The Sun.
London, England, 1864-04-08 00:00:00

, 0.1 oftle ,

not owing to smuggling. I think the evidence on that
subject is clear. It is quite true that in Ireland at this
moment there is an increase of smuggling as compared
with the three preceding years ; but it is not tine that
there is an increase in smuggling as compared with what
it was when the duty was Bs. I will venture to give a
proof of that. We have means of judging wbcther distress
has operated in this matter or not, bets Du. the circum-
stances of the three countries, as connected with consuming
power, have materially differed during the last four years.
Ireland has unhappily been afflicted with a succession of
bad harvests. Better in 1863, not perhaps as regards the
seller, but as regards the consumer ; but the three preceding
harvests were of an exceedingly lamentably defective cha-
racter. England has suffered in the great focus of consump-
tion of this kind, viz., in Lancashire, in a peculiar degree.
Scotland, having a very small cotton trade and having its
industry generally in a flourishing condition, may be said to
have hardly suffered at all. Now it is curious that the spirit
revenue of the three countries has varied in the precise pro-
portion of their distress. In England the revenue has been
stationary since 18.59-60. It was £4,341,000 then. In 1863-4
it was L 4,390,000, showing an increase of £49,000, or about
1 per cent. on the revenue. In Ireland, where the pressure
of distress is greatest, in 1859-60 the revenue was £2,655,000.
In 1863-61 it sunk to £2,322,000—a decrease of about 14
per cent, on the whole, which is amply accounted for not
only by the gradual change of taste which operates in all
the three countries, but also by the special distress under
which Ireland laboured. In Scotland, where the pressure
of the distress has been much less felt, the Scotch revenue
from spirits has increased in a manner not at all unsatisfac-
tory, considering the changes which have been made in it.
In 1859-60, even although unduly swelled by premature de-
liveries, it was £2,973,000, and in 1863, £3,332,000—(hear)
—showing an increase of upwards of £300,000. This may
be considered a very satisfactory result. The truth is, a
very great change of taste is going forward. It is not to be
indicated by one circumstance or another, but by the com-
parison in aggregate effects of a multitude of observations.
There is a steady process, a very happy process, in operation
—the translation of taste for stronger and more ardent spirits
to milder and more wholesome liquors ; and we cannot un-
derstand what is going on with regard to the spirit duty,
unless we keep that essentially in view. lam glad, how-
ever, to say that, as far as regards distillers, though they
have had a considerable diminution of home demands, an
export trade is rapidly creating itself. Some 20 years ago
he quantity exported was very trifling. In 1859 it had risen
.o 1,941,000 gallons ; while in 1863 it had risen to 4,071,000

and I eegeee.
will include in my statement of exports of '
British, the exports of foreign and colonial produce, of
which this country is becoming more and more the
centre. In the year 1861 our imports were estimated
at £217,485,024. In 1862 they were estimated at
£225,716,976 ; and in 1863, the year when we were almost
wholly deprived of the largest and most valuable of all oar
imports—namely, the cetton of America —the imports were
estimated at £248,980,942. Our exports of British produce
stood for the first of those three years at 114102,514 ; for
the second of three years at £122,992,264 ; and for 1863
they stood at £146,489,768. Oar experts of foreign and
colonial produce for the first year were £34,529,684; for
the second year £42,175,870; and for the third year
£19,485,005. The total exports of the country were, in 1861,
£159,632,498; in 1862, £166,168,134; and in 1863,
£195,974,7 73. The total movement of the foreign trade of
the country is this : Imports and exports, taken together,
amounted in 1861 to £377,117,522; in 1862, £391,585,110;
and in 1363, £144,9:55,715. That astonishing sum I will
only illustrate by these two statements. In the first place,
it may be taken to be about three times the trade of this
country as it stood at a period comparatively recent, viz., in
the year 1842, when Parliament first began deliberately and
advisedly to set itself to work with a view to reform our
commercial legislation. (Cheers.) In the second place,
that sum may be taken to represent as nearly as possible
£1,500,000 for every day in the year—a magnitude of
operations connected with industry so vast that, if it did not
stand on. incontrovertible figures, it would hardly receive
belief. But not only aro these figures remarkable when
we consider them as showing the progress of the energies
of Englishmen, and the strength of that country which is
dear to all our hearts, but they mean much more than
this. They mean that England is becoming more and
more deeply pledged from year to year to be the chem.
pion of peace and justice throughout the world—to take
part, with no view to narrow and selfish interests, but to act
with the broad object of tho welfare of humanity at large, in
every question which arises, in whatever part of the globe.
(Cheers.) I referred a moment ago to the year 1842, and
stated that it was since 1842, since the commencement of
the great work of Parliament with regard to commercial
legislation, that these changes had taken place. Ido not
overlook for a moment the effect of other elements that have
been at work—elements of immense power and immense ad •
vantage. There are some who think the same effects would
have been produced, even if your commercial legislation had
remained as it was. (Hear, hear, from an Hon. Member—
laughter.) I hear a solitary " hear, hear." It is a matter
of great national and public interest that we should satisfy
ourselves in some degree by approximate evidence of the
truth of this statement. Ido not deny that other countries
have made great progress in trade and industry. I do not
undervalue the effect of the powers of locomotion which
have been set in operation amongst us, There are many
other causes which have co-operated to produce this extra-
ordinary development of modern industry ; but this I have
observed, and it will at any rate go for what it is worth,
that during the several years in which Parliament has with
an unsparing hand addressed itself to the business of libe-
rating commerce, these operations have been immediately
followed by striking augmentations of the trade and indus-
try of the country. Whatever is due to locomotion, to tele-
graphs, the progress of machinery, the change has been equal
from year to year. Allowance must always be made for
good harvests and bad harvests, but still if I find this meet-
ing me in examination of the case that the legislation of
Parliament has immediately been followed by striking and
great results, it shows me that we have not been feeding
ourselves on empty dreams when we believed that in
giving freedom to the commerce and capital of England
we were adopting the true means of extending our pro-
sperity. I will only take the three last years in which
changes of that kind have taken place. In 1853 important
changes of that description were made. The exports of Bri-
tish produce in 1852 had been £78,066,000. The year 1852
was a year of great prosperity, an excellent harvest, and of
the cheapest capital ever known is this country. 1853 was
a year of bad harvest, but a year of legislation on behalf of
