§ LORD CARSON
My Lords, I beg to ask His Majesty's Government whether they would publish as a Parliamentary Paper a statement of the financial relations between Great Britain and the Free State of Southern Ireland showing the effect of recent legislation in the revenues of both countries and any adjustment" that will have to be made between them. I have put this Question upon the Paper not at all with a view to inaugurating this evening a discussion on the financial relations between the Irish Free State and the United Kingdom, but to draw attention to the fact that no materials whatever have been furnished showing the changes that have been made by recent legislation or informing citizens of the Free State and of this country who may have interests in both countries—either people in this country having interests in Ireland or people in Ireland having interests here—how they stand in relation to taxation. As I will show in a short time, this is a matter which is causing grave anxiety on account of the indefinite way in which it is apparently being allowed to drift.
It is somewhat remarkable that while the Treaty of surrender was going through Parliament, and, indeed, ever since that time, we have not had a statement of any kind, during the whole of that period of a year and a half, showing the changes in the financial relations between the two countries. Whether the matter was really ever considered by the late Government 113 or, indeed, by the present Government, I do not know, but your Lordships will at once see that there must be a great deal of information as to what has been going on, and is at present going on, which we are certainly entitled to have in this country, and which is not purely the private property of His Majesty's Government. I understand that there has been a new régime since March 31 of the present year, but so far as last year is concerned we have never had any statement of accounts as between the British Exchequer and the Irish Free State with reference to the value of land, buildings or other property taken over by the Free State, or the value of materials, arms, equipment, stores, etc., supplied by the British Government, or how these matters have been dealt with in account between the British Government and the Government of the Free State. Nor have we had any statement showing us how questions of Customs and Income Tax were dealt with in the past year.
I have been told, but I want information on the subject, that the Excise Duty, say, on liquor sent from Ireland to this country and other places was all handed over to the Irish Government, although, of course, it would be paid, as regards such commodities, by the British taxpayer, naturally, on the price that could be charged here. I do not know whether that is so, but, if it is, I think we ought to have information to show how much has in reality been given over as a present to the Free State Government in that way. In the same way, as regards Income Tax, I do not know how, where Income Tax is deducted in this country at the source, the money has been dealt with as regards people who are members of the Irish Free State but who may be living over here, or living elsewhere than in Ireland. So much as regards matters up to March 31 last.
I understand that entirely new elements have arisen in the present financial year. The Free State Government are, as I understand, now to collect their own Customs, and they are also, I suppose, to collect their own Income Tax. As regards the questions of Customs, I want to ask whether there are to be corresponding Customs, or what is to be the system that is to prevail as regards goods 114 coming from the Free State into this country. Will there be a Customs barrier set up here in this country, or how will the matter be dealt with? Then as regards Income Tax, I should like to know what is to be done in such cases as the following. Take the case of an Irishman who has a domicile both here and in Ireland, and who has property in both countries. Is he to be taxed in each country in relation to this property? Is he to be taxed in Ireland, as an Irishman, in relation to the property he has in Ireland? And, if he is living in Ireland, how is he to be taxed as regards income derived from money invested in British securities, where the Tax is collected in England at the source? I should like further to suggest that it ought to be made perfectly clear, whether an Irishman living in this country will have to add to his income in this country money which he gets from property in Ireland, for the purpose of Super-Tax. All these are very complicated questions, and, as I said before, for the last eighteen months, since the surrender, not one single bit of information, so far as I know, either in debate or by the presentation of Parliamentary Papers, has been given to people situated in these particular circumstances.
Very grave apprehensions have arisen in Ireland, and I think it will be found, as time goes on, that there are many developments, by reason of the separation of the Free State from the United Kingdom, which have never been contemplated, and I should like to know how they are going to be dealt with. Take one case, as to which I hope to get a specific answer, because I have already brought the matter to the notice of the Chancellor of the Exchequer, and therefore I am not springing it on the Government. The Protestant Episcopalian Church in Ireland has, as I understand, funds of about £9,000,000 invested in British securities. The majority of the Protestants are probably in the North of Ireland, but, at the same time, the office of the Representative Church Body, setup under the Church Act, is situated in the Free State, and consequently, as I understand the law, the domicile of the Church Body is in the Free State.
