SIR ROBERT PEEL'S FINANCIAL STATEMENT.

MOUSE OF COMMONS, FRIDAY, MARCH 11, 1842.

The House having resolved into a Committee of Ways and Means; Mr. GREENE in the Chair; Sir ROBERT PEEL spoke as follows :— Sir, as the House has now sanctioned the votes that her Majesty's Government considered it their duty to propose for the maintenance of the chief military establishments of the country, I rise to redeem the pledge I gave some time back, that I would avail myself of the earliest opportunity, consistent with Parliamentary usage and the public inter- est, to develop the views of the Government with reference to the financial and commercial policy of the country. No one can feel more than I do the importance and the extent of the duty that devolves on me; no one can be more conscious than I am how disproportionate are my intellectual powers to the proper performance of the task : but, Sir, I should be unworthy of the trust committed to me—I should be unfit to stand in this place where so many Ministers of the British Crown have stood—if I could feel disheartened or discouraged—if I could entertain anything but composure and contentedness of mind— anything, I may say, but that buoyancy and alacrity of spirit which ought to sustain every public man when entering upon the discharge of a great public duty ; conscious that he is actuated by no motives that are not honourable and just, and feeling a deep and an intimate con- viction, that, according to the best conclusion of his imperfect and fal- lible judgment, that which he intends to propose will be conducive to the welfare, I may say, essential to the prosperity of the country. Sir, from some of the embarrassments which often accompany a financial statement of this kind I am free. It is sometimes necessary, on such occasions, to maintain great reserve, and to speak with great caution. A due regard for the public interest may impose on a Minister the duty of only partially disclosing matters of importance. But I am hampered by no fetters of official duty. I mean to lay before you the truth, the unexaggerated truth, but to conceal nothing. I do this first, because in great financial difficulties the first step towards improvement is to look those difficulties boldly in the face. This is true of individuals, it is true also of nations. There can be no hope of improvement or of recovery, if you consent to conceal from yourselves the real difficulties with which you have to contend. I have another motive, also, for making a full and unreserved disclosure. It is my in-- tention, on the part of the Government, to undertake the responsibility of proposing that which we believe essential to the public interests. With you will rest the responsibility of adopting or rejecting the mea- sures which I propose; and it is therefore fitting, in order that you may be enabled properly to perform the duty which you owe to the country, that you should have before you every information—ever): element which is necessary for the formation of a full and impartial judgment.

Sir, I have but two requests to offer to the House before I en- ter on my statement. The first is, that they will bear in mind,

that from the period at which I bring forward my financial state- ment, I am labouring under some special disadvantages. I speak particularly with reference to the estimates which I may form of the probable revenue of the country. I have considered it to be my duty not to wait until the Supplies have been voted—until the financial accounts of the year have been closed. If, hereafter, in my estimates, formed as they shall be with every desire that they should be just and accurate, I should be found to have been mistaken, I trust the House will bear in mind that I ant labouring under disadvantages to which others have not been exposed. Another request which I shall make is, that the House will have the goodness to postpone its judgment until I shall have laid before it the whole plan of the Government ; that they will not judge hastily on a partial development of my views; that they will not hastily pronounce that what I may propose is an insult to the country ; or, if I affect any particular interest, that I should not there- fore be given out as proposing something that is perfectly unreasonable and unjust. I earnestly hope that every man, bringing to the con- sideration of this subject a full sense of our real, but not insuperable difficulties, will postpone his judgment until he has before him the whole of the plan which I shall propose. I shall now proceed, Sir, in the ordinary manner to state the facts with reference to the finances and expenditure of the country. And, in the first place, I have to refer to the estimate which was formed by the right honourable gentleman, the late Chancellor of the Exchequer [Mr. F. T. Baring] with respect to the probable revenue and expendi- ture of the country in the year ending the 5th of April 1842. Sir, events have proved that the right honourable gentleman's estimate was as nearly correct as it is possible for an estimate to be. I think the right honourable gentleman calculated that the income of the country might be expected to realize the sum of 48,310,0001. He calculated the expenditure for the same period, that is, for the year ending 5th April 1842, at 50,731,000/. There were some slight variations after- wards made in the votes, which of course the right honourable gentle- man could not foresee at the time when he was speaking. There was a supplementary vote taken for, I think, the Ordnance Estimates, in the first session of the present Parliament ; I think there was also a vote omitted—that, namely, for the Caledonian Canal; but the amount of the difference made by these changes was so small as to be hardly worth referring to. Of course it is impossible to say, at this moment, whether the right honourable gentleman's estimate is perfectly correct or not, because a portion of one quarter of the year is not yet closed. The actual produce of the revenue from 5th April 1891 to 26th February 1842 was 43,730,0001. If you estimate that the receipts for the current quarter of the present year will be equal to the receipts of the current quarter of last year, you must add to the actual receipt the sum of 4,323,000/. Consequently the revenue will amount, on the 5th of April, to 48,053,0004; being less than the amount estimated by the right honourable gentleman by 160,0001. On the other hand, the actual ex_ penditure was not quite so great as that which he estimated, or rather will probably not be so great; and consequently his estimate, which took the expected deficit at 2,421,0001., will probably, on the whole, I think, exceed the actual amount of the deficit. The actual amount of the deficit for a year will, I think, be 2,334,0001.; speaking, as I said before, without the return of the last quarter, but giving the best estimate I can form of the probable amount of the de- ficiency for the present year. The deficiency, therefore, for the current year, we may assume to be about 2,350,000/. I now pro. ceed to estimate the income for this year, which will end on the ' 5th of April 1843. I take the Customs for the ensuing year at 22,500,0001. The Excise, on account of the unfavourable season for malting, I am afraid we cannot take at a higher sum than 13,450,0001. Of course, supposing there is a favourable harvest, that will have a ten- dency to increase the Excise revenue, but it has also a tendency to diminish the amount of the revenue you derive from the importation of foreign corn. On the other hand, with an unfavourable harvest, if your Excise is diminished in amount, then there will be some com- pensation to be expected from the import-duty on foreign corn. I will take the Customs, then, for the year ending the 5th of April 1843, at 22,500,000/.; the Excise at 13,430,000/.; the Stamps at 7,100,0001.; from the Taxes I expect to obtain 4,400,0001.; the Post-office, I think, may probably yield 500,0001.; the produce of the Crown Lands I take at 150,000/., and the other Miscellaneous items of revenue at 250,0001.; making a total of estimated revenue for the year ending the 5th of April 1843, of 48,350,000/. The expenditure, now that the House has sanc- tioned the votes for the Army and Navy, can be estimated with greater accuracy. The interest on the Debt will be 24,627,0001.; Terminable Annuities, 4,076,0001.; the interest on Exchequer-bills, 722,0001.; mak- ing the whole charge on account of Debt 29,427,000/. The other charges on the Consolidated Fund I will take, including the Civil List 300,0001., at 2,368,000/. The field I have to travel over is so extensive, that perhaps it will be better that I should omit mentioning the various items. The total charges on the Consolidated Fund, therefore, will be 31,795,0001. The vote for the Army, if ultimately sanctioned by the House, will be 6,617,000/.; that for the Navy will be 6,739,000!.; that for the Ordnance, 2,084,0001.; the Miscellaneous charges on the an- nual grants by Parliament will be 2,800,0001.; the vote on account of Canada, which is to be expended on the clothing of the Volunteers, will be 108,0001.; and when that charge ceases, there will be a nearly -correapopding amount to be applied annually to the erection of fortifi- cations in Canada. I will take the charge for the expedition to China, upon the whole, at 675,000/. for the present year. That vote consists of two parts, which 11%01 state to the House : 175,000/. will be required to defray the arrears of expenditure for the current year ; and the other vote is a sum of 500,0001. to meet the charge which it will be necessary to provide for by actual vote during the year ending 5th of April 1841. The general result therefore is, that the expenditure for the year ending 5th April 1843, will be 50,819,000L, and the income will be 48,350,0001.; making a probable deficiency of 2,469,000/. But that deficiency is upon the votes of the year—upon the expenditure which it will be necessary to provide within the year. To that defi- ciency ought to be added the actual charge which may be incurred on account of the hostilities carried on with China. I do not contemplate that it will be necessary to provide within the year more than 500,000!.; 'but he would form a very inadequate estimate of the probable cost of 'that expedition, who should think that the total expense will be limited to that sum of 500,000/. Sir, the expense of our expedition to China stands thus :—The amount due to the East India Company, up to 1st April 1841, is 708,735/. A grant was made in the session of 1840, of 172,4421. This leaves arrears of former years to be provided for to the amount of 535,313/. The estimates of the expenditure to the 1st of April 1842, is 658,3791.; making the total charge to April 1842, nearly 1,193,6921. There is to be applied to this charge a grant of Parliament made in 1841, amounting to 400,000/., and money from the ransom of Canton amounting to 618,430/. You have, therefore, to settle for the cost of 1841 thus :—Against the charge of 1,193,692/. there is to be put an actual payment of 1,016,430/., and the arrears now amount to 175,262/. Looking to the extent of the preparations which have been made for the continuance, and I trust the completion, of the hostilities with China, I do not think I can safely estimate the cost for the year end- ing the 5th of April 1843, at much less than 1,400,000/., or 1,500,000!.; for 500,0001. of which we make provision in the present year. But let us take the whole cost at 1,300,000/.,—that is the lowest sum we can fairly take : there will then be a deficiency, some time or other to be provided for, of not less than 800,000/. Therefore, to my estimated deficiency of 2,570,000/., in the sum to be provided for the general service of the year, you must add the probable demands which may be made upon you to the extent of 700,0001., or 800,000/. In addition to this, there may be demands for Australia and other colonies, that may possibly amount to the sum of 100,000/. I do not take into account the charge which will probably be necessary on account of Canada—it is not a charge exactly, but I think there was an engage- ment that we should give the aid of our credit to Canada, for a loan of 1,500,0001. But that, I apprehend, i3 altogether independent of actual charge, and I think that under the circumstances we should not be dis- inclined to support the credit of Canada by that of this House. At the same time, it is right that the whole extent of our engagements should be placed fairly before the country. In addition to all this, those events of which we have had recent cognizance, as having occurred in Afghanistan, may, and so far as I can form a judgment will, impose upon her Majesty's Government the necessity of calling on Parliament to sanction, perhaps, a considerable increase in the Army Estimates. I think it not fitting that we should conic to any hasty decision in the absence of official information ; but I have already received a decisive proof that the Members of this House, the representatives of a great people, will be determined to make every effort which can be shown to 'be necessary for the purpose of repairing occasional or partial disasters, and vindicating the authority of her Majesty's name in India. (General cheering.) Bear in mind, then, that to my estimate of the actual de- feiency of 2,570,0001. for the general service of the year, and of the -deficiency which must at some time or other be provided for on account of the expenditure in China, you must add the probable demand I may have to make for the increase of the military or naval establishments of this country, having regard to the position of affairs in the East. Sir, for the purpose of bringing before the House a full and complete view of our financial position, as I promised to do, I feel it to be say duty to refer to a subject which has of late occupied little attention in the House, but which I think might, with advantage to the public, have attracted more of their regard—I refer to the state of Indian finance, a subject which formerly used to be thought not unworthy of the con- sideration of this House. I am quite aware that there may appear to he no direct and immediate connexion between the finances of India and those of this country; but that would be a superficial view of our relations with India which should omit the consideration of this subject. Depend upon it, if the credit of India should become disordered— if some great exertion should become necessary, then the credit of England must be brought forward to its support ; and the collateral and indirect effect of disorders in Indian finances would instantly be felt in this country. Sir, I am sorry to say, that the scale of Indian finances offers no consolation for the state of finances in this country. I hold in my hand an account of the finances of India, which I have every reason to believe is a correct one ; it is made up one month later than our own accounts—to the 5th of May. Some question may arise on the papers presented to Parliament with respect to the commercial assets of the Company, but I have every reason to believe this to be a true account of the position of Indian finances. It states the gross revenue of India, with the charges on it ; the interest of the debt; the surplus revenue, and the charges paid on it in England ; and there are two columns which con- tain the net surplus and the net deficit. In the year ending May 1836, there was a surplus of 1,520,000/. from the Indian revenue. In the year ending the 5th of May 1837, there was a surplus of 1,100,000!.; which was reduced rapidly, in the year ending May 1838, to one of 650,000/. In the year ending the 5th of May 1839, the surplus fell to 280,000/.; in the year ending the 5th of May 1840, the balance of the account changed, and so far from there being any surplus, the deficit on the Indian revenue was 2,414,000/. I am afraid I cannot calculate the deficit for the year ending May 1841, though it depends at present partly on estimate, at much less than 2,334,000/. The House, then, will bear in mind, that in fulfilment of the duty I have undertaken, I present to them the deficit in this country for the current year to the amount of 2,350,0001., with a certain prospect of a deficit for next year to the amount of at least 2,570,000/., independently of the in- crease to be expected on account of China and Afghanistan, and that in India, that great portion of our empire, I show a deficit on the two last years which will probably not be less than 4,700,0001.

