THE INCOME TAX BILL. (Hansard, 23 June 1853)

§ The EARL of ABERDEEN
moved, "That the House do now resolve itself into a Committee."

The EARL of CLANCARTY
My Lords, although I do not rise with any purpose of interfering with the progress of the Bill now before your Lordships, I yet may be permitted to make a few observations upon it, with reference to its chief novelty, namely, the extension of the income tax to Ireland, the objections to which have hitherto been but very slightly noticed. In the abstract, my Lords, the proposition is certainly not unjust, that all who live under the same laws, enjoy the same privileges, and owe the same duty to the State, should be subjected to the same burdens of taxation; and I freely admit that direct taxation, being a necessary consequence of the departure from the principle of indirect taxation, involved in the repeal of protective duties, whatever loss the farmer or manufacturer may have sustained by the withdrawal of protection from native industry, both one and the other must now submit to pay for the boon of free trade by allowing what remains to them of available income to be further reduced by the operation of a direct tax. But although I acquiesce in the principle of free trade, I cannot allow that Ireland does enjoy the benefit of equal laws or of equal privileges 589 with England; and I must add, that in the redistribution of taxation proposed in the Budget that is now to be considered in this House, Ireland has been very hardly and most unfairly treated. We are told, and truly so, that this is an sera of great prosperity; and certainly we may behold, both in this vast metropolis and throughout the whole of England, a condition of wealth and progressive improvement quite unexampled. Agriculture, manufactures, commerce, all flourishing. Activity in every department of business. Scarcely an idle person, unless those may be so considered who live in the pursuit of pleasure, and their name is "legion;" but from the highest to the lowest every class appears well cared for, and in no other nation in the world is there to be seen so much of the enjoyments and of the luxuries of civilised life. Regarding this happy state of things as, under the Divine permission, a consequence of the influence of free institutions upon a people peculiarly fitted to appreciate them, I trust it may long endure. Though coining from a less favoured portion of the empire, where free institutions have as yet exercised no salutary influences, a land far from wealthy, and to this day the scene of much suffering and of more privation than any Englishman could endure, I rejoice most sincerely at the prosperity I here see around me. I had, indeed, in common with others, entertained the hope that, as Providence had showered down blessings in such abundance upon this country-—as the gold of distant lands was daily adding an increase of capital to her already great resources, and the imperial revenue, notwithstanding an expenditure that might be termed lavish, yet exhibited a large surplus of income beyond expenditure—I had hoped that Ireland, so lately prostrated under the heaviest visitation that over befell a people— Ireland, scarcely convalescent, and still reeling under the pressure of her poverty, might have been spared to recover a more healthful condition before being subjected to new burdens not justified by any necessity of the State. But no forbearance has been shown to her, and she has been made to feel, in addition to her physical extenuation, that she had not in the Imperial Parliament sufficient political influence to have her case even inquired into before it was decided upon. The decree has gone forth that Ireland, distressed, overburdened, and, to a great extent, bankrupt, as she already is, should be taxed, or rather subjected, to a net increase of taxation to the amount 590 of about half a million sterling; and that relief from taxation shall be confined to wealthy England, to the net amount of no less than 1,040,000l. Now, my Lords, looking at the comparative condition of the two countries, and considering how lately the Government found it indispensably necessary to extend gratuitous relief to certain distressed districts of the south and west of Ireland; and that in order to obtain the requisite funds, a tax under the name of a rate in aid was levied, not as it ought to have been, impartially off the United Kingdom, but exclusively off Ireland, the tax now to be imposed is peculiarly unjust. It is in fact a rate in aid to be levied for the greater relief of the English taxpayer. It is scarcely possible to conceive a more partial, unjust, and oppressive step upon the part of the Government, or one more calculated to repress any hopeful exertion in Ireland, and to alienate the confidence and affections of the Irish people. The noble Earl opposite, and most of his Colleagues, profess themselves the disciples of the late Sir Robert Peel; lot me for a moment compare their policy towards Ireland with that which was adopted by that eminent statesman. He imposed the income tax upon England first in 1842; he renewed it in 1845. The former year was a period of great financial difficulty; the latter was a period of great prosperity, but not comparable in England to the prosperity of the present day. Yet, although Ireland was throughout that period far better off than she is at present, and had attained at the close of it, just before the famine broke out, a more prosperous condition than she had ever before known, it was not thought expedient that, in her then condition, she should be subject to an income tax. Her share in the increased taxation, then necessary to renovate the finances of the country, was limited to an increased stamp duty, which I believe still continues. Why, my Lords, have those disciples of Sir Robert Peel departed from his policy? The noble Earl says they were obliged to extend the