HC Deb 06 July 1926 vol 197 cc1979-99

I beg to move to leave out the Clause.

Captain BENN

On a point of Order. I am not quite clear if we have this Motion whether it will rule out the Amendment to which I have my name—to leave out the word "May" and insert "June"?

Mr. DEPUTY-SPEAKER (Mr. James Hope)

I understood that that was not going to be moved. Does the hon. and gallant Member wish to move it?

Captain BENN

It does not raise the general question of the Clause at all. It covers quite a small point, and I was asked to put it down on behalf of the London Chamber of Commerce in order to ask a question of the Chancellor of the Exchequer. That is my only purpose.


I hope the Amendment will be saved.


This is a Clause which extends the McKenna Duties to commercial motor cars. We only intend briefly to state our objections to it, and to take a Division. This extension of the duty to commercial motor cars contradicts every statement and every argument by which the Chancellor of the Exchequer supported the re-introduction of the McKenna Duties. His argument when he re-imposed these duties was, that they were duties of a purely luxury type, on articles of enjoyment and recreation simply, and that they would have no effect on the prices of manufactured articles. Now he has found himself in the position in which, in order to retain his luxury duties, he is compelled to place duties on articles which enter into practically every industry in the land and which affect the prices of practically every article produced in the country. Hon. Members opposite, in the last Debate, attempted to argue that this duty would have no effect on the price of commercial motor cars, but those trades that are going to use them have sent a protest to every Member of this House.

We have all had letters from the Farmers' Union who argue, and argue quite rightly, that as they are forbidden to have protection it is unjustifiable to ask them to pay this tribute to an industry whose prospects are far brighter than their own. The Chancellor of the Exchequer said it had nothing to do with Protection, but that the Customs House was put into certain difficulties in distinguishing between the parts of these cars and the parts of private cars, and the duty had therefore to be imposed. That argument justifies the objection we originally urged. If he now finds himself in a position in which he imposes duties on certain articles, and then finds that in order to retain those duties he is compelled to impose them on other articles, then his proper action is to withdraw these duties, instead of adding others. We quite know why he cannot do this. The reason is that this duty is supported by the hon. Members behind him on purely Protectionist grounds. The Chancellor of the Exchequer in the last Debate told us that these duties did not raise the issue of Protection or Free Trade but in every speech in which hon. Members behind him supported him, the speech was based on the grounds of sheer Protection. I was interested to follow the argument used by one hon. Member opposite, and it comes with greater and greater frequency from Conservative speakers—that if you propose a protective duty on, say, commercial motor cars, they obtain larger markets and manufacturers can work on a larger scale and bring down overhead charges, and thus reduce prices. That is the argument I hear over and over again with increasing frequency. So far as it is true that by producing on a larger scale manufacturers can lower prices, that is an argument not for Protection but for amalgamation. It is exactly the position that has arisen in the coal trade, and the very remedy the Government themselves are proposing is amalgamation. When other trades come forward with that argument our reply to them is, "Let them amalgamate," If they are not willing to amalgamate then they are not entitled for that reason to ask other industries to pay them a tribute in order to do what these industries ought to do for themselves, and for that reason I beg to move.


I beg to second the Amendment.

I think we can claim to say that we are not absolutely one-sided in connection with our views on this matter. On the last Clause that we were discussing we stated it would be a great relief to the poorer class. On this occasion we cannot claim that as a reason why we are bringing this forward, because it cannot be said that a large number of the poorer class use commercial cars or luxury cars or are concerned about the component parts of the car. Therefore, it ought to appeal to the people on the other benches—when they are there. It ought to appeal to those people on the Government side because they are the people mostly concerned in using the cars most mentioned in this Clause, either commercial or luxury. We usually find that they are not over-patriotic about using British cars, although they are concerned in advertising that British goods are best. We do see some of them using foreign cars, and naturally if they get the foreign-made cars they do want the component parts sometimes if they have got worn out. I therefore think the Chancellor of the Exchequer would be doing a good turn to some of his supporters if he would have this Clause deleted.

It is quite true that the users of commercial cars are beginning to wake up to what this duty means. I think nearly all the Members of the House have received circulars in connection with this matter, and it has not surprised me at all, because when the Chancellor brought forward this matter in his Budget proposals, I said that what we were going to impose on commercial vehicles would naturally be passed on, in increased charges. In the end, it is always the consumer who pays, and this duty will be passed on to such people, for example, as those who desire to remove their furniture. The removal contractors state that if this duty is to be imposed, to the extent proposed by the Chancellor of the Exchequer, they will have to increase their charges. Occasionally poor people have to move, whether they want to do so or not, and they will have to pay. In all the circumstances I think the right hon. Gentleman ought to agree to the deletion of this Clause, and thus help the people who use commercial vehicles instead of hampering them.


This appears to be a completely Protectionist Clause, and I want to try to persuade the Chancellor of the Exchequer to withdraw it. I may be able to do so, because the quotations which I propose to make come from one who, I am quite certain, the right hon. Gentleman has no desire to contradict. I have brought into the House with me a book. The Chancellor may not think himself a great man, but his portrait figures on the cover of this volume and the old phrase: Oh that mine adversary had written a book enters into this matter. The right hon. Gentleman looks much better in that picture than he does now.


We are all getting on.


It is not a question of age. I am taking other factors of difference into account as between the time when the right hon. Gentleman wrote his book and the present time. As a man thinks so he becomes, and the right hon. Gentleman is looking much better in that picture than he looks to-day. I wish to take some of his statements in this book in regard to the matters before the House. He says on page 33: Protective tariffs have warped and restricted the growth of the industries of the nations who have adopted them, and again, Protection will not stop unemployment. Then he goes on to give ample proof that the principle by which he stands today is absolutely wrong. Either he must tell the House that he was wrong then and is right now, or he must admit that he was right then and is wrong now.


