The Sun.
London, England, 1860-03-31 00:00:00

THE INCOME TAX BILL.

The order of the day for resuming the adjourned debate
on the consideration of the Income Tax Bill, as amended,
having been read,
Mr. DISRAELI wished to ask the noble lord on what
day the Government meant to propose the adjournment for
the Easter holidays.
Lord PAIAMERSTON said they would move the adjourn-
ment of the house on Tuesday next if the state of public
business would allow them; and if not, they would make
the motion on Wednesday.

Mr. BRIGHT said he would venture to recommend to
the Government to dispose of the questions involved in the
budget before they proceeded with the Reform Bill. They
would then be able to go on continuously with that mea-
sure.

Lord JOIIN RUSSELL said that was very much the
course which the Government wished to take. Ire pro-
posed to fix the resumption of the debate on the Reform
Bill for the 20th of April. He trusted by that time the de-
bates on the budget would be got through ; and by the end
of the th of April he further proposed that the house
should , -to committee on the Reform Bill (hear, hear),
and he proposed that they should then go on with the bill
continuously. .

The motion for considering the income tax, as amended
was then agreed to.

Mr. W. WILLIAMS moved a clause, in pursuance of
notice, to the effect that incomes under £l5O should be
exempted from the operation of the tax, and that persons
now charged on incomes under LISO should have a power
of appeal. _ _

Sir H. WILLOUGHBY said there could be no doubt as
to the hardship of the tax on the class alluded to ; but what
he wished to know was, whether the right hon. gentleman
contemplated the appointment of a committee to consider
the inequalities of the tax. He believed there was no
doubt thfat the tenpenny tax proposed would ox property
amount to one 'shilling. He knew that in Leamington
some paid the tax on the not rental and others on the
gross rental, and yet the parties injured had no redress
whatever. It was his intention to have moved for such a
committee, but he did not wish to delay the passing of the
bill. The taxation of the ,country ou;ht to bear equally on
all classes, and when it did not the house should remedy
the evil.

Mr. MIBBARD thought that an, inquiry at that time
would bo useless, but he hoped for some explanation of the
views of her Majesty's Government on the subject. The
tax was only imposed for one year, and it was so full of in-
equalities that he thought they ought to get some insight
into the policy of Ministers in the coming year with regard
to this subject. With respect to the motion before the house,
he objected to it because they could ill afford to lose such a
sum, and in his opinion £lOO a-year was a fair point to
start from. So far ho was perfectly satisfied with the bill,
and he thought the Government ought to be assisted in
carrying it into effect.

Mr. _ROEBUCK had no doubt that the Chancellor of
the ExChequer wanted the money, but still he wouldsug-
zest to b im the injustice he was inflicting, not intention-
ally,' but of necessity on other parties. The income-tax in
its preser.t shape was incomplete and unjust in its opera-
tion. Ta.lse a man with £5,000 a-par in the funds or in
land, and compare his position with another who earned
his brains the same:, amount. The physician or the
li.wyer makes that income by his brains, and it certainly is
a large sum to set down; he goes on from year to year
until suddenly illness comei upon him, he is struck down
by a fit of apoplexy and is destroyed. While he enjoyed
that income he paid as much income-tax as the than who
had £5,000 a-year in the funds or in land. Now, was that
just;? Then he would come to 4Jfe small salaries; and here
a greater injustice was perpetrated. The man who had
£l5O a-year was charged in the , same propor-
tion.. Compare his case with the artisan. He had a
family, a. wife and three or four children perhaps, he
must live-in a particular house, and maintain an appear-
, ance; but in doing all this his salary disappears. Hew
' then was he to pay the tax ? By stinting himself of many
articles of enjoyment which he can no longer afford ; and
in that case the non-consumption of what would be indi-
rect taxAtion.upon him was such that not a penny additional
found its way to the Treasury. (Hear.) He (Mr. Roe-
buck) knew the Chancellor
.Of the Exchequer was in a piti-