freedom of trade; and while in 185'2 the exports were
£78,000,000, those of 18:53 ware £98,938,000. The yearlBso
was one of the worst harvests known during the last half
century; and in that year the exports showed an increase
of £161,000 on the preceding year. In 1863 it was in the
power of Parliament to grant extensive measures of com-
mercial relief. In the previous year, 1862, the exports were
£166,168,000 ; but in 1863 they rose to L 19,5,974,000. Ido
not think it is possible to lay down any precise rule or de-
gree ; but I do say these figures represent a connection be-
tween the years of legislation and the great increase of the
trade of the country. I will now refer to the fiscal and com-
mercial legislation during the same years to show that we
have not been indifferent to the complaints of those who
think they have been hardly dealt with. And, first of all,
let me refer to the completely settled—l mean settled so tar
.as legislation is concerned—question of the paper duty.
'Though the accounts which I shall present are fragmentary
and partial, they are indisputable, so far as they go. There
has been an increase of imports to the following extent :
Is 1859 it was 13,000 cwt, and in 1861, 101,00:e cwt, which
-eras an enormous increase. When we cone;der the import of
she materials or paper, we find thst in 1859 we imported
173,000 cwt, and in 1871, 725,00 Q cwt. There is a positive
increase in the amount of B' et;sh paper goods exported. In
1859 it reached 115,0 QC) cwt, and in 1564, 193,000 cwt.
This is the quantity as nearly as can be estimated, but of
the quality I cannot speak. Then comes the question of
vhe price, and this has been greatly reduced. We will take
-printing papers; and in 1359 the price was 61e1 to 811 per
1b; 1364 it was tia to 61a—(hear, hear)—eo that the re-
duction has beers from 7to 9 farthings per pound. There
le another very curious fact connected with the paper trade,
nhough I am very far from represent*ne that the paper trade
ds as prosperous es one could desire to see. (Hear, hear.)
It is remarkable that the diminution in the number of paper
manufactories which was taking place before the repeal of
the duties has ceased. In 1533 the number of paps r menu
/'dories was 526, of whom it is necessary to deduct a small
per contage for the card-board trade. In 1843 there were
417; in 1838, 386 ; in 1859, 38.5; and in 1351, when the duty
was repealed, the number had sunk to 361. In 1863 it was
360, though these had been labouring under considerable
disadvantages ; for the paper trade was in no small degree
dependent upon the cotton trade. And you must recollect,
with respect to the value of cotton goods exported, the cot-
ton had vastly increased in price; therefore the total value
of the exports, as compared with other years, may tend to
diminish the appearance of loss. INt this high-priced class
'of cotton goods required no more paper to pack them than
did the cotton which was formerly sold at a cheap rate. Ihe
papermakers have also suffered with respect to rags. I must
ask the house to remember that the cotton trade grew up
:under protection. Protection immersed the energies of the
:manufacturers, and they were contented with imperfect and
wasteful methods of manufacture. But protection was with-
drawn, and it was said that it would cause considerable suf-
fering to throw the manufacturers upon the resources of
;their invention and skill. The restorative process com-
menced, and, after a short interval, every one of the branches
,of this trade found itself more healthy, more vigorous,
and more profitable. (Applause.) I will quote a
single instance in the paper trade in support of what I
have said. The facts are supplied to me by a gentleman
in the trade, who is a partner in a mill which was set up
since the repeal of the duties, I am not authorised to
Ursa this gentleman's name, but if his facts should be doubted
he is willing to communicate the particulars. For the four
months ending Oct. 31, 1863, he made paper at £57 per
ton, but it did not pay. He and his partner set themselves
to work for the purpose of seeing what could be done by the
:improvements of the process and by chemical agency. In
Oct., 1863, as I have said, he produced paper at £57, and in
December ho had his partner had reduced the price to 117
per ton. (Hear, hear.) At the present moment they are
manufacturing it at £37 per ton—(applause]—and the arti-
cle ie a better one than that which cost £57 per ton. I think
it would be ill advice to them if they were told not to de-
pend upon their own energies. It is certainly monstrous
to say to any branch of British industry that we shall ex•
pose them to the effects of foreign competition unless we
likewise say " You shall have all your wants at home sup-
plied on the best possible terme." (Hear; hear.) We very
much lament that foreign Governments should maintain
restrictions of any kind on the imports of raw material, It
is with great satisfaction that I am authorised to say that
we hope and believe that a concession will be made by the
Government of France in the export duty on rags. (Hear.)
I neat come to the question of 21)i:it duties, the importance
of which will bo remembered when I say that, not from
strong liquors taken in the whole, but from the single arti-
cle Of what is called ardent spirits, we raise nearly one-fifth
of the entire revenue. In 1360 the duties were raised to the
highest
•point, viz., 103 the gallon, and it was said that,
although there would be a considerable diminution in the
i consumpi
-dm, yet from the augmentation of duty there
mull be en increase of revenue. The duty was not so
great as was expected, but the question arises whether that
wee due to smuggling, to distress, or to the operation of
the duty. With respect to the duties of the year 1859-60
the revenue department explains that there was a large
sum received in consequence of what may be called the
premature delivery of spirits from bond under the
expectation that the deities would be increased in February,
1860. The effect was that £320,000 duty was received, and
went to the estimate of the year 1859.60, which really be-
longed to 1860.61. The actual revenue for 1859-60 must
be estimated for as follows First we must deduct from the
duty then received on British
spirits a sum of £340,000;
and, secondly, a sum of 225,000, in consequence of the great
diminution that in the yearlBs9-63teas enacted by Parlia-
ment on the duty in foreign spirits, and particularly on
French brandy. The corrected. total of the revenue for
foreign, colonial, and British spirits in 1859-63 for the pur-
pose of comparison with the revenue of the present year,
would stand as follows : /11,756,000 ; namely, on Brinell
spirits, £9,458,000; on foreign, £2,298,000; making
£11,755,000. In. 1863.61 it was .€12,163,000; in 1861-2 it
was £12,267,000; and in 1832-3, when the Lancashire dis-
tress had reached its utmost intensity, it fell to £12,102,000.
In 1863-4, when the distress had been abated, it rose to
£12,638,000. So that the real state of the question, con-
si tiered as a final question, is as follows : The revenue, 1859-
1869, properly belonging to it, may be taken as £11,756,000 ;
in 1863-61, 112,638,000 ; showing an increase in the revenue
from spirits of £882,003. This beteg a question of great
interest, I have sought for means of throwing light upon it.
Why is it that the revenue from spirits has not risen. Is it
due to smuggling, to distress, or to a change of taste' It is

