found from another source.

The DEPUTY-CHAIRMAN (Sir E. Cornwall)

Of course, it will not be in order to develop an argument as to the extent to which evasion takes place, because that might lead to a very wide discussion.

Mr. GRIFFITHS

I suppose I shall have to avail myself of another opportunity. I shall make one other suggestion. I was just having tea with an hon. Member who has a great amount of money invested in War Stocks, and he pointed out to me that—

The DEPUTY-CHAIRMAN

The hon. Member is pursuing that argument.

Mr. GRIFFITHS

I will say no more at present.

Major BARNES

According to the figures given to us, it would appear as if the proportion of direct taxation had increased a little as a result of the War, and that the figure for indirect taxation was really higher in proportion after the War than before.

Sir R. HORNE

I said that the percentage figure of direct taxation had increased steadily from 1905 to the time when the War broke out, and still more since then.

Major BARNES

I understood the Chancellor of the Exchequer's contention to be that the percentage figure of direct taxation had increased for the period he mentioned and had increased from the period before the War to the present time, and that relatively speaking, with regard to indirect taxation, it was higher than before. [HON. MEMBERS: "No!"] I want to get it clear. I understood that, relatively speaking, direct taxation is greater than it was before the War, and that, therefore, indirect taxation is less than it was before the War. I think that view is a fallacious view, because it takes into account only one side of the balance sheet. You are thinking only about revenue; you are not thinking about expenditure. When you come to look at the expenditure side the real position is that the wealthy classes of this country at the present time are not contributing at all to the cost of government. It is a misconception that they are doing so. The view is very firmly held, particularly by the right hon. Baronet (Sir F. Banbury), but if you take the revenue side and the expenditure side and compare the position before the War with the position after the War, you will find that what I have said is correct.

Take the position before the War. I will give the 1913 figures. You had indirect taxation before the War of £88,000,000. That came, roughly speaking, from the wealthy classes of the country. Before the War you paid on your debt service £24,500,000. That, roughly, went back to the same people. You had left in your possession, as Chancellor of the Exchequer, a sum of something like £63,000,000 of balance, with which to carry on. What is the position to-day? On the current year, excluding Excess Profits Duty, you are getting something like £521,000,000, as against £88,000,000, an enormous increase. No wonder the direct taxpayer thinks there has been a tremendous jump, and on those figures there has been. But look at the other side of the book. What are you paying on your debt service? The provision for debt service is £345,000,000 for interest and sinking fund, and £177,000,000 for reduction, a total of £522,000,000. So that if you take both sides of your account into consideration you are getting £521,000,000 and you are sending back to the same class £522,000,00. If you could cancel the two you would be £1,000,000 better off.

Sir F. BANBURY

Does not the hon. and gallant Gentleman see that for that interest there has been received an enormous sum of money?

Major BARNES

I can see the right hon. Baronet's point. I realise that somehow or other £6,000,000,000 was found. As far as my information goes, I do not understand that foreign investments are any less than they were. [HON. MEMBERS: "Yes."] I know that that is a common impression. But if the Chancellor of the Exchequer will make himself familiar with a return of the Department he has just left and take the figures presented in the statistical abstract as being the value of foreign investments for Income Tax purposes and compare those figures with the 1913 figures, he will find that what I say is right. That is a matter of fact. [HON. MEMBERS: "No, no."] I have made my statement, and it is open to anybody to get facts to controvert it. Somehow or other there is a first charge on this country of £600,000,000 held by somebody. That is the result of the War. The effect of that is to put the balance sheet in an entirely different position from what it was before the War and substantiates the case for some reduction in direct taxation. I know it is equally true that a very considerable amount of money is being spent on beneficial services more than before the War. In 1913 something like £40,000,000 was spent on education, old age pensions, labour exchanges, and other services of that kind. [HON. MEMBERS: "Order order!"]

Sir H. CRAIK

On a point of Order. Is this at all relevant to the Question before the House?

The DEPUTY-CHAIRMAN

I have been wondering myself. I heard the Chancellor of the Exchequer speak, and he gave the amount of indirect taxation and the amount of direct taxation. Hon. Members are entitled to reply to that, but they are not entitled to cover the whole ground of the taxation of the country. I think the hon. Member, in this case, is going too far.

Major BARNES

I am submissive to your ruling. I quite understand that these figures are not as well appreciated on the other side of the House as they are on this side. If this is not the proper place and time to produce them perhaps some other opportunity will be afforded of which I shall be glad to take advantage. I was endeavouring to take this percentage figure which is being bandied from one side of the House to the other and to show how it is really arrived at. I think I have made my point that if in dealing with the question of indirect taxation you take into account not only revenue, but expenditure, the presence of the great War debt entirely alters the incident of it. In reference to the matter with which we are directly concerned, the revenue from tea, which was a little over £6,000,000 in 1913, has increased to over £16,000,000 in the present year. What in the old days we called breakfast table duties—sugar, tea, cocoa, coffee, and chicory—have increased in that period from £10,000,000 to £53,000,000. The Chancellor says that the effect of this Amendment would be to create a charge of something like £12,000,000 on the present year which he cannot meet. If he cannot meet it, he is responsible for that fact more than any other Member in this House, because that £12,000,000 might have been got out of the money which we have had to pay in connection with the coal stoppage. There is a direction in which money might have been saved. The remission of Excess Profits Duty is in fact a remission of direct taxation which is proved by the fact that, although Excess Profits Duty has gone, the return on Income Tax is expected to be greater. That shows that what originally came to the Government in Excess Profits Duty is now going into income. The House has always regarded it as necessary that every reduction in direct taxation should be balanced by a corresponding reduction in indirect taxation. That is all we are asking for. The effect of this Amendment will be to wipe out all the duty on tea, and if the Chancellor cannot afford that he might meet us in some way. Last night the House gave a Second Reading to a Bill which is going to reduce the unemployment allowance by 5s. [HON. MEMBERS: "Order, order! "] Hon. Members opposite are extremely sensitive. I am entitled to use arguments in making an appeal. We are asking on this side for something that will reduce the cost of living, and I am pointing out that last night you went a long way towards reducing the means of living. If the Chancellor can see his way to give some reduction in respect of this particular duty, he will be doing something to mitigate the hardship which the House is—I believe very unwillingly—going to impose upon the people of this country. I do not regard the Members who voted for the Second Reading of that Bill as not being humane, but they are inflicting great hardship in doing what they feel to be their duty.

The DEPUTY-CHAIRMAN

The hon. Member is now discussing what took place in the House yesterday. I must ask him to be more relevant.

Mr. SPENCER

Whatever may be said with regard to the proportion of direct taxation as against indirect taxation the one outstanding fact is that since the year 1913–14 indirect taxation has risen out of all proportion to the income of the people. In that year it was £75,000,000, and in 1920–21 it was £348,650,000. That is an increase of 400 per cent. and the wages of the working class out of which they have to meet that increase have gone up somewhere in the region of 100 per cent. It will be admitted that as far as indirect taxation is concerned the impost is borne chiefly by the working classes. This particular tax on tea is one which affects the food of the people, and here we find an increase altogether disproportionate to the means of the people. As the hon. Member for Newcastle (Major Barnes) has pointed out, we were paying so far as food is concerned, about £10,000,000 in taxes in 1913–14 and now the impost upon food is £53,000,000. I maintain that impost is out of all proportion to the ability of the people to pay. The hon. Member for Oxford (Mr. Marriott) referring to Members on this side of the House said we were desirous of avoiding all forms of taxation, that we paid very little taxation except indirect taxation and that this was an attempt to get rid of the burden on ourselves and transfer it to somebody else. We have no desire whatever to escape our legitimate share of the financial burden of the country. One reason why we oppose a tax of this character is because it admits of no discrimination. If there were some form of discrimination in regard to this and other taxes so that they could be proportioned according to the ability of of the people to pay there would be no fault to find so long as taxation was not imposed in those cases where the imposition would affect the physical well-being of the people. It is not only right financially but it is right morally that regard should be had to people who have only slender incomes which provide them with the bare physical means of existence. That is our stand. Beyond that we admit that whether it is the miner, or the man in the textile industry, or the engineer that above a certain point it should be agreed upon that all should contribute directly to the revenue. In this particular instance the taxation is not levied according to that principle. The idea of it is that out of the people's poverty they must contribute something to the revenue. At the same time that we are asking people to do that we are going to take from them part of the slender sum we have contributed to the relief of their distress. I hope the Minister will give a

sympathetic ear to the plea that we make on behalf of those who are destitute. If he wants to institute a more scientific system of taxation which will apportion the burden according to the ability of all to pay we on our part are prepared for a graduated income tax, but taxation of this kind will always receive our strongest condemnation. Whether we succeed or fail, whether this be regarded as a foolhardy annual or not we shall press for this relief, and some day these methods of taxation will be swept away altogether and a more scientific method take their place.

Question put, "That the words proposed to be left out stand part of the Clause."

The Committee divided: Ayes, 199; Noes, 69.