able condition—that he was, as it were, living from hand
to mouth to arrange matters for the present year. But let
him remember this injustice when considering the subject
next year. He wanted him to draw a distinction between
the incomes. of men of skill, of science and art, and those
who had fixed annuities from land, or otherwise. When
he (Mr. Roebuck) made an appeal to the right hon. gentle-
man on a previous occasion, he told hit. he had no answer
to give, but that he wanted the money. He believed that
if he adopted his suggestion he would bo able to drawn an
equal sum of money in taxation from the country without
committing the injustice now perpetrated on a particular
class. The tax fell with especial severity, not upon the ar-
tisan, but on the poor clerk, the poor gentleman, and the
poor clergyman, and he hoped, therefore, that some steps
would be taken as soon as possible to remove its dispropor-
tionate pressure from those classes. (Hear, hear.)
Mr. Alderman SALOMON S observed that nothing could
be more disagreeable than the ordeal to which small trades-
men were subjected when they appealed against the tax.
The baker had to account for his contracts with his miller
and his customers. The grocer also had to enter into
minute details of his private transactions, while the word
of the great merchant or professional man was taken at
once.

Mr. P. URQUHART agreed with the hon. member for
Lambeth that persons whose incomes were less than £l5O
a-year were deserving of commiseration as regarded the
burden of the income tax. He hoped something would be
done as soon as possible to get rid of the inequalities com-
plained of. (Hear, hear.)
Sir M. FARQUHAR suggested that the Chancellor of
the Exchequer would` take into consideration the pro-
priety of adopting the scheme proposed by Sir Robert
Inglis some years ago, to the effect that if a person had £lO5
it-year, £lOO should be deducted, and he should be taxed•
only on £5, and that the same rule should apply to other
incomes up to a certain amount. If that plan were adopted,
and the Chancellor of the Exchequer stopped at £5OO, it
would afford enormous relief. (Hear)
SIIERIDAN asked what difference it would make
in the revcuue if the tax were remitted on incomes under
£1.50.