gallons. lam informed that the Scotch, in addition to a
tolerably supply which they have found for the people of
Scotland, have secured to themselves a considerable portion
of this export trade. With respect to wine the figures
stand as follows : In 1859 wine imported from Portugal was
2,106,000 gallons; in 1861, 2,669,000 gallons, showing an
increase of somewhat over 25 per cent. The wine imported
from Spain is more in favour than the Portuguese wine ;
for in 1859 it was 2,884,000 gallons, and in 1864 it had
risen to 4,799,000 gallons, or about 70 per cent. The wine
imported from France in 1859—the last tear before

the change—was 597,000 gallons, and in 1864, 1,965,000
gallons—showing an increase of 330 per cent. As regards
other foreign countries, which are generally represented by
light wines, the amount in 18.59 was 577,000 gallons, and
in 1864, 1,184,000 gallons, or over 100 per cent. The im-
port of colonial wine has largely decreased, distinctly
proving that nothing but a duty perfectly artificial and
extravagant in amount, and totally unreasonable in its
grounds of endowment, in effect taken out of the pockets
of the people of England, was really the basis of the

trade in colonial wines. If the wine trade will grow nett],
rally in the colonies, by all means let it do so ; but I believe,
in those colonies whose climate was best suited to the
growth of wine, the rate of labour is a good deal too high to
allow anyone to hire a large number of persona to set about
the manufacture. The growth of the consumption of wines
in this country is most satisfactory. In 1858-59 it was
6,974,000 gallons ; and in 1863.64, 10,729,000 gallons,
showing an increase of 54 per cent. The figures for
1863-61 are not precisely as regards units or hundreds of
zallons, but for every substantial purpose they are correct.
There is another subject I wish to mention to the committee,
because it was a subject of legislation last year, and also
is a subject of great fiscal and considerable commercial
importance—l mean the subject of the tobacco duties.
During the last year an act was passed for the purpose of
reconstructing our system with regard to duties and
rawbacks on manufactured tobacco, The objects of the
act were to diminish smuggling and to increase trade and
revenue. I think the committee will be of opinion that
where those objects can be satisfactorily combined, the
results are well worth having. As regards the increase of
articles which were formerly smuggled, the case stands as
follows—The descriptions of tobacco which were largely
smuggled into the country wore cigars and cavendish. The
cigars imported in the eleven months from April up to
February, 1863, was 2,316,0001 b. The cigars imported in
the corresponding period of eleven months in 1863-61 was
3,976,0001 b., showing a large it crease. With respect to
cavendish, the manufacture of which in this country had
been previously prohibited, but which was allowed by the
Act of last year to be manufactured in bond, six manu-
factories of cavendish hove been established by way
of a commencement of the trade. But this in-
crease of importation of the foreign article has not
been attended with a diminution of the tobacco
manufacture at home ; for, whereas it appears that in
1863 there was entered for consumption 35,700,0001 b of
raw tobacco, in 1861, after the duty had been lowered an!
the British manufacturer had been put through his usual
paroxysm of apprehension and alarm—after the usual an-
nouncement had gone forth that many hundreds of thou-
sands cf workmen in the tob son trade were about to be dis-
missed, if they had not been actually put upon the streets—
now what aro the facts of the case ? In the year preceding
the change, the British manufactured tobacco entered for
home consumption before this terrible and pernicious
change was 36,569,000 lbs. ; and whereas in 1862-63, in
the eleven months, we only exported 50,000 lbs.,
in 1863.64, for the same period, we exported 120,000 lbs.
The reverse, I am happy to say, has been going on
in a very satisfactory manner. About 1843 it was ad-
mitted that the smuggler had got the better of the re-
venue department ; but his triumph, if it was really a
triumph, was only temporary. The smuggler has been
kept within bounds, and, I trust, now is not only kept
within bounds, but greatly limited and reduced. The ave-
rage annual growth of the income of this country from to-
bacco alone for the twenty-one years, beginning with 1842
and ending in 1862, has been £105,000 a year. Last year,
when the change of duty was adopted, the revenue rose from
£105,000 to £293,000. (Cheers.) The house may desire to
know what is the condition of our trade with France. In
the year 1859, immediately after the treaty of commerce, our
imports from that country were £16,870,000. In the year
1861 they had risen to £24,024,000. Our exports to that
country during the year 1859 were £9,561,000. In the year
1863 they had risen to £22,963,003. But I am very glad to say
that the French manufacturers, like the English, are begin-
ning to find the futility of their alarms, just as the traders in
this country found it in their own case mane times over ; and
that at this moment the spinners of France, who were in a
state of dire apprehension when the hon. member for Roch-
dale was executing his work, have become exporters of linen
yarn, and have sent to Dundee cargoes of that commodity
amounting to half a million sterling in value. (Hear.) With
all this I remind the house that the pauperism of this
country remains not only stationary—l exclude Lancashire
as a matter of temporary operation—but may now be said
to have been for a considerable number of years on the
decrease. In 1848.49 the paupers of this country num-
bered 981,000 ; in 1853-61 they were 828,000, without
including Lancashire. In 1848-49 there were 61 paupers
in every thousand of the population, and now there are
only 46 in a thousand. In other words, in the first of
those years there were 239 in every thousand who were
a working population, and now there ate 954 in every
thousand who are a working and a self-supporting mutt
lation. That is the gate of the case as regards the year
1863-4, through which we have just passed. New I come
to the estimates for the year 1864-5. (Hear.) The charge
for the funded and unfunded debt may be taken as
£26,400,000. The increase which appears in this charge is
owing to the operation of the measure to which I recently
referred for converting perpetual into terminable annuities.
The charges upon the Consolidated Fund other than that
debt aro £1,930,000. The estimates for the army are
£11,814,000. The estimates for the navy are £10,432,000,
but they will probably be subjected to a certain amount—
not a largo amount—of increase on account of a planwhich
is under consideration for improving the position of various
classes of cfficers in the navy. The estimates for the collec-
tion of the revenue are £4,692,0e0. The packet estimates are
£833,000. The miscellaneous estimates may be taken for
the present purpose at £7,628,000. It is probable that
that will not ultimately be the precise figure, but I may
observe that I have reserved a sum of £BO,OOO to cover any
variation which may occur an the navy and miscellaneous
estimates. The total estimated expenditure of the country
will therefore stand for tho year 1864-5 at £66,890,000,
That is lower than the estimated expenditure of 1863-.4 by
£1,393,000, and lower than the actual expenditure of that
year by £166,000, but it is higher than the estimated expen-
'9ture of 1858-59, which was the last year before we come to
the years of very high expenditure, £2,226,000. Or if we
correct the comparisonby debiting ourselves with the amount
of the long annuities which we have saved, and likewise
with the fortification expenditure, but deduct the sum of
£1,125,000 on the other side, to which I have referred as
now appearing on both sides of the account, and which
did not appear in 1859.59, the increase since 1858-59 may
be taken as £1,017,000. lam anxious to draw the atten•
tion of the committee to that figure because I think it is
a fair estimate of the actual present remaining growth of
our expenditure since the time when we returned from the
Russian war to a peace establishment. And now I come to
ttxe estimates of the revenue fur the year. First, I take the
revenue from the customs as £23,150,030 ; second, excise,
£18,030,000; third, stamps, £9,320,000; fourth, taxes,
£3,350,000; fifth, income tax, £3,600,000; sixth, Post-
office, £3,950,000; seventh, Crown Lands, £310,000. That
is the whole of the revenue properly so called. Eigth,
miscellaneous receipts, estimated at £2,250,000; ninth,
indemnities, £600,000, of which £500,000 is from China
and £lOO,OOO, in two sums, received from Japan. The
total estimated income wine therefore, be £69,460,000,
and the total estimated charges £66,899,000 ; and the pro-
bable surplus of income over expenditure will be

£2,570,000. There are several minor subjects, which
have no great bearing on the revenue, but which I may as
well mention to the committee in the first instance, in
order to put them out of the way of the more material ques-
. _ _