Sir, this is the amount of deficiency we have to meet (I mean of course, only the part I have stated affecting this country): but how shall that deficiency be supplied ? We cannot escape the consideration of that question. And it is our duty, no doubt, before any proposition be made, to exhaust in consideration the modes by which that deficiency can be supplied. Shall we persevere in the system on which we have been acting for the last five years ? Shall we, in time of peace, have resort to continued loans ? Shall we try issues of Exchequer hills ? Shall we resort to Savings Banks ? Shall we have recourse to any of those expedients which, call them by what name you please, are neither snore nor less than a permanent addition to the Public Debt? We have a deficiency of nearly 5,000,000/. in two years ; is there a prospect of reduced expenditure ? Without entering into details, but looking at your extended empire, at the demands that are made for the protec- tion of your commerce, and the general state of the world, and calling to mind the intelligence that has lately reached us, can you anticipate, for the year after the next, the possibility, consistently with the honour and safety of this country, of greatly reducing the public expenses? I am bound to say I cannot calculate upon that. Is this a casual deficiency for which you have to provide a remedy ? Is it a deficiency for the present year on account of extraordinary circumstances ? Is it a deficiency for the last two years ? Sir, it is not. This deficiency has existed for the last seven or eight years. It is not a casual deficiency. In the year ending the 5th of April 1838, the deficiency was 1,428,000/. In the year ending the 5th of April 1839, the deficiency was 430,0001. In 1840, it was 1,457,000/. In 1841, the deficiency was 1,851,0001. In 1842, I estimate the deficiency will be 2,334,000/. The deficiency in these five years amounts to 7,302,000!.; and to that actual deficiency I must add the estimated deficiency for the year ending the 5th of April 1843- 2,570,000!., making an aggregate deficiency in six years of 10,072,000/. I ant sure I shall not be blamed for adhering to my resolution, in making a full and unreserved disclosure of our financical situation. ["Hear, hear !"form all sides of the House.] I do it, as I said before, because I am deeply impressed with the conviction that a full knowledge of the truth is the first step to improvement; and because I have that con- fidence in the resources, in the energy and the wisdom of Parliament, that I cannot consent to avail myself of the miserable subterfuge of with- holding any knowledge I may be able to communicate with respect to the financical difficulties of the country. Well then, Sir, with this proof that it is not with an occasional or casual deficiency that we have to deal, will you, I ask, have recourse to the wretched expedient of continued loans ? Sir, I cannot recommend such a step. It is impossible that I could be a party to a proceeding which I should think might, perhaps, have been justifiable at first, before you knew exactly the nature of your revenue and expenditure ; but with these facts before me I should think I was disgracing the situation I bold if I could consent to such a paltry expedient as this. I can hardly think that Parliament will adopt a different view. Jean hardly think that you, who inherit the debt that was contracted by your predecessors, when having a deficient revenue they reduced the charges of the Post-office, and inserted in the preamble of the bill a declaration that the reduction of the revenue should be made good by increased taxation, will now refuse to make it good. The effort having been made, but the effort having failed, that pledge is still unredeemed. I advised you not to give that pledge ; but if you regard the pledges of your predecessors, it is for you now to redeem them. If, however, you are not bound by the pledges of your predecessors, you are bound, I apprehend, by the engagement which you your- selves have contr ted. Almost the first vote you gave after the election of the prsent Parliament was the adoption of a resolution that it was impossible to permit that state of things to continue which presented copstant deficits of revenue : Parliament assured the Crown that they would without delay apply themselves to a consideration of &trice, and would adopt some racemes for the purpose of equalizing revenue and expenditure. I apprehend, therefore, that with almost universal acquiescence I may aban- don the thought of supplying the deficiency by the miserable de- vice of fresh loans, or an issue of Exchequer bills. Shall I then, if I must resort to taxation, levy that taxation upon the articles of con- sumption—upon those articles which may appear to some superfluities, but which are known to constitute almost the necessaries of life ? I cannot consent to any proposal for increasing taxation on the great articles of consumption by the labouring classes of society. [Cheers from both sides of the House.] I say, moreover, I can give you con- clusive proof that you have arrived at the limits of taxation on articles of consumption. I am speaking now of articles of luxury which might be supposed not to constitute the consumption of the labouring classes; and I advise you not to attempt taxation, even upon those articles, for you will be defeated in your expectations of revenue. The right honour- able gentleman opposite, [Mr. F. T. Baring,] attempting to redeem the pledge which had been given by Parliament to repair the deficiency which was caused by the defalcation of the Post-office revenue, pro- posed in 1849, that 5 per cent. additional duty should be laid on the articles of Customs and Excise, and 10 per cent. additional on the Assessed Taxes. I am much obliged to the House for the patience with which they listen to me, and feel sorry to trouble them with these details, but I do think them necessary parts of the statement I have to make. [Loud cheers.] The net produce of the Customs and Excise, in the year ending the 5th of January 1840, after deducting drawbacks and repayments, was 37,911,506/. I wish to carry your judgment along with me while I am exhausting the different means by which men might contemplate the supplying of the deficiency, and trying to show that increased taxa- tion upon any articles of consumption will not afford relief. Well, then, the net produce of the Customs and Excise for the year ending 5th January 1840, was 37,911,5061. The estimated produce of the Customs and Excise for the year ending 5th January 1842, including the addi- tional 5 per cent, which was estimated to produce 1,895,5754 was 39,8117,0811. And I think it better to compare the years 1840 and 1842 than 1840 and 1841, because at the end of 1811 it is probable that all articles had not been brought under the additional duty. The net produce of the Customs and Excise for 1842 was estimated at, and ought to have been, if an addition in taxation always produced a pro- portionate increase in revenue. 39,807,081/.; but the actual produce was only 38,118,2211. The estimated increase from the additional, 5 per cent was 1,895,575/.; whereas the actual increase was only 206,7151.; showing that not an increase of 3 per cent, but little more than one-half, per cent, was realized by that additional duty of 5 per cent. In the depression of trade there may, undoubtedly, be circum- stances sufficient to account for the expectations of the right honour- able gentleman not having been realized; but still, making every abatement for these causes of decrease, I think it impossible not to admit that 5 per cent increase of duty on articles of consumption would not produce 5 per cent in net amount to the revenue. On the other hand, the right honourable gentleman's estimate with respect to the produce of the Assessed Taxes was fully realized. I know it may be said that full time has not been given for notifying the intention to discontinue some articles partaking of the nature of assessed taxes; but, on the whole, I think we may disregard that circumstance ; for although the notice of such discontinuance may not have taken full effect, yet the inference, I think, may be fairly drawn that the right honourable gentleman did not overdraw his estimate. The net produce of Assessed Taxes in 1840 was 2,758,0001.; the 10 per cent addition being 275,0004 the estimated produce was 3,034,0001.; but the actual produce of the Assessed Taxes, including the additional 10 per cent for the year ending the 5th of January 1842, very far exceeded the right honourable gentleman's estimate ; for instead of realizing only 3,034,0001. as he calculated, 3,500,0001. was realized. Prom this, per- haps, I should make an abatement on account of the survey of win- dows : that new survey of windows produced an increase in the revenue of 430,0001.; consequently the increase in Assessed Taxes alone ought perhaps to be diminished to something like that amount ; but still if you make that abatement, you will find that the right honourable gentleman's estimate was verified—there was an increase in the Assessed Taxes to the full amount he calculated, the increase being 311,000/. i. e., 11 per cent was produced by the nominal impo- sition of 10 per cent additional duty. I compare these two results —I compare the complete failure of the taxes on consumption, and the complete justification of the taxes upon something ana- logous to property. [The enunciation of these words produced a marked sensation in all parts of the House.] I find in the one ease the estimate was exceeded ; I find in the other it was miserably disappointed. These are the results I feel it my duty to bring before the Committee ; but may immediate object was to adduce a proof that you had arrived for purposes of revenue at the limits of

taxation upon articles of consumption. Then I say, making abatements on account of the depression of trade, I do not think any man can re- sist the conclusion which I draw, that to lay 10 per cent additional on Customs and Excise will end in nothing but failure and disappoint- ment.

Well, then, I have now discarded the notions of supplying the de- ficiency by incurring fresh debt. I have attempted to carry your con- viction with me while I have endeavoured to show that I cannot look to taxation on articles of consumption : now it is possible to resort to another expedient. Shall I revive old taxes that have been abolished,

or impose new ones ? Shall I take the Post-office ? ["Hear, hear !"]

I do feel it to be necessary that you should adhere, not to the contract you have entered into, but to observe the request I made at the com- mencement of my address—that you should suspend your judgment until you have heard the entire of my plan. I must deal with each of these questions step by step. What I ask is, that you should not con-

demn any individual proposition until you can judge of it in relation to the whole. Never doubting the social advantages of the reduction of the duty on postage—thinking that the duty as it existed was too high and might fairly admit of reconsideration and reduction—I did never- theless deprecate, in the then state of the finances. the reduction which took place to Id. upon all letters. I do believe, if it were necesssary, I could show to you that from the Post-office you do not receive one far- thing of revenue. If you will add the charge of the packets to the other expenses of the Post-office, the account which will be presented to you will show a deficit in the revenue of the Post-office. But when I state that, I do not undervalue the importance of the reduction in a moral and social point of view. I will not say—speaking with that caution with which I am sometimes taunted, but which I find a great conve- nience—I will not say that the Post-office ought not to be a source of revenue. I will not say, that it may not fairly become the subject of discussion : but I will say this, that I do not think the measure has had a complete and full trial ; and I am so sensible of the many advantages which result from it, that I cannot recommend that in the present year we should attempt to alter it. I say again, notwithstanding all the taunts to which I have been exposed during the last month in consequence of my proposal in respect to the Corn-laws, that no man can feel a more intimate conviction than I do, that what. ever be your financial difficulties and necessities, you must so adapt and adjust your measures as not to bear on the comforts of the labouring classes of society. And my conviction further is, that it would not be expedient with reference to the narrow interests of property that that should be done. Well then, Sir, I must with my sense of public duty abandon the hope of realizing in the present year any revenue from the Post-office. Shall I revive the taxes which were laid upon great articles of consumption, and which were very produc- tive ? Shall I revive the taxes upon salt, upon leather, and upon beer ? With respect to leather, for instance, I do not know that the reduction took place with perfect wisdom ; I am very much afraid that the full amount of the reduction was not carried to the account of the con- sumer. I believe you omitted to take a step which you ought to have adopted concurrently with the reduction of the duty on leather— namely, to reduce the duty on the import of foreign hides. I am afraid you reduced the duty on leather in favour of a monopoly, and without benefit to the consumer. But the question is not now whether we shall reduce an existing duty : the question is whether we shall re- vive a duty that has been abolished, and on the faith of the abolition of - which various contracts, numerous commercial and manufacturing ar- rangements, have been made. If I take the case of salt, for instance, I find that, since the reduction of duty, salt has been consumed in a variety of ways in which its use was never before contemplated. On account of chemical discoveries and improvements, in consequence of the application of science to manufactures, salt now enters into a variety of products. The ground upon which the abolition of the duty was strongly urged was the importance of facilitating the supply of salt to the working classes : but, independently of their consumption, in my opinion, it would be -unwise to revive the duty on this article, on account of its extensive use in manufactures. There might be a danger of inter- fering with manufacturing industry, which would greatly check its prosperity: there would be a necessary system of drawback on account of the salt consumed, which would lead to opportunities of evasion and fraud, and increase the necessity for larger Excise establishments. I don't think I need argue, therefore, against the revival of the duties on salt, leather, or beer. Shall I, then, resort to locomotion for the pur- pose of finding a substitute ? Shall I increase the taxes on railways? I confess nothing but a hard necessity would induce me to derive re- venue from locomotion. In the present state of this country, when it is a great object to facilitate the transfer of labour, and to enable those to whom labour is capital to bring it to the best market,—seeing the immense social advantages which result from the freedom of communi- cation, not perhaps immediately visible, but still not the less real,—I should contemplate with great reluctance and regret the necessity of increased taxation upon railroads. Well, again, gas has been suggested : I must say I should be also unwilling to add to the taxes on gas. I range the taxes on locomotion and the taxes on gas-lights in the same category with the taxes on salt : not that the sante principle is exactly applicable, but I freely own, seeing the deficiency I have to supply, I should be unwilling to look for revenue either from locomotion or gas-lights. Shall I, then, look for any portion of this deficiency to any of those miserable driblets of taxation which occupy the at- tention of provincial Chancellors of the Exchequer ? There are those who seem to have nothing else to do but to suggest modes of taxation to men in office ; and as I tried to discourage the applications to me for Foreign Consulships, and advertised that with reference to Downing Street I had "no connexion with the next door"—I shall take this opportunity, with reference to these subjects of favourite occupa- tion and amusement to those who in small communities turn their attention to financial affairs, and who fancy they have made some dis- covery that pretty nearly puts them on a level with Archimedes,—when, finding that pianofortes, umbrellas, or such articles are not subject to taxation, they immediately suggest them to the Chancellor of the Exchequer, accompanied with a claim for a very large percentage on the ground of the novelty of their discovery and the certain success of its application,—I shall take this opportunity of discouraging all such suggestions, by assuring these volunteer financiers that men who are spending eight or ten hours a day in consideration of matters of finance are at least as likely to form an accurate judgment on such matters as those who suggest such pitiful propositions.

