The Sun.
London, England, 1845-03-13 00:00:00

stituents, whose prcAts were so low that the continu-
ation of this tax would leave them no profits at all.
On the question being put that the clause be
agreed to,
The CHANCELLOR of the EXCHEQUER
said he gave the Hcnourable Member full credit
for the motive which had induced him to
bring this subject under consideration; and if he did
not agree to it, it would not be because there was not
time to do justice to all parties v;ho had claims
upon the Legislature. He agreed with the Hon.
Member also in thinking that they should lay the
burdens of the State on those who ware able to bear

:hem. But he must resist this motion, because he
believed that, as the law stoo3, every relief afforded
except such as would operate unjustly to other classes.
The maintenance of a family was 'supposed to be.a
proper employment of income, and the income of
every man was taxed on the supposition that he de-
frayed out of it the expenses of his family. If
any person employed in trade employed a mem-
ber of his fainily, whom he paid for his serVice,s,
he would be entitled to claim exemption in that
respect. The Hon. Member said that nothing would
be easier than to carry out his proposal by the ewe
ployment of public officers. Why, for a public officer
to inter:ere with the domestic arrangements of 'a
family would be a very serious and objectionable thing.
He would call the attention of the House to another
clause which the Hon. Mernbei had given notice of
bringing before them. He alluded to T that
in which the lion. Member wished. to
deduct from the tax, the amount of local and other
rates. He had no hesitation, whatever, in
saying, that local rates levied on that part of the
premises which was employed in trade, werr
allowed to be deducted by the provisions of the At
itself; therefore, if the allowance had not been made 41:
some particular cases, it was owing to the Maladminis-
tration of the lave, and not to the law itself. With respeit
to the other point urged by .his Hon: Friend; he, did
not think it would be just, or that it would contrihatf
in any way towards the easy collection of the tax,
that they should depart from the original principip.i,
Mr. SPOONED wished to. explain.-. The Right
lion. Gentleman had, he felt sure, unintentionally
misrepresented him. He did not say that the, fair
gatherer ought to enter every man's house to wet.:
taro how his family was employed, nor did what he
said imply it. With respect to the • second clause,
after the Right lion. Gentleman's declaration, he
world not take up the time of the House in alluding
to it ; but this he would say, that the Right Hon.
Gentleman was mistaken in saying the maladminis:
tration of the law, in respect to the allowance of local
rates, was only particular and partial ; it was general
if not universal, and several cases of the kind had
come under his own immediate knowledge. He had
inquired in two or three different, offices, one of them
in the City, and he found it was the universal praC-
lice to allow rent, because rent was mentioned, and
to disallow poor rates and . local rates, because the
mentioning of rent and not of rates did, by inference,
exclude them.

The House then divided, when there appeared—
For the clause . ... 39
Against it
Majority against theUlause —ll2
The clause was consequently lost.
On our return to the gallery,
Mr. SPOONER moved— And _be it further
enacted that from and after the passing of this Act it
shall be lawful for all persons chargeable under
schedules D and E, who may have effected, or may
hereafter effect any insurance or insurances on their
respective life or lives, to claim deduction for the
amount of the annual premium paid for such insu-
rance or insurances ; and whenever such deduction so
claimed shall reduce the net annual income below
the annual sum of 1501., the parties so claiming
shall be entitled to exemption from payment of duty:
His object in moving this resolution was, to allow
persons who insured their lives for the benefit of their
families, to deduct the premiums which they paid for
these insurances from the amount of their profits. It
was their duty to enable persons who had to depend
upon small salaries and incomes to make this provi-
sion for their families after death. The Right Hon.
Baronet, the other evening, said he excluded clergy-
men from the operation of this Act, but this was not
the case. The Hight Hon. Baronet only excluded
those clergymen whose incomes or livings depended
upon tithes.—(Hear, hear.) It might be objected
that an insurance did not differ in the least degree
from any other investment, from which an immediate
interest was derived. He, however, did not admit
the justness of this reasoning, for, to a certain ex-
tent, paying premiums on an insurance was an
absolute loss ; while, on the other hand, in-
vestment in the shape of annuities, &c.,
brought in immediate returns. Again, it might
be objected that a man, to evade the income or
property-tlx would invest all his profits in in-
surances. But the unprofitable nature of investment
—for to a certain extent it was unprofitable—would
effectually prevent tradesmen or professional men re-
sorting to this system of fraud.--(Hear, hear.) All
be asked for was, that, from the incomes of profes-
sional gentlemen, clergymen, and annuitants, there
might be deducted the amount of insurance which
they paid upon their lives. They had already paid a
tax on the policy, which increased their claim. He
would not trouble the House at further length, and
thanked them for the patience with which they had
heard him.