Division No. 168.]	AYES.	[5.45 p.m.
Addison, Rt. Hon. Dr. Christopher	Davies, Thomas (Cirencester)	Johnstone, Joseph
Adkins, Sir W. Ryland D.	Davison, Sir W. H. (Kensington, S.)	Jones, Sir Evan (Pembroke)
Agg-Gardner, Sir James Tynte	Dawes, James Arthur	Jones, J. T. (Carmarthen, Llanelly)
Ainsworth, Captain Charles	Denniss, Edmund R. B. (Oldham)	Kelley, Major Fred (Rotherham)
Allen, Lieut.-Colonel William James	Dockrell, Sir Maurice	Kidd, James
Ashley, Colonel Wilfrid W.	Doyle, N. Grattan	King, Captain Henry Douglas
Bagley, Captain E. Ashton	Du Pre, Colonel William Baring	Lane-Fox, G. R.
Baldwin, Rt. Hon. Stanley	Elliot, Capt. Walter E. (Lanark)	Law, Alfred J. (Rochdale)
Balfour, Rt. Hon. A. J. (City of Lon.)	Eyres-Monsell, Com. Bolton M.	Lewis, Rt. Hon. J. H. (Univ., Wales)
Balfour, George (Hampstead)	Falle, Major Sir Bertram Godfray	Lloyd-Greame, Sir P.
Banbury, Rt. Hon. Sir Frederick G.	Fell, Sir Arthur	Loseby, Captain C. E.
Barnston, Major Harry	FitzRoy, Captain Hon. Edward A.	Lowther, Major C. (Cumberland, N.)
Barrand, A. R.	Flannery, Sir. James Fortescue	Lowther, Maj.-Gen. Sir C. (Penrith)
Beauchamp, Sir Edward	Foreman, Sir Henry	M'Donald, Dr. Bouverie F. P.
Bell, Lieut.-Col. W. C. H. (Devizes)	Forestier-Walker, L.	Macdonald, Rt. Hon. John Murray
Bellairs, Commander Carlyon W.	Forrest, Walter	Mackinder, Sir H. J. (Camlachie)
Bennett, Sir Thomas Jewell	Foxcroft, Captain Charles Talbot	McLaren, Robert (Lanark, Northern)
Betterton, Henry B.	Gange, E. Stanley	McMicking, Major Gilbert
Bigland, Alfred	Gardiner, James	McNeill, Ronald (Kent, Canterbury)
Birchall, Major J. Dearman	Geddes, Rt. Hon. Sir E. (Camb'dge)	Macpherson, Rt. Hon. James I.
Bird, Sir A (Wolverhampton, West)	Gee, Captain Robert	Macquisten, F. A.
Bird, Sir William B. M. (Chichester)	Gibbs, Colonel George Abraham	Magnus, Sir Philip
Borwick, Major G. O.	Gilbert, James Daniel	Maitland, Sir Arthur D. Steel-
Bowyer, Captain G. W. E.	Gilmour, Lieut.-Colonel Sir John	Malone, Major P. B. (Tottenham, S.)
Boyd-Carpenter, Major A.	Grant, James Augustus	Marriott, John Arthur Ransome
Brittain, Sir Harry	Green, Albert (Derby)	Martin, A. E.
Brown, Major D. C.	Green, Joseph F. (Leicester, W.)	Matthews, David
Buchanan, Lieut.-Colonel A. L. H.	Greenwood, Colonel Sir Hamar	Molson, Major John Elsdale
Buckley, Lieut.-Colonel A.	Greenwood, William (Stockport)	Moreing, Captain Algernon H.
Bull, Rt. Hon. Sir William James	Greig, Colonel James William	Munro, Rt. Hon. Robert
Burdon, Colonel Rowland	Gretton, Colonel John	Murray, William (Dumfries)
Butcher, Sir John George	Gritten, W. G. Howard	Neal, Arthur
Campbell, J. D. G.	Hacking, Captain Douglas H.	Newman, Sir R. H. S. D. L. (Exeter)
Cautley, Henry Strother	Hannon, Patrick Joseph Henry	Nicholson, Reginald (Doncaster)
Cecil, Rt. Hon. Evelyn (Birm., Aston)	Harris, Sir Henry Percy	Nicholson, William G (Petersfield)
Chadwick, Sir Robert Burton	Hennessy, Major J. R. G.	Nield, Sir Herbert
Chamberlain, Rt. Hon. J. A.(Birm., W.)	Henry, Denis S. (Londonderry, S.)	Ormsby-Gore, Hon. William
Chamberlain, N. (Birm., Ladywood)	Herbert, Col. Hon. A. (Yeovil)	Pearce, Sir William
Cheyne, Sir William Watson	Herbert, Dennis (Hertford, Watford)	Pease, Rt. Hon. Herbert Pike
Clough, Robert	Hewart, Rt. Hon. Sir Gordon	Peel, Col. Hn. S. (Uxbridge, Mddx.)
Coates, Major Sir Edward F.	Hills, Major John Waller	Percy, Lord Eustace (Hastings)
Coats, Sir Stuart	Hinds, John	Pinkham, Lieut.-Colonel Charles
Cockerill, Brigadier-General G. K.	Hoare, Lieut.-Colonel Sir S. J. G.	Prescott, Major W. H.
Cohen, Major J. Brunei	Holbrook, Sir Arthur Richard	Pretyman, Rt. Hon. Ernest G.
Colfox, Major Wm. Phillips	Hope, Sir H.(Stirling & Cl'ckm'nn,W.)	Purchase, H. G.
Coote, Colin Reith (Isle of Ely)	Hopkins, John W. W.	Raeburn, Sir William H.
Cope, Major William	Horne, Sir R. S. (Glasgow, Hillhead)	Ratcliffe, Henry Butler
Cowan, D. M. (Scottish Universities)	Hotchkin, Captain Stafford Vere	Raw, Lieutenant-Colonel Dr. N.
Cowan, Sir H. (Aberdeen and Kinc.)	Hunter-Weston, Lieut.-Gen. Sir A. G.	Rawlinson, John Frederick Peel
Craig, Capt. C. C. (Antrim, South)	Hurst, Lieut.-Colonel Gerald B.	Rees, Capt. J. Tudor- (Barnstaple)
Craik, Rt. Hon. Sir Henry	Inskip, Thomas Walker H.	Renwick, George
Croft, Lieut.-Colonel Henry Page	James, Lieut.-Colonel Hon. Cuthbert	Roberts, Samuel (Hereford, Hereford)
Curzon, Captain Viscount	Jephcott, A. R.	Roberts, Sir S. (Sheffield, Ecclesall)
Rodger, A. K.	Stewart, Gershom	Winfrey, Sir Richard
Roundell, Colonel R. F.	Sturrock, J. Leng	Wise, Frederick
Samuel, A. M. (Surrey, Farnham)	Sugden, W. H.	Wolmer, Viscount
Sanders, Colonel Sir Robert Arthur	Surtees, Brigadier-General H. C.	Wood, Hon. Edward F. L. (Ripon)
Seager, Sir William	Taylor, J.	Wood, Sir H. K. (Woolwich, West)
Seddon, J. A.	Thomson, F. C. (Aberdeen, South)	Yate, Colonel Sir Charles Edward
Shaw, Hon. Alex. (Kilmarnock)	Wallace, J.	Yeo, Sir Alfred William
Shaw, Capt. William T. (Forfar)	Walton, J. (York, W. R., Don Valley)	Young, E. H. (Norwich)
Simm, M. T.	Ward, Col. L. (Kingston-upon-Hull)	Young, W. (Perth & Kinross. Perth)
Sprot, Colonel Sir Alexander	Watson, Captain John Bertrand	Younger, Sir George
Stanler, Captain Sir Beville	Wheler, Col. Granville C. H.
Stanley, Major Hon. G. (Preston)	White, Col. G. D. (Southport)	TELLERS FOR THE AYES.—
Stanton, Charles Butt	Williams, C. (Tavistock)	Colonel Leslie Wilson and Mr.
Steel, Major S. Strang	Wills, Lt.-Col. Sir Gilbert Alan H.	Parker.
Stephenson, Lieut.-Colonel H. K.	Wilson-Fox, Henry
NOES.
Acland, Rt. Hon. Francis D.	Hall, F. (York, W. R., Normanton)	Richardson, R. (Houghton-le-Spring)
Adamson, Rt. Hon. William	Hallas, Eldred	Roberts, Frederick O. (W. Bromwich)
Barker, G. (Monmouth, Abertillery)	Halls, Walter	Robertson, John
Barnes, Major H. (Newcastle, E.)	Hartshorn, Vernon	Rose, Frank H.
Benn, Captain Wedgwood (Leith)	Hayday, Arthur	Sexton, James
Bowerman, Rt. Hon. Charles W.	Hayward, Evan	Shaw, Thomas (Preston)
Bromfield, William	Hirst, G. H.	Short, Alfred (Wednesbury)
Brown, James (Ayr and Bute)	Hogge, James Myles	Sitch, Charles H.
Cairns, John	Irving, Dan	Spencer, George A.
Carter, W. (Nottingham, Mansfield)	John, William (Rhondda, West)	Spoor, B. G.
Davies, A. (Lancaster, Ciltheroe)	Jones, J. J. (West Ham, Silvertown)	Swan, J. E.
Davies, Alfred Thomas (Lincoln)	Kennedy, Thomas	Thomson, T. (Middlesbrough, West)
Edwards, C. (Monmouth, Bedwellty)	Kenyon, Barnet	Thorne, W. (West Ham. Plaistow)
Edwards, G. (Norfolk, South)	Kiley, James Daniel	Waterson, A. E.
Edwards, Major J. (Aberavon)	Lawson, John James	Wedgwood, Colonel Josiah C.
Edwards, Hugh (Glam., Neath)	Lunn, William	White, Charles F. (Derby, Western)
Finney, Samuel	Maclean, Nell (Glasgow, Govan)	Wignall, James
Galbraith, Samuel	Morgan, Major D. Watts	Wilkie, Alexander
Gillis, William	Murray, Dr. D. (Inverness & Ross)	Williams, Aneurin (Durham, Consett)
Glanville, Harold James	Myers, Thomas	Wilson, Rt. Hon. J. W. (Stourbridge)
Graham, R. (Nelson and Colne)	Newbould, Alfred Ernest	Wilson, W. Tyson (Westhoughton)
Graham, W. (Edinburgh, Central)	O'Grady, James
Grundy, T. W.	Parkinson, John Allen (Wigan)	TELLERS FOR THE NOES.—
Guest, J. (York, W.R., Hemsworth)	Rendall, Atheistan	Mr. Arthur Henderson and Mr. T.
		Griffiths.

Colonel WEDGWOOD

I beg to move, to leave out the words, Additional duties on dried fruit …8. In all the recent Budget Debates we have not had a Division on this question of dried fruits, and I think we ought to emphasise our protest against this duty on food. In the Safeguarding of Industries Bill we are raising extensive additional duties on goods coming into this country, but even in that Bill all duties on foodstuffs are specially exempted, and I think a case ought to be made out by the Government for continuing these duties on food when even in their own Bill they exempt any such duties. The Government profess a desire to bring down the cost of living in this country, and here is an opportunity for them to do something definite in that direction. If we could get the duties off currants, and raisins, and figs, and prunes, and all the other dried fruits taxed under this Clause, it would do something to bring down the budget of the ordinary household, and at a time when wages are being reduced everywhere it becomes additionally important that the actual out-of-pocket expenses of the household should be cut down too. We have had these duties on dried fruit for many years. We have recently admitted to the franchise the women of the country, and here is a change in taxation which could not fail to be very agreeable to the housekeepers, the women who run the households of this country. While we realise that this tax on fruit would mean a larger tax on large families than on small families, I will not go into these other questions, but will content myself with moving the omission of these duties and expressing my desire to have a Division on this subject, so that we may show the women of the country particularly who are the people in this House who are definitely prepared to reduce the household budget.

Question put, "That the words proposed to be left out stand part of the Clause."

The Committee divided: Ayes, 205; Noes, 65.