The circumstances may have changed.


The circumstances have changed but have changed all in favour of the right hon. Gentleman having been right when he wrote this book. On page 133 he talks about the vagueness of a tariff and he writes: We catch a glimpse of its glittering skirts in the flourish of a peroration. We find some reference to it upon a half sheet of notepaper. It figures in the after-dinner speeches of irresponsible persons. We try to follow it through the cryptic pronouncements and laboured ambiguities of political leaders. We have it brought to our notice by the puffs and paragraphs and trial balloons of the inspired or semi-inspired or wholly imaginative Press. [HON. MEMBERS: "Is that Socialism?"] If hon. Members knew the political history of the country as they ought to-know it they would be acquainted with this book. If they wished to know about the political changes that have taken place they should learn what this book has to tell them. This Clause establishes the beginning of absolute full Protection. I do not wish to use all the arguments employed by the Chancellor of the Exchequer against that policy but I ask him to tell us whether he has altogether forsaken that which was the virtue of his youth and has gone completely astray?


I hold in very considerable respect the opinions which the hon. Gentleman has just quoted, and I should be very sorry if I found myself needlessly in collision with them at any time, but, after all, we must take cognisance of the march of events. If the so-called McKenna Duties, or any ancillary additions to the so-called McKenna Duties should be held to come into collision with any of the doctrines contained in that volume from which the hon. Gentleman has quoted, then it is perfectly well known that the friction began, not in this Budget nor in the last Budget, not in this Parliament nor in the last Parliament nor in the Parliament before that, but as early as the year 1915 or the beginning of 1916, when these duties were proposed by a Government headed by no less an authority and no more faithful an adherent of Free Trade than Lord Oxford himself. The duties are associated with the name of one of the greatest Free Trade authorities, Mr. McKenna, and were supported by the subsequent Coalition Government under the leadership of the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George). They were supported, not only by representatives of his party but also by representatives of the Labour party, who were officially represented in that Government. I, as a subordinate functionary, in those days naturally felt that I could not stand single-handed against all the parties in the State. If I am to be reproached, I can only say that I share my fault with three great parties in the State and the most eminent leaders of those parties.

We have reimposed the McKenna Duties for purposes of revenue. That was the sole object if had in view. It may well be that a duty imposed, sincerely and soundly, for one purpose may commend itself to other people because it happens incidentally, to achieve other objects, in themselves highly arguable at least, but possibly defensible.

The McKenna Duties, imposed solely for revenue purposes, were found to contain a curious gap in that certain commercial motors were found to have escaped, and the burden of this non-inclusion has thrown upon the Customs officials a difficulty, that of tracing the spare parts, etc. They have discovered how narrow, shifting and ambiguous was the line which divides the commercial use from the pleasure use of cars, and how impossible it was to track the original vehicle through all its phases and changes, and it has been felt that in the interests of simplification it was desirable to add this Clause on motor vehicles to keep in general line with the McKenna Duties. I have explained before that my reasons were twofold: administrative convenience and additional revenue. I have no other reason whatever. Those reasons are perfectly just and adequate. It may be that other hon. Members have other objects to the revenue produced by the taxes. I welcome, the support which I receive on any ground; in support of a policy which is in itself inherently and ineffaceably sound.

I myself do not believe in the present state of the commercial motor industry that the position of the users, in view of the comparatively small quantity of foreign cars that come into this counry, will be materially affected. Nor do I believe that the price of the home article will be affected in the way suggested. I believe that the competition in the British commercial motor trade is sufficiently keen and strong to keep the price down. It may even be in the case of a rapidly expanding industry that this new factor of being able to produce on a larger scale, and with a greater assurance of sale will have the effect of producing a cheaper article. It is not from the standpoint of tariffs or fiscal policy that I am introducing the duty but solely for the two perfectly good and sufficient reasons that I have already mentioned to the House. I should have thought that in view of the three or four occasions on which we have debated this matter that we would have exhausted the possibility of argument, and that we were not now likely to find any new argument which could be used. I could have hoped that we would have succeeded in these discussions in converting hon. and right hon. Gentlemen opposite to our proposals, but, at any rate, we hold the opinion that these duties should be imposed. We have debated the matter at length on Second Reading, in Committee, and now on Report. If, after all this labour and argument we are not yet in complete unity, I fear there is absolutely nothing for it but to carry the quarrel and the differences to the supreme arbitrament of a Division.

Captain BENN

In the speech which he has just delivered the Chancellor of the Exchequer has defended himself with what I may call, I hope without offence, a degree of shamelessness. He knows perfectly well that this tax is a protective tax, intended to be a protective tax. I do not agree with the hon. Member for Poplar (Mr. March) that the consumer is not going to pay this tax. I think when that hon. Gentleman spoke about commercial vehicles he intended to refer to luxury vehicles. All I was thinking of was the vehicle which carries round commodities for retail sale, which carries people to and from work; and in this respect it can be shown that the tax on this vehicle, like all protective taxes, is borne by the consumer, and mostly by the poorer consumer. It is quite well known that the importer pays the tax. If there is doubt about some things, there is no doubt about that. The fact of the matter is the right hon. Gentleman introduced this as Protection to please his Protectionist friends. He said the other night that no new arguments had been advanced, but he himself has defended this on an entirely new ground. He explained that the position had been brought about by the march of events—that march of events which leads him from one side to the other. He defends this tax on the grounds, first of all, that it is part of the McKenna Duties. It was never part of the McKenna Duties, and had nothing whatever to do with them. It was specifically excluded from the McKenna Duties. So far as that argument is concerned it has no bearing upon the matter. The right hon. Gentleman defended the McKenna Duties themselves on grounds that were absolutely false, and demonstrably false, and which had been repeatedly shown to be false in the Debates in this House.