But now to refer to the plans which have been proposed re-
specting the sugar duties. I know the committee has a
peculiar aversion to dealing with any question where three
courses are open to us—(laughter)—but this is a question
in which not three, but four, courses are before us.
(Renewed laughter.) The plans are these. One is to have
two rates of duty—one upon refined sugar, and the other
upon unrefined. But refined and unrefined are not the only
categories with which we have to deal ; because refined and
unrefined are both of them solid sugars. There is also that
which I may call liquid sugar, which comes under the class
of melado or molasses ; and there are those who say let
us have one duty for refined, and another duty for unre-
fined solid sugar, and a third duty for liquid sugar. An-
other plan is to have one rate of duty only for refined and
unrefined, and another for liquid sugar. A third plan is to
have one rate of duty for solid and liquid sugars ; and the
fourth is the system of classification, based upon an appro-
ximation to the value of the article. Now, it appears to me
that the advocates of a uniform duty have not a leg to
stand upon, and therefore I utterly reject the proposals
founded upon that view. In the same way I reject the dis-
tinction between solid and liquid sugars. In the contest
between the importer and the revenue it would be impos-
sible to maintain any such principle of distinction. The
question really is between uniform duties and classified
duties. Ido not contend-that the present scale is a perfect
one. Indeed, the select committee to which I have referred,
pointed out that it operated inequitably in two respects. In
the first place it is almost prohibitory as regards the lowest
descriptions of sugar; and, in the second place, it operates
severely upon the higher descriptions of unrefined sugar
which come from the Mauritiusand the East Indies. I put
aside all question of refining in bond, for that is not open to
us as a practical question. Ths proposition which I lay
down, and which I invite the committee to accept, is this,
that the form of our duty should be that which should least
interfere with the natural course of trade. I have no hesi-
tation in saying that I adopt the doctrine laid down by the
Manchester Chamber of Commerce, and which has been
accepted also by the Liverpool Chamber of Commerce I
received the other day an address from Manchester on the
subject of the sugar duties. The memorialists expressed
their opinion that the duty should be in proportion to the
amount of crystalisable sacccarine matter which the sugar
contained. (Hear, hear.) Now, let me try it by example.
And here I must use one of those outlandish barbarous
words, " jaggery," which means the lowest class of sugar
manufactured in the East Indies. Let us suppose 2 cwt. of
this sugar in the market in the East Indies, and that these
2 cwt, contain 50 per cent., not of saccharine matter,
because in saccharine matter it will not differ very much
from much better sugars, but of what is called " orys-
tallieable eaecharine matter," as the Manchester Chamber
of Commerce has very properl described it, which can pro-
fitably be extracted by the refiner, 2 cwt of that glass will
yield 1 cwt for duty. Ido not refer to the minor results of
refining, which would only complicate the case very much.
I take only the first recess, that is, just as it comes from
the cane and undergoes the first peones ; and the question
is, how are we to adjust our law in such a way that we
shall give no inducement to any man, by means of the duty,
to refine in England rather than in India, or in India rather
than in England ? That, I think, is a fair statement of the
case. What will the Indian refiner do ? Let us suppose
we have an uniform duty. That is the way, we are told, to
do justice and avoid protection. Let us look at the operation.
The Indian refiner buys the 2 cwt and refines them. He
sends them to this country, arid if the duty in this country
is 10s per cwt, he pays lOs for the introduction of his 100 lb
of refined sugar. What has the British refiner to do ? He
buys 2 cwt in India at the same rate as the Indian refiner;
he sends it at a greater expense to England—brit that is his
affair, not ours; we must not undertake to reimburse hit t
for that—he brings it here to refine, and he pays 205 upon
the 2 cwt : so that the English refiner pays a 20s duty to
get his sugar into the market, while the Indian gets it in for
10s. And yet we are told that is the way to do justice and
so avoid the stigma of protection. We have endeavoured to
consider the question entirely without prejudice, but there
is no doubt at all what the meaning of that operation
would be—that it would be simply equivalent to a bounty
of 10s on refining in India. And this might happen : it
might be that in India, in consequence of the dearness of
skilled labour and the dearness of capital and machinery,
refining might cost 5s per cwt more than in England, and
still it might be worth while to get sugar refined in India
rather than to send it to be refined in England, because
of the 103 fine imposed by the fiscal laws here. That
is the nature of the view we take. We are not willing
to give any premium on the employment of labour and
capital in England as compared with India : but certainly
we are not willing to impose a penalty upon the employ-
ment of labour and capital in England, which is in our
view the effect of the duty. We have resolved to amend the
duty on the principle laid down in the memorial of the Man-
chester Chamber of Commerce. Now, I will explain my
proposals. The present duty on sugars—rejecting for a
moment the consideration of the semi-liquid classes, is dis-
tributed amongst four ela,ses ; refined 18s. 4d.; equal to
white clay, 16s. ; equal to brown clay, 13s. 100. ; musco-
vado, or not equal to brown c!ay, 128. Bd. I must mention
Dutch numbers—which may he speaking in a foreign tongue
to society in England, but which are the only universal
language of the alga: trade of the entire world ; and if you
tell a man what a duty is in Dutch numbers, it is constru-
able in the tongue of every foreign country, and he knows
exactly upon what quality of sugar the duty will fall. The
refined sugar corresponds with the Dutch No. 20, which is
the highest of them. The 163. duty, or equal to white clay.
corresponds with Dutch Nos. 15 to 18 ; the 13s. 10d. duty
corresponds with Nus. 11 to 14 ; the 12s. 8d , or not equal
to brown clay, corresponds with Nos. from 7 to 10; and
nothing under 7 can possibly pay the duty which we now
impose. We have had to consider whether it is desirable
for us to alter essentially the dividing points between these
classes. There are four classes, and therefore three divid-
ing points. These dividing points do not rest upon any
abstract principle, but upon knowledge and experience, and
are well understood here and all over the world. Therefore,
we have thought it very undesirable to recast the duty in
Coto, and to establish a completedy new state of distinction.
Consequently we adhere to these dividing points between
the different classes now establi-hed ; but we meet the
grievance in the better class of refined sugars by diminish.
ing the interval of duty at the upper end of the scale ; and
we meet the grievance in the lower class by establishing a
new class, at a lower rate of duty than the rest, for the pur-
pose of making those sugars admissible which are now pro-
hibited. The drawbacks, of course, will have to be altered
in proportion to the duties; and I should say also, in regard
to a collateral point of some importance, that, to make
this change fair as regards the refiner, we shall pro-
pose to postpone the reduction of duty on foreign refined
sugar to four weeks from the present day. We hope,
if the committee shall be disposed to accede to our
proposal, and think it reasonable to proceed this day week
with the resolution relating to sugar, then on Saturday week
the new lace will be is actual operation. I will now read
the new scale. Refined sugar, instead of lne 4d, will be 12s
10d ; the second class, or equal to white clay, instead of 163,
will be lls 81 ; the third, or equal to brown clay, instead
of 13s 10d, will be lOs ; the fourth, not equal to brown
clay, instead of 12s 8d will be 93 4d , and a new oh ss of in-
ferior sugars, corresponding with Dutch numbers not rising
above No. 6, to be 8s 20 ; the duty
on peeled() and molasses
will follow in proportion, the duty on the former for 6s 7d,
and on the latter 3s 6d. The effect of this I will describe
as well as I can. The interval between brown clay and re-
fined, the chief subject of complaint, is so great that it cer-
rainly does destroy and divert the natural course of trade.
It is now 4s ed ; we reduce it to 2s 4d. The firth class pro-
vides for the lowest classes of sugar. The smallest reduction
made is 3s 4d, the largest 5s 6d, the average is over 4s. The
effect of this change will be to place the sugar duty in this
country is—or more than ls—
lower than it ever reached in
any former year. (Cheers.) We shall propose to make this
act permanent, and to leave the tea duty renewable from
year to year. I will show the committee what will be the
financial result of this plan. (Hear, hear.) The revenue
from sugar for the year 1864.5, as we estimate it, will be
£5,555,000. 'I he reduction of the duty, as I have stated,
would cause a first loss of £1,719,000 ; but allowing for the
entry of sugars now practically excluded, and taking credit
for increase of consumption amounting to 6 per cent, which
I consider a very moderate estimate. £361,000 of that sum
would be recovered, and the loss to the revenue.in 12 months
would be £1,358,000. But allowing for the fraction of the'
year that has already passed, the probable net loss will be
£1,330,000, and that at once, as the house will see, reduces
my surplus from £2,56',030, to X 1,230,000. So much for the
vhnelvceisrcaurn
whether
duty—because their
isf itn
sugar duties, upon which it has been necessary for me to
d which is made for
hear.)
.) undert
nt
enter rather fully in order to make myself intelligible to the
sms:htuaaebnyj
reductionce ecbste o,
offt otghreepaodat
ras
for her
Imna
joewetyco,emGe
otoverannisuebnjte,ct which it is impossible
re-
venue of £6,000,000. A reduction of one-half would in the
first instance involve nearly twice as much as the large isyrn bip)
:ye
repeal
mtlwa
oeni
fatnnhet o.htuhe(toumnedanoelrtatt: notice,
re-
duction I have just proposed for the sugar duties ; and I can
not disguise, and do not disguise, that is a question of great
political importance. A great victory has recently been won
in Hertfordshire. (Laughter.) A gentleman, highly compe-
tent not only to take his share in the business of this house,
but even to adorn this house, has, as I am informed, failed
to obtain a seat in Parliament because he was not ready to
accede to the demand for the repeal of the malt tax. (A
laugh) The successful candidate saw no difficulty in his
way, and on the list of his committee appeared a name most
justly respected in this house--the name of a person of great
political influer le—the name of my right hon. friend the
member for Hertford: hire, and Secretary for the Colonies
in the late Administration. The question then is, has the
remission of the malt tax a claim upon our remaining sur-
plus? Is the house disposal to give that to the repeal of
the malt duties ? (No, no, and laughter.) It is commonly
said that if we reduce the malt duty by one-half there will
be little or no loss. But practically one half the malt duty
was taken off when the beer duty was removed. Thirty-four
years have elapsed since the beer duty was removed, but
although during the last year the malt duty raised £700,000
more than in the year before, the malt duty has not yet
supplied the loss of the beer duty. For in 18 t 9 the joint
produce of the beer and malt duties was £7,280,000, while
last year the malt duties only produced Se3,o9l,ooo—the
average produce of the melt duties during the last few years
being 51 moliens—whilst after 35 years have elapsed from