Division No. 169.]	AYES.	[5.57 P.m.
Addison, Rt. Hon. Dr. Christopher	Geddes, Rt. Hon. Sir E. (Camb'dge)	Murray, William (Dumfries)
Adkins, Sir W. Ryland D.	Gee, Captain Robert	Neal, Arthur
Agg-Gardner, Sir James Tynte	Gibbs, Colonel George Abraham	Newman, Sir R. H. S. D. L. (Exeter)
Allen, Lieut.-Colonel William James	Gilbert, James Daniel	Nicholson, Reginald (Doncaster)
Ashley, Colonel Wilfrid W.	Gilmour, Lieut.-Colonel Sir John	Nicholson, William G. (Petersfield)
Bagley, Captain E. Ashton	Green, Albert (Derby)	Nield, -Sir Herbert
Baldwin, Rt. Hon. Stanley	Green, Joseph F. (Leicester, W.)	Ormsby-Gore, Hon. William
Balfour, George (Hampstead)	Greenwood, Colonel Sir Hamar	Parry, Lieut.-Colonel Thomas Henry
Banbury, Rt. Hon. Sir Frederick G.	Greenwood, William (Stockport)	Pearce, Sir William
Barnston, Major Harry	Greig, Colonel James William	Pease, Rt. Hon. Herbert Pike
Barrand, A. R.	Gretton, Colonel John	Peel, Col. Hon. S. (Uxbridge, Mddx.)
Beauchamp, Sir Edward	Gritten, W. G. Howard	Percy, Lord Eustace (Hastings)
Bell, Lieut.-Col. W. C. H. (Devizes)	Hacking, Captain Douglas H.	Pinkham, Lieut.-Colonel Charles
Bellairs, Commander Carlyon W.	Hamilton, Major C G C.	Pollock, Sir Ernest Murray
Benn, Capt. Sir I. H., Bart. (Gr'nw'h)	Hannon, Patrick Joseph Henry	Prescott, Major W. H.
Bennett, Sir Thomas Jewell	Harris, Sir Henry Percy	Pretyman, Rt. Hon. Ernest G.
Betterton, Henry B.	Hennessy, Major J. R. G.	Purchase, H. G.
Bigland, Alfred	Henry, Denis S. (Londonderry, S.)	Raeburn, Sir William H.
Birchall, Major J. Dearman	Herbert, Col. Hon. A. (Yeovil)	Ratcliffe, Henry Butler
Bird, Sir A. (Wolverhampton, West)	Herbert, Dennis (Hertford, Watford)	Raw, Lieutenant-Colonel Dr. N.
Bird, Sir William B M. (Chichester)	Hewart, Rt. Hon. Sir Gordon	Rawlinson, John Frederick Peel
Borwick, Major G. O.	Hills, Major John Waller	Rees, Capt. J. Tudor- (Barnstaple)
Boscawen, Rt. Hon. Sir A. Griffith-	Hinds, John	Renwick, George
Bowyer, Captain G. W. E.	Hoare, Lieut.-Colonel Sir S. J. G.	Richardson, Alexander (Gravesend)
Boyd-Carpenter, Major A.	Holbrook, Sir Arthur Richard	Roberts, Sir S. (Sheffield, Ecclesall)
Brittain, Sir Harry	Hood, Joseph	Rodger, A. K.
Brown, Major D. C.	Hope, Sir H. (Stirling & Cl'ckm'nn'n,W.)	Roundell, Colonel R. F.
Buchanan, Lieut.-Colonel A. L. H.	Hopkins, John W. W.	Samuel, A. M. (Surrey, Farnham)
Buckley, Lieut.-Colonel A.	Home, Sir R. S. (Glasgow, Hillhead)	Sanders, Colonel Sir Robert Arthur
Bull, Rt. Hon. Sir William James	Hotchkin, Captain Stafford Vere	Scott, A. M. (Glasgow, Bridgeton)
Burdon, Colonel Rowland	Hunter-Weston, Lieut.-Gen. Sir A. G.	Seager, Sir William
Butcher, Sir John George	Hurd, Percy A.	Seddon, J. A.
Campbell, J. D. G.	Hurst, Lieut.-Colonel Gerald B.	Shaw, Capt. William T. (Forfar)
Cecil, Rt. Hon. Evelyn (Birm., Aston)	Inskip, Thomas Walker H.	Simm, M. T.
Chadwick, Sir Robert Burton	James, Lieut.-Colonel Hon. Cuthbert	Sprot, Colonel Sir Alexander
Chamberlain, Rt. Hn. J. A. (Birm., W.)	Jephcott, A. R.	Stanier, Captain Sir Beville
Chamberlain, N. (Birm., Ladywood)	Johnstone, Joseph	Stanley, Major Hon. G. (Preston)
Cheyne, Sir William Watson	Jones, Sir Evan (Pembroke)	Stanton, Charles Butt
Clough, Robert	Jones, J. T. (Carmarthen, Llanelly)	Steel, Major S. Strang
Coates, Major Sir Edward F.	Kelley. Major Fred (Rotherham)	Stephenson, Lieut.-Colonel H. K.
Coats, Sir Stuart	Kidd, James	Stewart, Gershom
Cohen, Major J. Brunel	King, Captain Henry Douglas	Sturrock, J. Leng
Colfox, Major Win, Phillips	Lane-Fox, G. R.	Sugden, W. H.
Cope, Major William	Law, Alfred J. (Rochdale)	Surtees, Brigadier-General H. C.
Cowan, D. M. (Scottish Universities)	Lewis, Rt. Hon. J. H. (Univ., Wales)	Taylor, J.
Cowan, Sir H. (Aberdeen and Kinc.)	Loseby, Captain C. E.	Thomson, F. C. (Aberdeen, South)
Curzon, Captain Viscount	Lowe, Sir Francis William	Turton, Edmund Russborough
Davidson, J. C. C. (Hemel Hempstead)	Lowther, Maj.-Gen. Sir C. (Penrith)	Walton, J. (York, W. R., Don Valley)
Davies, Thomas (Cirencester)	Lyle, C. E. Leonard	Ward, Col. J. (Stoke-upon-Trent)
Davison, Sir W. H. (Kensington, S.)	M'Donald, Dr. Bouverle F. P.	Ward, Col. L. (Kingston-upon-Hull)
Dawes, James Arthur	Macdonald, Rt. Hon. John Murray	Watson, Captain John Bertrand
Denniss, Edmund R. B. (Oldham)	Mackinder, Sir H. J. (Camlachie)	Wheler, Col. Granville C. H.
Dewhurst, Lieut.-Commander Harry	McLaren, Robert (Lanark, Northern)	White, Col. G. D. (Southport)
Dockrell, Sir Maurice	M'Lean, Lieut.-Col. Charles W. W.	Williams, C. (Tavistock)
Doyle, N. Grattan	McMicking, Major Gilbert	Wills, Lt.-Col. Sir Gilbert Alan H.
Du Pre, Colonel William Baring	McNeill, Ronald (Kent, Canterbury)	Winfrey, Sir Richard
Edwards, Allen C. (East Ham, S.)	Macpherson, Rt. Hon. James I.	Wise, Frederick
Edwards, Hugh (Glam., Neath)	Macquisten, F. A.	Wolmer, Viscount
Edwards, Major J. (Aberavon)	Magnus, Sir Philip	Wood, Hon. Edward F. L. (Ripon)
Eyres-Monsell, Com. Bolton M.	Maitland, Sir Arthur D. Steel-	Wood, Sir H. K. (Woolwich, West)
Falle, Major Sir Bertram Godfray	Malone, Major P. B. (Tottenham, S.)	Yate, Colonel Sir Charles Edward
Fell, Sir Arthur	Marriott, John Arthur Ransome	Yeo, Sir Alfred William
FitzRoy, Captain Hon. Edward A.	Martin, A. E.	Young, E. H. (Norwich)
Flannery, Sir James Fortescue	Matthews, David	Young, W. (Perth & Kinross, Perth)
Foreman, Sir Henry	Mitchell, William Lane	Younger, Sir George
Forestier-Walker, L.	Molson, Major John Elsdale
Forrest, Walter	Moreing, Captain Algernon H.	TELLERS FOR THE AYES.—
Foxcroft, Captain Charles Talbot	Morris, Richard	Colonel Leslie Wilson and Mr.
Gange, E. Stanley	Morrison-Bell, Major A. C.	Perker
Gardiner, James	Munro, Rt. Hon. Robert
NOES.
Acland, Rt. Hon. Francis D.	Davies, A. (Lancaster, Clitheroe)	Grundy, T. W.
Adamson, Rt. Hon. William	Davies, Alfred Thomas (Lincoln)	Guest, J. (York, W. R., Hemsworth)
Barker, G. (Monmouth, Abertillery)	Edwards, C. (Monmouth, Bedwellty)	Hall, F. (York W.R., Normanton)
Barnes, Major H. (Newcastle, E.)	Edwards, G. (Norfolk, South)	Hallas, Eldred
Benn, Captain Wedgwood (Leith)	Finney, Samuel	Halls, Walter
Bowerman, Rt. Hon. Charles W.	Galbraith, Samuel	Hartshorn, Vernon
Bromfield, William	Gillis, William	Hayday, Arthur
Brown, James (Ayr and Bute)	Glanville, Harold James	Hayward, Evan
Cairns, John	Graham. R. (Nelson and Colne)	Hirst, G. H.
Carter, W. (Nottingham, Mansfield)	Graham, W. (Edinburgh, Central)	Hogge, James Myles

Irving, Dan	O'Grady, James	Thorne, W. (West Ham. Plaistow)
John, William (Rhondda, West)	Parkinson, John Allen (Wigan)	Walsh, Stephen (Lancaster, Ince)
Jones, J. J. (West Ham, Silvertown)	Rendall, Athelstan	Waterson, A E.
Kennedy, Thomas	Richardson, R. (Houghton-le-Spring)	Wedgwood, Colonel Josiah C.
Kenyon, Barnet	Roberts, Frederick O. (W. Bromwich)	White, Charles F. (Derby, Western)
Kiley, James Daniel	Robertson, John	Wignall, James
Lawson, John James	Sexton, James	Wilkle, Alexander
Lunn, William	Short, Alfred (Wednesbury)	Wilson, Rt. Hon. J. W. (Stourbridge)
Maclean, Neil (Glasgow, Govan)	Sitch, Charles H.	Wilson, W. Tyson (Westhoughton)
Morgan, Major D. Watts	Spencer, George A.
Murray, Dr. D. (Inverness and Ross)	Spoor, B. G.	TELLERS FOR THE NOES.—
Myers, Thomas	Swan, J. E.	Mr. Arthur Henderson and Mr. T.
Newbould, Alfred Ernest	Thomson, T. (Middlesbrough, West)	Griffiths.

Mr. KILEY

I beg to move to leave out the words New import duties … 12. 6.0 P.M.

If the Committee accept this Amendment, the import duties of 33⅓ per cent. now levied on certain manufactured goods imported into this country will cease to be imposed. The Committee will recall that when these duties were imposed as a temporary War Measure, they were imposed, and were accepted by this House, on the distinct understanding that they were for temporary War purposes only, and the House was certainly led to believe by the then Chancellor of the Exchequer, Mr. McKenna, that they would cease to be imposed when the War necessity no longer occasioned their being imposed. I understand that the Chancellor of the Exchequer, in a debate which took place a short time ago, stated that the only reason which necessitated their retention was the fact that they brought in a certain amount of revenue, and from that point of view, and if that were the only point of view with which this Committee was concerned, doubtless there would be much to be said; but, on the other side, we have to consider what are the injurious results of the imposition of these taxes. Slightly under one-half of the total revenue realised represents a duty on component parts which are used for remanufacture. No one who knows anything at all about manufacturing will for a moment suggest that if a manufacturer is compelled, or finds it necessary or desirable, to import part of his material, and has to pay heavy taxation upon that, he is better equipped to meet the world's demands for his goods. When one realises that nearly half the total of this revenue is derived from that source, the Chancellor of the Exchequer should certainly give some thought as to the effect which the imposition of these duties is having upon trade as a whole.