After the War there was a Coalition Government composed of members of the Labour, Liberal and Conservative parties. There were Free Trade Members in it, and Protectionist Members. There was a shortage of tonnage. The Cabinet decided to impose the duties, the purpose of which, it was stated, was to restrict imports, and not to give protection to any industry—to restrict imports and particularly luxuries.


And to raise revenue!

Captain BENN

There were some who thought there was a danger of the duties being used for the purpose of introducing Protection into this country, but they, though they had qualms, had also patriotism, and they had the courage not to press their objections. Now the Chancellor is taking advantage of that. The argument he is using is not a very worthy one. In addition, however, to the Members of the Cabinet being patriotic they were also cautious, and the then Leader of the House, the late Mr. Bonar Law, when he introduced these duties—and when doubt was expressed from the back benches—used these words: These were duties which never in any circumstances would be kept on after the conclusion of the War. That being so, what becomes of the Chancellor's flimsy defence that this is merely carrying out the policy of the McKenna Duties, in which he himself took part—


And the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George).

Captain BENN

Yes, and it was a great error of judgment on my part if I omitted to mention him. He goes on to say that if when he is seeking revenue certain effects follow which please his supporters, why is he to be blamed for that? As long as he gets revenue he is justified. Suppose a proposal were brought forward to put a duty on wheat. Would the Chancellor of the Exchequer say, "As long as I can get revenue by putting a duty on wheat the fact that there are corollaries such as the protection of agriculture and a rise in the cost of the food of the people has nothing to do with me. I am merely a man seeking revenue. I have forsaken none of the principles which were set out in the volume quoted by my hon. Friend and so interestingly adorned on the cover." The fact is, these duties do mark a distinct departure. We know the Government are at heart Protectionists, and we know the party behind them are Protectionists, but never before have we had naked uncamouflaged Protection presented to us. This case will be quoted as the beginning of a policy which ultimately will land us in a general tariff, and even to-day, small and apparently unimportant as it is, it is a distinct violation of the pledge given by the Prime Minister.

Question put, "That the words proposed to be left out to the word 'May,' in page 2, line 22, stand part of the Bill."

The House divided: Ayes, 211; Noes, 120.