Therefore, although the bulk of the Protestants may be, and I think probably are, in the Six Counties—because I know 115 that many are leaving or have left the South and West, owing to the way in which the British Government has treated them—what is going to happen, unless there is a change in the law, is this: By your Proclamation you have said that Acts of Parliament, where the United Kingdom is mentioned, are not to include the Free State. The Income Tax Act of 1843, I think, gives back to charitable institutions, which, of course, include the Church, the amount that is deducted from the income upon investments made in this country. If the South of Ireland is no longer to be subject to the taxation of this country, and is no longer under the Income Tax Act of 1843, as I understand to be the case, the result will be that no longer will it be possible for the British Government to give back to the Church the Tax which has been collected at the source. When I tell your Lordships that the amount that that would mean in the case of the Episcopalian Church in Ireland is £98,000 a year, you will see what a deadly blow would be inflicted upon that Church unless something is done to meet such a case. It would really mean very nearly a quarter of their income. And that, you will observe, although the bulk of the people who are supported by these Church funds live in the Six Counties.
But it is not only the Church—I merely gave that as an example: it is all other charities. As the Protestant population were more pro-British than the others they probably had more confidence in this country. I think you will find that nearly all the Protestant charities invested any accumulated funds which they possessed in this country, and they will be affected in the same way. Take Trinity College, Dublin. It is fast being ruined unless something can be done to help it. How does it fare? By reason of the setting up of the Free State it lost £30,000 a year which was given to it under the Act of 1920—given just as you gave grants to Oxford and Cambridge Universities, as the result of a Royal Commission, given because it was impossible in the new circumstances to go on without the money. Through lack of prevision or lack of concern on the part of the late Government in pushing through the Treaty of surrender they made no provision whatsoever for retaining that payment, or making it a charge on the Irish Revenue. So this ancient and loyal University, an offshoot 116 of Cambridge—and, I think I may say with some pride, one of the most successful institutions that you have planted in Ireland—is cut off from a revenue of £30,000.
And, what is more, in the state of want that they were in between the Act of 1920 and the passing of the surrender Treaty, they, thinking that they were sure to get this £30,000 a year, proceeded to spend it. Now, what is the result? They are kept out of their rents, because nowhere in Ireland is any rent being paid, nor has any been paid for two years. There is practically a seizure of the whole of the property either by tenants or by outsiders. They are deprived of this £30,000 and also of their rents, and here is the last blow: they have lost about £5,000 a year that used to be returned to them as a charitable organisation from moneys that they have invested in this country.
So that, if I am right in the law—I hope I am not—what you are really doing by your policy, and through your lack of foresight and of the ordinary care that has always hitherto been exhibited in framing great Acts of Parliament, is, in your hurry to get away from Ireland, to inflict wrongs upon the Protestant population there which cannot be measured merely in money. What is the result? If you read the report of the meeting of the Methodist body over there the other day you would see the way in which their people are being gradually wiped out in the South and West of Ireland. I met an Archbishop from Ireland the other day, who told me that one of the most popular churches in Dublin, one that I have known well since my childhood, was going to be shut up. This is all going on without any concern on the part of anybody. I think the time has come when the Government ought to furnish us with the fullest possible material, showing how this legislation is working out financially in Ireland, and what is the policy of the Government for the protection of those interests which, I think, the whole community would say ought to be protected. I therefore put this Question upon the Paper with some confidence that His Majesty's Government will be able to give me a satisfactory answer.
§ THE SECRETARY OF STATE FOR THE COLONIES (THE DUKE OF DEVONSHIRE)
My Lords, as the noble and learned Lord has reminded us, this question is an 117 extremely complicated and difficult one. My right hon. friend (the Chancellor of the Exchequer), in responding to similar Questions in another place, stated that he is quite prepared to consider the preparation of such a Return, although he was not able to do it at the moment. I shall certainly bear in mind what has fallen from the noble and learned Lord, and, after consultation with him, I hope we may be able to issue some statement which will clear up the points which are rightly exercising your Lordships. From representations which the Government have received, it is clear that a large part of the income of the charities in the Irish Free State is derived from securities invested in this country. I understand that, unless provision were made, those charities would not benefit by the exemption which they now receive. This has been brought to the attention of the Chancellor of the Exchequer. He fully admits the gravity of the situation, and he has inserted in the Finance Bill, which is now before the other House, a clause, Clause 13, which has for its intention the preservation of the exemption, which would otherwise be taken away from the Irish charities; in other words, we are proposing that the Irish charities—I use the word charities in the broadest sense; I think it includes the Church—shall receive for the year the benefit of that exemption.
§ THE DUKE OF DEVONSHIRE
It is obviously provisional, but it will at any rate give time for further consideration, and, if possible, for those who are interested in the matter to make further arrangements. The Chancellor of the Exchequer could not at this stage do more than place that clause in the Finance Bill of this year. If the clause is accepted, as I have every reason to anticipate it will be, those charities will have the benefit of that exemption. With regard to the other matters raised by the noble and learned Lord, I shall be very glad, in consultation with the Chancellor of the Exchequer, to see whether we are able to furnish further information.