The Sun.
London, England, 1853-05-31 00:00:00

allowed to deduct all expenses necessary for the perfor-
mance of religious services.
After a few words from Mr. G. A. HAMILTON and Mr.
BI'MAHON,
The CHANCELLOR of the EXCHEQUER said the
question was one of great difficulty. He should e glad
to allow these expenses if they could be defineA : but
there was great difficulty in doing this. Where an excise
officer was compelled to hire a horse, it was easy to see
that that was an expense necessarily incident to the dis-
charge of his duty. But in the case where a Roman Catho-
lic priest paid 2 guineas or 5/. a year to the suppert of his
bishop, it was difficult to say whether that was a neces-
sary expense. The principle was an equitable one ; and if
any terms could be devised which would prevent its receiv-
ing an undue latitude of application, and being made the
means of fraud, he should be happy to consider them on
the bringing up of the report.
The clause was then agreed to, as was clause 40.
In clause 41,
The CHANCELLOR of the EXCHEQUER introduced
a verbal amendment, which he said would principally
affect some classes of persons in Scotland, who were ob-
liged to contribute a certain sum out of their salaries to-
wards the support of their widows and orphans ; and the
object of the words now introduced was to place such
deductions on the same footing as premiums on life as-
surance.

Mr. T. CHAMBERS said the terms of the clause would
confine the deductions to be made in respect of life as-
surance to assurances effected with companies that were
either incorporated or completely registered under the
Joint-Stock Companies Act, and there were many com-
panies that did not come under either of those descrip-
tions.

The CHANCELLOR of the EXCHEQUER said the
provision would confer a very considerable benefit on in-
surance companies by inducing persons who had not
hitherto insured their lives to do so, and it might lead
those of the companies which were not yet completely re-
gistered to become so. He had had no representation
from the companies complaining of this provision ; and
though it was not absolutely essential to the act, it was
not unfair, while they were giving a boon to the com-
panies, that they should have some public and authentic
information as to what these companies were.
In answer to another hon. member,
The CHANCELLOR of the EXCHEQUER said there
was not the slightest doubt as to the respectability of
many of the non-registered and unincorporated companies.
It was far from the intention of the Government to cast a
slight upon those companies. It was a general object of
public policy.
Mr. MALINS said it would be unfair to compel the
companies to register by a side-wind.
The CHANCELLOR of the EXCHEQUER said it
would be a real boon to the insurance offices, being a sti-
mulus to the practice of life insurance.
Mr. J. G. PHILLIMORE hoped the right hon. gentle-
man would press the clause.
The amendment and the clause were then agreed to, as
' were clauses 42, 43, and 44.
On clause 45,
The CHANCELLOR of the EXCHEQUER stated, in
answer to Mr. G. A. Hamilton, that he was not prepared
to assent to any proposal excluding the Government from
resorting to the services of the collectors of poor rates in
case of need.
Mr. GEORGE said it was objectionable to mix up any
other tax with the poor rate in its collection. This had
been done in regard to the Consolidated Annuities—a most
unpopular tax. It would be better for the State to bear
the expense of a distinct machinery for the collection of
the income tax than to slip it in as a portion of the poor
rate.

After a few words from Mr. I. BUTT, the clause was
agreed to, as were the remaining clauses to the end of the
bill.