Division No. 327.] AYES. [8.27 p.m.
Agg-Gardner, Rt. Hon. Sir James T. Briscoe, Richard George Colfax, Major Wm. Phillips
Alexander, E. E. (Leyton) Brittain, Sir Harry Conway, Sir W. Martin
Allen, J. Sandeman (L'pool, W. Derby) Brocklebank, C. E. R. Cooper, A. Duff
Ashley, Lt.-Col. Rt. Hon. Wilfrid W. Brooke, Brigadier-General C. R. I. Cope, Major William
Astbury, Lieut.-Commander F. W. Brown, Col. D. C. (N'th'I'd., Hexham) Couper, J. B.
Balfour, George (Hampstead) Brown, Brig.-Gen. H. C. (Berks, Newb'y) Craig, Ernest (Chester, Crewe)
Barclay-Harvey, C. M. Burgoyne, Lieut.-colonel Sir Alan Crooke. J. Smedley (Deritend)
Barnston, Major Sir Harry Burman, J. B. Crookshank, Col. C. de W. (Berwick)
Beamish, Captain T. P. H. Burney, Lieut.-Com. Charles D. Crookshank, Cpt. H.(Lindsey,Gainsbro)
Beliairs, Commander Canlyon W. Burton, Colonel H. W. Cunliffe, Sir Herbert
Bennett, A. J Cadogan, Major Hon. Edward Curtis-Bennett, Sir Henry
Berry, Sir George Caine, Gordon Hall Dalkeith, Earl of
Bethel, A. Cassels, J. D. Davidson, Major-General Sir John H.
Betterton, Henry B. Cautley, Sir Henry S. Davies, Dr. Vernon
Birchall, Major J. Dearman Cayzer, Sir C. (Chester, City) Davies, Sir Thomas (Cirencester)
Bird, Sir R. B. (Wolverhampton, W.) Chadwick, Sir Robert Burton Dawson, Sir Philip
Blades, Sir George Rowland Charteris, Brigadier-General J. Drewe, C.
Blundell, F. N. Churchill, Rt. Hon. Winston Spencer Edmondson, Major A. J.
Boothby, R. J. G. Churchman, Sir Arthur C. Elliot, Major Walter E.
Bourne, Captain Robert Croft Clarry, Reginald George Ellis, R. G.
Bowyer, Captain G. E. W. Clayton G. C. Everard, W. Lindsay
Braithwaite, A. N. Cobb, Sir Cyril Falle, Sir Bertram G.
Briggs, J. Harold Cochrane, Commander Hon. A. D. Fanshawe, Commander G. D.
Fermoy, Lord Locker-Lampson, G. (Wood Green) Sanderson, Sir Frank
Fielden, E. B. Lougher, L. Shaw, R. G. (Yorks, W.R., Sowerby
Forestler-Walker, Sir L. Lucas-Tooth, Sir Hugh Vere Shaw, Lt.-Col. A. D. Mcl. (Renfrew, W)
Foxcroft, Captain C. T. Luce, Major-Gen. Sir Richard Harman Shaw, Capt. W. W. (Wilts, Westb'y)
Fraser, Captain Ian MacAndrew, Major Charles Glen Shepperson, E. W.
Frece, Sir Walter de Macdonald, Capt. P. D. (I. of W.) Simms, Dr. John M. (Co. Down)
Gadle, Lieut.-Colonel Anthony Macdonald, R. (Glasgow, Cathcart) Slangy, Major P. Kenyon
Galbraith, J. F. W. McDonnell, Colonel Hon. Angus Smith-Carington, Neville W.
Gault, Lieut.-Cot. Andrew Hamilton McLean, Major A. Somerville, A. A. (Windsor)
Gibbs, Col. Rt. Hon. George Abraham Macmillan, Captain H. Stanley, Hon. O. F. G. (Westm'eland)
Gilmour, Lt.-Col. Rt. Hon. Sir John Macnaghten, Hon. Sir Malcolm Steel, Major Samuel Strang
Glyn, Major R. G. C. McNeill, Rt. Hon. Ronald John Storry-Deans, R.
Goff, Sir Park Maitland, Sir Arthur D. Steel Stott, Lieut.-Colonel W. H.
Grenfell, Edward C. (City of London) Malone, Major P. B. Streatfeild, Captain S. R.
Grotrian, H. Brent. Margesson, Captain D. Stuart, Crichton-, Lord C.
Gunston, Captain D. W. Meller, R. J. Stuart, Hon. J. (Moray and Nairn)
Hall, Lieut.-Col. Sir F. (Dulwich) Merriman, F. B. Styles, Captain H. Waiter
Hammerstey, S. S. Meyer, Sir Frank Sugden, Sir Wilfrid
Hannon, Patrick Joseph Henry Milne, J. S. Wardlaw- Templeton, W. P.
Harland, A. Mitchell, S. (Lanark, Lanark) Thom, Lt.-Col. J. G. (Dumbarton)
Harmsworth, Hon. E. C. (Kent) Mitchell, W. Foot (Saffron Walden) Thomson, F. C. (Aberdeen, S.)
Harvey, Major S. E. (Devon, Totnes) Monsell, Eyres, Com. Rt. Hon. B. M. Tinne, J. A.
Haslam, Henry C. Moreing, Captain A. H. Titchfield, Major the Marquess of
Henderson, Lieut.-Col. V. L. (Bootie) Morrison-Bell, Sir Arthur Clive Tryon, Rt. Hon. George Clement
Hennessy, Major J. R. G. Nall, Lieut.-Colonel Sir Joseph Turton, Sir Edmund Russborough
Hills, Major John Waller O'Connor, T. J. (Bedford, Luton) Vaughan-Morgan, Col. K. P.
Hope, Capt. A. O. j. (Warw'k, Nun.) Oman, Sir Charles William C. Waddington, R.
Hope, Sir Harry (Forfar) Pennefather, Sir John Wallace, Captain D. E.
Hopkins, J. W. W. Percy, Lord Eustace (Hastings) Warrender, Sir Victor
Hopkinson, Sir A. (Eng. Universities) Perkins, Colonel E. K. Waterhouse, Captain Charles
Horlick, Lieut.-Colonel J. N. Perring, Sir William George Watson, Sir F. (Pudsey and Otley)
Howard, Captain Hon. Donald Pielou, D. P. Watson, Rt. Hon. W. (Carlisle)
Hudson, R. S. (Cumberl'nd, Whiteh'n) Pilditch, Sir Philip Watts, Dr. T.
Hume, Sir G. H. Preston, William Wells, S. R.
Hunter-Weston, Lt.-Gen. Sir Aylmer Price, Major C. W. M. Wheler, Major Sir Granville C. H.
Huntingfield, Lord Radford, E. A. Williams, Com. C. (Devon, Torquay)
Hurd, Percy A. Raine, W. Williams, Herbert G. (Reading)
Hurst, Gerald B. Ramsden, E. Wilson, R. R. (Stafford, Lichfield)
Hutchison, G.A. Clark(Midl'n & P'bl's) Rawson, Sir Cooper Winterton, Rt. Hon. Earl
Jacob, A. E. Rees, Sir Beddoe Wise, Sir Fredric
James, Lieut.-Colonel Hon. Cuthbert Remer, J. R. Womersley. W. J.
Jephcott, A. R. Rentoul, G. S. Wood, E. (Chest'r, Stalyb'ge & Hyde)
Jones, G. W. H. (Stoke Newington) Rice, Sir Frederick Worthington-Evans, Rt. Hon. Sir L.
Kennedy, A. R. (Preston) Roberts, E. H. G. (Flint) Wragg, Herbert
Kidd, J. (Linlithgow) Ropner, Major L.
Kindersley, Major Guy M. Russell, Alexander West (Tynemouth) TELLERS FOR THE AYES.—
King, Captain Henry Douglas Rye, F. G. Captain Viscount Curzon and
Lister, Cunliffe-, Rt. Hon. Sir Philip Samuel, A. M. (Surrey, Farnham) Lord Stanley.
Little, Dr. E. Graham Sandeman, A. Stewart
Adamson, Rt. Hon. W. (Fife, West) Gibbins, Joseph Lee, F.
Alexander, A. V. (Sheffield, Hillsbro') Gillett, George M. Lindley, F. W.
Ammon, Charles George Gosling, Harry Livingstone, A. M.
Attlee, Clement Richard Graham, D. M. (Lanark, Hamilton) Lunn, William
Baker, J. (Wolverhampton, Bilston) Graham, Rt. Hon. Wm. (Edin., Cent.) Maclean, Neil (Glasgow, Govan)
Barker, G. (Monmouth, Abertillery) Greenall, T. March, S.
Barr, J. Greenwood, A. (Nelson and Coine) Mitchell, E. Rosslyn (Paisley)
Batey, Joseph Grenfell. D. R (Glamorgan) Montague, Frederick
Benn, Captain Wedgwood (Leith) Groves, T. Morris, R. H.
Bowerman, Rt. Hon. Charles W. Grundy, T. W. Murnin, H.
Broad, F. A. Hall, F. (York, W.R., Normanton) Oliver, George Harold
Bromfield, William Hall, G. H. (Merthyr Tydvil) Palin, John Henry
Bromley, J. Hardie, George D. Paling, W.
Brown, James (Ayr and Bute) Heyday, Arthur Parkinson, John Allen (Wigan)
Buchanan, G. Hayes, John Henry Pethick-Lawrence, F. W.
Buxton, Rt. Hon. Noet Henderson, Rt. Hon. A. (Burnley) Ponsonby, Arthur
Charleton, H. C. Henderson, T. (Glasgow) Potts, John S.
Clowes, S. Hirst, G. H. Purcell, A. A.
Clase, W. S. Hirst, W. (Bradford, South) Richardson, R. (Houghton-le-Spring)
Clynes, Right Hon. John R. Hudson, J. H. (Huddersfield) Riley, Ben
Collins, Sir Godfrey (Greenock) Jenkins, W. (Glamorgan, Neath) Salter, Or. Alfred
Compton, Joseph John, William (Rhondda, West) Scrymgeour, E.
Cove, W. G. Johnston, Thomas (Dundee) Scurr, John
Cowan, D M. (Scottish Universities) Jones, Henry Haydn (Merianeth) Shaw, Rt. Hon. Thomas (Preston)
Dalton, Hugh Jones, Morgan (Caerphilly) Short, Alfred (Wednesbury)
Davies, Rhys John (Westhoughton) Jones, T. I. Mardy (Pontypridd) Sinclair, Major Sir A. (Caithness)
Day, Colonel Harry Kelly, W. T. Sitch, Charles H.
Dennison. R. Kennedy, T. Smillie, Robert
Duncan, C Kirkwood, D Smith, Ben (Bermondsey, Rotherhithe)
Dunnico, H. Lansbury, George Smith, H. B. Lees (Keighley)
Forrest, W. Lawrence, Susan Smith, Rennie (Penistone)
Gardner, J. P. Lawson, John James Snell, Harry
Snowden, Rt. Hon. Philip Tinker, John Joseph Wilkinson, Ellen C.
Spencer, G. A. (Broxtowe) Townend, A. E. Williams, C. P. (Denbigh, Wrexham)
Stamford, T. W. Viant, S. P. Williams, David (Swansea, E.)
Stephen, Campbell Wallhead, Richard C. Williams, Dr. J. H. (Llanelly)
Stewart, J. (St. Roflox) Walsh, Rt. Hon. Stephen Williams, T. (York, Don Valley)
Sullivan, J. Watson, W. M. (Dunfermline) Wilson, R. J. (Jarrow)
Sutton, J. E. Webb, Rt. Hon. Sidney
Thorne, G. R. (Wolverhampton, E.) Welsh, J. C. TELLERS FOR THE NOES —
Thurtle, E. Wiggins, William Martin Mr. Charles Edwards and Mr. A. Barnes.