Mr. GLADSTONE said the Government were not in a
position to give a general view of what they would do with
respect to taxation in 1861. When the expenditure of the
country was in a stable and normal state, and when the
Government had no reason to anticipate any important
change, it might be done; but under existing circumstances
nothing could be more unreasonable than to make plans for
!the future, or to attempt to make anything like a permanent
provision for supply. He admitted that there were great
inectualities in the income tax, but many other taxes
were liable to the same objection. If they took schedule A
they would find great inequalities between the tax on house
property andl landed property,' and also between different
kinds of house property—inequalities sometimes amounting
to a difference of from 25 to 30 per cent. The Government
were not prepared to propose any committee of inquiry on
the subject, inasmuch as they did not think it expedient to
subject a great and gigantic'tax like this to the scrutiny of
a committee of the House of Commons, unless the Govern-
merit had been conscientiously persuaded that they could
make proposals to the committee, and lay plans before them
which would either remove or mitigate the evil. If they
could do so, nothing would be more desirable than to have
such a committee. The Government, however, did not
think they could do so, and they thought it would be un-
worthy of them to obtain popularity by encouraging expec-
tations which could not be realised. There were in the
house many gentlemen of experience and ability, and
who represented large bodies of the people, and who
were more sanguine in their views with regard to
the re-construction of the income tax than the Ministers of
the Crown happened to be, and if they desired to have such
an inquiry instituted, her Majesty's Government would not
give any oppositiOn to the proposal. There were two great
questions involved in this matter, besides the inequality and
injustice of the income tax—one was the re=adjustment of
the schedules according to the nature of the incomes which
those schedules represented, and the other was whether the
tax should be imposed upon so low an income.? The ques-
tion of the schedules would hardly come under the notice
of any such committee. The other subject had relation to
the question put by the hon. member for Lambeth, as to
whether incomes under £l5O should be exempt from the
tax. An hon. member had pertinently asked what diminu-
tion in the revenue would be 6used by such a remission.
The difference in the receipts of the Exchequer which the
adoption of the amendment would cause, would amount to
between £500,000 and £600,000. The hon. member himself
was convinced that it was possible to make such reductions
in our expenditure as to permit of that reduction. Ha had
no doubt whatever that his hon. friend was fully convinced
in his own mind that this could be done, and very possibly
it might at some future time, but could that conviction be
imparted to a majority of the house and carried into effect
this session ? That was the real question. Ho had no means
of ascertaining the exact amount of the difference; but he
could estimate what it would' come to upon Schedules D
and E, and judging by that, he feared that the sum would
be more than £600,000, so that if the amendment was
adopted there would be no alternative but that which he
was almost afraid to mention, the imposition of another
penny in the pound on all incomes of £l5O and upwards.
(Hear, and laugh.) He 'confessed, however, that though
the anicndment was not one which, at the prcaent time, and
in its present form, could be adopted safely by the house,
it was not a matter to be disposed of by merely considering
temporary difficulties, for he fully admitted that it was
' fraught with many grave as well as painful considerations.
He hoped the house would not assent to the amendment
of his hon. friend. (Hear.)
Mr. DISRAELI observed that the trumpet of the right
hon, gentleman seemed to give but an uncertain sound.
The right hen. gentleman was not prepared to inquire into
' the character ,of the income tax. Some ten years ago,
when the noble lord (Lord J. Russell) was First Lord of
the Treasury, a committee had been proposed and carried
to inquire into the tax. It was very true that the income
tax had been then some ten years in operation, but the feel-
ing in the country was exceedingly strong against it. The
Government of that day assented to the appointment of the
committee to inquire into the principle and operation of the
tax. That committee was formed of some of the most
eminent men of that day, and its proceedings were con-
ducted by the late Mr. Hume, who had great experience in
all financial subjects. Mr, Mill, the eminent political
,economist, and Mr, Newmarsh, the actuary, were, with
many other men of seism° and distinguished ability,
examined before it. Soon after there was a change of Go-
vernment, and there was a public feeling against the tax
which no Government could pass by with indifference.
That Government of which he (Mr. Disraeli) was a mem-
ber determined to make an absolute difference between the
assessments of Schedule D and A on condition that there
should be an end to- all remissions and exemptions, and
that they should make the income tax as low as they could
with a fair hope of collecting it. Where was the man who
could draw the line between income received-from wages
and property, or who could define what was manual labour ?
Was the clerk who got £l5O a year for driving a quill all day
long to be placed in the category of property ; and was the
man who earned the same amount by the spade, or as an
auxiliary to a •machine, to be exempted ? The policy of
that Government was opposed with the greatest ability and
success by the present Chancellor of the Exchequer. The
right hon. gentleman declared that the income tax was an
immoral tax, that it was theant only for an emergency, and
upon occasions, when all men ought to be ready to make
sacrifices for their country. It was not for a moment, ac-
cording to the right hon, gentleman's statement, to be
thought of as a permanent source of taxation.' The tax
must be put an end to, Well, the Government of 1852 was
turned out because it did not deal with the income-tax in a
scientific and satisfactory manner. Since the oration of De •
mosthenes de corona there had been nothing more success-
ful ; it gained for the orator a celebrity that had actually
lasted him for seven years. (Laughter.) The history of
scarcely any public man showed a destiny so much to be en-
vied as that of the Chancellor of the Exchequer. The bottle
conjuror was successful for 48 hours in duping his auditory
into the belief that he would jump into a pint bottle, but the
right hon. gentleman had managed to keep up his reputa-
tion for seven years—it certainly deserved a favour able
place in the category of human achievements. (Laughter.)
The right hon. gentleman the Chancellor of the Exchequer
said that altered circumstances had released him from his
former pledges—opinions which had made the right hon.
gentleman for seven years the idol of an admiring nation.
(A laugh.) Well, the Minister was the creature, often the
slave of events, but every hour during which the tax existed
in 1880, must, according to the former statement of the
right hon. gentleman, tend to sap the morality of the coun-
try, and to undermine its resources. BUt the Chancellor of
the Exchequer entered into a special contract with the
country itself. He told them that in 1860 terminable an-
nuities would fall in to the amount of £2,100,000, and that
that was a fund on which they might rely as furnishing the
means by which his policy could be carried out. But this
year the Chancellor. of the Exchequer had ostentatiously
appropriated the £2,000,600 to another object. He never
heard from the Chancellor of the Exchequer, in the
moments not. of insolent but of triumphant rhetoric,
or on those occasions when he, tried to persuade them
that the income-tax was the best tax in the world—he
never heard from him any explanation on the subject.
But to-night, instead of referring to the income-tax as
an immoral tax, he said there was a good deal to be
said against it, but then there was a good deal to be said
against every tax. Contrast with that those invectives
which he used against the tax during the seven years. that
the country was expecting the fulfilment of the expecta-
tions raised by him. Lilt he was not doing justice to the
right hon. gentleman. Did hon. gentlemen remember the
speech of the right hon. gentleman in 1847. He told theme
thatTiremootances had occurred which prevented the ful-
filment of his promise. He would not stop to show that a
great deal of the increase of the debt was owing to the po-
licy of the Cabinet of which the right hon. gentleman was
himself a member. 1N1857 the budget was brought forward
by the present Secretary for the Home Department (Sir G.
C. Lewis). It wallistened to with great respect; but the
right hon. "gentleman (the Chancellor of the EXchequer),
who then sat below the gangway, could not contain his in-
dignation. Ho denounced all the principles of taxation
laid down in it; but he did wore, he repealed the policy if
180 and successfully conveyed to the house, and be bi-

