HC Deb 06 July 1926 vol 197 cc1925-31

As from the first clay of August, nineteen hundred and twenty-six, the Excise Duty chargeable under Section four of the Finance (New Duties) Act, 1916, as amended by Section eleven of the Finance Act, 1916. at the rate of eightpence per gallon on certain table waters known as unsweetened waters, and kept for sale in Great Britain and Northern Ireland, shall cease.—[Mr. B. Peto.]

Brought up, and read the First time.


I beg to move, "That the Clause be read a Second time."

Those duties were imposed during the War as a War measure, and bit by bit they have been remitted. In 1923 the duty on sweetened table waters was reduced to 2d., and in 1924 it was entirely repealed, but since then the duty of 8d. a gallon on unsweetened table waters has been retained. At the same time, the duty on cider, which contains at least a certain amount of alcohol, has been entirely removed. I propose to show the House that there are other than historical reasons for the Clause I am moving. Not only is this the last remission of a War duty which I think ought to be removed, but, owing to the imposition of this duty, there has been a great growth in the manufacture of soda water and other aerated waters by other means than those carried out in factories carrying on this trade. The use of sparklets has increased enormously. In one advertisement it is pointed out that by the use of this method you can save 3½d. on every syphon, while another points out that you can have a free trial and that you can produce a quart syphon of soda water and pay no duty at all. I am told by the Scottish Federation of Aerated Water Manufacturers that, prior to the imposition of this duty, there were practically no such things as soda water fountains known in Scotland. Now this means of producing soda water has increased enormously, and until quite recently it entirely escaped the attention of the Chancellor of the Exchequer.

5.0 P.M.

It is true they are now trying to bring this soda water fountain within the meaning of the Act, so far as this duty is concerned. The Scottish soda water manufacturers, however, say it is extremely doubtful whether the measures which have been taken to prevent evasion of duties by the users of the fountains will be successful. I have a copy here of an advertisement which has been put out for one of these soda fountains, and it states that at a cost of only 10s. 200 gallons can be produced, or 4,000 glasses. The duty on that quantity, produced in the ordinary factories for the production of soda water, would be £6 13s. 4d. I do not think the Chancellor of the Exchequer should put temptation on such a scale in the way of manufacturers of soda water and other aerated waters by maintaining this duty. There is another reason I want to put, and it is that this is practically the only duty which is collected simply on the declaration on the part of the trader or manufacturer that he has produced a certain quantity. It is found to be quite impossible to collect this duty in any other way. The Chancellor of the Exchequer has to trust to the honesty of the person producing it to say how much tax he ought to pay, and at the same time anyone can buy a box of sparklers and can produce soda water at home without any tax at all. I think it is time the Chancellor of the Exchequer did one of two things. Either he should quite simply tax these other methods of producing soda, water, by having a stamp upon each box of these sparklets exactly like on patent, medicines—it would be much easier to collect that part of the duty than the other—either he should do that and have a square deal, or else he should give it up altogether. The present duty depends entirely on the honesty of the manufacturer for being collected at all, and produces, I believe, a small amount of money. It is the last of these war-time duties which were always irritating and which have gradually been removed until nothing now remains except the tax on plain water and unsweetened aerated water.


In order to try and remove every hindrance from those who want to drink pure and unadulterated water, even though it be in a bottle, I beg to second the Motion.


The hon. Member for Barnstaple (Mr. B. Peto) began with an argument with which we are very familiar, that is, that this duty is the remainder of a war measure or war tax. I believe that if we were strictly to investigate all our expenditure on a historical basis like that, we should find that Income Tax was also a war tax. I am afraid the finances of the country are not so far removed from the exigencies of a war period that we can afford to wipe out this revenue. But I do not think the hon. Member really relied on that historical argument. His real argument was that there is an inconsistency in putting this tax on one form of water and not on another, and he argues that measures should be taken to cover all competition. He referred to sparklets and soda water fountains, and put before us a most appalling state of affairs. I think he informed us that we could get no less than 400 glasses—I think I am right.


Four thousand glasses or 200 gallons.


He said 4,000 glasses of soda water could be made for 10s. by these soda water fountains, but does he suggest that any ordinary householder is likely to brew 4,000 glasses for his 10s. or does he mean that it is produced in this manner for sale?