It is not alone the actual articles concerned, but the Board of Customs have to go a good deal outside what was ever intended when these duties were imposed. The other day I came across an importer of furniture casters, who had had trouble with the Board of Customs. They would not. allow him to obtain possession of his case of casters until he gave a satisfactory assurance that he would account to His Majesty's Board of Customs for every caster sold to a pianoforte manufacturer. I mentioned, in a previous Debate, about an importer of magnifying glass who was compelled to give bonds that if he sold any of his glass to a lamp manufacturer who supplied motor car users with lamps, he must pay duty. This is one of the many difficulties which arise owing to the imposition of these duties. In the case of every package that is delivered at the docks, when it is known, or suggested, that there is a duty payable on that package or part of the package, it is taken possession of by the Custom House officers, and put into a bonded store, and it takes days and weeks to get that package cleared. In the meantime rent and other charges have got to be paid by the importer, so that not only is the manufacturer injured by the duty, but also by the delay in getting his goods and the additional expense incurred. These are some of the drawbacks of the imposition of these duties.

There is a far more important point, which has been raised several times during the discussions on these duties, to which, up to now, no satisfactory solution has been found, and that is the indirect effect which these taxes have upon the re-export of articles to which no process of manufacture is added. I refer to clocks, watches, and musical instruments imported into this country and re-exported. A case was brought under my notice only last week, where an application was made to His Majesty's Customs for a drawback on something like 200 different consignments of these goods, which had been imported into this country and re-exported out of the country. An application was made for a drawback on those goods, but His Majesty's Customs, in their wisdom, were not satisfied that sufficient definite evidence was forthcoming to identify these goods as having paid the duty, and, therefore, the duty is not to be refunded. This sort of obstacle, to my own knowledge, is having a very serious effect upon the trade which we are so anxious to regain. Last year, I admit, the yield from these duties was very great, because of the vast importation of finished motor cars in the early part of the year. Owing to the dearth in cheap cars then, an enormous number were imported from America. They were at that time very badly needed, and they yielded a very large amount to His Majesty's Customs. But that was a temporary cause, and I think, if the Chancellor of the Exchequer has any figures at his disposal, he will tell us that at the present time that boom has passed away, and that his receipts to-day are very small indeed. Yet the duties are a source, not only of annoyance and trouble to those concerned, but they are having a very serious effect upon the manufacture and re-export of these articles. There are also some points of detail which could be dwelt upon, but, as the subject has been debated pretty often, and only a few weeks back, I will not pursue the matter in detail, although, if the Chancellor of the Exchequer desires it, I have plenty of material.

Captain W. BENN

We have had a good many Debates on this question, but, perhaps, I may remind the Committee of some of the leading facts in connection with these import duties. Let me, first of all, requote the positive assurance that was given by a former Leader of the House as to these duties when they were imposed. Speaking of the fear that these duties would lead to something else, the right hon. Member for Central Glasgow (Mr. Bonar Law), when Leader of the House, said: Duties of this kind would never be continued under any circumstances when the War was over. I think the Chancellor of the Exchequer should take some note of that, because, if words ever mean anything, that is a perfectly definite and specific pledge. Then I deeply regret that we have not got the presence of the Minister of Health. We are always very glad to see him in these days: he adds so much light to the discussion. The Minister of Health spoke on these duties too, and he did not speak of them in the post-War period, but at the time of the War, when, in my opinion, there was some justification for them. He said: The articles selected were ridiculous, the results were absurd, and the proposals would not achieve what was intended. I am very sorry that it is not possible for him to be here with us to-day to explain what are the circumstances, now that the War is over, that have made the articles less ridiculous and the results less absurd.

Sir F. BANBURY

I have converted him.

Captain BENN

Circumstances have altered.

Sir F. BANBURY

No; I have converted him.

Captain BENN

That may be so. Then I would like to ask what is going to be the attitude in this matter of the Coalition Liberal party? The Division which is-going to take place will be a very important one. The Financial Secretary—I trust he will not go away for a moment or two—I remember that last year these duties so impressed him as being unnecessary that he most sturdily went into the Lobby in opposition to them. What are the circumstances that have happened in the twelve intervening months to alter his judgment as to their necessity? I do not know. I am firmly convinced that when he accepted the very important office which he now adorns he accepted it with the determination to uphold and spread in Government circles those views of which he was so sturdy an exponent on this side of the House. I trust the right hon. Baronet has not converted him.

Sir F. BANBURY

Perhaps.

Captain BENN

There may be no end to the good work which the right hon. Baronet does in this House! Then what about the hon. Member I see opposite who represents Montrose (Mr. Sturrock)? He is a very pertinacious speaker. When he gets up to speak he is not averse to fighting. I wonder what he will say when I give to the House this quotation. I apologise for using this very strong language, which is certainly not at all congenial to me. He said: These duties absolutely reek and stink of old-fashioned protection. Surely the hon. Member cannot have any great love for supporting something which reeks and stinks, and I am quite sure that, after that speech, we shall have the advantage of his support. I read in the paper that at a largely attended meeting of the Coalition Liberals held yesterday—this refers to some time ago, a couple of years. [Laughter.] Does any hon. Gentleman who laughs suggest that the eternal principles held by the Coalition Liberal Members have changed in the brief period of two years? It is impossible! They are the only Liberal party. We have that on the assurance of one of the Patronage Secretaries whose duties are so light here that he is able to devote a good deal of his time to expounding these things in the country. He has told us that the Coalition Liberals are the only Liberals. I submit, therefore, that it is very material to this Debate to hear what the Coalition Liberals have to say and what they think about these duties. Mr. George Lambert presided. I am reading the names as they appear in the paragraph— Mr. George Lambert presided. The meeting was to receive an account of an interview that a deputation appointed at the last meeting recently had with Mr. Austen Chamberlain on the subject of the retention of the Government duties embodied in the Budget of 1915. Certain suggestions were made, and Mr. Neal and other members— I am sorry that the Parliamentary Secretary to the Ministry of Transport is temporarily absent— also spoke, and the following resolution, moved by Mr. Gerald Prance, and seconded by Mr. Leng Sturrock, was carried, 'That this meeting deprecates the continuance of the import duties imposed by the Budget in 1915.' It is extremely disappointing when we have these healthy, virile, sturdy sentiments expressed in the Committee Room, that they are translated more actively in the Lobby. We are not receiving the support that we should like from that quarter. It is very disappointing, because the interdependence of the Coalition Liberals and the Protectionist party in the Cabinet is essential for the maintenance of the Coalition. We have it that there is a Minister specially appointed, as I read in the paper yesterday, and to dislodge whom would bring the whole of the Coalition to the ground. He is there for the purpose of maintaining this sacred connection. So I hope I have made it quite clear that the action of the Coalition Liberal party, the only Liberal party, is really of most vital moment to the fiscal fortunes of our country.

One other point. Under this Clause of the Bill a duty of 33⅓ per cent. is put on a number of articles selected, so far as one can make out, quite at random, not from the point of view of yielding revenue at all. We must now look at this in the light of the further Bill which has been introduced, and is now before the House, for adding another 33⅓ per cent. I do not understand, as regards Part II of the Anti-Dumping Bill, that the duties are "in place of it," because it says in Clause (3) "in addition to any other duties and customs." What, therefore, we are really doing if we take this course to-day is to put a duty of 66 per cent. on these products.

Sir R. HORNE

Surely my hon. and gallant Friend must be fair. The duties which are provided for in the Safeguarding of Industries Bill do not necessarily go on.

Captain BENN

That really makes the case a thousand times worse, because the one thing the trader wants to know is what he has got to pay. Under the Safeguarding of Industries Bill and on account of the alteration of the exchanges, he may ultimately find himself involved in charges he never contemplated, and in that case there is very, very little to be said for Part I of the Safeguarding of Industries Bill. The real point is this: We are conferring upon the Treasury powers to impose duties which in the aggregate may amount to 99 per cent., and certainly in many cases to 66, without estimating the 26 per cent. extra to which reference has been made. I do once more suggest that if the Government is desirous of introducing Protection—we were told by the Leader of the House only the other night that both parts of the Coalition believe it is necessary and are completely in harmony—would it not be very much better if, instead of keeping this meaningless Protection of 33⅓ per cent., they should not introduce frankly a tariff Bill and so let Free Traders and Protectionists alike know exactly what is proposed? If the Government justify such measure on the grounds of Protection and that there is such a thing as scientific interference with trade in the interests of their own country then we could understand; but to go on as they are doing, suggesting that it is in the interests of the Revenue and of the trade of the country, is not going to benefit either.

Sir R. HORNE

The hon. and gallant Gentleman opposite—[HON. MEMBERS: "Leng Sturrock!"]—I take it that the hon. Member for Montrose will have the opportunity later, if he thinks it necessary, to reply to what the hon. and gallant Gentleman opposite has said. The views which were expressed by the last speaker are those which we are accustomed to hear regularly in these Debates. The only new element which the hon. and gallant Gentleman has succeeded in bringing into his speech is a somewhat lively series of quotations from his old friends. They have separated from his party, and he very much regrets what has happened, and the band to which he belongs have lost some of their most skilled and the most erudite members. But it is really too late in the day now to discuss practical measures from the point of view of the old Free Trade and Tariff Reform controversy. It is an attempt to make what is really a matter of business a matter of religion on the part of my hon. Friends opposite. Some of them seem to think that the question of Protection or Free Trade must necessarily give rise to systems to every part of which you must be devoted, and every part of which you must put into definite application. For my part I have never been able to look upon the fiscal question as other than a practical matter of business. If a duty pays you and you can put it on without injuring your own people, you do a service to trade. Why not, then, apply it? If, on the other hand, there _is a balance of disadvantage, then we should not apply it. To talk, however, as if because you had one particular duty you must have a thousand others seems to me to be the height of fatuity. In regard to the means of raising revenue, I hope I shall never be led astray by that kind of complaint, or be led to pay attention to that which is not a principle and never was intended to be, but, in fact, is merely a matter of business.

When I look at this particular duty, I find something which is really useful to the trade of the country. It does no injury to anybody, yet at the same time it produces revenue of £2,100,000, we hope, for the present year. We want money. Is it not far better that we should get that by the taxation of luxuries, none of which need affect the ordinary consumers of the country? If you look at the case of motor-cars: you tax luxury cars and not the commercial vehicles.

Captain BENN

What about commercial travellers?

Sir R. HORNE

You cannot go into the ultimate destination of the car when it arrives at the seaport, and you can therefore only deal with a car according to its class. Here you do get a revenue from a tax which injures nobody. The hon. Gentleman opposite (Mr. Kiley) alleged that half of the tax is taken from components. I am told that components are not a very large part at all. If my hon. Friend has any cases which he would like to bring before me, I shall be glad to have them inquired into, because we are anxious to make it as clear as possible that we do not desire to create difficulty. We do not think there is any real difficulty in the administration of the duty.

Mr. KILEY

I got the figures from the "Board of Trade Journal" about the component parts, and I can show them to the right hon. Gentleman.

Sir R. HORNE

I should be glad to see them. My hon. and gallant Friend's speech was concerned with a series of quotations and he regretted that the right hon. Gentleman the Member for Central Glasgow (Mr. Bonar Law) was not in his place. I am very sorry that the late Leader of the House is not in his place because he would have been able to inform my hon. and gallant Friend with more effect that what has just been quoted is a complete misrepresentation of the attitude which he then took up. So far from the speech being one which would be in favour of taking off these taxes after the War, it was to the opposite effect. When he spoke about nobody continuing duties on this scale after the War he really meant on that slight scale. I really do not think that the hon. and gallant Gentleman can have read that speech.