lieved to the country, that if he presided over the finances
in 1860, which at that time did not appear likely, he was
prepared to carry out that policy which in 1853 he had laid
down.

The CHANCELLOR of the EXCHEQUER here made
an observation across the table which did not reach the
gallery, but which was understood to be a denial of what
Mr. Disraeli was stating.
Mr. DISRAELI said that facts were stubborn things,
and were not to be got over by the Chancellor of the Ex-
chequer informing him that he had made a mistake. He
made that statement on his recollection, on the records of
the house, and he believed on the recollection of every
gentleman who sat in the house at the time. Now,
they were told it was an inconvenient thing to deal
with a tax of thew gigantic proportions. Who had made
it a tax of these gigantic proportions ? (Hear, hear.) There
was a Minister once who said it was a tax so intolerable, se
immoral, so injurious to the domestic character, so fatal to
the private spirit of the country, that it could not be
tolerated in an emergency in peace, and that immediate
steps should be taken for its gradual and certain abolition,
and an act of Parliament had been Awed for that purpose.
Was it to be believed that that Minister, who took care that
2d. or 3d. of this tax should be taken off every year until
it was altogether abolished, should come forward in 1860
and propose that the tax should be reneweds? Would he tell
them, as the Secretary for Foreign Affairs told them every
night, that thq country was in danger, and that we were on
the eve of a great conjuncture ? On the contrary, he told
them that he could not feel justified in making the proposi-
tion if ho thought the tax was to be permament. Well, then,
what was the result at which they had arrived ? They must
believe either that the right hon. gentleman, in 1853, had
not sufficiently considered this question, or his conduct
must have been what it was impossible it could have been,
it must have partaken of the immoral nature which the tax
partook of. That was totally impossible, and, therefore, he
could only suppose that in that eager moment, and that
memorable occasion, in 1853, when the right hon. gentle-
man laid down this principle respecting this impost he had
not considered the subject sufficiently. He could only sup-
peso that the right hon. gentleman, after the experience
which he had had, found it his duty now to come forward
and prepare the country for that which he denounced be-
fore, which he (Mr. Disraeli) himself believed to be most
unwise, viz., that he should throW off himself and the Go-
vernment the responsibility of imposing this tax, and ask
the committee of the House of Commons to adopt a respon-
sibility from which no Minister, and much less the right
hon. gentleman, should seek to be relieved. (Hear.)
The house then divided—
For the amendment
Against it
Majoyity

24
174
----150

The bill was then ordered to be read a third time to-mor.
row (this day).

STAMP DUTIES BILL.

This bill, as atnended, was considered.

Mr. BENTINOK proposed to'omit clause 17, which
was intended to repeal the act of Sir J. Barnard, which
was passed in the 7th year of the, reign of George 11., in
order to prohihit time bargains.