For sale, undoubtedly. There are now more than 100 of these soda water fountains in Scotland alone.


Just so. If they are for sale, then they are under the duty now, and his only complaint is that the tax is not sufficiently covered, and that is a question of machinery. I do not know whether that is so or not. He only told us from his advertisement what might be. I have always noticed that advertisements always take a very indulgent view. It is quite likely that an advertisement will tell you that for 10s. you can get a great quantity of soda water, but it does not at all follow that the means of doing so is used extensively. They may be used probably by individuals for their own private use for making their own drink. I do not see any objection to that. I do not see any reason why people should not make their own drink.


Will the right hon. Gentleman apply that to alcohol as well?


What the hon. Member for Barnstaple says here is that this particular sort of drink is not dutiable. Alcohol is dutiable, so I do not see really that the interruption of the hon. and gallant Member for West Walthamstow (Major Crawfurd) has any particular relevancy. The point really is a matter of commonsense. If there was a substantial sale or manufacture of this class competing with legitimate manufacture the question would be different, but all the information we have is that there is really no substantial evidence of competition. Having regard to the fact that there is a very considerable revenue derived from these waters, there is no evidence, as far as we know of, of mysterious interference with the trade from the figures we have as to the number of gallons produced, which is not an appalling quantity as it would be if this competition were gaining a hold. It is quite true that we have no figures to compare consumption now with consumption before the duty was put on, but year by year there is no sign of the consumption in unsweetened waters decreasing. As it brings in a revenue of …370,000, which is quite a substantial sum, we certainly cannot afford to throw that away. I submit that the hon. Member for Barnstaple does not succeed, even if all he has told us is in accordance with the facts, in showing that there is a strong case against taxing these waters. I hope, therefore, that he will not press his Amendment.


Will the right hon. Gentleman between now and the next Budget see the Scottish soda water manufacturers and also the London Federation of Mineral Water Manufacturers? All the figures I gave were based on actual facts supplied by the trade.


All I will say is that I had the opportunity not long ago of talking with a deputation representing this industry.

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

The House divide. Ayes, 121; Noes, 262.