Captain BENN

Yes, I have read it all.

Sir R. HORNE

Then the hon. and gallant Gentleman cannot have read it with his usual care and accuracy. The right hon. Gentleman in his speech said: That is one of the strongest arguments, because obviously 33⅓ per cent. does not meet the case. The right hon. Gentleman went on to say: Duties of this kind would never have been continued when the War was over on this scale. He meant that these duties would not meet the case if they attempted to set them up as a protective scale. If the right hon. Gentleman were here I am sure he would agree that in reality what we are doing is raising revenue for the State upon a particular set of commodities which are regarded as luxury commodities. There is another passage in the same speech, which my hon. and gallant Friend did not quote, in which my right hon. Friend said: The only possible objection to their point of view is that the imposition of these duties would be an object lesson which will show after the War is over that they have not done harm but have done good. His point was that these duties might form an illustration that you could have duties upon commodities not only without doing any harm, but doing good. I think it has been shown that these duties have done good and no harm, and for that reason I cannot accept the Amendment.

Major HAYWARD

The Chancellor of the Exchequer has drawn no distinction between the attitude of mind of himself and my hon. and gallant Friend (Captain Benn). The right hon. Gentleman says he regards this as a matter of business, while my hon. and gallant Friend, he says, regards it as one of religion. I think the Chancellor of the Exchequer is doing both himself and my hon. and gallant Friend an injustice, because I am sure he would be the last to deny that he himself does not allow principles of religion to influence him in his conduct of business. The right hon. Gentleman has drawn a distinction which really does not exist. He said that on the one hand he considered what was the revenue derived from these taxes, and on the other side whether that advantage was overbalanced by countervailing disadvantages. That is precisely the test we apply, and our opinion is that the revenue he derives is more than counterbalanced by countervailing disadvantages. The Chancellor of the Exchequer has told us that the revenue he derives from these taxes is £2,100,000. I believe I am right in saying that as a matter of fact more than one-half of that amount is derived from one class of commodity only, and from one country only.

Some time ago the President of the Board of Trade was good enough to give a return showing the total value of the articles subjected to the new import duties which were imported into this country during the past few years, and according to those figures the total value for the year 1920 is £21,727,610. I believe the amount actually derived for the year 1920 showed an increase on the estimate for this year. The amount contributed by cinematograph films is just over £1,000,000. Clocks, complete and parts, produced over £1,000,000. Watches complete, watch cases and parts produced £2,287,000, and the amount contributed by motor cars, chassis and parts is £15,500,000. So that motor cars really cover a great deal more than half the total amount, and of that £15,500,000, £12,325,843 are imported from the United States of America. Apart from motor cars, the amount of revenue to be derived from these new import duties must be very small indeed. I put it to the Chancellor of the Exchequer whether it is worth while, for the small amount of revenue he derives from these other commodities, to put the commercial and industrial community to the great disadvantages which undoubtedly do occur owing to these taxes.

Mr. STURROCK

I am only anxious to allay the anxiety of my hon. and gallant Friend the Member for Leith (Captain Benn) by at once letting him know that it is my firm intention to support the Government. My hon. and gallant Friend has done me the honour of making a quotation from one of my speeches, and I feel highly honoured at being associated with the right hon. Gentleman the Member for Central Glasgow and other celebrities whom my hon. and gallant Friend thought it worth while to quote upon this subject. I confess freely to the Committee that I can live and learn, while my hon. and gallant Friend is one of those firm politicians who never can alter his view point, and declares himself to be an advanced radical whilst I am a reactionary Conservative.

I make no apology for the words I used when one examines these duties, and looks back upon their operation. The hon. and gallant Member for Leith has been searching here, there, and everywhere for political ammunition to use in his constituency, and now he comes here wasting the time of the Committee by attempting to oppose duties on luxuries like motor cars, clocks and mouth organs. We now see the small rump of dissentient Liberals occupied in the pleasant task of opposing duties on what really are luxuries. That is not the Gladstonian Liberalism in which I was born. I ask my hon. and gallant Friend to withdraw his opposition to these duties, having in view the present state of the finances of the country. [HON. MEMBERS: "Why?"] Simply because there is no justification for robbing the Treasury of money that is very seriously needed. Only yesterday my hon. and gallant Friend demanded that the Minister of Labour should not alter the unemployment pay, and on that occasion he was anxious to spend more money; but to-day he and his friends come here, and try to rob the Government of some of the money which it needs so badly.

The CHAIRMAN

I think the hon. Member is getting wide of the Question before the Committee.

Mr. STURROCK

I have only done so, Mr. Chairman, under the provocation of having my speeches quoted by the hon. and gallant Member. The argument of the hon. and gallant Member for White-chapel (Mr. Kiley) is that we should sweep these duties away altogether, because there will be delays in connection with the Customs authorities. Does he propose that the whole revenue should go because there may be delays? I never heard a more feeble argument. We want all the money we can get. Hon. Members know it, and if they come down here to oppose such duties as these, I think at any rate they ought to remain very mute when questions are put forward entailing expenditure on the part of the Government.

Mr. J. W. WILSON

As one who views this problem from a business rather than a religious point of view, may I say that we may expect that in the administration of the fiscal measures before us in another Bill I think I am justified in asking whether the duty on these goods of 33⅓ per cent. will run concurrently? Is there a possibility that in the case of some of these articles which are liable to 33⅓ per cent. they may be liable, if not by a direct Measure of Parliament, by the action of the Board of Trade, to another 33⅓ per cent. at least, and possibly more? Certainly, where motor cars, watches, or musical instruments come to us from countries with an adverse exchange, they might be claimed by the Board of Trade to come within the scope of their administrative powers. In whatever way one looks at these duties, from whatever aspect one has been accustomed to view them, we must all agree that the essential security for the encouragement of trade is a knowledge of what is to come. Uncertainty regarding trade, even for a few months ahead, is always a great deterrent to business, and I think it would be well if we are to assume from what the Chancellor of the Exchequer has told us that it is not the intention of the Government, or of any Department of the Government, that these duties should be cumulative, or, to use a legal phrase, that these sentences should run concurrently. If importers have reason to fear that the goods they deal in will be liable to a double duty it may prove a serious deterrent to trade.

Sir R. HORNE

I would remind my hon. Friend that the other Bill to which he has referred has not yet entered upon its Committee stage, and it does not seem right that in dealing with the Bill now before the House we should refer to another Bill as to which we do not know in what form it will leave the House. So far as the proposals of the Bill are concerned, any duties other than the key industries duties would only be imposed after inquiry by a Committee which would take all the circumstances into consideration. They might decide that if a duty already existed there could be no need for imposing any further duty. At the same time, it would be possible for them, as the Bill now stands, to make the duties cumulative.

Lord R. CECIL

What is the intention of the Government?

Mr. WILSON

I think I was justified in the question I put to the Chancellor of the Exchequer, especially in view of the words of Clause 3, "in addition to any other duty." I think we may expect the Government will favourably entertain some time in Committee a request that that point shall be made clear, and they might possibly reduce the discretion at present allowed to the Board of Trade. By so doing they would help to put more at ease the minds of certain people in the business community.

Sir R. HORNE

My right hon. Friend will have every opportunity of raising that question on the other Bill in Committee. I say it would be possible to have the two duties cumulative if the Committee dealing with the matter thought fit to put one on top of the other, but they would only do that having regard to all the circumstances of the time.

Mr. A. SHAW

I would like to remind the Committee that at the outset these duties were imposed in order to save shipping space. That was the origin of them. The character of them is perfectly obvious. The Chancellor of the Exchequer has spoken of them as an example of the small harm done; in fact, he rather seemed to claim that they had proved a benefit, but I want to point out that they are rather an illustration of the fact that when once insidious protectionist taxes have been inserted into our system it becomes lmost impossible to get rid of them. We are led from one article to another until we reach a system of protection on a large scale, and we find it impossible to get rid of a measure which is essentially vicious. I quite admit that my hon. Friend the Member for Montrose (Mr. Sturrock) is perfectly entitled to change his mind, but I much regret that he should have gone so far as to decide to go into the Lobby against this Amendment.

Mr. T. THOMSON

Those of us on this side who intervene in the family differences which have broken out on the opposite Benches need not apologise if we claim that the principles on which business experience in the past has been built up are perfectly sound, and if we still hold that what has led to the great business prosperity of this as a manufacturing and importing country has been the application of those very principles which the Chan- cellor of the Exchequer now seems to think he is deriding when he describes them as some form of religion. If there is one thing for which the business world to-day is asking it is to be rid of the restrictions imposed durng the War, restrictions which were willingly borne at the time, but which, now that the necessity has passed, ought to be removed. The hon. Member for Montrose (Mr. Sturrock) suggested that they should be regarded as luxury taxes for revenue purposes. Why not make it a real luxury tax? Why not include diamonds, and pearls, and all kinds of jewels? Why not put your luxury tax on these things rather than tax the schoolboy's watch which can hardly be counted as a luxury, because the watch-making industry in this country is largely specialised on the higher classes of trade and not on the cheap class of watches such as we get from abroad. Really, instead of making it a luxury tax you are taxing the workman and the schoolboy and compelling them to pay much more for their watches than you ought to.

I come to the question of musical instruments. Many men not very well paid earn their daily livelihood by using these instruments, and upon them you will put a very heavy burden. They may be but a small class of the community, but still they do deserve some consideration. I submit that those principles which have proved sound and satisfactory from a business point of view should be maintained. The trading community desire freedom to manage their own affairs in their own way without restrictions artificially imposed by the bureaucracy. In a Committee upstairs to-day the right hon. Gentleman in charge of the Government Railway Bill declared that freedom of competition was the very life of our railway services. Surely freedom of competition is equally necessary in those larger spheres of commerce with which this Bill is more particularly concerned. I do not think, therefore, there is any need for any of us to apologise because we have not changed our principles. We hold to the old faith upon which the prosperity of this country has been built up, and we believe that that prosperity will be renewed if we only give it a fair chance.

Dr. MURRAY

I should like to sympathise with the hon. Member for the Montrose Burghs (Mr. Sturrock) in the savage attack made upon him by the hon. and gallant Member for Leith (Captain W. Benn), and I think he did well to be angry at it. My hon. Friend lives and learns, so he tells us. He not only learns, but apparently he has discovered a royal road to learning. He said some very strong things only a few months ago, and to-day he spoke in an almost opposite direction. That is evidence that he has discovered a royal road to learning. The Chancellor of the Exchequer told us that we on this side regarded Free Trade as our religion. At any rate, we do not accept Protection as our religion, and, unfortunately, we are not in a position to practise our religion. The right hon. Gentleman apparently has accepted Protection as his religion, and now he can practise it. The late Leader of the House certainly never intended to impose a tariff of 33⅓ per cent. as a scientific tariff. The utmost he had in his mind was, I believe a 10 per cent. tariff, and he never imagined that any Government would after the War dream of putting on a 33⅓ per cent. tariff. The right hon. Gentleman just now spoke of motor cars as a luxury. I would like him to hear the opinions of some doctors who have to use motor cars in their daily practice, warring against all kinds of wind and weather in all parts of the country. Does he imagine that they look upon riding in a motor car as a luxury? And yet it is that very man who will be hardest hit if this 33⅓ per cent. tariff is imposed upon motor cars. My objection to this Bill is that the Government are producing a snowball of Protection. One tax is being piled upon another, and almost before we know where we are we shall

find every article we used taxed, and taxed to such an extent that it will be impossible to make use of them.