income tax to Ireland, because in some of the more distressed districts the consolidated annuities could not be collected, and the people of England would not otherwise consent to give them up. I cannot believe that the noble Earl was seriously influenced by such reasoning. In another place this change of policy is, I believe, upon the authority of the Chancellor of the Exchequer, otherwise accounted for. It is said that the income tax was not ex- 591 tended to Ireland by Sir Robert Peel, as the amount that would have been collected would scarcely have repaid the expense, as there was not the same poor-law machinery as at present. Such, however, could not have been the fact, as the valuation of the country was at that time considerably higher than it is at present, and would consequently have yielded a better revenue; and precisely the same poor-law machinery was then in operation as that of which it is now proposed to take advantage. To put forward, therefore, as a reason of the income tax being now extended to Ireland, that the circumstances of the country were more favourable, shows only in what ignorance, or affected ignorance, of the true state of facts, this question has been determined. Much, my Lords, as I lament some of the political acts of the late Sir Robert Peel, it is but due to his memory to say that his forbearance towards Ireland on the question of the income tax proceeded from no such paltry calculation of whether the amount lie could exact from her would sufficiently exceed the cost of making the exaction. I believe he was governed by more statesmanlike views than he has been given credit for. That seeing that Ireland, then newly brought under the operation of a poor-law, was, though backward, improving through the awakened energies of the owners of the soil, he considered it more important that the means immediately necessary for the development of her resources should be so applied, than confiscated to the Imperial Treasury. This, my Lords, does not rest upon mere conjecture: it is the legitimate inference to be drawn from the distinction he made between the absentee and the resident proprietor; and if the present Chancellor of the Exchequer, and the noble Earl the First Lord of the Treasury were not, as unfortunately they are, total strangers to Ireland, they would have seen that it was a distinction of the greatest practical advantage to the country, that in taxing the income of the absentee he encouraged residence, and that in exempting the income of the resident, he, in fact, secured to the country an expenditure in its improvement, and in the sustainment in industry of a very poor and dependent population to the full amount of what would otherwise have been abstracted from it in the shape of income tax. The fact is, that Ireland was, and is, for the most part, without manufactures, and her commerce very limited; but she has a large agricultural population, and a great extent of 592 waste but improvable land. It is manifestly, therefore, good policy in the State to encourage the employment of that population in the reclamation and improvement of the land, so that it may contribute to the general wealth of the community, and become available for the purposes of revenue. The land can only be improved by its owners, and I may say, although there are some brilliant exceptions to the rule, that in general it is only done by resident proprietors. These, however, are mostly very poor; they have not the superfluities of the absentee; their style of living is very frugal, and as they will be the chief and almost the only subjects of the proposed extension of the income tax, whatever is so taken from them will be, in fact, so much unwisely abstracted from the use to which for the general advantage it might best have been applied. Let me observe to your Lord-ships that, with the exception of the district of Belfast, where there is the linen manufacture, nearly the whole population of Ireland is dependent upon the land. The farms are in general very small, or, if extensive, of little value, and the farmers without capital; very few of them, therefore, lay out more employment upon their farms than they can perform with the labour of their own families; they do not, as a general rule, give employment to hired labourers. To whom, then, can the cottier class, and the occupants of the lanes and suburbs of the country towns, look for [employment or support? They naturally turn to the resident proprietor, whose interest it is, if he can, to employ them; the alternative is the workhouse, and I need not tell your Lordships that the man who is compelled to throw himself upon the workhouse feels himself degraded —his existence there is alike unprofitable to himself and to the community—a drag upon, instead of an aid to, the industry and improvement of the country; and I warn Her Majesty's Government, that every poor man who may be driven to the workhouse, in consequence of the confiscation now proposed of the means of employing him, will be a reproach to their injustice and rapacity. That it is the endeavour, as well as the interest, of the resident proprietors to employ the poor, and to improve the land, is perfectly manifest from the fact, that where they cannot command the means from their own incomes, they have in so many cases borrowed money for the purpose, under the Land Improvement Act; but indebted as 593 Irish property in general is, proprietors are now unwilling further to add incumbrances upon the land, if they can possibly avoid it. How shortsighted, how illiberal, how unwise is it then to withdraw thus from Ireland, by a direct tax, a sum insignificant as an item of revenue, but of the greatest value, if allowed to fructify upon a soil where it is so necessary, and might be so beneficially invested. The policy of this income tax upon Ireland appears to me to be penny wise and pound foolish—a grasping, as it were, at