tion as to how the surplus is to be dealt with. Perhaps the
committee may be surprised when I say it is intended to
submit to the Houses of Parliament a proposal for altering
the present duty upon corn. The duty on corn is at present
levied by measure, while almost all transactions connected
with the foreign corn trade are carried on by weight. In
consequence of this discrepancy, and the inconvenience re-
sulting from it, the merchants connected with the corn trade
—I think 12 months ago—made representations to the Go-
vernment that the form of duty ought to be altered. We
propose accordingly to alter the duty from the uniform rate
of one shilling a quarter, to a uniform rate of threepence
per cwt. This change will take effect immediately on the
passing of the Act. It is also proposed to put some articles
of very small importance—such as lentils—which now pay
no duty, on the footing of corn. That has been done
at the request of the trade. But, sir, I ought to mention
that it has been proposed by many persons connected with
the trade to modify the duty in this wa) —to lay a duty of
3d, per cwt. on wheat, and 2d. per cwt. on other kinds of
grain. And it is very justly said that that would be a more
fair arrangement in reference to the value of the article on
which the duty is imposed. Now, there are two reasons
which have withheld the Government from acceding to
that view of the case. One is that the change would entail
a considerable loss to the exchequer, which we do not
think that, having a pressure of other claims, we are in a
condition to afford. The other objection is this, that it
would appear as if we were deliberately setting about the
construction of a regular system of corn duties, and as if
we regarded that item as a permanent portion of
our finance. When the corn duty was imposed
in 1846, it was imposed under the idea of its
being a nominal source of revenue. It has, however, pro-
duced considerable revenue, with which it Might be dif-
ficult to part. lam not prepared to say that it should be
parted with at the present moment ; but I confess that, on
the other hand, I should be reluctant to commit myself to
any plan which appeared to assume that a duty of this kind
—not a heavy duty, but still more than a nominal one—is
to be regarded as permanently imposed upon the chief
atticle of subsistence. I propose to make a change in the
rate of the charge for the licences of dealers in tea in cer-
tain cases. It is well known that these licences, in some
cases, operate severely in the rural districts, where the deal-
ings of the shopkeepers in each particular branch of trade
are very small ; and they are obliged to combine a great
number of branches in order to constitute a business that
will yield a competent and moderate return. At present no
i person can sell a pound of tea without paying the shm of
lls 6d for a licence. That sum of Ils6d is reckoned to be
10 per cent. on the sale of from 30 to 35 pounds of tea in the
year. That tends to narrow the supply of this commodity,
especially to the rural population. It is not felt as a griev-
ance in the towns. I think it is good policy, even taking
no higher ground, in furtherance of the great change which
we adopted last year, to make a reduction upon that duty
with reference to the thinly populated districts. I therefore
propose in all houses under £lO a year rating, and not being
in a municipal or parliamentary borough, to reduce the duty
from lls 6d to 2s 6d. That would cause a loss to the re-
veuue of £lO,OOO. Two years ago we adopted useful regu-
lations with regard to hawkers. We legislated for hawkers
on foot and for hawkers having one horse. We reduced the
duty from £3 to £4; but we forgot the case of the hawker
who had two horses. (Laughter.) The result is that at
the present moment a hawker who has two horses pays £4
on one, and £8 on the other. We propose to place both
horses on the same footing. (Renewed laughter.) We
propose the equalisation of the stamp duties which are now
payable upon admission to ecclesiastical benefices of small
value. At present there is a distinction in the rates of charge
in the case of rectories, vicarages, and perpetual curacies.
There is no ground for the distinction. We propose, there-
fore, to abolish it, and substitute for the scale now in force
—which would levy a payment of £7 upon presentation and
institution together to benefices of £3OO a year—a scale of
duties which will bring the charge to £5 in the case of bene-
fices under £3OO a year, and which would diminish as the
value of the living decreased ; so that a living of less annual
value than £5O would be altogether free from charge. Next,
sir, I willingly accede to the hon. member for Devizes the
proposal he has suggested, which proposal is founded on
good sense; it is, that the duty on proxies to vote at jeint-
stock companies, which at present is 6u, but which was
formerly 305, shall be reduced from 6d to ld. I pro-
pose certain reductions upon the duty on letters of
attorney for the receipt of dividends, anti I pro, ose to
make a change in the stamp duties with regard to the sale
and transfer of the stock of foreign companies. I propose
to legalise the practice known as marine reinsurances upon
payment of ld stamp, as in the case of fire insurance. I
propose, under the same control of the magistrates,
to give to refreshment-houses and sellers at the bar the
benefit of occasional licence, as far as it is enjoyed by pub-
licans. lam silent on the question of charities this year ;
but I wish to remind the committee that there isno change
in our views, and certain directions have been given by the
Home Secretary for the purpose of collecting information,
which will be laid before Paniament, to enable it to form a
sound judgment when its attention will again be drawn to
the subject (Hear, hear.) Therefore, with the insigni-
ficant exception of £10,030, the surplus will stand nearly
at its original amount. Now as regards the disposal of the
actual surplus of £2,500,000. (Hear, hear.) This year has
brought forward a large number of formidable claimants ;
but I shall endeavour to deal fairly with such cases as can-
not be possibly passed over. With regard to the largest
portion I will not keep the committee in suspense. I don't
think, when the matter is considered apart from prejudice,
interest, promise, or pledge, there can be any doubt that
the first claim upon the surplus is the claim of sugar. I need
scarcely remind the committee of the enormous importance
of that article. I believe its importance, as regards the
comforts of the people, stands next to corn. The duty on
sugar was raised for the purposes of war, and the principal
part of the impost was never removed. We now propose to
make a considerable reduction in the sugar duties. At
present sugars are 10s. above the price of 1863, and they
are Gs. above the price of 1861 and 1862. There is no com-
parison between the claims of tea and sugar. With regard
to tea, we are dependent upon one source of supply, and we
are the great consumers of the world, and exceed all other
consumers in a large degree ; whereas, in the article ot
sugar, our consumption is small with reference to the total
consumption of the world. Sugar is produced in a mul-
titude of countries and is sent into a multitude of markets;
and the consequence is that if it is diminished in price it
will have the effect of attracting it to the highest mar-
kets, and, therefore, mitigating whatever inconvenience
may be felt from a restricted consumption. Tho stock
offers by no means a satisfactory prospect. On the last
day of February, 1862, the stock of sugar was 707,000
cede. ; on the last day of February, 1863, it was 238,000
cats.; and in 1864 it was 227,000 cwts. But now
I approach the most formidable part of my task this even-
ing. I said I proposed to deal with the sugar duty, but how
is it to be dealt with ? There arises a question which is
grave in two senses. The question whether sugar is to be
taxed with a uniform or a classified duty is one of great im•
portance to all who are interested in its cultivation ; but, on
the other hand, as regards details, it abounds in every ele-
ment of repulsiveness. The present classified duty upon
sugar is approved by some, while it is a scandal and offence
to many more. The system of a uniform duty became gra-
dually modified until the markets were opened to all the
sugars of the world ; but we found we had to deal with
classes of sugar of which very little was previously known.
In the year 1841 the consumption of sugar was 71bs. per
head of the population. In the year 1851 there was a
change consequent upon free trade, and the consumption
had risen to 26:lbs. per head. In the year 1861, after being
ten years under the operation of the classified system—but
when we had not the power to give the boon to the consu-
mer which was given in the ten years between 184 L and
1851—the consumption per head was 35ilbs.; and in 1863
the consumption rose to 3541b5. per head of the population.
Referring to the influence of authority, I may say that the
literature upon this question has been enormous. (Hear.)
Up to within the last fortnight, I believe I may conscien-
tiously say that I kept myself on a level with the press of
the country. So far as the sugar duties are concerned in
the last fortnight, however, my efforts have been baffled.
(Renewed laughter.) But upon the subject of authority,
passing from the opinion of political economists, I may re-
mind the committee that a select committee was appointed
upon the motion ot the member for the City of London, two
years ago, under the presidency of my right hon. friend the
Secretary for the Colonies, and that the report of that com-
mittee, atter a most patient investigation was distinctly in
favour of the present system of classification. Nor is that all.
Last year we had what may be called an international dis-
cussion upon this subject. Representatives from the customs
departments of England, France, Belgium, and Holland,
met in Paris and discussed the subject; and not only did
the representative of England find no reason to recede from
the system of this country, but the representatives of France
and Holland came to the conclusion that they would do
well to abandon the system of an uniform duty. As far,
therefore as authority is concerned, we have ample in favour
of classification. Bat it is said classification means protec-
tion ; and there is another argument, drawn from the
analogy of the mode in which we have dealt with other
articles. No doubt Parliament did impose duties upon dif-
ferent descriptions of tea ; and it abandoned that system not
because it came to the conclusion that the principle was
false, but because we found from the nature of the commo-
dity that the arrangement was impracticable. And now is it
true that a system of uniformity is the system recognised
throughout our tariff? lam happy to say that our tariff
has now reached very moderate dimensions ; nevertheless
instances may be set forth, almost all of which are in favour
of classification. There are the wine duties for example.
Again, refer to the case of coffee. When coffee comes over
here in the raw state it pays 3d ; when roasted it pays 4d.
Cocoa, when it comes here as a pure raw material, you tax
id in the lb ; when it comes removed from the husk you tax
it ld ; and when it comes in the more advanced stage of
chocolate you tax it 2d in the lb. Take the case of corn.
The duty on corn is now is a quarter, but you are going to
make the tax 3d a cwt. Well, what is the duty upon flour,
which may be said to be corn refined ?—why, ,liel per cwt.
Lastly, take the case of wood. Wood pays a duty of is a
load, but if sawn into deals it pays 2s. Therefore, so far as
the analogy of our tariff goes, it is in favour of classification•