Division No. 323.] AYES. [5.10 p.m.
Adamson, Rt. Hon. W. (Fife, West) Hall, G. H. (Merthyr Tydvil) Rose, Frank H.
Alexander, A. V. (Sheffield, Hillsbro') Hamilton, Sir R. (Orkney & Shetland) Runciman, Rt. Hon. Walter
Ammon, Charles George Hardie, George D. Saklatvala, Shapurji
Attlee, Clement Richard Harney, E. A. Salter, Dr. Alfred
Baker, J. (Wolverhampton, Bilston) Hartshorn, Rt. Hon. Vernon Scrymgeour, E.
Barker, G. (Monmouth, Abertillery) Hayday, Arthur Shepherd, Arthur Lewis
Barnes, A. Henderson, Right Hon. A. (Burnley) Shiels Dr. Drummond
Barr, J. Henderson, T. (Glasgow) Short, Alfred (Wednesbury)
Batey, Joseph Hirst, G. H. Sitch, Charles H.
Beckett, John (Gateshead) Hirst, W. (Bradford, South) Slesser, Sir Henry H.
Benn, Captain Wedgwood (Leith) Hudson, J. H. (Huddersfield) Smith, Ben (Bermondsey, Rotherhithe)
Bowerman, Rt. Hon. Charles W. Hutchison, Sir Robert (Montrose) Smith, H. B. Lees (Keighley)
Broad, F. A. John, William (Rhondda, West) Smith, Rennie (Penistone)
Bromley, J. Jones, Henry Haydn (Merioneth) Snell, Harry
Brown, James (Ayr and Bute) Jones, Morgan (Caerphilly) Snowden, Rt. Hon. Philip
Buchanan, G. Jones, T. I. Mardy (Pontypridd) Spencer, George A. (Broxtowe)
Buxton, Rt. Hon. Noel Kelly, W. T. Spoor, Rt. Hon. Benjamin Charles
Charieton, H. C. Kennedy, T. Stamford, T. W.
Clowes, S. Kenyon, Barnet Stephen, Campbell
Cluse, W. S. Kirkwood, D. Stewart, J. (St. Rollox)
Clynes, Rt. Hon. John R. Lansbury, George Sullivan, J.
Compton, Joseph Lawson, John James Sutton, J. E.
Cove, W. G. Lee, F. Thorne, G. R. (Wolverhampton, E.)
Cowan, D. M. (Scottish Universities) Lindley, F. W. Thurtle, E.
Crawfurd, H. E. Livingstone, A. M. Tinker, John Joseph
Dalton, Hugh Lowth, T. Townend, A. E.
Davies, Evan (Ebbw Vale) Lunn, William Trevelyan, Rt. Hon. C. P.
Davies, Rhys John (Westhoughton) MacLaren, Andrew Viant, S. P.
Day, Colonel Harry Maclean, Nell (Glasgow, Govan) Wallhead, Richard C.
Dennison, R. March, S. Walsh, Rt. Hon. Stephen
Dunnico, H. Montague, Frederick Watson, W. M. (Dunfermline)
Evans, Capt. Ernest (Welsh Univer.) Morrison, R C. (Tottenham, N.) Webb, Rt. Hon. Sidney
Gardner, J. P. Murnin, H. Wedgwood, Rt. Hon. Josiah
Gibbins, Joseph Naylor, T. E. Wheatley, Rt. Hon. J.
Gillett, George M. Oliver, George Harold Wiggins, William Martin
Gosling, Harry Palin, John Henry Wilkinson, Ellen C.
Graham, Rt. Hon. Wm. (Edin., Cent.) Paling, W. Williams, C. P. (Denbigh, Wrexham)
Greenall, T. Parkinson, John Allen (Wigan) Williams, David (Swansea, East)
Greenwood, A. (Nelson and Colne) Pethick-Lawrenee, F. W. Williams, Dr. J. H. (Llanelly)
Grenfell, D. R. (Glamorgan) Peto, Basil E. (Devon, Barnstaple) Williams, T. (York, Don Valley)
Griffiths, T. (Monmouth, Pontypool) Ponsonby, Arthur Wilson, R. J. (Jarrow)
Groves, T. Potts, John S.
Grundy, T. W. Purcell, A. A. TELLERS FOR THE AYES.—
Guest, Haden (Southwark, N.) Richardson, R. (Houghton-le-Spring) Mr. Charles Edwards and Mr.
Hall, F. (York, W. R., Normanton) Riley, Ben Hayes.
Acland-Troyte, Lieut.-Colonel Briggs, J. Harold Cockerill, Brig.-General Sir G. K.
Agg-Gardner, Rt. Hon. Sir James T. Briscoe, Richard George Colfox, Major Wm. Phillips
Alnsworth, Major Charles Brittain, Sir Harry Conway, Sir W. Martin
Albery, Irving James Brooke, Brigadier-General C. R. I. Cooper, A. Duff