There is another source, which, adopting this process of exhaustion, I must not forget, which was brought forward and urged upon the House by the late Government, and to which I feel it my duty to refer. Shall I then hope for the increase of revenue from diminished taxation ? But before I apply myself to this point, let me remind you of the extent of your deficit, the amount of the sum to be provided for, and the proof I have offered you that it is not an occasional or casual deficiency you have to make good. No one has greater confidence

than I have in the ultimate tendency of reduction in taxation. on the great articles of consumption, if wisely managed ; but after giving to

this 50d-et the fullest consideration. I have come to the complete con- viction that it would be mere delusion to hope for supplying the de ficiency by diminished taxation on articles of consumption. I have a firni confidence that such is the buoyancy of the consumptive passers

of this country, that we may hope ultimately to realize increased re.

venue from diminished taxation ; hut a long period must elapse before this end is attained. and I feel confident that the adoption of any plan like that proposed by the late Government, or the adoption of any other plan for raisins revenue by means of diminished taxation, would not afford any immediate relief, or provide any resources on which we might rely for supplying the deficiency of the revenue. I have looked with considerable attention to the effect produced by a reduction of taxation upon articles of considerable consumption, and I do perceive that in many cases that elasticity which gives, after the lapse of time, increased revenue, but in almost every instance-in all. I believe, with- out exception-the space of time which elapses, after reduction of

taxation, before the same amount of revenue is realized, is very considerable. Let us take the case of wine. In 1825 the revenue derived from wine was 2,153,0001.: the duty was reduced from 9s. 11d. to 4r. 21d. the gallon ; and in the next year after the reduction of the duty there was a falling-off of the duty from 2,100,0004 to 1,400.000/. ; in the next year the duty amounted to 1.600,0001.; in the subsequent years to 1,700,0004 1,400,000L, 1,500,000/.; and the duty has never realized its former amount. Upon tobacco the duty was reduced from 4s. per lb. to 3e. per lb. Previously to the reduction of the duty, the revenue derived from tobacco amounted to 3,378,000/.; and im- mediately after the reduction there was a falling off: it fell from 3,300,000/. to 2,600.000!.; then it rose to 2,800,0001.; and in the fol- lowing years it realized 2,700,0004, 2,800,0001., 2,900,0001., and again, 2,900,000/.: but the duty on tobacco has never recovered its former amount. The case generally relied on, as showing the advantage of a reduction of duty on articles of consumption, is that of coffee . the duty on coffee was diminished from Is. per lb. to 6d. per lb. This was in 1824, when the revenue received from coffee amounted to 420,000!.: in the next year after the reduction, the amount of duty fell to 336,0001.; then it rose to 399,0001.; and in the third year the duty reccvered it- self, and has gone on advancing. Still, even in this instance of coffee, which is by far the most favourable case, a period of three years elapsed before the full amount of duty was realized. The duty on hemp was reduced from 9s. 10d. per cwt. to 4s. 8d.: at the time of the reduction, the revenue derived, from hemp was 236,000/.; and since then hemp has never-yet paid but half that amount of duty. In the ease of rum, there was an increase of revenue after the reduction of duty from 12s. 2d. per gallon to Ss. 6d. The duty on sugar was reduced from 27s. per cwt. to 24s.: at the time of the reduction, the revenue derived from sugar amounted to 4,896,0001.; it then fell to 4,600,0001., to 4,300,0001., and then rose to 4,500,0001.; and it has never since paid the same amount of duty. I do not think I need go through the whole of the articles in detail in which a reduction of duty has taken place. In addition to tobacco, hemp, sugar, and the articles I have mentioned, the duty was also reduced on glass, beer, soap, paper, on newspapers and advertisements; but I think I need not refer to all these articles in detail. In many of these cases there has been no considerable re- duction of the amount of duty; but, with the exception of coffee, which realized the full amount of duty in the third year after the reduction, and rum, there is not a single article the duty on which has recovered itself within a period of five or six years after a considerable reduction. Therefore, on this ground, I am led to believe, that with respect to the present deficiency of the revenue, which it is necessary to supply, you cannot look to that supply from a mere reduction of duty upon articles of consumption ; and that if you resort to that as the only means of supplying the deficiency, you must make up your mind to continue the system, which I thought you ready to abjure-namely, to have re- course to loans, and those other devices I have before alluded to, for the purpose of making up the deficiency. I trust that I have-I will not say, convinced you that none of those measures ought to be adopted, hut that, at any rate, I have clearly explained the grounds on which I cannot be a party to their adoption.

I will now state what is the measure which I propose, under a sense of public duty, and a deep conviction that it is necessary for the public interest ; and impressed, at the same time, with an equal conviction that the present sacrifices which I call on you to make, will be amply compensated ultimately in a pecuniary point of view, and much more than compensated by the effect they will have in maintaining public credit and the ancient character of this country. Instead of looking to taxation of comsumption-instead of reviving the taxes on salt or on sugar-it is my duty to make an earnest appeal to the possessors of property, for the purpose of repairing this mighty evil. [General cheering.] I propose-for a time at least- (and I never had occasion to make a proposition with a more thorough conviction of its being one which the public interest of the country required)-I propose, that for a time to be limited, the income of this country should be called on to contribute a certain sum for the purpose of remedying this mighty and growing evil. I propose, that the income of this country should bear a charge not exceeding sevenpence in the pound- which will not amount to 3 per cent ; but be, speaking accurately, 2/. 18s. 4d. per cent - for the purpose of not only supplying the deficiency in the revenue. but of enabling me with confidence and satisfaction to propose great commercial reforms ; which will afford a hope of reviving commerce, and such an improvement in the manu- facturing interests as will react on every other interest in the country ; and, by diminishing the prices of the articles of consumption, and the cost of living, will, in a pecuniary point of view, compensate you for your present sacrifices, whilst you will be at the same time relieved from the contemplation of a mighty evil. [Here some interruption oc- curred, caused by several Members speaking privately to each other. After a pause, during which there were cries of "Order ! " Sir Robert Peelpro- ceeded.] I hope honourable gentlemen will allow me to make the statement I have yet to lay before the House uninterruptedly. [Hear, hear.] In 1798, when the prospects of this country were gloomy, the Minister had the courage to propose, and the people had the forti- tude to adopt, an Income-tax of 1.0 per cent. The Income-tax con- thus,' to the close of the war in 1802; and, in 1803, after the rupture of the peace of Amiens, a duty of 5 per cent was placed upon pi operty: it was raised in 1805 to 61 per cent, and in 1806 again to 10 per cent ; and so it continued to the end of the war. I propose that the duty to be laid on income shall not exceed 3 per cent, or, as I said before, exactly 2/. 18s. 4d., being 7d. in the pound. Under the former duty, all iTICOM,'S below 601. were exempt from taxation, and on incomes between 60/. and 150/. the tax was on a reduced rate. I shall propose, that from the Income-tax I now recommend all incomes under 150/. shall be exempt. Under the former Income-tax, the amount at which the occupying tenants were charged was estimated at three-fourths of the rent : it is admitted, I believe, that to calculate the profits of the tenants at the three-fourths of the rent was too high an estimate; I propose, therefore, that in respect of occupying tenant, the occupation of land shall be charged at one-half instead of three-fourths of the rent. I believe this to be a perfectly fair reduction ; and it was contemplated in 1816, when Lord Bexley proposed the renewal of the laconic-tax. I believe it to be a perfectly fair reduction, inasmuch as rents have in- creased in reference to the value of land in a proportion to justify it. I propose, for I sec no ground for exemption, that all funded property, whether held by natives of this country or foreigners, should be subject to the same charge as unfunded property. This is the nature of the proposition which it is my intention, with the full and unanimous concurrence of my colleagues, and with the deepest conviction on our parts that it is wise and necessary, to submit to the House. Of course, the House will call upon me for some esti- mate, the best I can form, of the probable produce of this tax. I am sure that every gentleman will admit how imperfect are the means of forming an estimate ; but I will give the best I can make up, and state as clearly as I can the grounds on which it is based. In 1814, which is the last year in respect to which we have returns, the income in Great Britain, assessed to the Property-tax, was 170,000,0001. The property on which the Income-tax was assessed was comprised in five different divisions or schedules. The schedule distinguished by the letter A conta;ned the property which was derived from land. It was divided into three classes-the rent of land, the rent of houses, and the rent derived from tithes, quarries, canals, and other similar descrip- tions of property. The property classed under the rent of land, in respect of which a duty was imposed, amounted to 39,400,000!.; the rent of houses equalled 16,260,0001.; the profits from tithes, &c., 4.470,000!.; making a total value of the property derivable from lands of 60,130,0001. Schedule B contained the rent of land in respect of occupation by occupying tenants, and the amount of income on which the duty was imposed equalled 38,396,0001. Schedule C contained the income from public funds and similar securities, amounting to 30,000,000!.; schedule D contained the profits of trades and profes- sions, amounting to 38,310,000!.; and schedule E the income of public officers, amounting to 11,744,000/. Now, I will in the first place deal with schedule A. As I said before, the rent of land is there stated at 39,400,000/. Now, I cannot doubt that the return of peace and the cessation of war-prices must have had a considerable effect in reducing the rental of land ; and, taking into consideration the effect of the re- storation of the currency, the rental of land may probably at first have fallen far below that amount; but still, when I look at the improve- ment which agriculture has received from mechanism, and the effect of the application of science to land, I cannot but entertain a conviction that the present rental of land must be equal to the rental in the year 1814. I will therefore assume that the rental of the land is at present equal to what it was in 1814, and put it down at 39,400,000/. The rent of houses in 1814 equalled 16,260,000/. I presume I am acting in ac- cordance into the general opinion of this House in entering with these details. [" Hear, hear !"] In 1814, the number of houses was 2,231,100; in the present year the number has increased to 3,460,000. If the in- crease of rent be proportioned to the increased number of houses, I shall be justified in estimating the amount of income derived from the rental of houses at 25,000,000/. There is another principle on which I can form my calculation : I can take the proportion of rental which was valued to the House-tax, and compare it with the valuation for the purpose of the Property-tax in 1814; and I find very nearly the same result. A calculation founded on the relation which the charge to the House-tax bore to the charge to the Property-tax will give a present income of 25,000,000/. Forming an estimate, therefore, in either way, I calculate the present rental of houses at 25,000,000/. With respect to tithe, little doubt comparatively exists : as far as I can learn from the information of the Tithe Commissioners, the amount of tithe is 3,500,000/. I find that the dividends, as far as I have been able to ascertain the fact, of railway companies, canals, and other properly of a similar nature, amount to 3,429,0001. I do not think that the an- nual profits derived from mines and iron-works arc more than 1,500,0001. Adding these three last-mentioned stuns together, the result is a total of 8,400,0001. I will now recapitulate the estimate of property in schedule A. I calculate the rent derivable from land at 39,400,0001.; the rent of houses at 25,000,0001.; tithe, railway shares, and mines, and other property of the same description, at 8,400,0001.; which gives a total income in respect to which a tax is proposed to be imposed (sub- ject to a limitation I shall presently mention) of 72,800,000/. I also propose that all incomes under 1501. shall be exempted from the tax. This is an immense deduction, being not less than one-fourth of the total of the assessable property. Deducting that one-fourth, the pro- duce of the tax on this species of property included in schedule A will be 1,600,000/. Schedule B is the rent of lands in respect of occupancy. The sum assessed in 1814 was 38,396,0001., but in that year the value of tenants' occupancy was assumed to be three-fourths of the rent ; whereas I take it at one-half of the rent. I assume, then, the rent of land which I can touch by my assessment in the first instance, to be re- duced to 26,000,000/., on account of that reduction, from three-fourths to one-half. Then I must apply another exemption, namely, all ten- ants who derive profits less than 1501. a year ; on that account I must make a further reduction ; so that, upon the whole, I cannot calculate upon a greater amount of duty than 150,000/. from occupying tenants. The effect of this will be, as I calculate the profits at about one-half, that a tenant who pays a rent of less than 3001. a-year will be exempt

from this tax, unless he has other sources of income. I now come to

schedule C. Se l' C comprises income from Public Funds and Se- curities. The dpita! assessed under this head in 1814 was 30,000,0001.: the payments in the year 1841 for dividends and interest of public funds and securities amounted to 29,400,0001. I think there cannot be a question that I ought to deduct the whole amount of payments on ac- count of savings-banks. I must therefore, on that account, make a de- duction of 1,000,0001.; which will give me a net income assessable to the Property-tax from the Public Funds of 28,400,0001. To that I must add for the dividends on Bank Stock, India Stock, and Foreign Stock, the dividends of which are payable in this country, an amount of 1,500,0001.; making a total amount of very nearly 30,000,0001. for the amount of payments in the year 1841. But again I must apply a de- duction on account of all exempted incomes of less than 150/. a.year. I deduct one-fourth on that account, and the estimated produce of the Property-tax arising from public income is 646,0001. Schedule B, in 1819, contains income derived from the profits of trades and profes- sions. Here it is exceedingly difficult to form an estimate which shall approach the truth. I find that the total exports and imports in 1814, compared with the total exports and imports in 1841, were in the ratio of 86 to 138; but the declared value of those exports bears only a ratio of 45 to 51. But, on the other hand, the quantity of' British shipping employed in commerce in the year 1814 was 1,990,000 tons; and in 1841 it was 3,292,000 tons. From this, I cannot form an estimate upon very satisfactory grounds ; but I think that the income derived from trades and professions in the pre- sent year cannot be far short of 56,000,000/. I deduct one-fourth on account of exempted income ; and the produce of the tax upon the whole I calculate at 1,220,0001. Schedule E contains the income of all public officers. In 1814 the income of all public officers amounted to 11,744,0001. On account of the great reductions in our estab- lishments which have taken place, a very great deduction must be made from the income of public officers. I do not think it could be safely estimated at more than 7,000,0001., instead of 11,744,0001. I again must deduct one-fourth for exemption ; that leaves as assessable a sum of 5,250,000!.; and the produce of the tax is 155,000/. I will recapitulate the total estimated amount of duty from the application of a charge of about 3 per cent, for the purpose of keeping the subject clear. Under

Schedule A I calculate upon deriving . £1,600,000 Schedule 150,000 Schedule C 646,000 Schedule D 1,220,000 Schedule E 155,000 making the total aggregage estimated receipts £3,771,000. I will now state what are the views of her Majesty's Government with respect to the duration of this duty, if it shall meet with the sanction of the House. I trust that Parliament will confirm the duration I am about 'to propose ; and I trust that Parliament would not be unwilling, in case of necessity, to continue the duration of this tax for a period of five years. But still there may be, as there have been before, and of which I do not despair, those revivals of commercial prosperity, coupled with the measures which I am about to propose, that may make Par- liament naturally anxious to have the opportunity of reconsidering the subject at an earlier period than that which I name : they may wish to have the opportunity of considering the operation of this tax at an earlier period than five years ; and although I must contemplate the possibility, for public interests, of that duration—and although I trust, that in case the experiment should not be complete, Parliament would not hesitate to prolong it—yet I think, upon the whole, it is only just, in the first instance, to limit the experiment to a period of three years, in order to give Parliament an opportunity of reconsidering it at the end of that time, if necessary. I propose that it shall commence so that the 10th of October next shall be the first half-year.