TIM SUN, LONDON, FRIDAY EVENING, APRIL 8, 1864.

the time when practically half the malt duty was taken off,
there is still a gap of millions not filled up. If then you
choose to take the step which you are asked to take, you
may tell your little children now growing up that the
longest lived amongst them may witness the recovery of
the malt duty, but pray give up any hope of seeing it
yourself. What, indeed, is the great grievance of the
growers of barley in this country ? The grower of fine
barley, who possess a practical monopoly, has no grievance
at all. During the 25 years when the duty was levied by
the sliding scale, from 1827 to 1846, the average price of
barley was 32s 6d per quarter ; for the 17 years since the
repeal of the sliding scale, it has been 43s 11/d. But that
is not all, for while there has been a rise in the price of all
barleys, there has been a special and peculiar rise in the price
of the good barleys, and growers of which are now so obstre-
perous for relief. But it is time, sir, that the question
sh-ould be looked at from another point of view. When the
member for Hertford proposes to sacrifice some millions on
account of the malt tax, let us consider how this bears upon
the interests of the three countries, England, Scotland, and
Ireland, and how the remission would be divided amongst
them. At present, if I take the revenue from spirits and
malt together, I find that England pays £10,21E,000, or 10s
a head ; Scotland, £3,620,000, or 22s a head ; and Ireland,
£2,653,000, or lOs a bead. What would be the effect of
taking five millions or three millions off the malt tax ? It
would be a boon to England to be made up by general taxes
on the three kingdoms. Scotland anti Ireland would obtain
almost no part of the relief, but would be liable to pay their
fair share of any augmented income tax or other tax which
might be imposed. (Cheers.) The malt duty paid in Eng-
land during the financial year just expired was £5,722,000 ;
in Scotland, £263,000 ; in Ireland, .C 306,000. (Hear.)
Under these circrmstances, the Government, not insensible
to the evils of a system of excise as applied to any manufac-
ture, have come to the conclusion that they would betray
their duty to the country, under the circumstances in
which we stand, if they proposed to apply any part of the
surplus to the reduction of the malt tax. (Cheers.) Now,
there is another question which it is ray duty to bring to
the notice of the house—the income tax; for this is a ques-
tion not only involving the largest amount of revenue on
which it is in the power of a Minister to address Par-
liament, but it is in other respects the most important,
because it is associated with the strength and security
of the country in, times of emergency in a manner
which belongs to no other tax whatever, and in-
volves social relations touching the relations of class
to class, and their relative susceptibility to taxation, and
moral questions concerning the effect of certain schedules,
which are of a moment far transcending those which bear
on ordinary questions of taxation, It appears to me that
the country should be dealt with fairly and openly on the
subject of the income tax. Parliament should consider—
Will it maintain the income tax on its present level—abolish
it altogether—reduce it to a lower level—regard it as an in-
strument of ordinary finance—or, declining to employ it in
time of peace, reserve it for great national emergencies, ex
cept as a means of effecting further reforms in our fiscal
system ? These questions have never been decided by Par-
liament. In 1842 the income tax was imposed to facilitate
commercial reforms—in 1815 it was renewed with a view to
still further commercial reforms—in 1849 it was renewed on
the proposition of my right hon. friend the Secretary of State
for India, in a time of considerable apprehension, although
not of actual danger. In 1851 Parliament refused to renew
it, except after the appointment of a parliamentary commit-
tee. In 1853 it was renewed for the longest period for
which Parliament has ever granted it, but it was renewed
upon a statement of figures and calculations which appeared
to afford a reasonable promise of its extinction. In 1860 it
was renewed, and even raised, to meet the necessities of the
country, in connection with our establishments, and like-
wisd with a view to carry still further the work of commer-
cial reform. Since 1860, Parliament has taken no distinctive
any question of policy connected with it. The
resolution or..
.mod to 7d. in the pound, we find our-
tax being now reduo- were in 1812. These are
selves at the point where we have an opinion.
questions on which earliament ought
of in the
It, is not desirable that they should be dispose,. • -alt
dark, or that the income tax should be continually me.
with simply by rene vats from twelvemonth to twelvemonth,
founded perhaps on, and sufficiently justified by, the exi-
gencies of the moment, but having no reference to policy
announced to the country, and to a clear, distinct, and
decided opinion on the part of Parliament with respect to
the proper use of that great tax. There are, no doubt,
many arguments which tend very much in favour of the
permanent maintenance of the income tax, even as a matter
of ordinary revenue. Its efficiency is enormous. Ido not
know any other tax by which, in the same degree as by the
income tax, you get at the vast reserved capital of this
country. You get it by the income tax—a tax very rough
and unequal, subject to that mysterious process of almost
virtual self-assessment which refers it pretty neariy to she
conscience of the taxpayer, in the great majority of cases, to
determine what precise payment shall be made. But still,
after all, they are got at by better means than by any other
engine of taxation. But there is, as the house is well aware,
much harshness in the mode in which the income tax ope-
rates upon the lower incomes which it affects. That opera-
tion has been much mitigated by the measure adopted last
year, There is no doubt that those who desire the perma-
nent maintenance of the income tax have reason to congra-
tulate themselves on the adoption of that measure, which
very greatly relieves the harshness of the tax in the lower
part of the region in which it acts. But it is still severe
upon porno as dependent upon small fixed incomes—upon
what may be called the non-elastic incomes of the people.
It imposes undoubtedly a very great amount of trouble in
the assessment. It has often been my business in this house
to perform the invidious task of deprecating the complaints
of honourable members with respect to the vexatious annoy-
ance which it involves. That is not because Ido not sym •
pathise with those complaints, because 1 know how much
annoyance and trouble is inseparable from the ordinary
operations of the tax, especially at the triennial period,
when the assessments cn certain portions of the community
in schedule A are to be renewed. The inquisition into pri-
vate affairs is a serious matter in connection with the in-
come tax. The use of a war tax in time of peace—of a por-
tion of your last resource—is a matter which, if for no other
reason, deserves the notice of the house. The opinion of
the inequality and injustice of the tax, of which the hon.
member for Buckingham (\lr. Hubbard) is the champion
in this house, though her Majesty's Government do not
accede to it, they cannot deny to be an opinion which is
widely spread among a large class of people. (Hear, hear.)
There is no doubt that this a matter to be considered with
reference to any tax whatever. It is needless to enter into
the subject of fraud. It is said, and I am afraid it would be
difficult to deny, that the extent to which encouragement is
given to it is very great. But there is one operation of the
income tax which I cannot help—though it is matter only
of private opinion—frankly stating to the house. It is its
operation with regard to public economy. (Hear.) That is
a topic which I do not think has been fully, or indeed ever,
aiscussed before Parliament. Long experience in the office
I hold, necessitating my placing myself in conflict at all
times of day and night, and in all places and ad circum-
stances with every sort of demand for increased public ex-
penditure, has brought me, after long observation, to the
conclusion, that it is the desire of the house to re- establish
in public ,administration those principles of reasonable
• hritt—l do not speak of wholesale retrenchment, in which
I have little faith, but those principles of reasonable thrift
which directed the Government of this country from about
the period of the Duke of Wellington's Administration
down to the Russian war—if they are to be re-established
in administration, I greatly doubt whether it can be done if
the income tax is a permanent portion of the fiscal system
of this country, with a view to satisfy, not any particular
exigencies nor to work out great reforms, but with a view
to satisfy the ordinary every-day expenses of the country.
(Hear.) After stating that it may be said, " But why all
this talk about economy ? have you not stated the wealth
of the country, the growth of the revenue, the enormous
extension of our trade. ?" Yes, I have ; but I hold this
opinion as a matter of principle, that publio economy re-
mains just as much a duty of this house as before its great
work of commercial legislation—before we reaped the bene-
fit of railways--before the country had achieved the vast
material, and I hope likewise the great social and moral
progress, of which we have had the happiness to be wit-
nesses. (Hear, hear.) lam afraid it must be said of this
country, " You have had, you still have, and you always
will have, an enormous mass of pauperism." We have
840,000 dependent on the poor rates; but that does not in-
clude the numbers which are relieved by private charity,
though not driven to the hard recessity of that last resort,
the poor law or the workhouse. That is a large mass of
pauperism; but think of the large number of poor who are
bordering on that region ; think of the multitudes of the
labouring classes who struggle manfully, but who with
difficulty avoid it. I saw recently a clergyman of the East-
end of London, who told me, " I have 13,000 people, of
whom 12,000 are for ever on the verge of destitution." I
read last week a letter from one of the best known philan-
thropists of this country, in which he described the state of
the whole district at the East-end of London, where you
could not find a cab or art omnibus, where there was not
any street music, and not even a street beggar. What are
we to say of the peasantry of this country ? Happily, much
has been done in many places, where their wages have much
increased, but in many places they have not increased.
What are we to say of the duty of public economy when we
think of the population of Ireland ? Human life, in nine
cases out of ten, is a struggle for existence ; and if the
means for carrying on that struggle are somewhat bettered,
yet the standard of wants has risen equally with the stan-
dard of means. In respect to public economy, we have,
independent of general arguments, that which we gave two
years ago upon the motion of my noble, friend at the bead of
the Government, in which he very wisely asserted the prin-
ciple that " this house, deeply imperssed with the necessity
of economy in every department of the State, but at the same
time mindful of its obligations to provide for the security of
the country at home and the protection of its interests
abroad, observes with satisfaction the decrease which has
already been effected in national expenditure, and trusts that
such further diminution will be made therein as the state of
circumstances may permit." That is the relative situation
of the Government with respect to taxation. After all I
have said, I certainly am not one who ought to propose a
policy relating to the income tax reaching over a long
term of years. I have been sufficiently warned of the
dangers of propositions of that kind. We ask the
house to adopt no general conclusion en the subject of