Mr. E. JAMES said the clause under consideration was
not worth the paper on which it was written, for it repealed
the act of the 7th Geo. 11., which repealed itself, having
been passed for three years only, but it did not make the
least reference to the 10th Geo. IT., which made Sir J. Bar-
nerd's Act perpetual. (Hear, hear.) A more absorb sec-
tion, therefore, could not exist. (Hear, hear.) But be-
sides this there was the act bf the 7th and Bth Victoria
known as the Wagering Act, which applied to all wagers,
and defeated all transactions of that kind. The Wagering
Act, therefore, was a sufficient remedy against all gambling
transactions. Ho would only say, further, that it was an
inconvenient and a bad system of legislation to repeal an
act of Parliament by a bye-clause in a stamp act. (Hear.)

The SOLICITOR-GENERAL said his hon. and learned
friend made the most of his notable discovery, but as ho
could not deny that the circumstances, as stated by his hon.
and learned friend, were correct, he could only say that
if he had proposed this 17th clause he should have made
express reference to the perpetuating act of the 10th of
Geo. 11. But whether pn act expressly repealing the act
of the 7th of Geo. 11. would be a dead letter he was not at
that moment prepared to say. Ho would not take upon
himself to assent to that proposition. Any defect of the
kind pinted out might be remedied on a future occasion.
With regard to the proposition of the hon. member for
Norfolk, his arguments did not seem to him to be well
founded. The act of the 7th of George 11. began with
a-very vituperative preamble against " the wicked, perni-
cious, ;and destructive practice of stock-jobbing." The
first section -applied to the -practice itself, and as far as
putting an end to it was concerned, it proved utterly in-
efficacious. Ho supposed the hon. gentleman did not de-
sire to see the class of persons who wore engaged on the
Stock Exchange put an end to. His observations rather
applied to the second provision of the first section of the
oetAwhich provided for avoiding all wagers and von-
tracts in the nature of wagers. It provided a most cum-
brous machinery through the Court of Chancery of putting
the act into operation: but for the last 100 years there was
no practical, or at least no successful application of its pro-
visions. ' With regard to the object which the hon. gentle-
man aimed at, there was an act of a much more recent date
which was not a dead letter—the 7th and Bth of Victoria,
and which rendered all contracts or agreements, whether
in writing or without writing, by way of wagering, abso-
lutely void. The present clause proposed to repeal the spe-
cial act relating to stockbrokers, but it left the act relating
to wagers generally in full operation.

Sir 11. CAIRNS said that any one was liable to mistake,
but he had certainly been amused to hear the Solicitor-
General argue that a clause which repealed an act that htu:
come to an end 100 years ago could be stretched so as to re.
peal a wholly different act, which had made that act perpe•
tual. The question was one that was not argueable. II(