I come now to consider a matter intimately connected with this, namely the relation of Ireland with reference to this subject. In my opinion, if war should arise—I speak, of course, of some great European contest, calling upon this country to put forth its force—I will not hesitate to express my opinion, that in such a case Ireland ought to contribute, and I believe she would be desirous to contribute, her full share. But when I am proposing a tax limited in duration in the first instance to a period of three years, and when the amount of that tax does not exceed 3 per cent, I must, of course consider with reference to public interests whether it be desirable to apply that tax to Ireland. I must bear in mind that it is tax to which Ireland was not subject during the period of the war ; that it is a tax for the levy of which no machinery exists in Ireland. One advantage of the tax here is, that I can raise the amount at less charge than any other kind of tax ; the machinery is complete ; but Ireland has no Assessed Taxes ; the machinery there is wanting, and I should have to devise new machinery for a country to which the tax has never been applied ; and although I claim for Parliament the entire right to apply to Ire- land this tax, if such necessities as we have seen should require it, yet in the state of society in Ireland there is something peculiar, which makes the devising of machinery for its collection matter of grave con- sideration. At the same time, as no part of the empire will be more benefited by the reductions which I about to propose than Ireland, and as Ireland is united with this country, I think Ireland ought to bear a fair proportion—a fair proportion, I say, of that impost which I about to levy. If I find the means of raising from Ireland anything which might be considered of about an equivalent amount to that which she would contribute under an Income-tax, I should not be reluctant to raise that amount by other means. I think I can suggest two modes by which I can raise an amount very nearly equivalent, or perhaps quite, to that which Ireland would have to contribute; per- fectly consistent with the terms of the Act of Union, and without imposing any serious burden upon that country. I propose to levy a duty of Is. a gallon upon spirits in Ireland ; and I firmly believe that, by this means, a considerable revenue may be derived, not only with- out any injury, but with positive advantage to Irish distillers, and to Ireland herself. I must shortly call the attention of the House to the state of the spirit-duties. In England, the duty upon spirits is 7s. 10d. a gallon ; in Scotland, the duty is 3s. 8d.; and in Ireland, it is 2s. Rd. a gallon. If it were possible to equalize the spirit-duties in the three countries, great advantage would result from it. It would be of the utmost advantage to place all articles of produce of the three countries —the three constituent branches of this great empire—upon precisely the same footing, and to do away with all this system of' duty and drawback on the intercourse of the three countries, which leads to great frauds and operates most prejudicially: I think I can say conclu- sively, that, so far from Ireland deriving any advantage from the dimi- nished rate of duty, it has bad a very prejudicial effect upon her com- merce. As I said before, the duty on spirits in Ireland is 2s. 8d. a gallon, and 3s. 8d. in Scotland. What is the consequence ? The Scotch distiller exports his spirits in bond, and on landing it in Ire- land pays the Irish duty of 2s. 8d. a gallon ; but the Irish distiller has no corresponding advantage in exporting his spirits to Scotland, and he pays upon its arrival there Is. duty on account of the increased duty in that country : the consequence is, that Ireland receives a large supply of spirits from Scotland, but sends no corresponding supply of spirits to that country. I cannot give a stronger proof of the evil that arises from different rates of duty. Well, then, Ireland appears to have another nominal advantage on account of the drawback upon malt. That again operates to the prejudice of Ireland. The Scotch distiller sends his spirits to England ; but he has no draw- back on account of malt, because the English distiller has none ; but the Scotch distiller, in sending to Ireland, has a drawback of 8d. be- cause the Irish distiller is entitled to a corresponding drawback. That again tells injuriously to the Irish distiller ; and Ireland would itself derive a positive advantage, although contributing to my duty, from equalizing the duty upon spirits between Ireland and Scotland. Of course it is desirable to consider what would be the probable amount of duty which I should derive from this change of the duty on spirits in Ireland. I believe that no one will deny that spirits are a fit subject for taxation, and that the limit is almost the amount you can raise. At any rate, it is no objection to a duty on spirits that it encourages the consumption of other articles, and lessens the consumption of spirits. The consumption of spirits in Ireland in the last year was 6,500,000 gallons. It decreased very rapidly from the 5th of January 1839 to the 5th of July 1841; and, with a surprising and most laudable con- stancy, the people of that country, in the fulfilment of their engage- ment, abstained from the consumption of that article. I am sorry to see, however, that in the force of the Temperauee obligation there appears to be a relaxation in that country. It may have arisen from some other causes ; but there has been an increase in the consumption of spirits from the 5th of July 1841, to the present time. I have in- quired most minutely into the probable effect which the increased duty of la might have in encouraging that great evil, illicit distillation ; but, from the opinion of competent authorities upon this subject, whom I have consulted, I think that spirits in Ireland will bear a corresponding rise to the amount of duty on spirits in Scotland, without any risk of increasing the consumption or giving encouragement to illicit dis- tillation. If that be so—if an additional duty of Is. a gallon be paid— taking the annual consumption of spirits at what it is now, namely, 6,500,000 gallons, after deducting for some decrease in consumption, and for an increased expense of supervision, I should hope to realize from spirits in Ireland an income of 250,000/. The other source from which I contemplate to derive income from Ireland is a nominal taxation, but one which, in my opinion, instead of inflicting an injury, would confer a considerable benefit on that country. That other source from which I wish to derive some income, making, with the former, an equivalent for that which I should have hoped to derive from a Property-tax, is a source perfectly legitimate, and in its effect will, to a certain extent, fall upon property. I propose, in respect to the great mass of articles, particularly with respect to all those which are con- nected with property, to equalize the stamp-duties in Ireland with those in this country. At the present time, the duties are the same upon newspapers, marine insurance, policies, protests, and foreign bills of exchange. I propose not in all cases to increase the stamp-duties in Ireland, for I propose no addition to the rate of duty in Ireland upon advertisements, or upon leases just fallen in. In each country, both in Great Britain and Ireland, I propose to make some reductions in the stamp-duty. On charter-parties in every part of the united kingdom I propose a reduction from 35s. to 5e. I propose also to reduce the stamp-duty on bills of lading in Great Britain and Ireland from 3s., the present amount, to 6d. But I propose to raise Ireland to the English level, with respect to those stamp-duties which affect property, and to make the contributions from Ireland equivalent to a contribution from a Property-tax. I estimate that the equaliza- tion of stamp-duties in Ireland, with the exception I have mentioned— namely, advertisements, which I do not propose to raise—is likely to produce 160,000!.; add that amount from the stamp-duties to the 250,0001. from the spirit-duties, and the increased duty from Ireland will amount to 410,000/.; and I have the most perfect conviction that that is wiser and better, and more just under present circumstances, than to devise new machinery and impose a Property-tax in that coun- try. At the same time, with respect to absentees from Ireland, I pro- pose that they shall be subject to the Income-tax imposed in England. [" Hear, hear!"] Upon returning to their own country, and spend- ing their income on their estates, they may escape the levy I mean to propose. But, speaking of regular professed absentees, living and spending their incomes in this country, without any call of public duty, I think the income they derive from Ireland ought to be sub- jected to the same impost as those derived from England. Sir, there is one other duty I mean to propose : at present there is a duty imposed by law upon the export of coals in foreign !hips of 4!. per ton. When that duty was imposed, it was the intention that it should be levied : but no duty is imposed on coal exported in Bn- tish ships ; and the operation of the reciprocity-treaties has been to exempt foreign ships from the duty which it was originally in- tended to to levy on the export of coals. Sir, I must say I cannot conceive any more legitimate object of duty than coal exported out of this country : I speak of what is reasonable and just, and think that

a tax levied on an article produced in this country—an element of manufactures—necessary to manufactures—contributing by its export to increase the competition with our manufactures—I think that such a tax is a perfectly legitimate source of revenue. Sir, it is im- portant to consider the rapid increase in the quantity of coal exported. In 1831, the quantity was 356,000 tons, the duty received being , 50,000/. ; in 1833, the quantity was 448,000 tons, the duty 64,7101.; in 1839, the quantity was 1,192,000 tons; in 1840, 1,307,000 tons ; but the realized income, instead of being, as in 1833, 64.000/. was only 6,9001.! Now, I do not intend to increase the duty : I wish not at all to prohibit the export of coals ; but I propose that the duty at first intended to be levied on coals exported in foreign ships should be paid ; and with this view, I propose that the duty of 4s. per ton shall be levied on coal exported in British as well as in foreign ships, thus removing the exemption which under the reciprocity system the fo- reign ships claim. If the duty of 4s. shall be paid on the same num- ber of tons I shall then derive ,an annual amount from this source of revenue of 200,0001; not an inconsiderable increase of revenue, and operating, as few taxes do, to the encouragement of native industry. Now, Sir, having stated to the House all the new taxes I mean to propose, perhaps it may be convenient that I should briefly review the total amount. Of course I am speaking of the year ending the 5th of April 1843; as from the 5th of April 1842 it is that I propose these taxes to commence, with the exception of that on spirits, which, in order to avoid evasion, I must propose for adoption at the earliest possible period. Then, Sir, calculating with respect to the Property-tax a receipt of 3,700,000L—dealing only now with round numbers—from the stamp- duties, equalization 1,600,0001., from the increase of spirit duties 250,0001-, and from the duty on the export of coal 200,0001., I make the total 4,310,000/. as the amount of annual estimated income de- rivable from the new imposts I propose. [Mr. Labouchere here inti- mated across the table, that Sir Robert Peel had omitted an item of 70,0001., to which Si,' Robert assenting, stated the amount then would be 4,380,000/.] Now, Sir, I must deduct from this amount the estimated deficiency on actual votes, for which, of course, I must provide : that I take to be 257,0001.; leaving a surplus of 1,800,0001. But then the House will bear in mind, that this deficiency arises on votes for the current year, and that there must be added the excess of expenditure on the Chino: expedition, &c.; which I cannot estimate at less than 800,0001. Whatever measures also it v; ill be necessary for us Co adopt respect_to India must be deducted from the estimate; but for the present, with these reserves, and subject to such additional deductions, I calculate on a surplus of 1,800,0001. after providing for the excess of expenditure on actual votes. Having that surplus, then, Sir, in what way shall we apply it ? I propose to apply it in a manner which I think will be most conducive to the public interests, and most consonant with public feeling and opinion—namely, by making great improvements in the commercial tariff of England, [Loud crier of" Hear, hear!") and in addition to these improvements, to abate the duties on some great articles of consump- tion. Sir, I look to the tariff, and find that it comprises not less than 1,200 articles subject to various duties. During the interval which I have been blamed for securing, I can only say, that each individual item in that tariff has been subjected to the most careful consideration by myself and my colleagues. In the case of each article, we have en- voured to determine, as well as we can, the proportion borne by the duty to the average price, for the purpose of ascertaining to what extent it may be desirable to make deductions ; and the measure which I shall propose will contain a complete review, on general prin- ciples, of all these articles, with a very great alteration of the tariff. 'We have proceeded, Sir, on these principles—observe that I am speak- ing of general views; there may be individual articles which should form exceptions, but I wish a general result—first, we desire to remove all prohibition ; next, we wish to reduce the duties on raw materials for manufactures to a considerable extent, in some cases the duty we pro- pose being merely nominal, for the purpose more of statistical than revenue objects; in no case, or scarcely any, exceeding, in the case of raw materials, 5 per cent. I speak of course, in a general way. Then we propose that the duties on articles partly manufactured shall be materially reduced, never exceeding 12 per cent. Again, I say, I speak only as to general principles, and without reference to particular cases that may be excepted; while as to duties on articles wholly manufac- tured we propose that they shall never exceed 20 per cent. These are the general views of the Government as to the maximum duties to be imposed, not referring to certain commodities which I will mention subsequently. The course we have pursued, Sir, is this—We have ar- ranged the whole tariff under twenty heads; under the first head, for instance, including live animals, and provisions of all kinds; under the second, articles considered as spices; under the third, seeds ; under the fourth, wood for furniture ; under the fifth, ores, and other materials for manufactures; and without, Sir, going through all the immense mass of detail, I propose forthwith to lay before the House the amended tariff scheme. It is all prepared. [Loud cheers.] It is arranged as clearly as possible under the twenty different heads, classing as nearly as practicable articles of a similar nature, each schedule arranged under five columns ; the first giving the names of the articles, the second the present rate of duty, the third the amount of duty actually received during the year 1840, (taken from the Import Duties Com- mittee Report,) the fourth the proposed rate of duty to be levied on articles imported from foreign countries, the fifth the proposed rates of duty on the imports from British Colonial possessions. Now Sir, it appears that I could not lay before the House my project in any clearer way than in the one I intend. To attempt to go through all the pro- visions of my plan, at present, would increase my labour too much and too greatly fatigue the House. Here, Sir, is the new tariff, arranged under the twenty different heads I mentioned ; and on Monday morning all those engaged in commerce and manufactures throughout the country will have the opportunity of seeing what are the duties which the Government intend to propose. [Sir Robert Pcel here, taking the paper from the hands If Mr. Gladstone, kid it on the table amidst great cheering from all sides of the House.] Now, Sir, speaking generally, as I said before, I think that out of the 1,200 articles in the tariff, it is proposed to reduce the duty on 750—on all those articles which enter into manufactures as chief constituent materials. There remain about 450 articles on Which it does not appear necessary for the interests of commerce and for the interests of consumers to make any deduction of duty. But on 750 duties out of 1,200 I do propose reductions, some of them most material. Now, there are some very important articles on which we do not propose any reductions ; partly from considerations of revenue exclusively; partly on this account, that we found, on enter- ing office, there were negotiations pending with many states in respect to proposed commercial treaties, and we have done all we could to con- tinue those negotiations, commencing also some with other states. We have at this moment a treaty pending, commenced under the auspices of the noble lord opposite, [Viscount Palmerston] with Portugal; and I firmly believe, bad it not been for recent events disturbing the peace of that country, this treaty would ere this have been completed. We have opened communications with Spain for the purpose of forming a commercial treaty with that country, strongly urging on that country the policy of encouraging international commerce. As to this treaty, I can only say that the proposition was favourably received. We have, further, negotiations pending with Sardinia and with Naples. We have commercial treaties arranging with South American states. We have, moreover, intimated to France our earnest desire to resume negotiations for the completion of a commercial treaty, founded on principles, as I believe, of reciprocal benefit, and having a tendency to strengthen the ties of amity and friendly feeling between the countries. That treaty also was nearly completed by the noble lord opposite ; and I wish he had carried it into effect, believing firmly that France and England would, morally as well as physically, have derived the greatest benefit from it. I know not which country would have benefited most. There is the opportunity of materially benefiting the industry and trade of both countries by the relaxation of present duties—would the preju- dices of the French people admit of it. The benefit resulting to one country would react beneficially on the other, to an extent not to be estimated. I think it however right, adhering to strict truth, to add, that I can offer no prospect as to the probable period at which this treaty may be ratified : but with my conviction of the reciprocal benefits certain to result from it, I sincerely hope that the public mind in France will support the Government of that country in carrying it out. Now, while these treaties are pending, there are several articles which would enter into discussions with these states, and in respect to which, there- fore, I shall humbly. advise the House not .to, make any material relaxation. I will notnow enter upon the question as to whether it be or be not wise to make reductions in the duty on imports without reference to corresponding relaxations ; -but I. do think that when we make such reductions we ought to do our utmost to procure from foreign countries benefited thereby corresponding relaxations. Nor can I deem it wise to diminish the hope of satisfactorily arranging these relaxations with foreign nations by rashly reducing the amount of duties on articles which must form the bases of negotiation. I dp not, therefore, propose any reduction in the amount of duties On brandy and wines, though I hope that tjmy may be reduced when cor- responding relaxations are made by other countries benefited by our reductions. So with respett to the various fruits on which I am most anxious to relax the duty, but which form the basis of negotiation, I propose for that purpose to retain it ; not, I say, with reference to revenue, but simply to facilitate negotiation. Now, Sir, these various reductions, removals of prohibitions, or relaxations of duties, on articles such as oils, ores, &c.—these reductions having a tendency to remove the burdens upon commerce, and increase its buoyancy—these reduc- tions, producing as they will, I firmly believe, advantages to commerce and manufactures far exceeding in proportion the loss to the revenue, will consume about 270,000/. of the surplus.