a miserable penny, and losing the pound which it might hereafter have yielded. It is certainly the very reverse of the policy adopted by, or that would have been sanctioned by, the late Sir Robert Peel. I cannot accept as a boon to Ireland that for which the noble Earl takes so much credit as an act of great liberality, namely, the remission of the consolidated annuities. The liberality consisted in this, that what the noble Earl admitted could not be collected he would give up; but in so doing-he substituted an income tax of more than double the amount. What the noble Earl should have done was to have acted upon the just and impartial report that lies upon the table from a Committee of this House, whose unanimous verdict it was that a portion of the annuities was unjust, and ought on that account to be remitted; that the remainder—especially the repayments for the building of the workhouses—should hate been insisted upon. The course that is taken, especially with reference to the latter charge, is most unjust by those unions which taxed themselves to repay the sums advanced, and can only operate as an inducement for the future to postpone payments in order eventually to escape them altogether. Ireland appears to me to stand to the British Government much in the same relation as a distant and mismanaged estate to a rich absentee landlord. He is ignorant of its circumstances —he is wearied with representations of its distress—he consults only his under-agents and drivers, not as to the manner in which it might be improved, but as to the amount of rent that can be screwed out of it, estimating what the tenants ought to pay by what he receives from the favoured and well-managed part of the estate around his home, where his whole income is expended, and for whose benefit alone all his improvements are made; and when advised that he must forego some claims which are neither just nor capable of being enforced, he wonders at the ingratitude of his ten- 594 ants for not appreciating his liberality in giving them up. My Lords, the English Government is the absentee proprietor, and Ireland his distant mismanaged and ill-treated estate. I set out by saying that with equal laws and equal privileges it was just there should be equal burdens; but, my Lords, are there equal laws in Ireland, as in England? Would the continual recurrence of such monster meetings as were held in Ireland about the repeal of the Union, have been tolerated by the law in England? Could the lives of the Queen's subjects have been imperilled in England as they were in Ireland, dependent upon the forbearance of one man, from whose lips a single word would have induced the incited multitudes to imbrue their hands in the blood of all who refused to join them, and to the exercise of whose influence, and not to either the law or the Government of the country, it was, in fact, due that those meetings did not eventually terminate in bloodshed? Would the law have tolerated in England those scenes of outrage that more lately disgraced nearly every contested election in Ireland, or have allowed the inciters of the Six-mile Bridge affair, by which so many lives were lost, to go, not merely unpunished, but untried? And do not scenes so disgraceful to any civilised community go far to drive the timid and peaceful from the land, and to deter persons of ordinary prudence from investing capital where they cannot hope to meet with protection? The law is the protection of the subject in England; in Ireland it is hardly any protection. The circumstances of the two couutries, therefore, in this respect, are not the same. Then, how different is England from Ireland in respect of its privileges and other advantages! In England, the education of the people is free, regulated only with a view to its greater efficiency. It is not required that the great truths of religion should be compromised, and restrictions put upon the teaching of the Bible in the National schools; on the contrary, the Word of God is recognised and upheld as the proper standard of truth and morality. In Ireland, on the contrary, Her Majesty's Government lays down rules by which, practically, the education of youth is handed over to a Church of which it has been not untruly said that its object is to confine instead of expanding the intellect —to enslave the soul, instead of emancipating it. England flourishes as a country of manufactures. Educated in the school of protection, they had attained to 595 a very high degree of perfection before the markets of England were opened to unrestricted competition. How stands the case of Ireland? Is she, either in agriculture or in manufactures, in a position to invite unrestricted competition? Free trade has, no doubt, much to recommend it; but had not your farmers and manufacturers been trained under a fostering system of protection—protection even against Irish competition, whereby Ireland materially suffered —you would not now be in the position that I hope and believe you are in, of being able to cope successfully with the untaxed producers of foreign countries. Ireland was certainly not prepared for free trade, and has been forced into it solely for your interest. Again, England enjoys the whole of the packet communication with foreign countries, and is studded with harbours of refuge, upon which immense sums of public money are annually expended. Nature has done much in the formation of harbours on the Irish coast; but a jealousy unworthy of a great nation—a policy most unbecoming the Imperial Government—has caused these natural advantages to be neglected, lest England should be deprived of the benefit she derives from a monopoly of the packet service. Here you have naval and military arsenals, involving a large expenditure of public money, and the employment and training of artisans and shipbuilders. Ireland is denied any such advantages. Here you have the seat of Government