I beg to move, in page 2, line 22, to leave out the word "May" and to insert instead thereof the word "June."

This is not an Amendment which covers a wide area but is one which must impress itself on the Government as offering the opportunity for making a valuable concession. The effect of the Budget Resolutions now made statutory by the Clause we are discussing, is that people who had chassis, whether assembled or to be assembled, on order, to arrive here, say, in the first fortnight in May are going to be severely handicapped. I have seen correspondence from some firms, small firms especially, from which it appears that they will be faced not merely with immediate financial loss but possible bankruptcy because of the cancellation of orders. It has been said that this proposal is not likely to raise the price of commercial cars, but that is a very curious argument for the Chancellor of the Exchequer to use. I have seen communications from him which were sent to a representative of the Chamber of Commerce who asked for some consideration in regard to this duty in which it was stated that where the effect of the duty on imported chassis was such as to preclude their sale and involve the importer in loss, he would have the right under the Act of 1901 to claim the amount of that duty as an extra from his customer. Yet the Chancellor of the Exchequer said that this duty was not calculated to increase the price.

In the case of people involved in a loss of this kind I want to point out that it is a well-known fact in the trade that where a contract has been made for the purchase of a vehicle of this character it is generally on the basis of there being an option on the part of the customer to cancel the contract if within seven days there should be an increase of price not contemplated when the contract was entered into. There is nothing in the Act of 1901 which would enable the importer of commercial chassis during the first month of the operation of this duty to recoup himself against his losses. I cannot imagine the party opposite wishing to see any serious damage done to trade by the operation of this duty. I have seen the actual correspondence from some firms who fear that they are quite likely to be faced with bankruptcy on account of the losses they will incur by the operation of this duty. Probably the Financial Secretary to the Treasury and hon. Members opposite would desire to see this duty put on at the very earliest date for Protectionist reasons, but the date is now past, and there would be no possible effect on future imports by putting the date back from the 1st May to the 1st June, so that the people who have been involved in losses, without notice, in the case of orders contracted before the Budget statement might be put into a position of being able to carry on their business. I think that is a reasonable request, and I am hoping the Treasury will see their way to grant it. I am well aware that a large number of people in the trade, whether they deal in cars, chassis or other commodities, are bound to experience great inconvenience and loss by changes in the tariff once you begin to fiddle about with your fiscal system, but we are not making that point on this Amendment. We are simply asking for a concession of a month in order that those adversely affected may be able to put themselves four square.


I beg to second this Amendment.


The hon. Gentleman who moved this Amendment rather challenged me to say whether I thought that this proposal would inflict serious injury upon trade. I do not think it is necessary to assure him that those sitting on this side of the House have no such desire. On the contrary, any adjustment of taxation or any change which could be made consistently with the principle of the tax itself, and which would have the effect of improving matters as regards trade, is something which we are inclined to support. It does not follow that because the hon. Member who moved this Amendment was able to quote instances which have been brought to his notice of the inconvenience caused by the actual imposition of a duty of this sort that it is not consistent with the scheme of taxation adopted by the Government and the House to make the particular changes, adjustments or easements to meet the instances he has in mind. The hon. Member pointed out that a trader has a right under the existing law to recoup himself when, unbeknown to him, a duty was imposed, and in order to protect him from loss he has a right under these circumstances to add to the contract price what will recoup him. The hon. Member brings that forward as a proof of the general proposition that the effect of any duty must be to increase the price of the article.