the income tax. We do not propose a plan to abolish it.
We do not propose that the committee should pledge it-
self to its abolition as a policy. That which we do propose
is this—that we should adopt as a policy its redaction, as
circumstances may permit, to that which was once its legal
minimum ; and that we should now proceed to take the first
of the two steps which would bring us to that legal mini-
mum. (Cheers.) The proposal is to take off one penny from
the income tax. (Cheers.) But if we can reach the standard
of 5d on the income tax, that would establish a position in
which Parliament would have it in its power to consider de-
liberately and upon principle what course it should pursue.
Now, sir, we propose to make a reduction in the tax to 6d.
The ultimate loss would be £1,230,000, and the immediate
loss will be £BOO,OOO. The case of schedule B—l may say of
'cotland and of Ireland—will be dealt with precisely in the
manner it was dealt with by the act of 1853. £400,000 of
the loss will be postponed, and the surplus, which began at
£2,570,000, will be reduced to £434,000. But there is yet
another subject. In consequence of the indications—the
formal indications—given by the house, we have thought it
our duty, limited as our means are, to consider whether we
could submit a measure which would indicate our desire to
meet with deference' and respect the convictions that are
entertained by the House of Commons, even when we do
not entirely and absolutely share them. I advert, sir, to the
fire insurance duty. (-beers.) We do not think we should
have been justified in entertaining a large proposition with
respect :o fire insurance duties, to the displacement of either
of the proposals which have made; nor are we prepared to
L accede—and I trust the committee will not ask us to accede

—to any such proposal. How does the case of the fire in
surance stand? The amount cf it is £1,700,000, and it
increases at the rate of about £O,OOO a year. Now, here
again we are met with this difficulty. There is the greatest
possible difference of opinion with respect to what I may
call the self• recovering power of the fire insurance duty in
the event of a reduction. I must say, for my own part,
that I am not very sanguine, at least as regards the
greater part of that duty, Upon examining the duty,
it will be obvious to the committee that it divides
itself into two portions. One portion of it, the
larger portion, is a tax upon property ; the remaining and
smaller portion is a tax upon industry and trade. Two
thirds of it may be said to be levied on buildings and furni-
ture—that is a tax upon property; one-third, as nearly as
it is possible to make a conjectural estimate, is levied upon
what may be called stock-in-trade: Now, my hon. friend
the member for Bradford, in connection with an important
deputation from the Chamber of Commerce of that town,
expressed publicly to me a short time ago a strong opinion
that, as regards stock-in-trade, so far as his observation
went, with reference to those bra'nches of commerce with
which he is connected, a reduction of the fire insurance duty
would be followed by a rapid recovery. Undoabtealy Igo
thus far with him. I admit it to be a general rule that
taxes upon trade, industry, and labour, when they are re-
duced, recover rapidly; but taxes laid upon property, when
they are reduced, recover slowly. We have seen that in the
case of the assessed taxes and in other instances ; the solu-
tion of which is, that taxes upon property, are in the main
paid by the rich. They do not feel seriously or sensibly for
the most part the burden of those taxes, end when removed
their proceedings are not materially affected. New, sir,
we have felt that if this question is in dispute as to the self-
recovering power of the fire insurance duty, it would be very
desirable to endeavour to arrive at some solution of it by the
trial of an experiment, and therefore the proposal we make
to Parliament is to reduce the duty from 3s to is 6d, so far
as stock-in-trade is concerned. (Hear, hear) We shall
then see what the energy of commerce will effect with re-
spect to this particular portion. We have felt that there is
something invidious in the present positionfof the duty on
farm stock with reference to stock-in-trade. They are really
essentially the same thing, and they ought to have been
traced in the same manner. We do not propose to impose a
duty upon farm stock. I think that exemption was unfairly
granted when the duty on the stock-in-trade was retained.
(Hear, hear.) At the same time, we are not prepared to
propose that the duty should be reimp sed, but we are glad
to miiigate the incqaality of the reduction of one-half.
Of course this will not take effect until the • Act passes.
nropose it should take effect from the Ist of
•
July, and 1: will be necessary to introduce a provision
••urn of duty upon altered policies,
with respect to the re.
t the lower rate. The finan-
which would, of course, be
lads of the fire insurance
cial result will be this. The prom
duty upon stock-in-trade is £566,000. The first loss by
,aerate for
reduction will be £283,000 ; but, es it will only
nine months, the loss will be £213,000. I allow for ..:11 in-
crease of 10 per cent., which would be £21,000 ; net loel4
for 1861-5, £192,000. Now the committee will see that I
have got to the lull end of my tether. (A. laugh.) The
surplus, before deductions, was £2,570,000. The proposed
changes, and the relief by them, are as follows. The relief
would be : On sugar. £1,719,000; on income-tax £BOO,OOO ;
on fire insurance, £213,000 ; and on tea licences, £15,000 ;
making a total of £3,747,000. There will be a farther loss
in 1865 6 on sugar of £28,000 ; on income-tax of £433,000 ;
on fire insurances of £10,000; making a total of £531,000.
The financial loss on which I must reckon in the present
year, namely, 1864-5, would be, on sugar, £1,330,000; on
income-tax, £800,000; on fir© insurances, £192,000; and
on tea licences, £10,000; making a total loss of £2,332,000.
The relief from taxes in this year will be greatly augmented
by the enactments of last year. The relief from taxation
which would operate this year is made of £4747,000, which
we now invite you to adopt,and of £008,.000 handed over to
us from the remissions of 1863, making in all a total relief
for 1861.5 of £3,645,000. The loss by the changes I have
proposed being £2,332,000, the surplus, after these deduc-
tions, is £238,000. (dear, hear.) It has grown "fine by
degrees and beautifully less," and I am sure I need not say
to the committee that that is not a surplus upon which we
could possibly contemplate making any further operations.
(Hear, hear.) The plan of the changes we have proposed, we
have proposed in the discharge of our responsibility, and not
at all as being of opinion that they ought to be or can be com-
pared in point of magnitude as regards the remissions with
some former periods ; but they are, as we think, contributions
towards the accomplishment of the great purposes which
Parliament has taken in hand; and taken as the proposals
of a particular year, they may, perhaps, be just like
the stone that is cast by the passing traveller upon
the heap. Each separate contribution is small, but the
general result is that a heap of them arises, which becomes
enough to commemorate some signal action or the death of
a great man. It is in that sense we submit them to Par-
liament. We believe them to be good. We 'Unit they will
meet with your acceptance, and that you will concede them
to be a pledge on our part of out earnest desire to co• operate
with the Legislature in carrying yet further forwards those
purposes the partial accomplishment of which has already
done so much for the strength and security of England—
for the comfort and happiness of the people—for the honour
of the age in which we iive—and for the hopes that we en-
tertain on behalf of the times that are yet to come. (Loud
cheers ) The right hon. gentleman whose statement occu-
pied precisely three hours is its delivery, then placed in the
chairman's hands the resolution for the alteration of the
duty on corn,
Mr. CR A.WFORD thought the statement which had just
been made would give general satisfaction to the country.
The sugar duties were not levied in a satisfactory manner,
and he should be prepared to move a mode for the settle•
went of those duties, which would be at variance with the
proposition submitted.
Mr. CAVE said, with reference to the licences upon beer
houses, he hoped the Chancellor of the Exchequer would
give some other definition of those who were to be excluded
from the benefit of the change proposed.
Mr. HUBBARD expressed his regret at what had been
announced respecting fire insurances.
Sir J. FEIIGUSSON having offered a few observations
upon the surplus,
Mr. WHITE said he shared the satisfaction of the house
with the Chancellor of the Exchequer's statement, The
results of free trade policy ware certainly marvellous. He
deprecated and deplored, however, the reduction upon the
income tax, seeing that a much moro advantageous policy
could be pursued by lessening the cost of those articles
which were so largely consumed by the working classes.
Mr. DUNLOP thought that, upon consideration, the
member for the City of London would scarcely bring in any
measure at variance with what had been stated by the
Chancellor of the Exchequer respecting the sugar duties.
Mr. WHITESIDE criticised the policy which had been
pursued by the Chancedor of the Exchequer concerning
the spirit duties. The increase in the rate of duty had pro
duced the reverse of a good effect. It had caused an increase
in adulteration. He understood from an eminent distiller
that, though pure spirits were sent out by the distillers, a
great deal of it was adulterated before being sold in conse-
quence of the b'gh duties. In the first place it was watered,
then treacle was added, and it was strengthened by vitriol.
This dangerous and unpleasant compound was called Glad-
stone's Cordial. (Laughter.) In the course of further re-
marks upon the ill effects of the increase of the duty upon
spirits the hon. member said he believed there never was a
time when the illicit distillation of spirits was so rife in Ire-
land as at the present time; and it was a very remarkable
fact that wherever there was an illicit still there was Rib-
bonism. (Hear, hear.) He thought the right hon. gentle-
man should act up to his policy, and restore the duties to
what they were in 18.58.
Mr. MERRITT intimated that, notwithstanding what
had fallen from the Chancellor of the Exchequer in regard
to malt, he should persevere with the motion of which he
had given notice on that subject,
Mr. KINNAIRD regretted any trader should be speci-
ally oppressed by taxation, but in the case of spirits there
were high moral considerations why the duty should not be