Sir, I have been speaking of reductions of duty on articles entering into manufactures ; I now address myself to the consideration of re- ductions in duties on great articles of consumption. Sir, the chief articles of consumption to which duties refer (independently of wines and brandy) are sugar, coffee, and tea. I wish I had it in my power to state to the House that Her Majesty's Government could propose to Parliament such an alteration in the duties on sugar as would be likely to afford a large measure of advantage to the consumer. I do not deny, that if we were wholly unembarrassed by the question of the Slave-trade, I should have felt it my duty to propose a considerable alteration on this subject; but, looking at our position with reference to our West India Colonies, and having due regard to our relations with foreign states, and bearing in mind the treaties into which we have entered, I confess I do not see how it would be possible for me with justice or with safety to propose any modification of the duties now collected from sugar : at the same time, I am quite prepared to admit that this is a department susceptible of some change. The propo- sition which I shall have to make will be, not like the measure proposed in the last session of Parliament, which would have had the effect of exposing sugar, the produce of British possessions, to foreign competi- tion; but, on the contrary, one which will protect the British producer, while, as I hope, it will do no injury to the consumer. If I did reduce the duties on sugar, I trust that the reduction would be such as to insure an increased consumption at a diminished charge. I need scarcely remind honourable Members, that it is of the utmost importance so to limit these changes, that the profit shall not fall into the hands of the retail-dealer, or rather, I should say, that the whole advantage of the remission of duties should accrue to the consumer alone. I cannot consent, neither can those with whom I have the honour to act acquiesce, in any arrangement the effect of which would be to permit the import of sugar into this country, the produce of Brazil or of Cuba, without making some effort for the purpose of restraining that trade which this country has so long and so vigorously resisted. I retain the opinion which I formerly expressed upon this subject—that I do not believe it would be consistent with the honour and character of this country to take any course, however strong the motive for its adoption, the tendency of which would be to give the remotest sanction o encouragement to that traffic ; but, on the contrary, we ought to spare no pains and evade no sacrifice which could with safety and justice be made for the purpose of effecting its abolition, or, as far as our power extended, of mitigating its severity. Considering, then, the peculiar circumstances of our position with respect to the slave-trade, I cannot think it would be for the honour, the character, or the advantage of this country, that we should permit a competition between sugar the produce of British possessions and the sugar of foreign colonies produced by slave-labour. Is it politic to adhere to the principle of reducing the duty on sugar the produce of British possessions alone ? I greatly doubt the policy of any such reduction. If there were a fair compe- tition, I believe the reduction in the duty would be a great advantage, not only to the West India proprietor, but to the consumer likewise : but so long as the supply from the West or the East Indies partakes of the character of a monopoly, I am very much afraid that the advantage would be confined to the producer; so long as the supply continues to be limited, I fear the reduction of the duty would not benefit the consumer, but would go as a bonus to the West and East Indian proprietors : and though I do not disguise from myself the advantage of a reduction of duty on sugar, yet, after every consider. ation which I have been able to give the subject, I am not able to communicate views differing. from those which I expressed last year. There are, I confess, some circumstances from which I derive conso- lation in adhering to these views : I find that, in the year 1841, there has been a very material inerease in the consumption of sugar the produce of British possessions. In the year 1840, that is, the year ending the 5th January 1841, the quantity of sugar imported from British pos- sessions was 4,035,000 cwt.: in 1841, viz, the year ending on the 5th of Jaftuary 1842, the importation of sugar amounted to 4,830,000 cwt. The quantity of British-produced sugar imported for home consump- tion in the year 1840 was 3,594,000 cwt : in 1841, it was 4,058,000 cwt. The gross amount of duty collected in the year 1840, was 4,465,0001.: in 1841, the duty collected amounted to 5,120,0001. Thus it will be seen that the duties, without the addition of the foreign sugars, corresponded as nearly as possible with the calcu- lation made last year by the right honourable gentleman opposite : but the House mould, of course, see that the consumption of the present exceeded the consumption of last year; and the total amount imported from British possessions in the East and West Indies in the current year, exceeded the importations of any preceding season. It is almost needless to observe, that the imports afford the best data which we can possess, for the purpose of forming an estimate of the probable supply for the ensuing year. There is at present, or I should say there was on the 5th of the present month, in London, of British plantation, Mauritius, and East Indian sugar, 410,000 cwt.; while in the outports the quantity was 180,900 cwt. The total quantity then in warehouse in this country was 590,000 cwt. On the expected imports of sugar during the year 1843, I have sought the best information, and consulted those on whose judgment I had good reason to rely. The result of the communications which I have held upon the subject lead me to the conclusion, that, as nearly as possible, the imports of sugar in the next year may be estimated at 2,400,000 cwt. from the West Ladies, 800,000 cwt, from the Mauritius, and 1,700,000 cwt. from the East Indies ; making a total of 4,900,000 cwt. Now, if we add to this the quantity at present in warehouse in England, namely 590,900 cwt., we have for the consumption of the year 1843, a quantity of sugar which might fairly be estimated at 5,490,000 cwt. Now, as the amount of sugar taken out for home consumption in the present year was 4,040,000 cwt., that would !cave a surplus over the largest quantity ever derived from the British colonies of not less than 122,000 cwt. Though the statements which I have made are founded upon the best and the most accurate information which it was in my power to ob- tain, I do not mean to say that it warrants a conclusive argument against the principle of permitting foreign competition in the article of sugar, supposing always that we were not embarrassed by the ques- tion of slavery ; but I am happy to say that the opinion expressed by Government as to the anticipated reduction in the price of sugar, and the increase to the revenue without resorting to foreign supplies, has been fully realized. I am quite aware that other questions have arisen with the respect to the application of our efforts towards laying a foundation for the gradual abolition of slavery, in the success of which the country is much interested, and the success of which is of the highest importance to the honour, the good faith, and the pros- perity of Great Britain. Imputations on the honour and good faith of the country have been thrown out in reference to the efforts which we have made to accomplish the total abolition of slavery. One of the fairest and most obvious modes by which charges of that nature may be answered is, to avoid anything which could be construed into an encouragement, direct or indirect, of the slave-trade: therefore am I disinclined to incur the risk of doing anything that could tend to increase the horrors of slavery, by encouraging the cultivation of sugar by slaves in other countries. On these grounds, then, I adhere to the opinion which I expressed in the course of last year, and which I repeat on the present occasion, that I am opposed to the reduction of the duty on sugar while it partakes of the character of a monopoly.

I now come to two articles of very general consumption-coffee and timber. With respect to both of these I trust that the propositions that I shall have to make will be more generally acceptable. I am sorry to say that though therehas been an increase in the consumption of sugar, there has been a decrease in the consumption of coffee. In the year 1840 the home consumption of coffee was 2,870,800 lib. In 1841 it was 2,844,100 lib. The gross amount of duty received in the former year was 922,0001., and in the latter 880,0001. The duty on foreign coffee is Is. 3d., while on coffee produced in British possessions the duty is only 6d., and the duty on coffee produced in territories comprehended within the limits of the East India Company's Charter is 9d. Will the House do me the favour to look for a moment at the effect of this condition of our fiscal regulations ? Coffee the produce of Brazil and Hayti is conveyed to the Cape of Good Hope, and thence transmitted to England in order that it may come in at a duty of 9d. This, with ld. for the charges of freight, places foreign coffee under a burden of 10d., when coffee the produce of British possessions pays 6d. Now, it appears to me in this case the wisest, the fairest, and the best policy, to make a reduction on great articles of consumption, instead of several smaller amounts on articles of smaller importance. I desire to

make the reduction considerable, and I desire at the same time to make it effectual; and the mode in which! propose to accomplish this is, by. imposing two simple duties, and to get rid of the absurdity of sending coffee from Brazil and Hayti to take a voyage to the Cape of Good Hope before it comes to England. I thus appear to myself to get rid of the charges of freight, and to place the provisions respecting the im- portation of coffee upon a simple and intelligible basis. I intend that• coffee the produce of British possessions shall come in at a duty of 4d.. and that all foreign coffee shall pay 8(1. I shall now proceed to cal- culate the probable loss to the revenue front this arrangement. In the year 1841, the quantity of coffee imported from our own possessions was 463,000 lib. The supply of foreign coffee during the same period was 10,849,000 lib. Now, with:the altered duty, I find, upon the most accurate estimate which can be made of the probable loss, that it will not exceed 171,0001. The whole of the calculation into which I have entered stands thus-

The Revenue for 1841, derived from the present duties, viz. From British Possessions, 17,571,814 lib., at 6d. .. £463,699 Foreign countries, 10,849,096 lib., at 9d., ls. and 427,947 Revenue received in 1841 £891,646 Assuming no increased consumption, the revenue at duties of 4d. and 8d. per lib. would he- the two From British Possessions, 17,571,881 lib., at 9d. 292,864 - Foreign countries, 10,819,096 lib., at 8d. 361,636 Revenue for 1842-3 .. .. 654,500 Revenue for 1841 .. .. .. .. 891,646 Loss, assuming no increase of consumption .. 237,146 Assuming that the increase of consumption will be 10 per cent ; viz. producing 65,450 Probable loss of revenue .. £171,696 The other great article to which it is necessary that I should now di- rect the attention of the House is the article of timber. I am anxious to begin by applying as much as possible of the surplus revenue to the reduction of the duty on timber ; but here again I find myself consider- ably embarrassed by our relations with Canada. I shall now beg to_ call the attention of the House to the calculations upon which I 'pro- pose to found the arrangements to be made with respect to timber. This is an estimate of revenue from timber-duties from the 5th of April 1842 to the 5th of April 1843. The House will observe that it assumes no increased consumption- Foreign timber, 180,000 loads at 30s. .. .. £230,000 Foreign deals, &c., 350,000 loads at 35s. .. 612,500 Foreign lathwood, 25,000 fathoms at 20s. .. 25,000 Total of foreign timber .. £907,500

Colonial Timber, 570,000 loads at le. .. .. 28,500

Colonial deals, &c., 263,000 loads at 2s. • . . 26,300 Colonial lathwood, 25,000 loads at 2s. .. • . 2,500 964,800 Actual revenue .. .. 1,566,291 Loss, supposing no increased consumption .. .. £601,491 EstilnateA loss upon the proposed duties upon timber, from the 5th of April 1843 to 1814, supposing an increase of consumption took place, as follows- Foreign timber, 201,600 loads at 25s. .. .. £252,000 Foreign deals, &c., 420,000 loads at 30s. .. 630,000 Foreign lathwood, 25,000 loads at 20s. .. 25,000 Total of foreign timber .. £907,000 Colonial timber, 684,000 loads at ls. .. .. 34,200 Colonial deals, &c., 326,000 loads at 2e. .. 32,600 Colonial lathwood, 25,000 loads at 2*. 2,500 Total of foreign and colonial .. 976,300 Actual revenue .. .. 1,566,291 Probable loss at this estimate .. £589,991