In this matter you cannot lay down any definite lines, because such a thing might happen in some cases and not in others. It is evident from what the hon. Member has said that the importer cannot suffer damage from the duty coming on after he has made his contract. I do not agree that in the cases which the hon. Member has in mind the result under the existing law would involve any serious loss, and probably there would be no loss at all. I venture to say that the traders who used the word "bankruptcy" in talking to the hon. Gentleman opposite were unduly pessimistic as to the effect of this duty. The hon. Member for Hillsborough (Mr. A. V. Alexander) spoke of what he describes as "fiddling about with your fiscal system." I suppose the hon. Member only means a variation of taxation. I suppose the hon. Member would describe any variation of taxation as a fiddling about with your fiscal system. If you take a penny off the Income Tax or put a penny on or even adjust the Death Duties, the hon. Member would say that we were fiddling about with our fiscal system. There is no doubt that there must be a certain amount of inconvenience to those who are affected by the fiddling or the variation. In these circumstances it is not reasonable for the hon. Member to expect, and I do not think he does expect, that we should make a very serious inroad into the change which we are proposing, and which the Committee has already accepted. We cannot be expected to make a very serious inroad into that for no stronger reason than the hon. Member has brought to our notice.

I cannot say exactly what loss of revenue it would involve, but there would be some loss, and it would mean very serious inconvenience and difficulty in regard to machinery, because it would be necessary to separate from other importations the articles which have been imported during the month which the hon. Gentleman wants to take out, and I am advised that it would be very difficult and inconvenient—I do not say it would be impossible—to carry out that process. It has a still greater disadvantage. It would be a very bad precedent, and it would be practically a precedent which we should be obliged to follow in any future "fiddling with our fiscal system." I expect that in years to come a great deal of that will be done, and by no one more than by the party opposite, and it would be a very serious precedent to set, because, at any time when a duty of any sort was imposed, all that importers would have to do would be to bring in large quantities of goods on the speculation that, on the precedent which we should have accepted here, the date of imposition of the tax would be altered in order to exclude, over a certain period, goods that might have been presumed to be under way or under contract before the duty was imposed. That would be a very unfortunate thing for us to do, and, as I do not see that any sufficiently strong reason has been given to show that there is any real grievance, I must ask the House not to agree to the Amendment.

9.0 P.M.

Captain BENN

There is no question here of discussing any general principle. We are not talking about the merits of a tariff, or the ultimate incidence of taxation, but about a real commercial difficulty and hardship which threatens great injury to some importing firms. It is not a vague case, but a specific case, and I will give the right hon. Gentleman one example—no doubt there are others. I shall be happy to give him the names if he wishes. We are not concerned here with anticipatory dumping. There can be no question of anticipatory dumping, because the tax was fixed as from the 1st May, and became operative on the date on which it was announced. We are, therefore, dealing with a specific injury which may be done to traders, and I am sure the right hon. Gentleman has no desire either to put traders into bankruptcy or to do any unnecessary damage to any trading concern. The case to which I refer is that of an importer who has 33 commercial chassis in transit from New York, 20 in one ship and 13 in another. They were sold to him under a contract which would have left him a net profit of £40 per chassis. He will now be called upon to pay £110 in tax, and will, therefore, lose £70 on each vehicle. He alleges further that he is going to lose £1,000, and he says that this may drive him out of this importing business, and he will cease to be a contributor to the right hon. Gentleman's taxes. The right hon. Gentleman, surely, does not want that to happen. There is no party division here; it is purely a question of doing an injury to one man, or perhaps 20, or perhaps 50—I do not know. We sacrifice nothing; we assail no principle; we merely ask the right hon. Gentleman to make arrangements such as he has often made before in order to save firms in these matters. I have here a copy of an Order relating to gas mantles and cutlery, where the date was adjusted in order to cover goods in transit to this country.

The right hon. Gentleman has really only one reply in substance. He says that in Section 10 of the Act of 1901 power is given to a firm to add to the purchaser's price the additional duty, and the purchaser, no doubt, will pass it on to the consumer, so that no one will be damnified in the long run. But, in the contract between this man who is importing and his purchaser there is a stipulation that, in case of a rise in price from any cause, the purchaser will have a 10 days' right to cancel the contract. Therefore, this man may be in the position—and that is what he fears—of finding his contract for these 33 vehicles cancelled, in which case he will have to bear the cost, namely, £55 per vehicle, of sending them back to New York. I venture to suggest that I have made out a case which is deserving of careful consideration, and I hope the right hon. Gentleman, even now, will see his way to do in this Clause what he has often done in connection with tax-collecting machinery before, namely, to make such an adjustment that unnecessary harm is not inflicted on people who are trying to carry on their business, and who are quite willing to pay any tax that may be legitimately levied.

Question put, "That the word 'May' stand part of the Bill."

The House divided: Ayes, 214; Noes, 127.