agreed with Mr. James that the clause now under consi-
deration would be a perfectly dead letter. But the question
had assumed a new shape after the Solicitor-General had ad-
dressed the house. The Chancellor of the Exchequer had
proposed, as part of his financial scheme, to impose a tax
upon contracts for the sale of stock. Thereupon the gen-
tlemen of the Stook Exchange had expressed their readi-
ness to submit to this tax, provided they were relieved from
the difficulty they had hitherto been under owing t't., Sir
John Barnard's Act. The Chancellor of the Exchequer
had acceded to that proposition. He said he thought Sir
John Barnard's Act was unwise, and that he was prepared
to repeal it. Accordingly the clause now under considera-
tion-declared thUt the provisions of that act were an unne-
cessary restriction on the making of contracts. But the
Solicitor-General now told them that it was a delusion to
suppose that time-bargains or wagering contracts were to
be made legal, and that the only.object was tuemove' from
the statute-book that. offensive preamble Weir J. Bar-
nard's Act, which spoke of stockbrokers as a disgraceful
set of people. (Hear, hear.) He hoped that that would
satisfy the gentlemen of the Stock Exchange ; but he feared
that they had been in a fool's paradise in supposing that
time-bargains were to be legalised. The Solicitor-General
told them that some very recent legislation—not one of the
old acts against forestalling and regrating, but the act of 8
Victoria—provided that all contracts or agreements, in pa-
role or in writing, by way of gaming or wagering, should
be null and void ; and he said they had been most careful
not to touch that act. Accepting that explanation of the
law, how did the case stand ? The clause now under die-
cussion did not repeal or alter any existing act,, but merely
purged the statute-book of an offensive preamble. He had
never known that use made of a stamp act before. (A
laugh.) They were told that the law was not going to be
' altered at all, but that the sensitive minds of the stock-
, jobbers were to be relieved from the imputation that had
been cast upon them by Sir John Barnard's Act. The re«
suit was that time .bargains would be as legal as before .
and he was much relieved to hear that there was no • at-
tempt to make them legal.
Mr. HUBBARD thought Sir John Barnard's Act a dis-
grace to the statute-book. His impression was that nothing
tended more to permanently maintain the monetary trans-
actions in this country than those which]were carried out
on the Stock Exchange. As an illustration there was a
speech delivered in this house the other evening, affecting
in some measure a near neighbOur. of theirs on the other
side of the water, and he remembered that, on the next
morning, a friend of his asked him whether the funds had
not fallen in consequence of the formidable tone of that
speech—but they had not, and the great safety of the pub-
lic in such transactiorrs was that they were carried on by a
large body of men who had udeep interest in them. Those
bargains were not in themselves usually fraudulent; but
there was a disability affecting them under the operation of
Sir J. Barnard's act; and he thought her Majesty's Go-
vernment ought to take steps to' remove from the statute-
book an act which was fraught with so much evil, and'not
to pass the proposed clause in the manner which it was
proposed.

Mr. ISAAC BUTT said he for one should oppose this
act. They should take care not to send 'the bill
.to the
House of Lords with a clause in it which was disfiguring,
and which was open to great objection. It therefore occured
to him that, entirely independelat of Sir John Barnard's
Act, they ought not 'to pass this clause, and he hoped the
right hon. gentleman the Chancellor of the Exchequer
would withdraw it.

The OICIANCELLOR of the EXCHEQUER, in expla-
nation, said there was no demand made by the members of
the Stock Exchange for the repeal of the act known as the
" Wagering Act," but they did communicate to him that
they thought it would be but just that they should be re-
iieved from the operation of an act which placed great re
strictions upon them, now that it was proposed to impose a
stamp upon all transactions in contract notes. He admitted
the force of what had been suggested by the hon. and learned
gentleman who last spoke (Mr. Isaac Butt), and yielding
to it, he would withdraw the clause altogether—(hear,
hear)—and he would to-morrow (this day) give notice of
his intention to bring in a bill on the subject.

Mr. HENLEY understood the Solicitor-General to say
that if Sir John Barnard's Act were repealed, time bargains
would be still left where they were, inasmuch as they would
come under the denomination of gambling transactions,
and be punishable under the " Wagers Act" of the Queen
He thought the house had a right not to be left in the dark
upon the point, and that the Chancellor of the Exchequer
ought to explain, more fully what it was he really meant,

and whether it was the intention of the Government, by
imposing a stamp upon contract notes, to legalise gambling
transactions.
Lord PALMERSTON said, that as direct reference had
been made to the part he took in the passing of the act for
putting down gambling-houses, he would address a few
observations to the house. It was known that there srae
an act of the Legislature by which every person who laid a
wager on a horse race was liable to a qui tam action, and
even the hon. gentleman's own relative (the late Lord
George Bentinck) was sued by such a form of action. He
(Lord Palmerston) was Chairman of the Committee before
which that question was brought, and they were of opillien
that the act, which was obsolete, ought no longer to remain
on the statute-book. Now, taking the matter as the hon.
gentleman viewed it, he (Lord Palmerston) .was of opilliO3
that it came to the same state as horse-racing, and that the
law ought to be altered and amended.
The clause was then negatived.
The bill was then ordered to be read a third time tbig
day.
BANKRUPT LAW (SCOTLAND) AMENDM.ENT
BILL.
, This bill passed through committee.
PUBLIC IMPROVEMENTS BILL.

This bill, as amended, was considered, and the amen°
ments agreed to.
The house then adjourned at a quarter-past 12 o'clock.