The CHANCELLOR of the EXCHEQUER then pro-
posed to negative the postponed clauses, 13, 14, and 17, in
order to propose amended ones.
After conversation on the point of order, in which Mr.
I. Butt, Mr. G. A. Hamilton, the Chancellor of the Ex-
chequer, and the Chairman of the committee took part, the
proposal to negative the clauses was agreed to.
The CHANCELLOR of the EXCHEQUER read the
clause which he proposed to substitute for clause 13. He
said that it adopted the poor-law valuation as the primary
basis of the assessment under schedules A and B, as was
done in the old clause. It omitted the next two lines, and
then proceeded—" The assesssment of the said duties in
Ireland under schedule A is to be made upon the landlord
or immediate lessor of such tenements or rateable here-
ditaments ; or, if it shall appear to the commissioners for
special purposes necessary or proper, the said assessment
shall be made upon such person as the rate for the relief of
the poor would be made upon in respect of any such pro-
perty under the provisions of the act in that behalf ; and
the assessment of such duties chargeable under schedule
B, shall be made upon the occupier of such property."
Provisoes were added having two important effects.
They enabled the party assessed, if he thought he could
show that the annual value of his land was less than the
poor-law valuation, to have the privilege of appeal, and
to be assessed upon the annual value ; and they gave the
landlord a power of reducing the poor-law valuation to
the standard of the actual rent payable, in cases where
the actual rent was lass than the poor-law valuation.
(Hear, hear.) Where the rent was more than the poor.
law valuation, there the landlord would obtain the benefit
of the difference. It was intended that the assessment
should be made on the landlord or the immediate lessor,
in the absence of cause to the contrary ; but in the exist-
ence of such cause, the assessment might be made upon the
person upon whom the assessment for the relief of the
' poor was made. It might be asked why a discretion was
retained ? The Government thought it would be better
upon the whole, for the peace and contentment of Ireland,
and likewise for the easy and satisfactory collection of the
tax, that it should ordinarily be levied on the immediate
lessor. (Hear, hear.) They were led to this conclusion
from a variety of considerations, into which it was not
necessary for him to enter, as they were doubtless present
to the minds of the Irish members. The reason why they
thought it necessary to leave a discretion was this : The
case of messuages and of towns was very different from
that of lands. There the occupier was the proper party
to be assessed. Generally speaking, with respect to towns,
including dwelling-houses, and probably factories, the
natural and proper course would be to levy upon the oc-
cupier ; but with respect to land, the best course would
evidently be to levy from the immediate lessor. But it
was necessary to retain the remedy against the occupier,
in order to get at the immediate lessor, as otherwise there
might be difficulty in finding him. (Hear, hear.) Hence,
they took for the standard and basis of the assessment the
poor-law valuation, which in Ireland might not be, upon
the whole, very different from the actual rental of the
entire country, though in some cases it was above, and in
many .below it. Where an actual rental was below the
poor-law valuatipn, if they levied on the occupier, of course
he must be yea uired to pay on the poor-law valuation.
But this difficulty at once arose : in every instance where
the poor-law valuation was above the rent actually cove-
nanted to be paid, there was a certain surplus of poor-law
valuation over and above the rent, upon which they must
first levy the tax. Where the poor-law valuation was 1001.
and the rent 901., if they collected from the occupier they
must levy 100 sevenpences ; but when he repaid himself
he could only deduct 90 from his landlord. He was there-
fore ten sevenpences out of pocket ; and for that small
sum, less than 65., he must go through the ordinary process
for procuring repayment. That was an inconvenience
which would probably only occur once, as it would be as-
sumed that the case stood tin atatu quo till there was reason
to believe that it was altered. Still it was a serious inconve-
nience and a considerable hardship to small occupiers •, and
they were dealing with a country where the bulk of the oc-
cupiers were small, and where very few of them would be
called on to pay occupation profits. In that case they
would be chargeable with the income tax upon the differ-
ence, and it would be a very serious wrong to take it from
them. He must also confess that, considering the novelty
of the tax in Ireland, and the vast number of occupiers,
it was important, even in the matter of expense of collec-
tion, that they should not have to resort to a great number
of persons ; but this was a far less serious evil to the dis-
satisfaction which would result from persons with very
small incomes being called upon to pay the tax in the first
instance, after they had been given to understand that it
would not be levied upon persons whose incomes were less
than 1001. a-year. It was on these grounds Government
proposed to the committee to frame the act of Parliament
so as to show that the assessment in regard to the holders
of land should be made ordinarily on the immediate lessee,
but with a power to come where necessary direct upon
the occupier. The clause contained two important pro-
visos—the one giving the right to appeal to the person
assessed, whether lessor or occupier, to reduce the amount
to the annual value when the assessment was made above
that amount ; and the other to meet cases when the rent
was less than the poor-law valuation. There was another
clause which he proposed to sibstitute for clause 17, as to
the mode of recovery. He was anxious to consult the
convenience of the committee in reference to the consider-
ation of these clauses, and suggested that, perhaps, the
better course would be to insert them in the bill so that
they might be read in conjunction with the clauses which
preceded and followed them, as in that way he thought
they would bo more fully understood than if they were
painted separately in the votes. If this course should be
agreeable, he would move now to add these clauses to the
bill, as also that proposed by the hon. member for Dublin
University, for defining the deductions in the case of the
incomes of the clergy of Ireland which the Government
adopted, then he would have the bill reprinted, and fix a
day for the third reading, when the discussion might be
taken.