Mr. KILEY

I should like to give the Committee a little information which came to my knowledge only a few days ago as to the effect of these taxes upon trade. There is in the City a business firm which formerly was in the habit of doing a large re-export trade in Swiss watches. They were in the habit of sending them especially to East, West and South Africa, but after the War they found the repeat orders which they usually received had suddenly stopped, and it was not until some time later that they discovered that the Swiss manufacturer had been careful enough to put inside the boxes containing the goods his own name and address and the price at which he was able to do business with the African firms. This London firm as a result lost a large amount of its business. If the right hon. Gentleman will take the opportunity of looking to the export trade in pianos, he will find that in 1913 the trade in re-exported foreign made pianos in that year compared with what it is at the present time, was 90 per cent. greater. That is another proof of how trade is affected by these taxes, and if the right hon. Gentleman wants further information on that point I could give him many other illustrations of the very serious effects being produced on the export- trade of this country.

Question put, "That the words proposed to be left out stand part of the Clause."

The Committee divided: Ayes, 194; Noes, 79.

Division No. 170.]	AYES.	[7.2 p.m.
Addison, Rt. Hon. Dr. Christopher	Bowyer, Captain G. W. E.	Cowan, Sir H. (Aberdeen and Kinc.)
Agg-Gardner, Sir James Tynte	Boyd-Carpenter, Major A.	Craig, Captain C. C. (Antrim, South)
Allen, Lieut.-Colonel William James	Breese, Major Charles E.	Craik, Rt. Hon. Sir Henry
Amery, Leopold C. M. S.	Bridgeman, Rt. Hon. William Clive	Davies, Thomas (Cirencester)
Ashley, Colonel Wilfrid W.	Brittain, Sir Harry	Davison, Sir W. H. (Kensington, S.)
Bagley, Captain E. Ashton	Buchanan, Lieut.-Colonel A. L. H.	Dawes, James Arthur
Baird, Sir John Lawrence	Buckley, Lieut.-Colonel A.	Denniss, Edmund R. B. (Oldham)
Balfour, George (Hampstead)	Bull, Rt. Hon. Sir William James	Dewhurst, Lieut.-Commander Harry
Balfour, Sir R. (Glasgow, Partick)	Butcher, Sir John George	Dockrell, Sir Maurice
Banbury, Rt. Hon. Sir Frederick G.	Campbell, J. D. G.	Doyle, N. Grattan
Barnston, Major Harry	Cautley, Henry Strother	Du Pre, Colonel William Baring
Bell, Lieut.-Col. W. C. H. (Devizes)	Cecil, Rt. Hon. Evelyn (Birm., Aston)	Elliot, Capt. Walter E. (Lanark)
Bellairs, Commander Carlyon W.	Chamberlain, Rt. Hn. J. A.(Birm., W.)	Eyres-Monsell, Com. Bolton M.
Bennett, Sir Thomas Jewell	Chamberlain, N. (Birm., Ladywood)	Falcon, Captain Michael
Betterton, Henry B.	Churchman, Sir Arthur	Falle, Major Sir Bertram Godfray
Bigland, Alfred	Clough, Robert	Fell, Sir Arthur
Birchall, Major J. Dearman	Coates, Major Sir Edward F.	FitzRoy, Captain Hon. Edward A.
Bird, Sir A. (Wolverhampton, West)	Coats, Sir Stuart	Flannery, Sir James Fortescue
Bird, Sir William B. M. (Chichester)	Colfox, Major Wm. Phillips	Ford, Patrick Johnston
Borwick, Major G. O.	Conway, Sir W. Martin	Forrest, Walter
Boscawen, Rt. Hon. Sir A. Griffith-	Cope, Major William	Foxcroft, Captain Charles Talbot
Fraser, Major Sir Keith	Locker-Lampson, G. (Wood Green)	Rawlinson, John Frederick Peel
Gange, E. Stanley	Locker-Lampson, Com. O. (H'tingd'n)	Rees, Capt. J. Tudor- (Barnstaple)
Gardiner, James	Lorden, John William	Richardson, Alexander (Gravesend)
Geddes, Rt. Hon. Sir E. (Camb'dge)	Loseby, Captain C. E.	Roberts, Sir S. (Sheffield, Ecclesall)
Gee, Captain Robert	Lowe, Sir Francis William	Rodger, A. K.
Gibb's, Colonel George Abraham	Lowther, Major C. (Cumberland, N.)	Roundell, Colonel R. F.
Gilbert, James Daniel	Lowther, Maj.-Gen. Sir H.C. (P'nrith)	Samuel, Samuel (W'dsworth, Putney)
Gilmour, Lieut.-Colonel Sir John	Lyle, C. E. Leonard	Sanders, Colonel Sir Robert Arthur
Goulding, Rt. Hon. Sir Edward A.	M'Donald, Dr. Bouverie F. P.	Sassoon, Sir Philip Albert Gustave D.
Gray, Major Ernest (Accrington)	Mackinder, Sir H. J. (Camlachie)	Scott, A. M. (Glasgow, Bridgeton)
Green, Albert (Derby)	McLaren, Robert (Lanark, Northern)	Shaw, Capt. William T. (Forfar)
Green, Joseph F. (Leicester, W.)	M'Lean, Lieut.-Col. Charles W. W.	Simm, M. T.
Greenwood, William (Stockport)	McMicking, Major Gilbert	Sprot, Colonel Sir Alexander
Greig, Colonel James William	McNeill, Ronald (Kent, Canterbury)	Stanier, Captain Sir Beville
Gretton, Colonel John	Macpherson, Rt. Hon. James I.	Stanley, Major Hon. G. (Preston)
Hamilton, Major C. G. C.	Macquisten, F. A.	Stanton, Charles Butt
Harris, Sir Henry Percy	Maitland, Sir Arthur D. Steel-	Steel, Major S. Strang
Hennessy, Major J. R. G.	Malone, Major P. B. (Tottenham, S.)	Stewart, Gershom
Henry, Denis S. (Londonderry, S.)	Marriott, John Arthur Ransome	Sturrock, J. Leng
Herbert, Col. Hon. A. (Yeovil)	Martin, A. E.	Sugden, W. H.
Herbert, Dennis (Hertford, Watford)	Matthews, David	Surtees, Brigadier-General H. C.
Hewart, Rt. Hon. Sir Gordon	Meysey-Thompson, Lieut.-Col. E. C.	Taylor, J.
Hills, Major John Waller	Molson, Major John Elsdale	Thomson, F. C. (Aberdeen, South)
Hoare, Lieut-Colonel Sir S. J. G.	Moreing, Captain Algernon H.	Thomson, Sir W. Mitchell- (Maryhill)
Holbrook, Sir Arthur Richard	Morrison, Hugh	Thorpe, Captain John Henry
Hood, Joseph	Morrison-Bell, Major A. C.	Tryon, Major George Clement
Hope, Sir H.(Stirling & Cl'ckm'nn, W.)	Munro, Rt. Hon. Robert	Turton, Edmund Russborough
Hopkins, John W. W.	Murray, John (Leeds, West)	Ward, Col. J. (Stoke-upon-Trent)
Horne, Sir R. S. (Glasgow, Hillhead)	Murray, William (Dumfries)	Watson, Captain John Bertrand
Hotchkin, Captain Stafford Vere	Neal, Arthur	Wheler, Col. Granville C. H.
Hunter-Weston, Lieut.-Gen. Sir A. G.	Newman, Sir R. H. S. D. L. (Exeter)	White, Col. G. D. (Southport)
Hurd, Percy A.	Nicholson, William G. (Petersfield)	Williams, C. (Tavistock)
Hurst, Lieut.-Colonel Gerald B.	Ormsby-Gore, Hon. William	Wills, Lt.-Col. Sir Gilbert Alan H.
Inskip, Thomas Walker H.	Palmer, Brigadier-General G. L.	Wise, Frederick
Jackson, Lieut.-Colonel Hon. F. S.	Parker, James	Wolmer, Viscount
James, Lieut.-Colonel Hon. Cuthbert	Pearce, Sir William	Wood, Hon. Edward F. L. (Ripon)
Jephcott, A. R.	Pease, Rt. Hon. Herbert Pike	Wood, Sir H. K. (Woolwich, West)
Jones, Sir Edgar R. (Merthyr Tydvil)	Peel. Col. Hon. S. (Uxbridge, Mddx.)	Yate, Colonel Sir Charles Edward
Jones, J. T. (Carmarthen, Llanelly)	Percy, Lord Eustace (Hastings)	Yeo, Sir Alfred William
Kelley, Major Fred (Rotherham)	Perkins, Walter Frank	Young, E. H. (Norwich)
Kidd, James	Pinkham, Lieut.-Colonel Charles	Younger, Sir George
King, Captain Henry Douglas	Pollock, Sir Ernest Murray
Lane-Fox, G. R.	Prescott, Major W. H.	TELLERS FOR THE AYES.—
Law, Alfred J. (Rochdale)	Pretyman, Rt. Hon. Ernest G.	Colonel Leslie Wilson and Mr.
Lewis, Rt. Hon. J. H. (Univ., Wales)	Purchase, H. G.	Dudley Ward.
NOES.
Acland, Rt. Hon. Francis D.	Hartshorn, Vernon	Richardson, R. (Houghton-le-Spring)
Adamson, Rt. Hon. William	Hayday, Arthur	Roberts, Frederick O. (W. Bromwich)
Asquith, Rt. Hon. Herbert Henry	Hayward, Evan	Robertson, John
Barker, G. (Monmouth, Abertillery)	Henderson, Rt. Hon. A. (Widnes)	Seager, Sir William
Bonn, Captain Wedgwood (Leith)	Hinds, John	Sexton, James
Bowerman, Rt. Hon. Charles W.	Hirst, G. H.	Shaw, Hon. Alex. (Kilmarnock)
Bromfield, William	Hogge, James Myles	Shaw, Thomas (Preston)
Brown, James (Ayr and Bute)	Holmes, J. Stanley	Short, Alfred (Wednesbury)
Cairns, John	Hopkinson, A. (Lancaster, Mossley)	Sitch, Charles H.
Carter, W. (Nottingham, Mansfield)	John, William (Rhondda, West)	Spencer, George A.
Clynes, Rt. Hon. John R.	Johnstone, Joseph	Spoor, B. G.
Coote, Colin Reith (Isle of Ely)	Jones, J. J. (West Ham, Silvertown)	Swan, J. E.
Cowan, D. M. (Scottish Universities)	Kennedy, Thomas	Thomson, T. (Middlesbrough, West)
Davies, A. (Lancaster, Clitheroe)	Kenyon, Barnet	Thorne, W. (West Ham, Plaistow)
Edwards, C. (Monmouth, Bedwelity)	Kiley, James Daniel	Wallace, J.
Edwards, G. (Norfolk, South)	Lawson, John James	Walsh, Stephen (Lancaster, Ince)
Finney, Samuel	Lunn, William	Waterson, A. E.
Galbraith, Samuel	Macdonald, Rt. Hon. John Murray	Wedgwood, Colonel Josiah C.
Gillis, William	Maclean, Neil (Glasgow, Govan)	White, Charles F. (Derby, Western)
Glanville, Harold James	MacVeagh, Jeremiah	Wignall, James
Graham, R. (Nelson and Colne)	Mills, John Edmund	Williams, Aneurin (Durham, Consett)
Graham, W. (Edinburgh, Central)	Morgan, Major D. Watts	Wilson, Rt. Hon. J. W. (Stourbridge)
Griffiths, T. (Monmouth, Pontypool)	Mosley, Oswald	Wilson, W. Tyson (Westhoughton)
Grundy, T. W.	Myers, Thomas	Young, Robert (Lancaster, Newton)
Guest, J. (York, W. R., Hemsworth)	Newbould, Alfred Ernest
Hall, F. (York, W. R., Normanton)	Nicholson, Reginald (Doncaster)	TELLERS FOR THE NOES.—
Hallas, Eldred	O'Grady, James	Dr. Murray and Major Barnes.
Halls, Walter	Parkinson, John Allen (Wigan)