Alexander, E. E. (Leyton) Brown, Col, D. C. (N'th'l'd., Hexham) Cope, Major William
Alexander, Sir Wm. (Glasgow, Cent'l) Buckingham, Sir H. Couper, J. B.
Allen,J.Sandeman (L'pool, W. Derby) Bull, Rt. Hon. Sir William James Craik, Rt. Hon. Sir Henry
Amery, Rt. Hon. Leopold C. M. S. Bullock, Captain M. Crooke, J. Smedley (Deritend)
Apsley, Lord Burgoyne, Lieut.-Colonel Sir Alan Crookshank, Cpt. H. (Lindsey, Gainsbro)
Ashley, Lt.-Col. Rt. Hon. Wilfrid W. Burman, J. B. Cunliffe, Sir Herbert
Atholl, Duchess of Burton, Colonel H. W. Curzon, Captain Viscount
Baldwin, Rt. Hon. Stanley Butler, Sir Geoffrey Dalziel, Sir Davison
Balfour, George (Hampstead) Cadogan, Major Hon. Edward Davies, Dr. Vernon
Beamish, Captain T. P. H. Caine, Gordon Hall Davies, Sir Thomas (Cirencester)
Beckett, Sir Gervase (Leeds, N.) Campbell, E. T. Davison, Sir W. H. (Kensington, S.)
Bellairs, Commander Carlyon W. Cautley, Sir Henry S. Dawson, Sir Phillip
Benn, Sir A. S. (Plymouth, Drake) Cayzer, Sir C. (Chester, City) Dixey, A. C.
Bennett, A. J Cazalet, Captain Victor A. Drewe, C.
Bentinck, Lord Henry Cavendish- Cecil, Rt. Hon. Sir Evelyn (Aston) Eden, Captain Anthony
Berry, Sir George Chadwick, Sir Robert Burton Edmondson, Major A. J.
Bethel, A. Chamberlain, Rt.Hn.Sir.J.A (Birm.,W.) Edwards, J. Hugh (Accrington)
Betterton, Henry B. Charteris, Brigadier-General J. Elliot, Major Walter E.
Birchall, Major J. Dearman Churchill, Rt. Hon. Winston Spencer Ellis, R. G.
Bird, Sir R. B. (Wolverhampton, W.) Churchman, Sir Arthur C. England, Colonel A.
Blades, Sir George Rowland Clarry, Reginald George Erskine, Lord (Somerset, Weston.s.-M.)
Boothby, R. J. G. Clayton, G. C. Erskine, James Malcolm Monteith
Bourne, Captain Robert Croft Cobb, Sir Cyril Evans, Captain A. (Cardiff, South)
Faile, Sir Bertram G. Knox, Sir Alfred Samuel, A. M. (Surrey, Farnham)
Falls, Sir Charles F. Lane Fox, Col. Rt. Hon. George R. Samuel, Samuel (W'dsworth, Putney)
Fanshawe, Commander G. D. Lister, Cunliffe-, Rt. Hon. Sir Philip Sandeman, A. Stewart
Fermoy, Lord Locker-Lampson, G. (Wood Green) Sanders, Sir Robert A.
Fielden, E. B. Locker-Lampson, Com. O.(Handsw'th) Sanderson, Sir Frank
Forestier-Walker, Sir L. Lord, Walter Greaves- Scott, Sir Leslie (Liverp'l, Exchange)
Forrest, W. Lougher, L. Shaw, Lt.-Col. A. D. Mcl.(Renfrew,W.)
Foxcroft, Captain C. T. Lucas-Tooth, Sir Hugh Vere Shaw, Capt. W. W. (Wilts, Westb'y)
Frece, Sir Walter de Luce, Maj.-Gen. Sir Richard Harman Shepperson, E. W.
Fremantle, Lieut.-Colonel Francis E. Lynn, Sir R. J. Simms, Dr. John M. (Co. Down)
Gadie, Lieut.-Col. Anthony MacAndrew, Major Charles Glen Sinclair, Col. T.(Queen's Univ., Belfst.)
Gates, Percy Macdonald, R. (Glasgow, Cathcart) Skelton, A. N.
Gibbs, Col. Rt. Hon. George Abraham McLean, Major A. Slaney, Major P. Kenyon
Glyn, Major R. G. C. Macmillan, Captain H. Smithers, Waldron
Goff, Sir Park Macnaghten, Hon. Sir Malcolm Somerville, A. A. (Windsor)
Gower, Sir Robert McNeill, Rt. Hon. Ronald John Spender-Clay, Colonel H.
Grace, John Maitland Sir Arthur D. Steel- Stanley Col. Hon. G. F. (Will'sden,E.)
Grant, Sir J. A. Malone, Major P. B. Stanley, Lord (Fylde)
Grattan-Doyle, Sir N. Manningham-Buller, Sir Mervyn Stanley, Hon. O. F. G. (Westm'eland)
Greene, W. P. Crawford Margesson, Captain D. Steel, Major Samuel Strang