and all the patronage and expenditure incident thereto, and anything worth having in Ireland is commonly bestowed upon an Englishman or a Scotchman. Here, again, you have the Court, and all its pleasures and attractions. The Englishman basks, as it were, in the sunshine of royalty. From the humblest tradesman, nay, from the humblest recipient of charity to the first subject in the realm, every class feels that the vicinity and countenance of the Sovereign is a great advantage. All this is without the reach of an Irishman. He must also become an absentee if he desires to have access to the Royal presence. Perhaps I may be told of Royal visits to Ireland. My Lords, such visits are short and far between. I believe that, from the time of William III. to that of George IV., a period of considerably more than a century, Ireland never beheld her King. In the present century we have been more fortunate; two Royal visits stand recorded. The first, that of George IV., is commemorated by the substitution of the name of Kingstown for the more euphonious Irish 596 name of Dunleary; the second in the reign of her present Most Gracious Majesty, by the name of Queenstown being given to the Cove of Cork. Now, Windsor has long been the residence of the Kings and Queens of England. The Isle of Wight is much favoured by the Royal presence, and Scotland is annually honoured with a Royal visit; yet I do not find that any names have been given by the inhabitants of this well-favoured island to localities so honoured by the Royal presence, commemorative of such events. My Lords, it is not a matter of complaint that in England is the residence of the Court or the seat of Government, or that this gorgeous structure in which we conduct the business of the nation is erected in London rather than in Dublin. It would be unreasonable to ask, or even to think of its being otherwise; but when the circumstances of the two countries come to be compared, it must be admitted that England does enjoy much that is not within the reach of Ireland, and that any difference between the circumstances of the two countries is altogether in favour of England, and to the disadvantage of Ireland. Undoubtedly we all owe the same duty and are all animated with the same loyalty to the Crown, but we cannot all enjoy the same privileges and advantages; and I have shown your Lordships that we are either not under the same laws, or that the laws are so differently executed in Ireland from what they are in England, that they do not afford equal protection; These considerations, together with other peculiar circumstances that I have referred to, appeared to me to entitle Ireland to a forbearance and consideration that have not been shown her. Were my argument ever so convincing, I know that it is too late to have the Budget amended. Were it otherwise, personally interested as I am in the question, I should not now have addressed your Lordships. I have derived, as a resident landlord, the full benefit of that exemption from income tax which was shown to Ireland. I feel that you are, by this Bill, taking, as it were, my coat away, and I would rather offer you my cloak also, than occupy your time by an advocacy of my own personal interest. My sole object in representing the case of Ireland, as I have done to your Lordships, has been to found upon it an appeal to Her Majesty's Government to adopt towards Ireland a more liberal, a more upright, and a more enlightened policy than has heretofore been pursued—to examine honestly into her condition—especially to examine into the ques- 597 tion of the education of the poor, which, as now conducted, is, both in its principles and results, such a disgrace to a Christian country. Improvement, my Lords, in that quarter, must be at the foundation of any course of policy truly designed for the amelioration of Ireland. I would appeal to the Government to be more liberal in the encouragement of practical science, and in the development of artistic taste. It is not for want of native talent, but for want of public encouragement—such encouragement as is extended to the fine arts in this country—that Ireland does not stand higher than she does in the reputation of her sons. I will not detain your Lordships by enumerating all that might, or ought to be done in fairness to Irish interests; but two matters I must specify. First, I would urge the fairness of reconsidering the packet-station question, or at least expending a portion of that public money to which we are henceforth to contribute in full proportion, upon the improvement of the western harbours of Ireland. It is monstrous, that when two-thirds at least of the passengers to the United States of America arc Irish, the entire communication with America should be, of necessity, from the harbours of England. Secondly, I would call upon you to do justice to the loyalty of the Irish character, by raising an Irish as well as an English militia for the defence of our shores. But two years ago, the advocacy of the justice of this measure by a noble Lord, a Member of the present Cabinet, sufficed to overthrow the Government to which he was then opposed. Is the voice of that noble Lord, the solitary Irishman who occupies a seat in the Cabinet, now silent in behalf of his countrymen, or is his influence gone? Why, my Lords, should a difference be made? It is offensive to the Irish character, for it implies a want of confidence in Irish loyalty. If you have not that confidence, whose fault is it but your own, for you feel that you have not yourselves deserved confidence? Your duty, then, is to win it, as you certainly may do, by an upright, enlightened, and faithful administration of the functions of Government, and by such a course of general policy towards Ireland as may show that she is regarded as an integral portion of the empire, not alone for the purposes of taxation, but for her advantage and improvement.