Mr. MOSLEY

I beg to move, at the end of the Clause, to insert the words Provided that this Section shall cease to apply after the first day of August, nine- teen hundred and twenty-one, to violins which are over one hundred years old or of a greater value than fifty pounds, and which are imported after the said date. I am fully conscious that at first sight this Amendment appears to be unreasonable, and to discriminate between expensive and inexpensive musical instruments in an undesirable manner. I think, however, if the Committee will bear with me for a few moments while I briefly expound the case, such as it is, they will agree with me that this proposal can summon a considerable measure of reason to its aid. In brief, the case is that, by the prohibitive tariff instituted in this Bill, a valuable trade affording employment to a considerable amount of skilled labour and benefiting the revenue of this country to a very considerable degree, is being entirely destroyed and driven abroad. The case of the old violin is different from that of the new instrument, for many reasons. To begin with, old violins are not purchased in this country, or at any rate they are only purchased in very negligible numbers. For the last year or two no old violins have been purchased in this country. This trade rests entirely upon the re-export side of the business, and these old violins merely pass through this country but, in their passage, they benefit very considerably the revenue by the profits which are made by our merchants.

These duties have been defended on very varying grounds, and on three grounds that I have heard and remember myself. I venture to argue that on not one of these grounds can a tax on these old instruments be upheld. The first argument advanced in favour of these duties is that they benefit the revenue. I challenge with confidence my right hon. Friend to state that one penny has been derived by the revenue from the tax on old instruments. I am assured by the leading members of this trade, one of the chief of whom is a constituent of my own, that not a single old violin has been imported into this country since this tariff began, or at any rate during the last year or two. Consequently, the revenue has benefited not at all. The second ground on which this tax is justified, on occasion, is that it affords a protection to certain industries in this country. It is impossible to argue that it is necessary to protect the industry which manufactures antique violins. It might be possible that the industry for the manufacture of antique furniture stood in need of protection, but, in point of fact, no one will contend that an industry for the manufacture of antique violins has ever been constituted in this country or is likely to be constituted in the future. The third ground on which these duties are justified is that they are necessary in order to stabilise the exchange by the prohibition of luxuries entering this country. I quite agree that if these violins were bought extensively in this country that third ground might apply in this case. I can assure the right hon. Gentleman that under the present burden of taxation in this country nobody is buying these expensive instruments, no one is likely to buy them, and no one has, in fact, bought them. In only one country in the world are these instruments being purchased, and that country is America. The fact that these instruments are being bought by America and are passing through this country prior to their purchase is, in fact, stabilising the exchanges of the world in exactly the manner desired by the right hon. Gentleman. These instruments are bought in the Central Empires, mostly in Austria, they pass through this country, and are sold in America. The net result of the transaction is to benefit the exchange of the Central Empires at the expense of the exchange of America.

The Government is constantly ascribing many of the ills under which we labour to-day to the collapsed exchanges of the Central European countries. By these transactions those exchanges are benefiting at the expense of America, which has an appreciated exchange; and incidentally, by their passage through this country and by the profit that is made on the resale of these instruments to America, our merchants in this country benefit considerably, and consequently the general revenue of the country benefits by way of taxation. It is evident that on none of the grounds on which these duties are usually justified is it possible to defend their application to these old instruments. They do not benefit the revenue of the country; they do not protect any industry; they are not necessary to stabilise our exchange—in fact they militate, to such an extent as they affect the matter, against that stability which the right hon. Gentleman desires. I anticipate that the right hon. Gentleman will argue that it is possible for these English merchants to claim on re-export a refund of the amount ex- pended. That is technicality correct, but there are very grave practical difficulties in the way.

To begin with, it is very difficult to identify these old instruments. The Customs authorities, quite naturally, must be satisfied that the same instruments are re-exported. They must exercise the profoundest caution, and in point of fact the method that they pursue is to affix large seals to these old instruments. These put very great difficulties in the way of our merchants. The work of the trade is to restore these old instruments—in which work a considerable body of skilled labour is employed—to test them, and then to re-export them. The work of restoration and testing is virtually prohibited by the affixing of these seals to the instrument. It is impossible for the repairer to handle the instrument properly, and for the tester to play it properly. Consequently, with these seals affixed to the instrument, it is impossible for our merchants to carry on their business. The net result is that, unless the duties are rescinded, in so far as they apply to these old instruments, the main business in them, at any rate, is about to be transferred bag and baggage to Paris. That is the definite and fixed intention of these merchants, and of the chief importer in particular, namely, Mr. Hill, of Bond Street, who is a constituent of my own. The effect will be to deprive the British Revenue of the profit derived from the passage of these old instruments through the country. I venture to urge upon the right hon. Gentleman that no surrender of principle in involved in making this concession to a business which in the past has been eminently profitable to this country, nor is any surrender of revenue from the duties involved; and the right hon. Gentleman, without involving any evil consequences of any conceivable kind, might well meet these merchants and give them this concession. America, the greatest Protectionist country in the world, has removed the tariff against the entry of these old instruments, and, if she can open her arms to receive these treasures in perpetuity, surely we can open our borders merely to permit their passage, and, incidentally, the accretion of considerable revenue to our own resources.

Sir R. HORNE

I am sure that the constituent to whom the hon. Member has referred will feel that his case has received full justice in the speech to which we have just listened. I hope that the hon. Member will forgive me if I answer it in a single sentence. The answer is the same answer which was given by the author of these duties, Mr. McKenna. He said that the duties were luxury duties, and that, if there were anything that could be described as a luxury, it was a particularly valuable violin. On that ground he refused to consider their withdrawal.

Mr. KILEY

The Chancellor of the Exchequer has omitted to deal with the point raised by my hon. Friend (Mr. Mosley) with regard to a drawback or rebate when these goods are sent out of the country. That was really the principal point upon which my hon. Friend dwelt. I rise, not so much to support the Amendment, as to ask the Chancellor of the Exchequer whether he could not reconsider at some later stage the effect of these duties on violins as a whole. Take the case of a musician who earns his living by playing in an orchestra. He is taxed to the extent of 33⅓ per cent. on every violin or string that he uses.

The CHAIRMAN

This Amendment only applies to violins of a particular age or of a particular value.

Mr. KILEY

I was dealing with the strings. Whether they are on toy violins, on which the Chancellor of the Exchequer takes his toll of 33⅓ per cent.—

The CHAIRMAN

We cannot deal with that on this Amendment, which is very restricted in its scope.

Mr. KILEY

I submit, with all respect, that there is a duty on violin strings, and whether those strings are on an instrument worth £50 or £150, or whether they are on a toy violin which costs eighteen-pence, there is still a duty to be paid on the strings. However, I will not pursue that.

The CHAIRMAN

The hon. Member could have dealt with that in a separate proviso, but we cannot now discuss it.

Sir MARTIN CONWAY

I had expected that the Chancellor of the Exchequer would have seen his way to accept this Amendment. I should not have risen had it not been for the reason that he gave for not doing so. Against that I feel bound to protest. The right hon. Gentleman spoke of a violin as a luxury, but he is entirely and absolutely misinformed if he thinks that that is the case. A cheap violin is certainly not a luxury, and a Stradivarius or a violin by some other of the old and best makers is not a luxury. The right hon. Gentleman might just as well speak of a picture by Raphael or Velasquez, or any work of art, as a luxury. Why does civilisation exist except to produce works of art? It is the only ultimate value that the whole of civilisation has. All that we talk about and do in this House in the way of legislation for industries of different kinds, labour, profits, and all the rest—all of it ultimately eventuates in works of art. That is the only thing for which civilisation exists. An old violin is one of the finest works of art that can be imagined. The Government in its entirety should go to the port to receive it and bring it to London. There is nothing more magnificent in the world than these splendid old violins, and yet you try to keep them out of the country. The thing is an absurdity. You ought to welcome them; you ought to give a bounty rather than levy a duty upon them. I think that the attitude of the Chancellor of the Exchequer, if he will forgive me for saying so, is one that he must have taken up without due reflection. I trust that he may see his way, if not now, later on, to reverse the decision which in a hasty moment he has been led to take, and to admit these treasures into the country free of duty—not merely in the case of old violins, but in every case in which an object of supreme and extraordinary beauty and value is a national asset which we ought to be delighted to take. When you talk about them as a luxury, it must be remembered that one of these beautiful old violins, in the hands of a real performer, is a potentiality of immense value of the highest kind to vast numbers of people. It will develop their sense of beauty, will render them content amidst the miseries through which we have to pass in these evil days, and will in every way add to the health and happiness of the people. Therefore, I trust that the right hon. Gentleman will see his way to reverse his decision upon this point.

Mr. INSKIP

There is one reason which the hon. Member (Mr. Mosley) did not give in support of the Amendment. That is that it would have been very profitable to certain persons in this country and would have brought large sums of money into the country. There is in some countries an industry which produces violins which appear to be 100 years old or more. The instruments produced by these expert people are excellent counterfeit instruments. When they are brought to this country, a Customs official in gold lace will examine each of them, and, with the assistance of the New Bond Street emporium, he would say that it is 100 years old. It will then be admitted free of duty, and will have a certificate given by the gentleman in gold lace at the Customs wharf; and it will then be sold to America guaranteed by the British Customs as 100 years old. Having been brought from the gentleman who made it in Italy, it will produce a very large sum in profit, upon which a large Income Tax will be payable by the New Bond Street emporium. That is an excellent argument, of which I make the hon. Member a present, in favour of the. Amendment.