Gretton, Colonel Rt. Hon. John Marriott, Sir J. A. R. Stott, Lieut.-Colonel W. H.
Grotrian, H. Brent Merriman, F. B. Stuart, Crichton-, Lord C.
Guinness, Rt. Hon. Walter E. Milne, J. S. Wardiaw- Stuart, Hon. J. (Moray and Nairn)
Gunston, Captain D. W. Mitchell, S. (Lanark, Lanark) Styles, Captain H. Walter
Hacking, Captain Douglas H. Mitchell, W. Foot (Saffron Walden) Sueter, Rear-Admiral Murray Fraser
Hall, Lieut.-Col. Sir F. (Dulwich) Mond, Rt. Hon. Sir Alfred Sugden, Sir Wilfrid
Hall, Capt. W. D'A. (Brecon & Rad.) Monsell, Eyres, Com. Rt. Hon. B. M. Templeton, W. P.
Hammersley, S. S. Moore, Lieut.-Colonel T. C. R. (Ayr) Thompson, Luke (Sunderland)
Hanbury, C. Moore-Brabazon, Lieut.-Col. J. T. C. Thomson, F. C. (Aberdeen, South)
Hannon, Patrick Joseph Henry Morden, Colonel Walter Grant Thomson, Rt. Hon. Sir W. Mithchell-
Harland, A. Moreing, Captain A. H. Tinne, J. A.
Harmsworth, Hon. E. C. (Kent) Morrison, H. (Wilts, Salisbury) Titchfield, Major the Marquess of
Harrison, G. J. C. Morrison-Bell, Sir Arthur Clive Tryon, Rt. Hon. George Clement
Hartington, Marquess of Nall, Lieut.-Colonel Sir Joseph Turton, Sir Edmund Russborough
Harvey, G. (Lambeth, Kennington) Nelson, Sir Frank Vaughan-Morgan, Col. K. P.
Harvey, Major S. E. (Devon, Totnes) Newman, Sir R. H. S. D. L. (Exeter) Waddington, R.
Haslam, Henry C. Nicholson, Col. Rt. Hn.W.G.(Ptrsf'ld.) Wallace, Captain D. E.
Heneage, Lieut.-Colonel Arthur P. Nuttall, Ellis Warner, Brigadier-General W. W.
Hennessy, Major J. R. G. O'Neill, Major Rt. Hon. Hugh Warrender, Sir Victor
Herbert, Dennis (Hertford, Watford) Oman, Sir Charles William C. Watson. Sir F. (Pudsey and Otley)
Herbert, S. (York. N.R., Scar. & Wh'by) Penny, Frederick George Watson, Rt. Hon. W. (Carlisle)
Hoare, Lt.-Col. Rt. Hon. Sir S. J. G. Percy, Lord Eustace (Hastings) Watts, Dr. T.
Hogg, Rt. Hon. Sir D. (St. Marylebone) Perkins, Colonel E. K. Wells, S. R.
Hope, Sir Harry (Forfar) Perring, Sir William George Wheler, Major Sir Granville C. H.
Hopkins, J. W. W. Philipson, Mabel White, Lieut.-Col. Sir G. Dairymple
Hopkinson, A. (Lancaster, Mossley) Pielou, D. P. Williams, A. M. (Cornwall, Northern)
Horlick, Lieut.-Colonel J. N. Pilditch, Sir Philip Williams, Com. C. (Devon, Torquay)
Howard, Captain Hon. Donald Pownall, Lieut.-Colonel Sir Assheton Wilson, M. J. (York, N. R., Richm'd)
Hudson, Capt. A. U. M. (Hackney, N.) Preston, William Wilson, R. R. (Stafford, Lichfield)
Hudson, R. S. (Cumberl'nd, Whiteh'n) Radford, E. A. Windsor-Clive, Lieut.-Colonel George
Huntingfield, Lord Ramsden, E. Wise, Sir Fredric
Hurd, Percy A. Rawson, Sir Cooper Withers, John James
Hurst, Gerald B. Rees, Sir Beddoe Womersley, W. J.
Hutchison,G.A.Clark (Midl'n & P'bl's) Reid, D. D. (County Down) Wood, E.(Chest'r, Stalyb'dge & Hyde)
lnskip, Sir Thomas Walker H. Remer, J. R. Worthington-Evans, Rt. Hon. Sir L.
Jackson, Sir H. (Wandsworth, Cen'l) Rentoul, G. S. Wragg, Herbert
James, Lieut.-Colonel Hon. Cuthbert Rhys, Hon. C. A. U. Young, Rt. Hon. Hilton (Norwich)
Jephcott, A. R. Roberts, E. H. G. (Flint)
Kidd, J. (Linlithgow) Robinson, Sir T. (Lancs., Stretford) TELLERS FOR THE NOES.—
Kindersley, Major Guy M. Ropner, Major L. Captain Bowyer and Major Sir
King, Captain Henry Douglas Russell, Alexander West (Tynemouth) Harry Barnston.
Kinloch-Cooke, Sir Clement Salmon, Major I.