Lord NAAS understood from the right hon. gentleman's
explanation that these clauseswould introduce a totally new
mode of assessment, for which hun. gentlemen on that (the
Opposition) side were not in the least degree prepared, and
which it would take some time to enable them to form an
opinion upon. The right hon. gentleman had distinctly
stated that the mode of assessment in Ireland should be the
same as that in England ; but that was altogether dif-
ferent from anything that existed here. He appealed to
the noble lord (J. Russell) to consent to the chairman's re-
porting progress that the clause should be printed and
brought on for discussion on Thursday on the recommit-
ment of the bill.

Mr. MAGUIRE could not see any reason why the occu-
pier of a small house in a town, who was not himself
liable to the income tax, should be called upon to pay it
in the first instance. _

Lord J. RUSSELL thought the more convenient mode
would be to insert the clauses in the bill, and take the
discussion upon them on the report ; but if that was ob-
jected to, they might be inserted when the report was
brought up, though that would be hardly as convenient a
course, for until the clauses were printed and inserted,
they could not be seen and judged of in connexion with
the rest of the bill. It was, however, most desirable that
they should not be delayed beyond Monday, and as the
noble lord suggested Thursday for the discussion of the
clauses, he should be quite ready to take it then on the
report.
Mr. G. A. HAMILTON thought what was required
was an opportmlity of discussing these new clauses in com-
mittee' and suggested that the bill should be recommitted
for that purpose.
Lord J. RUSSELL had no objection, provided it was
understood that the discussion should be confined to the
points raised on the new clauses.
Lord NAAS concurred in this arrangement.
Mr. BUTT thought it hard upon the landlord to be com-
pelled to pay the income tax upon the rent before he re- '
ceived it.

made in levying the tax for losses from
Mr. M'MAHON suggested that allowances be
or
blight.
wasl' rt
o. CbAe Itßh that St
the asked
ownerift other oecffceuept i oe
rf
pay the tax irrespective of the receipt of the rent ?
otfh et
hpe
hpooos
se rode wc laasu
ts
oe
The CHANCELLOR of the EXCHEQUER replied that
it had never been the practice, under an 7 income tax
bill, that the tax should not be raised until the rent was
paid. He ought to have stated when he spoke of the occu-
piers in the towns as being the person upon whom it should
be levied in the first instance, that he did not mean to in-
clude the smaller class of house tenants. The understand-
ing, he believed, Was, that the clauses should now be
brought up, that the bill should be reportrod to-morrows

that it should be re-committed, and the discussion taken
on these clauses on Thursday, and that it should be read a
third time on Monday.
Sir G. BOOTH inquired whether the landlords would
be required to pay the tax half-yearly?
The CHANCELLOR of the EXCHEQUER—The pre-
sumption is that the rent is received half-yearly.
Several HON. MEMBERS—Not in Ireland.

The CHANCELLOR of the EXCHEQUER had always
thought it was received in two payments in the year ; but,
be that as it might, the tax would be collected half-yearly ;
but that which was due in one half-year would be payable
in the next. _ _

Mr. MAGUIRE asked what class of house occupiers it
was that the Chancellor of the Exchequer proposed to ex-
empt from the payment of the tax?
The CHANCELLOR of the EXCHEQUER replied that
that would require consideration.
The clauses were then brought up, together with that
proposed by Mr. G. A. Hamilton, and adopted by the
Chancellor of the Exchequer as to ecclesiastical incomes,
and added to the bill. _ _ .

Mr. I. BUTT moved the following clause—" That in
every case in which, for the purposes of this act, it shall
be necessary to ascertain the annual income derivable by
any person out of property in Ireland chargeable under
schedule A, such income shall be calculated exclusive of
any amount payable out of, or deducted from, the same on
account of poor rates."
The CHANCELLOR of the EXCHEQUER had con-
sidered this clause, and it appeared to him that the case
it was intended to meet was already provided for. The
income tax was entirely calculated on the basis of its being
exclusive of the poor rate ; and by a clause which he had
just brought up, landlords would be allowed to show that
the rental on which they were to be assessed was exclusive
of poor rates.
Mr. I. BUTT said his impression was that as the act
stood the landlord would have to pay on a nominal rent,
which was inclusive of poor rates.
The CHANCELLOR of the EXCHEQUER would take
care that the object sought by the hon. gentleman was
secured.
The clause was then withdrawn.
Mr. BLACKETT then moved the following new
clauses :
"1. That allowance shall be made for bad debts as de-
ductions from the income liable to be taxed under this act,
according to the following rules :—Wherever a debtor shall
be declared bankrupt, the whole amount of his debt shall
be deducted from the profits of the creditor for the year in
which the declaration of bankruptcy shall have taken
place, and all dividends paid in that or any following year
shall be accounted for by the creditor in his returns for
the year or years in which the same shall be respectively
received by him ; and whenever a composition shall have
taken place between a debtor and his creditors, such sums
only shall be liable to income tax as shall have been actu-
ally received by the several creditors within the year for
which their respective returns are made.
"2. Whenever it shall -seem reasonable to the commis-
sioners that a deduction is fairly due for wear and tear of
machinery, Rich deduction. shall be at the rate of fd. per
cent. on the returns of income liable to this tax.