In this calculation it is assumed that the consumption of foreign timber would increase by 12 per cent, and of deal 20 per cent ; of British Possessions timber 20 per cent, and on deals at 24 per cent, because the duty on British Possessions timber is merely nominal. The House will recollect that foreign timber comes in at a duty of 55s. per load, and that this duty is levied in an extremely complex and objectionable manner. The average amount of duty on foreign timber of all kinds. that is, including deals, laths, &c., is 41s. Now, it appears to me, that if we do effect any reduction, we should do it in such a manner as shall be of clear and certain benefit to the consumer, without producing any sudden effect upon our Canadian possessions, and not only no sudden effect, but no injurious effect whatever. Now, I think I perceive how this object can be attained. If I urn correct in the cal- culation which I have laid before the House, it will appear that the average duty collected on the various descriptions of timber is 41,.: this I admit is rather a limited scope : there have been various measures proposed on this subject, but that which has always appeared to me calculated to afford the keit relief, is the mea- sure which the late Government proposed on this subject, which was to reduce the duty from 50s. to 45s. on foreign timber, and to increase that on Canadian timber from 10s. to 15s. Now I am going to propose a plan totally different : and in stating this case, let me be allowed to say that I am not influenced by party bias ; that I am desirous of avoiding, as far as I can, such a paltry object as party crimination-an object which must sink into nothing when com• pared with the immense importance of the subject of which I um treat- ing, and the immense interests at stake. Sir, I do not believe that the measure of last year would have benefited the consumer, or afforded. relief to the revenue. But, having a surplus to deal with, I shall en- deavour to deal with that surplus with a view to benefit all classes. without risk or injury to Canada-with a view equally to the advantage of the consumer and the interests of commerce and agriculture ; and if

these objects can be realized, the interests of the consumer will not be more benefited than those of commerce or agriculture. The reduction of the duty on timber will be a great advantage in the way of building houses and ships. Sir, it may be said that this argument is more plau- sible than real ; and it may be represented to the working and manu- facturing classes that they will derive no benefit from a reduction of the duty on timber. This, however, is a superficial view of the subject;

for the real way in which we can benefit the working and manufacturing classes is, unquestionably, by removing the burdens that press on the springs of manufactures and commerce. I shall therefore propose— as I believe the aggregate average duty upon foreign timber does not exceed 41s.—I shall propose, in order that the reduction may be carried out to an efficient extent to the benefit of the consumer, that for the present the duty oir foreign timber, as distinguished from deals, should be reduced to 30s. I shall propose that for the present year, that is, the year ending 5th April 1843, the duties on deals shall be reduced to 35s. In imposing the duty, it is my intention that the contents shall be taken by the cubic foot, instead of being taken by the present un- fair mode. I shall, however, so arrange the imposition of the duty as regards the time at which it shall commence, as to prevent any possible injury to the Canadian export of timber from a sudden operation of it. The Committee which sat on the subject in 1835 strongly advised that there should be no sudden and immediate interference with Canadian timber : and Lord Sydenham, although it was the intention of the Go- vernment to bring into operation the reduction at once, was evidently of opinion that the arrangements should be such as would not interfere with the produce for exportation for the year ensuing. For my part, I do not think that, in making any arrangement on the subject of the timber- duties, we should interfere with the exportation of the year. It is my opinion that we should proceed with the utmost caution, in order not suddenly to interfere with the Canadian interest in any measure we may agree to : but what I propose will not injure any Canadian interest ; on the contrary, it will confer on the Canadian exporter of timber whilst it will be of advantage to the consumer, a great and permanent good. Now, what I propose with respect to timber is, that in the year ending the 5th of April 1844, the duty upon foreign timber shall be 25 shil- lings per load,—the duty on deals I propose to reduce to 30 shillings,— estimating it, as I have already observed, not in the present manner, lry the cubic contents; and the duty on lathwood I propose to be 20 shillings. If the House wish it, I will go through the numerical calcula- tions I have made in respect to this part of my statement. [Cries of "No, no."] Well, then, of course it is necessary to consider the relation in which Canada stands to this country : and with respect to this part of the subject—with respect to the proper relationship of Canada to this country (and I trust the most friendly connexion will always exist be- tween us)—I think it is most desirable to act upon this principle, as far as you can with safety to the general interest, namely, that you should treat Canada as if she were an integral part of the kingdom. The dis- tance at which she is placed and the cost of bringing timber here necessarily subject her to some disadvantage ; and if the duty on foreign timber is to be reduced to 25s. permanently, the duty upon Canadian tim- ber should be merely a nominal duty. It appears to me that you have no alternative, but that you must admit Canadian timber at the lowest nominal duty, or you will subject Canada to great disadvantage ; and if you consider the duty on foreign and Canadian timber, and apply the principle I propose, justice to Canada will require that the duty on her timber should be almost a nominal duty. I therefore propose, that the duty on Colonial timber shall be reduced to one shilling a load ; upon deals to two shillings ; and upon lathwood to two shillings. I say at once, that the introduction of this measure will produce a great loss to the revenue. But in my view, having made those reductions in order to aid our manufacturers and other branches of commerce, I cannot con- ceive a more beneficial reduction than the reduction of the duties levied upon timber. Sir, I estimate the total loss which will be incurred by this reduction at not less than 600,000/. a year. If the House wish it, I will go through the details which have led me to this conclusion. (Cries of" No, no.") But if the House does not wish it I should be glad to be spared that labour. Sir, there are two other, and only two other, considerable reductions of duties to which I wish to call the attention of the House; and I can- not help thinking that with respect to both of them I shall have the almost unanimous approval of the House. There are at present certain duties upon exports of British manufactures—duties which are contrary, as I think, to sound principles of legislation. These: duties I calculate to amount to a sum of about 108,000/. a-year ; they are levied upon woollens and yarns of British manufacture when exported to places with which we do not trade upon the principle of reciprocity, and which are not within the limits of the East India Company's territories. The duty on woollens I find amounts to 30,0001. per annum ; the duty on linen yarns amounts to 4,000/. per annum ; the duty on silk to 4,8001.; the duty on manufactured iron to 24,000/.; and the duties on other ar- ticles to 9,0001.; on earthen-ware and glass it is 8,0001a year, and on provisions 5,2001.; making, all together, a total of 81,9001., which, added to the duties on minor articles, makes a grand total of 100,000/. a year. Now, Sir, I propose to remit altogether the duties upon the export of British manufactures ; and this will incur a further loss to the revenue of about 102,000/. a year. There is another and a different class of duties which, I think, are unjust, for the removal of which a portion of the surplus income ought to be applied. In the first place, Sir, I wish to call the attention of the House to the rates of duty upon stage-coaches ; and, in considering this subject in the present day, we must remember the great competition which the proprietors of stage- coaches have to contend with from railways, especially upon those lines of road where railways are in full operation, and where it is possible for the House to make that competition much more adverse to stage- coaches by subjecting them to unfair and unjust duties. As I said be- fore, I am unwilling to propose any new duties upon locomotion ; but I am about to propose the remission of those incumbrances upon stage- coaches which are unfavourable and unjust as compared with the tax upon railway carriages. By the existing law, the amount of rates paid by railways to the state is only one-eighth of a penny per mile for each

-ager. Now, comparing this duty with that upon stage-coaches, I will not say that it is a great deal too low; but this I do say, that the duty upon stage-coaches is a great deal too much in proportion. The

rates of mileage now paid by stage-coaches are as follows—if licensed to carry not more than 6 persons, Id. per mile ; 10 persons, 11d.; 13 persons, 2d.; 16 persons, 3d. Then, again, there is a licence- duty of five guineas, and there are assessed taxes for coachmen and guards. There are no corresponding duties upon railroads. What I shall propose then with regard to stage-coaches is a uni- form mileage of lAd. per mile, and to take off the assessed taxes upon coachmen and guards altogether. I propose to reduce the licence-duty, in the case of six passengers, to three guineas. The effect of this proposition, if it be assented to by the House, will lead to a loss to the revenue of about 61,000l.; but it is a loss which, I think, can be vindicated, not merely upon grounds of policy, but upon the grounds of strict and impartial justice. Then I propose to take off the progressive duty lately imposed on the letting of job- carriages, which is about 9,0001. per annum ; which will, therefore, make the whole loss on account of stage-coaches 70,0001. a-year.

And now I will shortly review the whole of the financial arrange- ments which I have detailed.

The estimated deficiency of this year is £2,570,000 The reduction in the various articles of the tariff, to the number of 750, will not be more than .. 2,coo The loss on coffee I estimate at .. 170,005 That on timber at .. 600,000 The repeal of the export-duty on British manufactures

will occasion a loss of .. 100,000 And the reduction of the duties on stage-coaches will

lessen the revenue by .. . 70,000 Making a total loss to the public income, in conse- quence of the proposed reductions, of .. £3,780,000 The loss of 3,780,0001., deducted from the estimated revenue to be derived from the new taxes, and which is calculated at 4,300,0004, will leave a surplus of 520,000/. to meet the increased estimate which I may have to propose on account of India; to meet the increased charge which may be necessary to prosecute the war with China; to meet any increased reduction of duty which it may be necessary to propose on

account of the completion of commercial treaties with other countries. I believe I have now concluded the task I have undertaken [General cheering.] If I have been enabled clearly (which is all I have aimed

at)—clearly and fully to develop the views of her Majesty's Govern- ment, I am greatly indebted for that success to the very kind and patient attention with which the House has listened to the exceedingly long, and, I am afraid, in some respects tedious details with which I have been compelled to enter. I have laid before you, without reserve, the whole plan of the Government. I have given you a full, an ex- plicit, an unreserved, but I hope an unexaggerated statement of the plicit, an unreserved, but I hope an unexaggerated statement of the financial embarrassments in which we are placed. There are occasions when a Minister of the Crown may, consistently with honour and with good policy, pause before he presses upon the Legislature the adoption of measures which he believes to be abstractedly right : he may have to encounter differenees of opinion amongst colleagues whom he

esteems and respects; he may sincerely believe it to be for the public

interest that the Government of which he is a member should retain power, and that, therefore he should not hazard its existence by pro-

posing a measure which might not ultimately succeed ; he may, on

comparing the consequence of exciting and agitating the country by discussion upon such a measure, think it possible that there is a dis- advantage in proposing that which he believes to be abstractedly right, for the evil of fruitless agitation may possibly countervail the enunciation of a right principle. But there are occasions, and this is one of them, upon which a Government can make no compromise, there are occasions, and this is one of them, on which it is the bounden duty of the Government to give that counsel to the Legislature which it believes to be right, to undertake that responsibility of proposing measures which it believes to be for the public advantage, and to devolve upon the Legislature the responsibility of adopting or rejecting those measures. I have, then, on the part of the Government, performed my duty. I have proposed, with the full weight and authority of the Government, that which I believe to be conducive to the public good. It now devolves upon you to discharge that duty which properly belongs to you, of maturely con- sidering and of fairly deciding on the adoption or the rejection of the measure I have propounded. We have met together at an important period in the annals of the world. There may be a natural tendency to overrate the magnitude of the crisis in which we live, and of those particular events with which we are immediately concerned; but it is impossible to overrate the importance of that period in which our lot, and the lot of our fathers, has been cast—that period which has elapsed since the outbreak of the first French Revolution, and which has been one of the most memorable periods the history of the world has presented. I think, Sir, that I am warranted in saying of the course which as a nation we have pursued, that it will attract for ages to come the contemplation and admiration of the world. That period may be divided into two distinct portions ; the one a period of twenty-five years of continued conflict and warfare, the most mo-

mentous that ever engaged the energies of a nation ; and the other a

period of twenty-five years of profound European peace, consequent upon the sacrifices we had before made. There will be a time when those countless millions who have sprung from our loins will occupy half the globe, living under governments analogous to our own, and speaking the same language in which we convey our thoughts and feel- ings; and the time will come when those countless millions will view with pride and admiration the example of constancy and fortitude set by England in the time of difficulty through a long period of trials and conflicts. They will view with admiration our glorious achievements by sea and land, when we fought single-handed against the world, and our determination to uphold not only our native institutions, but the credit of the country and the interests of the whole human race. They will contemplate with delight the continued exhibition of all those qualities by which we were enabled ultimately to set an example to foreign nations and to insure the deliverance of Europe. Our conduct must come into comparison with that of our fathers : we have lived during a period of war and a period of peace; and after twenty-five years of peace, I am exhibiting to you these financial difficulties and embarrassments ; and my confident hope and belief is, that, following the example of those who have preceded us, we shall look those diffi- culties and embarrassments in the face, and not refuse to make the sacrifices which were made before for the purpose of insuring public trust and confidence by removing the public evil of financial embarrassment. You will bear in mind that this is no ordinary period, and no casual embarrassment : you will bear in mind that there are amongst the upper classes of society indications of an increase of the comforts and enjoyments of life—indications of increased prosperity and wealth ; and that concurrently with those indications there exists a mighty evil which has been growing up for some years past, and which you are called upon now to extinguish. If you would have us believe that you still possess that fortitude and constancy for which you have been cele- brated, you will not consent to sit with folded arms to view the annual growth of this mighty evil ; you will not reconcile it to your consciences to hope for relief from a diminished taxation ; you will not adopt the miserable expedient of adding, during peace and in the midst of these indications of wealth and increasing prosperity, to the burdens of posterity; you will not permit this evil to gain such gigantic strength that it will be far beyond your power to check its progress. If you do not take this course which is now opened before you—if you do per- mit this evil to continue, you must expect the severe but just judg- ment of a reflecting and retrospective posterity. Your conduct will be contrasted with the conduct of your fathers, under difficulties infinitely less pressing than theirs. Your conduct will be contrasted with that of your fathers, who, with a mutiny at the Nore, a rebellion in Ireland,and disaster abroad, yet submitted, with buoyant vigour and universal applause —with the funds as low as 52—to a property-tax of 10 per cent. I believe that you will not subject yourselves to an injurious or an unworthy con- trast. My firm belief is, that you will feel the absolute necessity of pre- serving inviolate the public faith ; that you will not throw away the means of maintaining the public credit ; and that you will in the most legitimate manner reduce the public burdens. My hope and firm belief is, that when I devolve that responsibility upon you, you will prove yourselves worthy of the mission with which you are intrusted—of your mission and functions as representatives of a mighty and intelligent people ; that you will not tarnish that character which it is your duty to cherish as your most glorious inheritance; that you will not impair your cha- racter for fortitude and for gcod faith, which, in proportion as the empire of opinion supersedes and predominates over the empire of physical force, constitutes for every people. but above all for the people of England—I speak of reputation and of character—the main instru- ment with which your people can repel hostile aggression and maintain extended empire. [Sir Robert Peel was loudly cheered from all parts of the House as_he concluded his speech.]