Lord J. MANNERS seconded the motion, te-
cause he approved of the tax itself, and because he was
anxious to render it as equitable as possible. He con-
sidered that the class mentioned by the Hon. Member
was every way entitled to the benefits of such a
provision.
Mr. WARBURTON said that it appeared to him
that the principles of the proposition of the Hon.
Member for Birmingham did not at all differ from
that proposed by the Hon. Member for Oxford,
but that it came before the House in a different
shape.—(Hear, hear.) He had already stated one
objection to the proposition of the Hon. Member for
Oxford, which was this—they might suppose a long
annuity divided into two parts—one consisting of
income derived during the period for which the in-
come-tax was levied, and the other portion derived
from that time which elapsed subsequent to the ex-
piring of that period; if they levied a tax, not only
for the period during which the income-tax was im-
posed, but from the period subsequent to that time
when the tax expired ; to be consistent they must
levy it on the present value of deferred an-
nuities and reversionary interests. In 1841 an
income-tax for three years was proposed,
and it was now proposed to extend that period three
years longer—that was, is the whole, over a term of
six years. If they proceeded on the principle of the
Hon. Member, and converted terminable annuities into
capital, and determine, in the first instance, that the
period in which the income-tax should be levied shall
be three years and not six, having capitalised all
terminable annuities, the true principles on which it
ought to be arranged was this—that the period for
which all annuities should be chargeable ought to
be precisely of the same duration. To capitalise
income arising from three years' annuity, and to
capitalise income arising from perpetuities, the tax
should be imposed for three years, and all parties
pay a per centage on the interest of capitalised
incomes for a period of three years. Let
them put aside, for a moment, the consideration
of interest. Take the income-tax of 1001. a year, pay-
able for a period over which the income-tax was levied,
say of a man who had a lease of three years' dura-
tion which gave him 100/. ; another man had an in-
come for the whole period of six years of 100/., there
was 3001. in the first instance, and 6001. in the second,
he meant the capitalised amount. In order to levy in
proportion to the capital for the whole period of six
years in both cases, the sum levied would be precisely
in proportion to the amount of capitalised income. It
was impossible to carry out the plan of the Hon.
Gentleman, and he should therefore oppose it.
The CHANCELLOR of the EXCHEQUER
contended that the proposition of his Hon. Friend,
however benevolently intended, could not be carried
out. Some, no doubt, would be benefited, but the
provision would open a door to fraud, and would ma-
terially interfere with the general principle of the
measure. 1,700,0001. of the income-tax was paid by
professional men, and those holding Government situ.
ations. 3,500,0001. was otherwise raised. It would
be impossible, without the greatest injustice, to make
any provision benefiting the former without allowing
cases which had quite as much merit in the latter class
to derive advantage from such a provision. If annu-
itants were to be excluded, persons would invest
sums of money in life-assurance offices for three
years, for the very purpose of evading the payment of
the tax, and just such sums as placed them without
its reach.—(Hear, hear.) He must call upon the
House not to adopt the proposal of the Honourable
Gentleman.
Mr. HAWES said the argument of the Hon.
Member for Kendal fell to the ground because he sup-
posed the income-tax as limited, whereas it was to be
perpetual. The only way to make annuities amen-
able was to make the tax permanent, of which there
could be no doubt. It was nominally for three years
in 1841, so it was now, and so it would be nominally
in 1848. He was altogether opposed to arguments
drawn from the belief of the temporary nature of the
tax, which he believed had been and was now intended
as perpetual.
Mr. AGL lONBY thought the arguments of the
Member for Kendal, or of the Right Hon. Gentleman,
had not been fairly met. A man might tins reduce
his income from 300/. to 150/.5 and thus, thoulh he
did net realise in one way, he did in another, akl.
yet avoid the imposition of the incoree-tax alto-
gether. There was another point to which he would
refer. The Hon. Member for Lambeth (Mr. Hawes)
said that they might classify insurances, and it might
be said that a man might insure his-life forl,ooo/.,
• and if he' wisFeelliciiti-sis“riiiii‘ h44'S
on going to the office the Company would give him
the value of his policy. On those grounds,