"4. Whenever any person is called upon to produce his
accounts under the provisions of this act, it shall be op-
tional to him to require that all further
_proceedings in
order to an assessment on him shall be taken before the
commissioners for special purposes, notwithstacding his
having omitted to give notice of his intention within the
time and according to the form appointed by sections 130
and 131 of the said act of the sth and 6th years of the
reign of her Majesty, chapter 35."
The CHANCELLOR of the EXCHEQUER admitted
that tin questions were of great difficulty and importance,
and he apprehended, therefore, it would not be wise to
adopt them. The first clause departed from the whole
principle upon which the income tax was based, and he
(the Chancellor of the Exchequer) was consequently ap-
prehensive of it. With respect to the second amendment,
he doubted if it would be an improvement on the law as
it stood. The third clause would be in effect very excep-
tionable, as it would encourage parties to drive two sets of
machinery, with a view to avail themselves of the oppor-
tunity that would be thus afforded to them of appealing
to two different tribunals of commissioners.
Sir J. WALMSLEY said that it was a great hardship
on men in business that the commissioners of income tax
refused to take cognisance of bad debts except in very
special cases.
Mr. G. BUTT thought the reasons urged by the Chan-
cellor of the Exchequer for not accepting the amendments
proposed were far from satisfactory. He hoped the com-
mittee would support the amendments.
The CHANCELLOR of the EXCHEQUER thought
it would be better to leave the amendments in his hands,
and he would endeavour to frame something that might
be an improvement on the law as it now stood. (Hear.
hear.)
After a few words from Mr. E. EGERTON and Mr.
CHEETHAM,
Mr. J. PHILLMORE suggested that a rule should be
laid clown ensuring uniformity of decision in all cases of
appeal. (Hear.)
Mr. A. HASTIE would support the principle of uni-
formity. (Hear.)
Mr. BRIGHT said that whilst agreeing in the general
proposition of the tax, ho should insist on such modifica-
tions as would render it more acceptable to the public at
large. If the Chancellor of the Exchequer paid income
tax as a manufacturer he would soon see the difficulty
which the second clause was intended to remedy. It was
the custom to expend much money in keepinr, the ma-
chinery in order, and the deduction of 5 per cent. was con-
siderably loss than the depreciation of the machinery by
annual wear and tear. (Hear.) With regard to the third
clause, he could not understand why it should be objection-
able. (Hear, hear.) He thought that some mode ought to be
adopted of making the tax agreeable to the public ; and he
complained that the right hon. gentleman had declined to
give any pledge that he would take the matter into his con-
sideration, and make such alterations as were advisable.
No doubt, if he merely wished for a rough and ready way
of raising a sum of 6,000,0001., that might be easily devised;
but it ought to be the duty of the Government to make a
tax, which was to last, for a considerable period, as equi-
table and agreeable as possible.
Sir W. CLAY would also put in a claim in favour of the
shipping interest, who were fairly entitled to some deduc-
tion on account of wear and tear and deterioration.

The.CHANCELLOR of the EXCHEQUER, said that as
regarded the first of the clauses proposed by the hon. gentle:
man. some consideration might fairly be given to it; bnt,
as regarded the second and third, he doubted very much
the propriety of sanctioning them. What was intended by
the hon. gentleman was an allowance for what was com-
monly called deterioration. He was not prepared to deny
that a great deal might be said in behalf of that principle ;
but then the question stood in a peculiar position 4 If they
were called upon to consider the depreciation of machinery
and of ships, and one had just as good a claim as the other,
then they must take into consideration how far the admis-
sion of that principle with regard to these two interests
affected other great classes of taxpayers. He reminded
the committee that the assessments under Schedule D
were calculated upon the average profit of the three pre-
vious years. If the fourth year did not equal the preced-
ing three, then the trader was entitled to the benefit of it ;
but if it exceeded the previous years, then he was not
required to pay upon the increased profits. Seeing the
extreme lenity with which he was dealt with in this in-
stance, and that he also had an allowance for repairs and
expenses of management, it became a matter of grave con-
sideration whether the committee would be justified in
giving that further concession.

