§ Mr. NEEDHAM
asked the Secretary of State for India whether he will give in full the relevant passages of Sir W. Meyer's speeches in introducing the Indian Budgets of 1916 and 1917 so far as they affect the questions of Indian Cotton Import Duties and Excise Duties?
§ Mr. CHAMBERLAIN
The following are the passages referred to:
Extract from Sir W. Meyer's speech in introducing the Financial Statement, 1916.46. The only other important item in the existing tariff on which I have not yet touched is cotton manufactures. For the last twenty years the position has been that cotton twists and yarns of all kinds are free of duty, while a duty at the rate of 3½ per cent. is imposed on woven goods of all kinds, whether imported or manufactured in Indian mills. We propose to leave the position here as it stands.1120WThe Council will naturally ask why, at a time when fiscal necessities compel us to make a material enhancement of the tariff in nearly every other direction, we should leave cotton alone. Well, the Government of India have not failed to represent their view that there should be a material increase in the Cotton Import Duties, while the Cotton Excise, which has formed the subject of such widespread criticism in this country, should be left unenhanced, subject to the possibility of its being altogether abolished when financial circumstances are more favourable. But His Majesty's Government, who have to consider the position from a wider standpoint, felt that the raising of this question at the present time would be most unfortunate, as it would provoke a revival of old controversies at a time when they specially desired to avoid all contentious questions both here and in England, and might prejudice the ultimate settlement of the larger issues raised by the War. His Majesty's Government feel that the fiscal relationship of all parts of the Empire as between one another and the rest of the world must be reconsidered after the War, and they desire to leave the question raised by the Cotton Duties to be considered then, in connection with the general fiscal policy which may be thought best for the Empire, and the share, military and financial, that has been taken by India in the present struggle. His Majesty's Government are aware of the great interest taken in this question in India and of the impossibility of avoiding some reference to it when new taxation has to be raised, but they are confident that their decision is in the best interests of India and that premature discussion of this particular issue could only be harmful. We fully realise the force of these arguments at the present juncture, and consequently we are reluctantly compelled not to propose any modification in respect of the Cotton Duties.
Extract from Sir W. Meyer's speech in introducing the Financial Statement, 1917.The taxation already described will yield us in all £1,500,000. The way in which we propose to make the bulk of the remaining provision required is one which will, I think, be received with satisfaction in this Council and in the country generally, while the incidence of the fax will be of much more general application than that of the imposts above described. It will be remembered that, in introducing the financial statement for the current year, I said that we had been anxious to raise the duty on imported cotton goods, while leaving the Cotton Excise Duty, which has formed the subject of such widespread criticism in this country, unenhanced, subject to the possibility of its being altogether abolished when financial circumstances are more favourable. But His Majesty's Government held that, in the then circumstances, such a course would be undesirable, and decided to leave the Cotton Duties question to be considered later on in connection with the general fiscal policy which may be thought best for the Empire, and the share, military and financial, that has been taken by India in the present struggle.' To-day I am able to announce that, in view of the taxation required to make our war contribution worthy of the place we desire to hold in the Empire, His Majesty's Government have now given their consent to our raising the Import Duty on cotton goods from 3½ per cent., as it now is, to 7½per cent., which is now our present general tariff rate. The Cotton Excise Duty will remain at 3½ per cent. There can be no question of our doing away with an impost which is estimated to produce about £320,000 next year at a time when we have to impose extra taxation. By this means we estimate that we can get an additional £1,000,000. I am sure that the action of His Majesty's Government, following as it does on their recent association of India with the special 1121W Imperial Conference called in connection with the War and the measures to be taken thereafter, will meet with the greatest appreciation in India.