§ The EARL of ABERDEEN
said, that as the subject of the extension of the income tax to Ireland was discussed on Tuesday last, he thought it was unneces- 598 sary for him to return to that question at this stage of the Bill; and it was the less necessary, perhaps, in consequence of the speech of the noble Earl having had very little reference to the subject now before them, but containing a variety of topics and arguments which would almost have led any one to suppose that he meant to conclude with a Motion for the repeal of the Union:—at least his list of grievances and his accusations against the present and all preceding Governments induced the inference that it would have been followed by some such result. It was perhaps not very surprising that the noble Earl should consider him (the Earl of Aberdeen) and his Colleagues to be profoundly ignorant of the state of Ireland, because the noble Earl had taken a course the most contradictory that he could possibly have followed. He objected to the imposition of the income tax upon Ireland —that was intelligible enough; but then he equally objected to the remissions of those burdens which pressed so heavily upon Ireland, namely, the consolidated annuities. Well, how were they to please the noble Earl? If they laid a tax upon him, they did not please him; and if they gave him the remission of a tax or a burden, they did not please him. How, then, were they to deal with him? He must say that, were it not for the sincere desire which the present Government and preceding Governments had felt to develop the resources of Ireland, to consider her distresses, to compassionate, and, as far as possible, relieve her in her difficulties, he (the Earl of Aberdeen) must say that there would not be much encouragement for those who made such efforts if they were to be met in the manner in which the noble Earl met them. He was sorry to hear the assertion of the noble Earl, that Ireland had been treated with injustice and illiberality. The reverse was the intention of the Government, as it was also the reverse of the fact; and he must repeat what he had said on a former occasion, that the principle of the extension of the income tax to Ireland was so just and indisputable, that he believed that the representatives of this part of the kingdom would not have passed the income tax at all had it not been so extended. And when the noble Earl complained that Ireland had not met with the same measure of relief with regard to taxation as had been extended to this country, the reason was sufficiently obvious—there were not the same number of taxes to relieve Ire- 599 land from. Take, for instance, the soap duties, amounting to about 1,000,000l. Ireland was already free from them, and therefore, of course, it was impossible to relieve her from them. The same might he said with regard to the assessed taxes. They did not exist in Ireland, and, of course, they could not be taken away. But this he would say, that with regard to the distribution of taxation and the whole of the policy of Her Majesty's Government towards Ireland, he declared conscientiously it was his conviction that this Government, as well as preceding Governments, had honestly and zealously endeavoured to promote the interests of Ireland as far as was in their power consistently with justice to this country. He would not any longer delay their Lordships with a discussion which, if not irregular, was at least unnecessary, considering what had taken place on the second reading.

The EARL of CLANCARTY
explained. He had not demanded that Ireland should be relieved from taxation; he had only said that the Government were putting taxes on Ireland in order that they might give greater relief to English taxpayers,

The EARL of LUCAN
was understood to observe that it was exceedingly hard on landlords who had borrowed money from the Government that they should not be allowed to deduct more than one-third of the amount in their returns under this Act.

The MARQUESS of CLANRICARDE
expressed a hope that the Government would take into its consideration the whole method of levying the tax, with a view to improving it.

The EARL of WICKLOW
observed, that there was at present on their Lordships' table a Bill enabling proprietors to borrow money from individuals in the same manner as they had hitherto done from the Government; he wished to know whether it was intended that the same description of deductions should he made from those who might hereafter be induced to lend money under the new Bill as was provided for in the present measure?

LORD CAMPBELL
said, he wished to enter his protest against the mode in which the income tax was to be levied in Ireland. He believed that the tax was 600 properly about to he extended to that country, but then the method of applying it should be just and equitable. He would submit to the Government that, if possible, they should extend to Ireland the same mode of levying the tax as that which was adopted in England.

§ The EARL of ABERDEEN
was understood to intimate that the subject should be taken into consideration.