Mr. J. B. SMITH called the attention of the committee
to the case of Mr. Fielden, formerly a member of that
house, to show that the the trader was not always so fairly
treated by the local commissioners. Although he had lost
a great quantity of money, he was assessed upon the ave-
rage of the three previous years, and was actually com-
pelled to pay, his goods having been seized and sold in
the market place. If there had been a power of appeal,
Mr. Fielden never would have been compelled to pay in
that unjust manner. Why should there not be a power
of appeal from the local commissioners to some superior
tribunal ?
Mr. BLACKETT had received so much encouragement
from the tone of the conversation which had taken place,
that he should take the sense of the house upon his first
proposition.
The CHANCELLOR of the EXCHEQUER said the
government had a pecuniary duty to discharge, and that
was to look after the interests of the public and the re-
venue, and he could not give his assent to the hon. gentle-
man's proposition.
Mr. BLACKETT said if the right hon. gentleman would
undertake to carry out the principle, ho should not oppose
any further impediment to the business of the committee.
Mr. G. BUTT was prepared to vote for the first clause,
doubting whether any better one could be devised to carry
out the very principle which had been recognised by the
right hon. gentleman himself.
Mr. W. MILES said as the right hon. gentleman was
willing to give the matter his consideration, he would re-
commend the hon. gentleman to withdraw his clause. The
Chancellor of the Exchequer had, be thought very pro-
perly, refused to bind himself down to any specific clause,
and he would recommend the hon. gentleman to leave the
question in the hands of the Government. If machinery
was once admitted to exception, agriculture might very
fairly put in its claim to consideration.
Mr. MITCHELL said he believed the fair principle to
adopt in that matter would be, to allow parties to make a
fair valuation of their bad debts at the end of the year,
just as they made a valuation of their goods.
Mr. BLACKETT said he would not press his motion to
a. division. He should, however, reserve to himself the
right to bring it forward on a future occasion, if ho should
think that the subject had not been fairly taken into con-
sideration by the Chancellor of the Exchequer.
The CHANCELLOR. of the EXCHEQUER said he
believed the just and proper principle to adopt in that
matter was that which had been laid down by the hon.
member for Bridport (Mr. Mitchell).
The clause was then negatived without a division.
The second and third clauses proposed by Mr.BLACKETT
were also put and negatived without a division.
Mr. J. BALL moved the addition of the following clause
to the bill :—" The Lords Commissioners of her Majesty's
Treasury shall nominate one fit person in Great Britain,
and one other fit person in Ireland, to act as official trustee
under this act ; and it shall be lawful for any person to
transfer or assign to such official trustees any sum of money
or any share in any Government stock, or in the stock of
any public company, to be held by such official trustee upon
irrevocable trusts for the benefit of the wife, child, or chil-
dren of the person transferring or assigning the same; and
if the whole beneficial interest in such money, stock, or
shares, shall by the operation of the trusts aforesaid become
vested in the wife, child, or children of such person, either
to take effect immediately, or to take effect upon the death
of such person, then he or she shall be entitled to deduct
the amount of such money, or the market value (at the rate
last ascertained before the period of such transfer or assign-
ment) of such stock or shares, so transferred or assigned in
any year, from the amount of annual income in respect of
which such person maybe chargeable withduties under the
respective schedules D and E to this act annexed; provided
always, that the whole amount of deduction which may be
claimed in any year on account of such transfer or assign-
ment shall not exceed one-fourth part of the whole annual
income liable to duties under either or both of the schedules
aforesaid." His object was to exempt from payment of the
tax the sums which parties might invest for the future sup-
port of their families ; and in order to carry out that ob-
ject he would appoint an official trustee, who should be the
depositary of the sums invested.
The CHANCELLOR of the EXCHEQUER said he felt
bound to oppose the clause. He could not consent to a pro-
posal under which an encouragement would be given to the
locking up of. Large masses of capital ; and ho did not think
that it would be advisable to effect an arrangement of such
importance in the case of a tax which, he hoped, would be
discontinued at no very distant period.
After a few words from Mr. E. BALL, the clause was
negatived without a division.
Mr. I. BUTT moved the clause he had proposed last
week, providing that parties might have the option of
being originally assessed by the special commissioners.
The CHANCELLOR of the EXCHEQUER objected.
Mr. I. BUTT was astonished at the conduct of the right
hon, gentleman--(hear)—for he had postponed the clause