Division No. 328.] AYES. [9.3 p.m.
Acland-Troyte, Lieut.-Colonel Butt, Sir Alfred Dawson, Sir Philip
Agg-Gardner, Rt. Hon. Sir James T. Cadogan, Major Hon. Edward Drewe, C.
Alexander, E. E. (Leyton) Caine, Gordon Hall Edmondson, Major A. J.
Allen, J. Sandeman (L'pool, W. Derby) Cassels, J D. Edwards, J. Hugh (Accrington)
Ashley, Lt.-Col. Rt. Hon. Wilfrid W. Cautley, Sir Henry S. Elliot, Major Walter E.
Astbury, Lieut.-Commander F. W. Cayzer, Sir C. (Chester, City) Ellis, R. G.
Balfour, George (Hampstead) Chadwick, Sir Robert Burton England, Colonel A.
Barclay-Harvey, C. M. Charteris, Brigadier-General J. Everard, W. Lindsay
Barnston, Major Sir Harry Churchman, Sir Arthur C. Falle, Sir Bertram G.
Beamish, Captain T. P. H. Clarry, Reginald George Fanshawe, Commander G. D.
Bennett, A. J. Clayton, G. C. Fermoy, Lord
Berry, Sir George Cobb. Sir Cyril Fielden, E. B.
Bethel, A. Cochrane, Commander Hon. A. D. Forestier-Walker, Sir L.
Betterton, Henry B. Colfox, Major Wm. Phillips Foster, Sir Harry S.
Birchall, Major J. Dearman Conway, Sir W. Martin Foxcroft, Captain C. T.
Bird, Sir R. B. (Wolverhampton, W.) Cooper, A. Duff Fraser, Captain Ian
Blades, Sir George Rowland Cope, Major William Frece, Sir Walter de
Blundell, F. N. Cooper, J. B. Gadie, Lieut.-Col. Anthony
Boothby, R. J. G. Courtauld, Major J. S. Galbraith, J. F. W.
Bourne, Captain Robert Croft Cowan, Sir Wm. Henry (Islingtn. N.) Gault, Lieut.-Col. Andrew Hamilton
Braithwaite, A. N. Craig, Ernest (Chester, Crewe) Gibbs, Col. Rt. Hon. George Abraham
Briggs, J. Harold Crooke, J. Smedley (Deritend) Gilmour, Lt.-Cal. Rt. Hon. Sir John
Briscoe, Richard George Crookshank, Col. C. de W. (Berwick) Glyn, Major R. G. C.
Brocklebank, C. E. R. Crookshank, Cpt. H.(Lindsey,Galnsbro) Goff, Sir Park
Brooke, Brigadier-General C. R. I. Cunliffe, Sir Herbert Grenfell, Edward C. (City of London)
Brown, Col. D. C. (N'th'I'd., Hexham) Curtis-Bennett, Sir Henry Grotrian, H. Brent
Brown, Brig.-Gen. H.C.(Berks, Newb'y) Dalkeith, Earl of Gunston, Captain D.
Burgoyne, Lieut.-Colonel Sir Alan Dalziel, Sir Davison Hall, Lieut.-Col. Sir F. (Dulwich)
Burman, J. B. Davidson, Major-General Sir John H. Hammersley, S. S.
Burney, Lieut.-Com. Charles D. Davies, Dr. Vernon Hannon, Patrick Joseph Henry
Burton, Colonel H. W. Davies, Sir Thomas (Cirencester) Harland, A.
Harmsworth, Hon. E. C. (Kent) Margesson, Captain D. Smith-Carington, Neville W.
Harrison, G. J. C. Meller. R. J. Somerville, A. A. (Windsor)
Harvey, Major S. E. (Devon, Totnes) Merriman, F. B. Stanley, Lord (Fylde)
Haslam, Henry C. Meyer, Sir Frank Stanley, Hon. O. F. G.(Westm'eland)
Henderson, Lieut.-Col. V. L. (Bootie) Milne, J. S. Wardlaw- Steel, Major Samuel Strang
Hennessy, Major J. R. G. Mitchell, S. (Lanark, Lanark) Storry-Deans, R.
Herbert, S. (York, N.R.,Sear. & Wh'by) Monsell, Eyres, Com. Rt. Hon. B. M. Stott, Lieut.-Colonel W. H.
Hope, Capt. A. O. J. (Warw'k, Nun.) Moreing, Captain A. H. Streatfeild, Captain S. R.
Hope, Sir Harry (Forfar) Morrison-Bell, Sir Arthur Clive Stuart, Crichton-, Lord C.
Hopkins, J. W. W. Nall, Lieut.-Colonel Sir Joseph Stuart, Hon. J. (Moray and Nairn)
Hopkinson, Sir A. (Eng. Universities) Neville, R. J. Styles, Captain H. Walter
Hopkinson, A. (Lancaster, Mossley) O'Connor, T. J. (Bedford, Luton) Sugden, Sir Wilfrid
Horlick, Lieut.-Colonel J. N. Oman, Sir Charles William C. Templeton, W. P.
Howard, Captain Hon. Donald Pennefather, Sir John Thom, Lt.-Col. J. G. (Dumbarton)
Hudson, R. S. (Cumberl'nd, Whiteh'n) Percy, Lord Eustace (Hastings) Thomson, F. C. (Aberdeen, South)
Hume, Sir G. H. Perkins, Colonel E. K. Tinne, J. A.
Hunter-Weston, Lt.-Gen. Sir Aylmer Perring, Sir William George Titchfieid, Major the Marquess of
Huntingfield, Lord Pielou, D. P. Tryon, Rt. Hon. George Clement
Hurd, Percy A. Pilditch, Sir Philip Turton, Sir Edmund Russborough
Hurst, Gerald B. Preston, William Vaughan-Morgan. Col. K. P.
Hutchison, G. A. Clark (Midl'n & P'bl's) Price, Major C. W. M. Waddington, R.
Jackson, Sir H. (Wandsworth, Cen'l) Radford, E. A. Wallace, Captain D. E.
Jacob, A. E. Raine, W. Warrender, Sir Victor