MOUSE OF COMMONS, FRIDAY, MARCH 18.

It was understood that Sir ROBERT PEEL would make a state- ment on this night of details in the execution of the measure which he had developed on the previous Friday ; amid there was much in- terest excited to learn the machinery which he had to propose, especially in respect to the Income-tax. His statement, however, was delayed by a preliminary debate, which Mr. F. T. BARING raised on the motion to go into Committee of Ways and Means. Some attempt was made to induce Sir ROBERT to make his state- ment before going into Committee ; but this he declined, as in Committee he should have the advantage of being able to speak more than once, if it should be necessary to give explanations or answer objections.

[Mr. BARING began by quarrelling with Sir Robert Peel's calcula- tions. He did not consider him warranted in supposing that the fall- ing-off in the revenue was likely to be permanent. Ile entered into some arithmetical statements on the subject of the deficiency, and con- tended that it was owing to casualties, such as the Canadian insurrec- tion and other extraordinary and unforeseen events, for which the late Government ought not to be deemed accountable. He held it a mistake to suppose that taxation upon consumable articles had reached its limits. He entered into some defence of the financial measure proposed by himself and his colleagues last year. The sources to which he had then looked were not exhausted now; and it was, therefore, unallowable as yet to resort to that extreme tax which this Government was seeking to levy. The new plan was to raise 4,300,0001.; of which only 3,000,000/. was required to meet deficiency, the remainder being intended to effect alterations in the Tariff, and afford a surplus for other objects. He ob- jected to the protection accorded to imports from the Colonies ; and especially to a differential duty of 100 per cent. on Colonial asses and Colonial eau de Cologne. Had taxes of any other kind been proposed, those members who had belonged to the 'Ate Government would, in- deed, have taken the choice of the House as between the late plan and the present ; but, if beaten on that comparative question, they would not further have opposed the taxes of the Government. But this was a tax which they must oppose.

Mr. GOULEURN observed, that the state in which the Government now Sound themselves was the consequence of the policy pursued by their predecessors, who had neglected to provide for difficulties which they could not but have foreseen. He went on with a general defence of the Government measure.

Lord HOWICR believed the country gentlemen would find they had made but a bad bargain for the land in setting up a sliding scale and getting an income-tax as its consequence ; on casting up their accounts they would find their sliding scale a very expensive luxury. He dilated upon the advantage of ulterior taxation upon consumption, especially in the instance of sugar ; made the imputation of insincerity against those who objected to the encouragement of foreign slave sugar ; and rounded his string of objections with a censure of the Income-tax.

Lord JOHN RUSSELL condemned the construction of the Tariff for not working out its own principle, but sparing certain important articles, as in the irstance of sugar, merely from fear of the influential

interests connected with them. The present Ministers complained of deficiency ; but that deficiency was owing to their own refusal of the remedies proposed for it. He repeated the usual objections to the Income-tax ; and announced that in Corn mittee he should vote against Sir Robert Peel's resolutions, and subsequently propose other resolu- tions of his own, in order to place upon record his sense of the nature of the financial situation in which the cou ntry was now placed, and his opinion that it was not necessary to have recourse to this very odious, and, if unnecessary, most unjust tax.] Sir ROBERT PEEL then rose, and said, I can assure the noble lord that the notice he has given of his intention to offer a determined oppo- sition to my proposal has not in the slightest degree disappointed or disconcerted me. Notwithstanding the silence of the other night- nots ithstanding the calmness with which my proposition was received —notwithstanding the declaration that my proposals should be con- sidered as a whole, I felt that in the attempt to meet the difficulties in which this country had been involved by the financical administra- tion of the late Government—I felt that whatever efforts I might make, whether by the continuance of loans, whether by the imposition of taxes upon the income and property of the country, whether by burdens upon the working classes by means of taxes on articles of consumption, I had not undertaken an easy task ; but I was confident that my chief opponents would be those who had involved the counrty in difficulties.

And you shall not divert the attention of the country from the real point at issue. This is no question of eau de Cologne ; this

is no question of colonial asses. [Laughter.] Never did I see the right honourable gentleman [Mr. F. Baring] so much ex- cited as he was upon that subject. The right honourable gen- tleman never felt half the indignation at the financial difficulties of the country that he exhibited at the imposition of a differen- tial duty upon colonial asses as compared with foreign asses. He contemplated with the calmness of a philosophe year by year,-^” increasing deficiency in the public finances; but to pr‘ vose the duty of ls. 6d. upon a colonial ass excited the right honourable if, _atavisms to a pitch of indignation. But the question to be considered is ti,. the financial administration of the country and of India having been, for five or six years, in the hands of honourable gentlemen opposite, in what position is the country placed ? The time has arrived (address-

ing the Opposition) when your tampering with savings-banks, and with 5 per cent upon Customs-duties, must be abandoned, and some decided and vigorous effort must be made to equalize the income and expenditure of the country.

You say that you will submit to future and onerous taxation when you are convinced of its necessity, in order to produce that equaliza- tion. Well, upon the actual expenditure you will be called to make in the course of this year there is a deficit of 3,000,000/. It has become necessary, since I last addressed the House on this subject, to send ad- ditional reinforcements to India in consequence of the policy you have pursued with regard to that country ; and it will be my duty, in order to adopt the measures which are requisite for vindicating the honour of the British arms, to propose to Parliament increased military esti- mates, in addition to those which I have already submitted. The actual deficit is 2,570,000/. The right hon. gentleman [Mr. Francis Baring) has seemed delighted at an error he supposed lie had dis- covered in my estimate. The right hon. gentleman said he had been fish- ing, and that he had fished with great success, and he informed me that he was about to offer me a large sum of which I was not aware. The right hon. gentleman said Iliad calculated an actual deficiency of 2,569,0001., while he had discovered that it would only amount to 2,469,000/., mak- ing a difference of 100,0001.; and he taunted me with my arithmetical inaccuracy in exhibiting such a blunder in my calculations. This sum of 100,000/. I thought it necessary to provide, though I could not enter much into detail on the subject, to meet any deficiency which might arise on special emergency. I calculated the cost of the expedition to China—which, in pursuance of the policy of the late Government, we have undertaken to carry on, I trust even with additional vigour—I calculated the cost of that expedition, for the year ending April 1843, would be at the very least 1,300,000/. I proposed merely to include in the estimates a vote of 500,000/., because I thought it might only be necessary to pro- vide for the actual payment of that amount in the course of the present year; but 800,000/. of expenditure is thus left unprovided for ; and add that sum,—supposing the actual deficit should amount not to 2,570,0001., but to 3,000,000/., in the course of the year,—to the amount which must be demanded for the service of the ensuing year, and you bring up the clear net deficiency to 3,800,000/. I think that estimate will not be questioned.

How, then, is this deficiency to be supplied ? All appear to concur in opinion that it ought to be provided for by an addition to the re- venue of the country. Sir, I wish in the face of that deficiency to incur a further deficiency. I wish, for the sake of public policy, for the sake of removing burdens which press upon the springs of manufactur- ing industry and commercial enterprise, to add to the existing defi- ciency. If it be politic to abolish altogether prohibitions, if it be politic to reduce prohibitory duties, if it be politic to mitigate the duties upon certain articles of consumption, and upon raw materials which enter into every commercial enterprise—I allude to such articles as timber—if that policy be approved of and adopted, a fresl-

addition must be • made to the deficit of the year of from 1,000,0001. to 1,200,0001.

If my facts be admitted as to the extent of the deficiency—if the policy of removing prohibitions, of mitigating prohibitory duties, and of reducing the amount of duty upon certain great articles of com- merce, be allowed, the deficiency thus produced must be met in some manner ; and the question at issue between the noble lord and myself —the question which will decide the financial policy as it will decide the fate of the Government—is whether my advice or that of the noble lord shall be taken—whether I shall be permitted to make this attempt to relieve the country from embarrassment, or whether the financial affairs of the nation, shall be restored to the hands of those who are re- sponsible for the difficulties by which we are surrounded.

The noble lord has intimated that he will submit resolutions to the House in opposition to my measure. Those resolutions will, of course, involve the consideration of the corn-laws and of the sugar-duties. The noble lord will again propose his fixed duty on corn, as a means of raising the public revenue; and it will be for the Ilouse to determine whether they will adopt the principle of the Property-tax, or impose a fixed duty of 88., or a lower amount, upon corn, in order to improve the finances of the country.

I don't deny the objections there are to a tax on the income of the country. I expected to hear that it was a novel proposition in times of peace. But is there any man who can be deceived by such a fallaci- ous proposition ? It is the public necessity which justifies that tax, whether that necessity arise in time of peace or war. In times of peace ! Because you don't hear the cannons sounding, you draw the con- clusion that you are living in profound peace ! Elevate your vision ; let it embrace your Indian territories; look at the war you have been carrying on on the nest of the Indus : I say nothing now of the policy of the course you have pursued, but can a country with that war to sus- tain—can it flatter itself that it is living in a time of pence ? Look at your Syrian expedition last year, and concurrently with that at the expedition to China ; and if you have not the proof— not that I fancy it is necessary — but if you must have proof that you are not living in a state of profound tranquillity, compare all these concurrent, sources of expenditures and demands made on you, and I ask you whether or not you have been in a state of actual and presing hostility which exempts you from ordinary

and juatifiel your incurring the inconvenience which I admit that an Income.tax imposes ? Sir, the noble lord says—" Don't im- pose this come-tax, because you will convince the people of foreign

es that the resources of this country are exhausted.' Sir, never d what the impression on foreign countries is, but do that which - you believe to be just.

Then, with this deficiency to supply, is it better to call on the income of the country to contribute, or to lay taxes on articles of general con- sumption? There is no alternative to raise 4,000,000/. of taxes. Does any man think that there is any alternative to raise 4,000,0001. of taxes to supply the deficiency of the present year and to snake these experi. meats with respect to the commercial tariff of the country ? Does any man maintain that there is any middle course between imposing taxes on property and laying taxes on articles of consumption ? Certainly, you may say, "I will resort to a house-tax, to assessed taxes." I can only say, Mr. Pitt adopted that course in 1797, and that he found the bur- den such, and the evasion such, that in the next year he resorted to a Property-tax. In 1797 Mr. Pitt, wishing to affect the property of the country, proposed a plan by which the assessed taxes paid at a pre- ceding period should be considered as the test of property, and he tried to get a 10 per cent. Income.tax on that property : he was obliged to abandon it; and my belief is that a House-tax would be much more unjust in its operation than a Property-tax.

The objection to the Property-tax is the inquisition into private affairs which it institutes. I don't deny the force of that objection ; but, apart from that, I believe it to be one of the best taxes. I don't conceal from myself at all the objection to the inquisition which the tax imposes ; but I take 3 per cent, in the present condition of this country from the income of the country, for the purpose of raising the supply which it is absolutely necessary to raise, and I make that proposal with the firm conviction that it is infinitely less onerous, and more just, than any other proposition. I have, moreover, the strongest conviction, that if these general provisions receive the sanction of the House, the actual sum which each man will contribute will be exceedingly small. I have a strong conviction that if the whole of this plan shall receive the sanction of the House, there will be a diminution in the cost of living which will repay the contributors of that Property-tax a large portion of that sum. (Loud cries of" Hear.")

Take the case of a mau with 5,0001. a-year ; he will contribute to the Property-tax 130/. per annum. I say, my firm belief is, that if the whole of these proposals shall receive the sanction of the House— if I set the saving in the cost of living against the annual 1501. which he would contribute, my belief is, that the burden on him will be less than any other tax I can lay. I will state the case of the man with 1501. a-year. Why, wherever you draw the line hardships must occur. I venture to say it is impossible to propose any tax which would not be liable to an objection of that kind. But even in the case of him who has 1501. or 2001. a-year, I still have a confident hope that re- duction in the cost of living will afford to that man a great compensa- tion for the actual amount he pays. Supposing the noble lord took a window-tax instead, he must give his exemption on account of a cer- tain number of windows. I might state the ease of a house which had seven windows, and which was liable to the window-tax, and compare it with a house with six which was exempt. Wherever a line of that kind is drawn it must be drawn on a principle somewhat arbitrary ; it is difficult to draw one on a principle of reasoning, and, of course, cases of hardship will arise. I trust we shall rather attend to general results, and fairly consider whether it would be possible by any chance, with equal results, to raise the sum required for the purpose of the public exigencies of the country.

I said I would avail myself of the earliest opportunity of giving some explanation with regard to the machinery which I shall propose for the collection of this tax ; and I assure the right hon. gentleman (Mr. F.