reduced.
Lord C. HAMILTON, on the other hand, urged that a
high duty led to illicit distillation, and observed that, for
himself, he should have been rejoiced if any reduction
could have been made in that branch of the revenue.
Mr. NORRIS suggested further and more equitable alte-
ration in the beer licences, and that the gigantic joint stock
companies which were every day springing into existence
might be made to contribute to the exigencies of the State.
In regard to the importation of rags, the Chancellor of the
Exchequer was wrong in supposing that the quantity re-
presented by the Board of Trade returns as having been im-
ported within the last is months were for the purpoee of
paper manufacture. The fact was that the cloth manufac-
turers of Yorkshire and Lancashire were so pressed for ma-
terial that they now imported the refuse woollen cloths of
the Continent, and rewrought them into new material.
Mr. M'M AtION advocated a redgetian in the duty crt,

spirits and free trade in cultivation, leaving. it to the farmer
to produce as he pleased barley, or beet, or tobacco.
Mr. BENTINCK complained of the tone in which the
right hon. gentleman (Mr. Glalstone) bad spat-en of pr
tection. (Heir, hear, and laughter.) He also contended
that there ought to be a reduction in the malt tax, and
prophesied that the first strong Go eertment velt:ich came
into office would re-enact the duty on paper. (Lat:ghter.)
Mr. CAIRD remonstrated with the Chancellor of the
Exchequer on his proposal to impose a duty on certain in•
tenor descriptions of corn, which were principally used in
feeding steck and the purposes of distillation.
The CHANCELLO it, of the EXC.H.EQUER. then rose
to reply. He said his proposal with respect to the descrip-
tion of corn referred to by the hon. member (Mr. Cairo)
was a matter on which all parties should be fully heard, and
that in passing the resolution with regard to it, the com-
mittee would not be bound to any final judgment. While
admitting that he had reason to be dissatisfied with the
general tone of the discussion, he would observe that he
should infinitely prefer to see the fire insurance duty stand.
altogether than reduce it by so small a proportion as 6d.,
With regard to a statement made by an hon. baronet (Sir
J. Ferguson) respecting the income tax, the right bon.
gentleman reminded the committee that last year, when be
submitted taxes of 7d and 9d, the figures he cave the house
were about £8,000,000. He now gave 7d, and his estimate
was still L 4,600.000, founded on the actual charges known
from the general re-assessment which had taken place. In
reply to the remarks of an hon. gentleman respecting illicit
distillation, he was prepared to show, with regard to Ireland,
that illicit distillation had not resulted from augmentation
of the spirit duty. As to the paper duty, since he spoke he
had had the opportunity of seeing, in a paper laid on the
table of the house, that the export duty on rags would be
removed by the French Government.
movin
(Hear, hear.) The
right hon. gentleman concluded by g that the chair-.
man report progress.
The motion was agreed to, and the house resurattd.
JAPAN.
On the motion for going into committee of supply on the
army estimates,
Colonel SYKES inquired whether provision had been
made in the Estimates for the charge of certain troops
transferred from the Indian establishment for service in
China or Japan, accompanying the inquiry by a rather long
disquisition upon transactions in Japan.
Mr. H. BERKELEY called attention to the inferior
armament of the Volunteer Artillery Force, and asked
whether any steps had been taken or were likely soon.
to be taken, to arm the Volunteer Artillery in the came
manner as the Royal Artillery.
Mr. H. VERNEY moved a resolution, that it is ex-
pedient that the recommendations contained in the report
of the committee on the proper means for the instruction
and employment of soldiers and their children in trades,
and of the Under-Secretary of State in a letter to the
Quartormaster-General, dated May 23, 1862, be carried.
into effect, with due regard to the duties and discipline of
the army.
The Marquis of HAItTIN(kTON, in his reply to Colonel
Sykes, said he was labouring under some misapprehension
on. the subject of his question, respecting which he gave as
explanation. In answer to Mr. Berkeley he observed that
the Volunteer Artillery were not intended to act generally
in the field, but were raised almost exclusively to serve as
garrison artillery, and they had all that was necessary to
teach gun drill. In regard to the resolution moved by Sir
H. Verney, he explained the intentions of the military
authorities on the subject.
Sir H. VERNEY withdrew his moe!on.
The remaining orders of the day were then proceeded
with, when certain bills were forwarded, and the house ad-
journed at 20 minutes to 12 o'clock.