James, Lieut.-Colonel Hon- Cuthbert Ramsden, E. Waterhouse, Captain Charles
Jephcott, A. R. Rawson, Sir Copper Watson, Sir F. (Pudsey and Otley)
Kennedy, A. R. (Preston) Rees, Sir Beddoe Watson, Rt. Hon, W. (Carlisle)
Kidd, J. (Linlithgow) Remer, J. R. Watts, Dr. T.
Kindersley, Major Guy M. Rice, Sir Frederick Wells, S. R.
King, Captain Henry Douglas Roberts, E. H. G. (Flint) Wheler, Major Sir Granville C. H.
Little, Dr. E. Graham Ropner, Major L. Williams, Com. C. (Devon, Torquay)
Locker-Lampson, G. (Wood Green) Russell, Alexander West (Tynemouth) Williams, Herbert G. (Reading)
Lougher, L. Rye, F. G. Wilson, R. R. (Stafford, Lichfield)
Lucas-Tooth, Sir Huth Vere Samuel, A. M. (Surrey, Farnham) Winterton, Rt. Hon. Earl
Luce, Maj.-Gen. Sir Richard Harman Sandeman, A. Stewart Wise, Sir Fredric
MacAndrew, Major Charles Glen Sanderson, Sir Frank Womersley, W. J.
Macdonald, Capt. P. D. (I. of W.) Shaw. R. G. (Yorks, W.R., Sowerby) Wood, E. (Chest'r, Stalyb'ge & Hyde)
Macdonald, R. (Glasgow, Cathcart) Shaw, Lt.-Col. A. D. Mcl. (Renfrew, W) Wragg, Herbert
McDonnell, Colonel Hon. Angus Shaw, Capt. W. W. (Wilts, Westb'y)
McLean, Major A. Sheffield, Sir Berkeley TELLERS FOR THE AYES.—
Macnaghten, Hon. Sir Malcolm Shepperson, E. W. Captain Bowyer and Captain
McNeill, Rt. Hon. Ronald John Simms, Dr. John M. (Co. Down) Viscount Curzon.
Malone, Major P. B. Slaney, Major P. Kenyon
Adamson, Rt. Hon. W. (Fife, West) Graham. Rt. Hon. Wm. (Edin., Cent.) Morris, R. H.
Alexander, A. V. (Sheffield, Hillsbro) Greenall, T. Murnin, H.
Ammon, Charles George Greenwood, A. (Nelson and Colne) Naylor, T. E.
Attlee, Clement Richard Grenfell, D. R. (Glamorgan) Oliver, George Harold
Baker, J. (Wolverhamlon, Bilstan) Groves, T. Palin, John Henry
Barker, G. (Monmouth, Abertillery) Grundy, T. W. Paling, W.
Barnes, A. Hall, F. (York, W.R. Normanton) Pethick-Lawrence, F. W.
Barr, J. Hall, G. H. (Merthyr Tydvil) Ponsonby, Arthur
Batey, Joseph Hardie, George D. Potts, John S.
Benn, Captain Wedgwood (Leith) Harris, Percy A. Purcell, A. A.
Bowerman, Rt. Hon. Charles W. Hayday, Arthur Richardson. R. (Houghton-le-Spring)
Broad, F. A. Hayes, John Henry Riley, Ben
Bromfield, William Henderson, Right Hon. A. (Burnley) Robinson, Sir T. (Lanes, Stretford)
Bromley, J. Henderson, T. (Glasgow) Runciman, Rt. Hon. Walter
Brown, James (Ayr and Bute) Hirst, G. H. Salter, Dr. Alfred
Buchanan, G. Hirst, W. (Bradford, South) Scrymgeour, E.
Buxton, Rt. Hon. Noel Hudson, J. H. (Huddersfield) Scurr, John
Charleten, H. C. Jenkins, W. (Glamorgan, Neath) Shaw, Rt. Hon. Thomas (Preston)
Clowes, S. John, William (Rhondda, West) Shepherd, Arthur Lewis
Cluse, W. S. Johnston, Thomas (Dundee) Short, Alfred (Wednesbury)
Clynes, Rt. Hon. John R. Jones, Henry Haydn (Merloneth) Sinclair, Major Sir A. (Calthness)
Compton, Joseph Jones, Morgan (Caerphilly) Sitch, Charles H.
Cove, W. G. Kelly, W. T. Slesser, Sir Henry H.
Cowan, D. M. (Scottish Universities) Kennedy, T. Smillie, Robert
Dalton, Hugh Kirkwood, D Smith, Ben (Bermondsey, Rotherhithe)
Davies, Evan (Ebbw Vale) Lansbury, George Smith, H. B. Lees (Keighley)
Davies, Rhys John (Westhoughton) Lawrence, Susan Smith, Rennie (Penistone)
Day, Colonel Harry Lawson, John James Snell, Harry
Dennison, R. Lee, F. Snowden, Rt. Hon. Philip
Duncan, C. Lindley, F. W. Spencer. G. A. (Broxtowe)
Dunnico, H. Livingstone, A. M. Stamford, T. W.
Forrest, W. Lowth, T. Stephen, Campbell
Gardner, J. P. Lunn, William Stewart, J. (St. Rollox)
Gibbins, Joseph Maclean, Neil (Glasgow, Govan) Sullivan, J.
Gillett, George M. March, S. Sutton, J. E.
Gosling, Harry Mitchell, E. Rosslyn (Paisley) Thorne, G. R. (Wolverhampton, E)
Graham, D. M. (Lanark, Hamilton) Montague, Frederick Thurtle, E.
Tinker, John Joseph Webb, Rt. Hon. Sidney Williams, T. (York, Don Valley)
Townend, A. E. Welsh, J. C. Wilson, R. J. (Jarrow)
Trevelyan, Rt. Hon. C. P. Wiggins, William Martin
Vlant, S. P. Wilkinson, Ellen C. TELLERS FOR THE NOES.—
Wallhead, Richard C. Williams, C. P. (Denbigh, Wrexham) Mr. Allen Parkinson and Mr.
Walsh, Rt. Hon. Stephen Williams, David (Swansea, East) Charles Edwards.
Watson, W. M. (Dunfermline) Williams, Dr. J. H. (Llanelly)