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Baring), when I declined to answer a question when it was put to me by him the other day, it was in the stron.impression'that I could not, in answer to a question, give a full and satisfactory explanation to the House on that subject, but that it would be infinitely better to reserve that ex- planation to a period when I could have an opportunity of making it more fully, and when there was not merely the question which the right hon. gentleman proposed to answer. The period since the Income-tax was in force is one of considerable duration, and I am sure I shall speak to many gentlemen who are probably aware of the work- ing of this tax less from their own practical experience than from con- versance with financial subjects ; but, at the same time, to give any ex- planation to those not so conversant with financial details, I must refer to matters which are not so well known to them as to those who have made this subject their study. I shall propose to adopt for the collection of this tax, the machinery, speaking generally, applied by the act brought in by Lord Henry Petty. in the year 1806, in the administration of Lord Grenville and Lord Grey ; and a reference to that act, passed in'1806; will show to any gentleman who wishes to ascertain it with great precision the general mode in which I propose to collect the tax. The Property-tax was col- lected and assessed, and will be collected and assessed, under the gene- ral regulations which apply to the assessment and collection of the Assessed Taxes on the land. There are in each county in England certain Land-tax Commissioners, certain persons who are known by the name of Commissioners of the Laud-tax. These Commissioners of the Land-tax will be impowered and required to appoint, speaking ge- nerally, from their own body—but they will not be limited to a selec- tion from their own body—certain Commissioners who will be called "Commissioners for General Purposes." These Commissioners for General Purposes will have the selection of others, who will be called "General Commissioners." Now, by the provisions of the act of 1806, these Commissioners will not be limited in number, but, generally speaking, two additional Commissioners will be required ; and these additional Commissioners will be paid at the charge of the assessment of Property-tax. With regard to Bank Stock, East India Stock, cer- tain public companies named, and certain other stock, I say generally I should propose to adhere to the provisions of the law of 1806 in that respect. I should propose, so far as the Government is concerned, to place the collection and general superintendence of the Income-tax under the control of the offices of Stamps and Taxes; and their officers will be employed in the performance of all duties connected with the levying of this tax. The Local Commissioners will have the appoint- ment of Assessors, and these Assessors will deliver at a certain time blank forms of returns to each party living in the district in which they act, with minute instructions as to the mode in which these blank forms of returns shall be filled up.

Every person will be required to make a return of the annual value of his property, in case that property shall be derived from land, or rents of houses, or from property included in schedule A. With re- spect to profits of trade, the provision of the act of 1806 is that which I propose—a return as to the profits of trade, framed on me average of the three preceding years. Of course it will be necessary to provide for cases of trade which have not been carried an for three years. But these details I will not now enter into, but confine myself to the general principle; and the general principle with respect to assessing the profits arising from trade is, that the profits shall be declared on an average of the profits of the three preceding years. In respect to in- comes derived from professions, I propose that they shall be calculated from the profits of the preceding year. I really believe the chief difficulty will be with respect to incomes included in schedule D, de- rived from trades and professions. [Loud cries of" Hear!"] I apprehend that it is in respect to that income that the inquisitorial powers of the Commissioners will be the most objectionable. With respect to divi- dends derived from the Funds, there will be no necessity for any great inquisition into property there. In property of that description few will deprecate any inquisition into it. It is tolerably notorious ; and after the new assessments made under the act recently passed, under Mr. Poulett Scrope's Act,

the value of land is generally known, and the income derived from that species of property is known. It is generally conceded that the chief force of its operation as an inquisitorial tax is as to incomes derived from trade and professional exertions. Then, I propose that the return shall be sent to the Assistant-Commissioners, and that it shall be accessible to the Surveyor acting on the part of the Government, and to the two additional Commissioners who have the immediate charge of the assessment. The return may be sent sealed to them, and is in- spected by them ; and it is competent for them, or the Surveyor acting on the part of the Goverment, to make a surcharge on that assess- ment.

As the law stands at present, or did stand in 1806, the appeal against a surcharge was heard by the general body of the Commissioners,

called "Commissioners for General Purposes.' They heard the appeal, and they had extensive powers with respect to demanding precise in- formation as to the nature of the profits. I propose to retain that commission, because the policy of the law with respect to Assessed Taxes, as it was with regard to the Property-tax, is not to make the collection of that tax depending on the more will of the Government.

It was thought more consistent with the principles of -the constitution, that parties locally known to those who we re to be taxed should be employed—that those who had the confidence of their neighbours should be employed in its collection ; and I propose to leave those pro- visions of the law untouched.

Although it will be thought more consistent with constitutional usage to employ parties who have local weight and authority in the

assessment and collection of this tax, yet a great objection was urged against those very parties sitting on appeal upon the affairs of those who lived in their immediate neighbourhood. It was urged that it was peculiarly objectionable that a party should be called on to produce to his neighbours, who might stand in the relation of friends, or in the relation of personal or political enemies, and to divulge to them the state of his affairs. I propose, therefore, in respect to the appeal, to give an option, of which every body may avail himself. I propose to permit the Tax-office at the Treasury to appoint a certain number of persons who will bear the name of "Special Commissioners," and that those Special Commissioners shall have all the powers of bearing appeals which the Commissioners for General Purposes did possess under the act of 1806; that such party shall have full option of going before the Commissioners for General Purposes if he please, but if he prefer it, that the appeal should be heard by a Special Commissioner, responsible to the Government and acting under the control of the Tax-office ; which Commissioner will, of course, be sworn to entire secrecy. I propose that the option shall be given to the party to have the appeal heard by a Special Commissioner. The decision of that Special Commissioner, of course, will be final. 1 apprehend it would not be necessary to extend that option beyond those whose pro- perty is included in schedule D.

When I ern stating this, of course reserve myself. The House will feel that there is a disposition to blame us if we in any respect alter the proposition we make. (General cries of" No!") I do trust, there- fore, that in respect to minute matters, and seeing the variety of persons interested in this question, this House will not consider it any reflection, if in matters of this kind, where no great public feeling is concerned, alterations may he made. In matters of principle I propose very little alteration, but in matters of detail I must reserve to myself entire power to benefit by any alteration which may seem to me beneficial and which may tend to give satisfaction ; yet I must reserve to myself the full power to make any alterations which I may be satisfied may be consistent with the policy of the Government.

Then, Sir, I hope it may be possible to include in the new act a pro- vision which was not in the old. I hope it will be possible to enable parties once having made a return of their income, whether derived from the profits of trade, calculated on an average of three years, or on the previous professional income of the year—I trust to make some ar- rangement by which they may be enabled to compound for the assess- ment. I think that every effort ought to be made to guard against evasion and fraud. One of the objections which has been urged against the Income-tax is, that it falls with peculiar severity on those who are determined to act honestly; and we ought, as far as possible, to dimin- ish the force of that objection. 'Without introducing enactments of peculiar severity, we ought, if an Income.tax is proposed, to give every advantage to those who are honest, and every discouragement against fraud and evasion ; yet still I hope to be able to make some provision for a composition which will endure through the whole period during which the act shall continue. I do not say it ought to be imperative ; that it ought in all cases to be obligatory on the Stamp and Tax-office to admit compositions in the same way as in the case of Assessed Taxes ; but in general to admit, as far as possible, this composition. But I hope that in making this statement as to these matters of detail I shall not be considered as concluded by anything that I have said. I think that, with many persons, this provision will be considered as a .great improvement upon the Old plan ; and I sincerely trust that we .shall be able to make such regulations as, without admitting of the possibility of parties evading the tax, will secure the benefit and con- venience of compounding for the whole period of the three years.

The House will then see that there are two provisions contained in our measure which are not found in the measure of 1806. The first is the option of appeal given to those who object to their case going be- fore the Local Coraniissioners. To such persons I propose to give the .option of going before the Special Commissioner to be appointed by the Government, who will be a stranger to all parties, and will he sworn 'to secrecy, and who will hear the appeal. The second provision is that which I have just mentioned—namely, that if possible facilities for composition for the three years will be afforded. Sir, I believe I have now answered the general questions which have been put to me by the right honourable gentleman, [Mr. F. T. Baring].

With respect to the collection of the duty, I greatly apprehend that the present establishment of the Board of Stamps and Taxes will prove insufficient for the satisfactory performance of the additional duties which will be cast upon them by this measure ; and I can only say that .every effort shall be made to effect that purpose, and every care taken, if additional officers should be found necessary, to employ only such persons as are able to give a sufficient guarantee for the effective dis- charge of the duties which they may be called upon to undertake. We shall also use every effort to prevent any incumbrance being fixed upon the country from the employment of the additional officers, whose em- ployment I trust will only be temporary.

There is one other provision which I may mention to the House—it is included in many of the Property-tax Acts, and, I think, in the act of 1806. Many parties, it was found under the old system, objected to the payment to the Collector of the sum due from them on account of the Property-tax. They said, that though they were subjected to no inquisition into the amount of their property, still it was painful to them that persons living in their immediate neighbourhood should be able to learn what amount they paid the Collector, and able, therefore, to infer what was_ the exact amount of their property. I shall enable persons who feel these objections to make payment of the duty, after the assessment is agreed to, into the Bank of England, without any

name, on account of the Property-tax. On reference to the proper clause of the bill, it will be seen precisely how it is proposed to effect this. As the bank of England has been greatly extended, and now has ramifications in different parts of the country, I should think that the .advantages given in this way may be greater than if the payment were

strictly confined to the Bank of England in the Metropolis. I do not know whether it is quite desirable to answer at present all the questions which I have been invited to answer; but with respect to

the Terminable Annuities, I was asked whether I proposed to make any reduction of the duty to be levied on Terminable Annuities as compared with the duty to be levied on money in the Funds. I do not mean to make any such reduction. My proposal is to impose a tax upon the income of the country ; but it is manifest, that if I consent to make distinctions in regard to the nature of the income which is to pay the tax, I must at once abandon the plan altogether. I think I could show, that if the Bank of England be entitled to a remission in its favour, and if the holders of Terminable Annuities are entitled to a like remission in their favour—if remissions are to be made in favour of the wealthy and affluent, remission ought to be made to a much greater extent. But if the tax is fit to be imposed at all, it ought to be general; there ought to be no discrimination as to the sources on which it is to be levied, but every man ought to pay according to his means. I cannot, therefore, admit that it would be just to remit a portion of the tax on Terminable Annuities, or to draw any distinction between those annuities and other descriptions of property. No such distinction was made by Mr. Pitt in 1793; no such distinction was made by Lord Henry Petty in 1806. The principle adopted in those acts was the same as that of my measure, and the tax was levied on Terminable Annuities. There were also at that time certain Ex- chequer Annuities, being analogous to the Terminable Annuities as they now stand ; and on these also the duty was levied. As I said be- fore, therefore, the tax is to be levied on income, and there can be no remission or reduction of it.

The noble lord opposite, intends—and I rejoice to hear it, because I am convinced that it will be for the public advantage that the determi- nation of the House of Commons on this subject should be known as early as possible—to take the sense of the House on certain proposi- tions which he means to submit in opposition to mine. Of course the financial policy of the year, and the determination of the hands to which the Government of this country shall be intrusted, rests upon that decision. If the House shall be desirous to adopt the principle of the noble lord and attempt to relieve trade and manufactures by im- posing a fixed duty upon foreign corn—if the House anticipate that by reducing the duty on foreign sugar, or by any other means which the noble lord may point out, or if they think that they can meet the difficulties of the country by a remission of taxation, they will adopt the proposition of the noble lord and reject mine. .....Lpfust say, that having maturely considered the subject, I am not-P7.-.iMved,. without some assurance with respect to the question of slavery, looking to the amount of the supply required in this country, and looking to the peculiar situation of this country with respect to foreign countries, to advise any alteration in the duty on foreign sugar ; and, not being pre- pared to advise that, I am not prepared to advise a remission of the duty on sugar the produce of our own colonies. Upon the whole, then, the more I consider the question, the more I feel convinced that the best measure which the House can resort to will be found by hav- ing recourse to a tax upon income ; and that this will be a far better tax and a far more effectual and productive one, than could be found in any of those modifications -of- the Customs and Hulse, or any of those additional taxes upon coasumption, of which we have heard. I believe that the attempt to impose those taxes' particularly if they were to be temporary, would much more disturb the application of capital and the operations of active industry, than to call upon each man to contribute 31. out of the hundred ; and it is my strong conviction that the great mass of the labouring classes of this country will consider that the voluntary determination of Parlia- ment to accept for themselves, as they impose upon the country, this tax for the purpose of relieving the burdens which press upon industry—that it will he generally held by the humbler classes through- out the country as a strong proof of a determination on the part of the upper classes to bear their fair share of taxation: for though I admit that the tax does press, in some respects, with additional severity (on account of the uncertain nature of profits) on the profits of trades and professions, yet, when I consider that one of my main objects in the measure is to reduce the duties on the raw materials of production and thereby to take the best chance for the revival of the commerce Of the country, I do feel that this is a tax which will work for the especial ad- vantage of those who are connected with trade and manufactures. With respect to those who hold land, and to those who derive their incomes from professions, I have also a confident expectation that by reducing the cost of living I shall compensate them for a great part, at least, of the pecuniary burden which-I impose ; but, if I find! cannot offer them that advantage—still if, by consenting to taking upon them this bur- den, instead of having the same, or a greater amount of taxation, thrown upon articles of consumption—if by diminishing the embarrassments and difficulties of the country—if they take from those who are disposed to agitate the public mind the means of creating discontent and dis- union—if they obtain only these results, I trust they will consider them- selves amply compensated.

I trust that my anticipation of relieving trade and manufactures with- in the three years will be realized. I trust that by the end of that time we may dispense with the tax. I trust that we may then find that we have been able to effect a revival of the commerce and industry of the country, and that we may have the satisfaction of contemplating a con- tented and united people ; their contentment and their union arising from the proof they have received that those who move in the higher stations of society, and who live in comparative affluence, have been prepared, at this crisis of great commercial and financial difficulty, to take on themselves a full proportion of the charge necessarily incurred in order to meet the exigencies of the country. (Loud cheers.)