Mr. T. THOMSON

Notwithstanding the ridicule which the hon. and learned Member (Mr. Inskip) has attempted to throw on this Amendment, I submit that, whatever our definition of a luxury may be, the reply of the Chancellor of the Exchequer did not meet the very strong logical case in support of the Amendment. The point, surely, was that these instruments were coming in, not for sale or use here, but for the purpose of a process of manufacture. They were bought in Austria as raw material, as it were, for the manufacturer here. That is the fundamental fallacy of so much of this protective legislation. The manufactured article of one trade is the raw material of another. These violins, to the manufacturer who employed, a large number of people, were the raw material upon which his work was done. A large amount of labour was spent upon them, providing a considerable amount of employment. Surely, at a time like this, when only yesterday we had the claims of unemployment so much before us—[Interruption]. Notwithstanding the interruptions, I submit that this instance, although it may be a small one, illustrates the viciousness of the whole of this legislation which is restricting the export and import trade of this country. Anything that will remove the difficulties which this legislation imposes ought to receive the support of the Committee.

Amendment negatived.

Question put, "That the Clause stand part of the Bill."

The Committee divided: Ayes, 181; Noes, 72.

Division No. 171.]	AYES.	[7.34 p.m.
Addison, Rt. Hon. Dr. Christopher	Gardiner, James	Ormsby-Gore, Hon. William
Agg-Gardner, Sir James Tynte	Gee, Captain Robert	Palmer, Brigadier-General G. L.
Allen, Lieut.-Colonel William James	Gibbs, Colonel George Abraham	Parker, James
Ashley, Colonel Wilfrid W.	Gilbert, James Daniel	Pearce, Sir William
Bagley, Captain E. Ashton	Gilmour, Lieut.-Colonel Sir John	Pease, Rt. Hon. Herbert Pike
Baird, Sir John Lawrence	Goulding, Rt. Hon. Sir Edward A.	Peel, Col. Hn. S. (Uxbridge, Mddx.)
Balfour, George (Hampstead)	Gray, Major Ernest (Accrington)	Percy, Lord Eustace (Hastings)
Balfour, Sir R. (Glasgow, Partick)	Green, Albert (Derby)	Perkins, Walter Frank
Barlow, Sir Montague	Greenwood, William (Stockport)	Pollock, Sir Ernest Murray
Barnston, Major Harry	Harris, Sir Henry Percy	Pratt, John William
Barrand, A. R.	Henry, Denis S. (Londonderry, S.)	Prescott, Major W. H.
Bell, Lieut.-Col. W. C. H. (Devizes)	Herbert, Col. Hon. A. (Yeovil)	Pretyman, Rt. Hon. Ernest G.
Bellairs, Commander Carlyon W.	Herbert Dennis (Hertford, Watford)	Purchase, H. G.
Betterton, Henry B.	Holbrook, Sir Arthur Richard	Rawlinson, John Frederick Peel
Bigland, Alfred	Hood, Joseph	Reid, D. D.
Birchall, Major J. Dearman	Hope, Sir H.(Stirling & Cl'ckm'nn,W.)	Richardson, Alexander (Gravesend)
Bird, Sir A. (Wolverhampton, West)	Hopkins, John W. W.	Rodger, A. K.
Bird, Sir William B. M. (Chichester)	Horne, Sir R. S. (Glasgow, Hillhead)	Roundell, Colonel R. F.
Blair, Sir Reginald	Hotchkin, Captain Stafford Vere	Royds, Lieut.-Colonel Edmund
Borwick, Major G. O.	Hunter-Weston, Lieut.-Gen. Sir A. G.	Samuel, Samuel (W'dsworth, Putney)
Boscawen, Rt. Hon. Sir A. Griffith-	Hurd, Percy A.	Sanders, Colonel Sir Robert Arthur
Boyd-Carpenter, Major A.	Hurst, Lieut.-Colonel Gerald B.	Sassoon, Sir Philip Albert Gustave D.
Breese, Major Charles E.	Inskip, Thomas Walker H.	Scott, A. M. (Glasgow, Bridgeton)
Bridgeman, Rt. Hon. William Clive	Jackson, Lieut.-Colonel Hon. F. S.	Scott, Leslie (Liverpool, Exchange)
Brittain, Sir Harry	Jephcott, A. R.	Seager, Sir William
Buckley, Lieut.-Colonel A.	Jones, Sir Edgar R. (Merthyr Tydvil)	Shaw, Capt. William T. (Forfar)
Bull, Rt. Hon. Sir William James	Jones, J. T. (Carmarthen, Llanelly)	Simm, M. T.
Burn, Col. C. R. (Devon, Torquay)	Kellaway, Rt. Hon. Fredk. George	Sprot, Colonel Sir Alexander
Butcher, Sir John George	Kelley, Major Fred (Rotherham)	Stanier, Captain Sir Beville
Campbell, J. D. G.	Kidd, James	Stanley, Major Hon. G. (Preston)
Chamberlain, Rt. Hn. J. A. (Birm., W.)	King, Captain Henry Douglas	Stanton, Charles Butt
Chamberlain, N. (Birm., Ladywood)	Lane-Fox, G. R.	Steel, Major S. Strang
Churchman, Sir Arthur	Larmor, Sir Joseph	Stephenson, Lieut.-Colonel H. K.
Clough, Robert	Law, Alfred J. (Rochdale)	Stewart, Gershom
Coates, Major Sir Edward F.	Lewis, Rt. Hon. J. H. (Univ., Wales)	Sturrock, J. Leng
Coats, Sir Stuart	Locker-Lampson, Com. O. (H'tingd'n)	Sugden, W. H.
Cobb, Sir Cyril	Lorden, John William	Taylor, J.
Coote, Colin Reith (Isle of Ely)	Loseby, Captain C. E.	Thomson, F. C. (Aberdeen, South)
Cope, Major William	Lowther, Maj.-Gen. Sir C. (Penrith)	Thomson, Sir W. Mitchell- (Maryhill)
Cowan, Sir H. (Aberdeen and Kinc.)	Lyle, C. E. Leonard	Thorpe, Captain John Henry
Craig, Captain C. C. (Antrim, South)	M'Donald, Dr. Bouverie F. P	Tryon, Major George Clement
Craik, Rt. Hon. Sir Henry	Mackinder, Sir H. J. (Camlachie)	Turton, Edmund Russborough
Davies, Thomas (Cirencester)	McLaren, Robert (Lanark. Northern)	Walton, J. (York, W. R., Don Valley)
Davison, Sir W. H. (Kensington, S.)	M'Lean, Lieut.-Col. Charles W. W.	Ward, Col. J. (Stoke-upon-Trent)
Denniss, Edmund R. B. (Oldham)	McMicking, Major Gilbert	Warner, Sir T. Courtenay T.
Dewhurst, Lieut.-Commander Harry	McNeill, Ronald (Kent, Canterbury)	Watson, Captain John Bertrand
Dockrell, Sir Maurice	Macpherson, Rt. Hon. James I.	White, Col. G. D. (Southport)
Doyle, N. Grattan	Maitland, Sir Arthur D. Steel-	Willey, Lieut.-Colonel F. V.
Du Pre, Colonel William Baring	Malone, Major P. B. (Tottenham, S.)	Williams, C. (Tavistock)
Edwards, Major J. (Aberavon)	Marriott, John Arthur Ransome	Wise, Frederick
Elliot, Capt. Walter E. (Lanark)	Martin, A. E.	Wood, Hon. Edward F. L. (Ripon)
Eyres-Monsell, Com. Bolton M.	Meysey-Thompson, Lieut.-Col. E. C.	Wood, Sir H. K. (Woolwich, West)
Falle, Major Sir Bertram Godfray	Molson, Major John Elsdale	Worsfold, T. Cato
Farquharson, Major A. C.	Montagu, Rt. Hon. E. S.	Yate, Colonel Sir Charles Edward
Fell, Sir Arthur	Moreing, Captain Algernon H.	Yeo, Sir Alfred William
FitzRoy, Captain Hon. Edward A.	Morrison, Hugh	Young, E. H. (Norwich)
Flannery, Sir James Fortescue	Morrison-Bell, Major A. C.	Young, Sir Frederick W. (Swindon)
Ford, Patrick Johnston	Murray, John (Leeds, West)	Younger, Sir George
Forrest, Walter	Murray, William (Dumfries)
Foxcroft, Captain Charles Talbot	Neal, Arthur	TELLERS FOR THE AYES —
Fraser, Major Sir Keith	Newman, Sir R. H. S. D. L. (Exeter)	Colonel Leslie Wilson and Mr.
Gange, E. Stanley	Nicholson, Reginald (Doncaster)	Dudley Ward.
NOES.
Acland, Rt. Hon. Francis D.	Carter, W. (Nottingham, Mansfield)	Graham, R. (Nelson and Colne)
Adamson, Rt. Hon. William	Clynes, Rt. Hon. John R.	Graham, W. (Edinburgh, Central)
Asquith, Rt. Hon. Herbert Henry	Cowan, D. M. (Scottish Universities)	Griffiths, T. (Monmouth, Pontypool)
Barker, G. (Monmouth, Abertillery)	Davies, A. (Lancaster, Clitheroe)	Grundy, T. W.
Barnes, Major H. (Newcastle, E.)	Edwards, C. (Monmouth, Bedwellty)	Guest, J. (York, W.R., Hemsworth)
Benn, Captain Wedgwood (Leith)	Edwards, G. (Norfolk, South)	Hall, F. (York, W.R., Normanton)
Bowerman, Rt. Hon. Charles W.	Finney, Samuel	Hallas, Eldred
Brimfield, William	Galbraith, Samuel	Hartshorn, Vernon
Brown, James (Ayr and Bute)	Gillis, William	Hayday, Arthur
Cairns, John	Glanville, Harold James	Hayward, Evan
Henderson, Rt. Hon. A. (Widnes)	Mills, John Edmund	Spoor, B. G.
Hinds, John	Morgan, Major D. Watts	Swan, J. E.
Hirst, G. H.	Murray, Or. D. (Inverness and Ross)	Thomson, T. (Middlesbrough, West)
Hogge, James Myles	Myers, Thomas	Thorne, W. (West Ham, Plaistow)
Holmes, J. Stanley	Newbould, Alfred Ernest	Walsh, Stephen (Lancaster, Ince)
John, William (Rhondda, West)	O'Grady, James	Waterson, A. E.
Johnstone, Joseph	Parkinson, John Allen (Wigan)	White, Charles F. (Derby, Western)
Jones, J. J. (West Ham, Silvertown)	Rees, Capt. J. Tudor (Barnstaple)	Wignall, James
Kennedy, Thomas	Richardson, R. (Houghton-le-Spring)	Williams, Aneurin (Durham, Consett)
Kenyon, Barnet	Roberts, Frederick O. (W. Bromwich)	Wilson, Rt. Hon. J. W. (Stourbrdge)
Lawson, John James	Robertson, John	Wilson, W. Tyson (Westhoughton)
Lunn, William	Sexton, James	Young, Robert (Lancaster, Newton)
Maclean, Neil (Glasgow, Govan)	Short, Alfred (Wednesbury)
MacVeagh, Jeremiah	Sitch, Charles H.	TELLERS FOR THE NOES.—
Mallalieu, Frederick William	Spencer, George A.	Dr. Murray and Major Barnes.

Question, "That the Clause stand part of the Bill," put, and agreed to.

CLAUSES 2 (Continuation of increased medicine duties), 3 (Duty on sparkling wine), and 4 (Additional duty on cigars repealed), ordered to stand part of the Bill.