May I ask whether in the Schedule, under the term "New Import Duties," are included duties on such things as clocks, watches, films, musical instruments, etc.? I would like to know if that is the item under which these articles will be assessed or taxed?
FINANCIAL RESOLUTIONS—REPORTED. - CUSTOMS.
Resolution 6 read a second time.
The new Import Duties would affect the items mentioned by the Deputy. I move that the Dáil do agree with this resolution.
On this particular proposition I would like to give an opportunity to the Minister, or, rather, I would like to tempt him to avail of the opportunity which he has not yet taken, of justifying the continuation of these new Import Duties. They were imposed in Great Britain during the war, and were imposed, I think, for a purpose which is not primarily revenue-obtaining and not primarily even protective, but to avoid the spending of large sums of money outside Great Britain when the money was required at that time in Great Britain. The effect, of course, has been protective —protection of British industries. The effect of continuing those duties will, in some cases at any rate, be not protective; they will be very doubtful as revenue-producing taxes, and if they are not revenue-producing and if they are not protective they require some justification. The number of clocks and watches that are manufactured in Ireland, and the revenue to be derived from a tax on the importation of clocks and watches, would probably not be worth the cost of the tax collecting.
There are other duties that I have no knowledge of. But I want again to bring to the notice of the Ministry and to ask for some light on the question of the duties on cinema films. The case has been put forward that the introduction of this particular tax in its present form is not going to be productive, and it is not going to be protective. It is going to impede such commerce and traffic as there is in that particular bye-path of trade without any benefit to the revenue. The people concerned have approached me in this matter, and they inform me that they are quite prepared to recognise their responsibility to the Revenue and are willing to meet any demand that may be made upon them within reason for a sum of money equivalent to the amount that is likely to be drawn into the Revenue by this tax as at present administered. But they say that the effect of the tax as at present administered is going to be costly to the Revenue, and is going to mean a certain amount of disemployment. A considerable amount of transfer of industry from Dublin to Liverpool and Belfast, is not going to assist the Revenue at all, and generally will act not as a protection, but as a repulsion of trade from An Saorstát. I think that some justification is required to be made for such a tax as this, which is not applicable. It does not meet the circumstances of the case. Where men have offered, as I understand those people interested have offered, to pay a licence duty upon the films, being at least equivalent in its revenue result to the present proposed duty, but without any of the drawbacks to the conduct of the business or resulting in unemployment, I would urge that the offer ought to be sympathetically considered. And in the case of any similar duty which we carry over, and which is obviously unsuited to the conditions of trade and industry in the Saorstát, we should be willing to alter the incidence of that tax. Deputy Hughes raised another question relating to another industry two or three days ago. It was the duty on industrial spirit. Only one distillery in the Saorstát has been engaged in that particular production, and its products have been entirely exported. The amount of revenue if the product was consumed in the Saorstát, if the industry would continue, would, no doubt, be considerable; but the effect of this tax upon industrial spirit for export to England or Scotland will mean a loss both to the Revenue and to the industry. The industry will be lost, and no revenue will be obtained. So that here we have a tax not applicable to the circumstances of the country, the effect of which is to kill an industry, to lose the revenue, and to throw a charge upon the unemployment fund. I submit that the case of any of those taxes that are not enumerated, but grouped under the term "New Import Duties," which are inapplicable to the circumstances of this country, should not be continued simply in deference to the general policy of carrying on as we have been. Where the case can be made against the imposition of taxes of this kind, I would urge upon the Minister the desirability of making a change and altering the incidence of those taxes. I suppose, as between now and the introduction of the Bill, there will be time for the Ministry to make closer enquiries than they have done as to the effect upon the Revenue and also the no less important effect upon the industry of the country; and if it is found possible to make any change in the present proposals that such change should take place.
Deputy Johnson lays down a principle which is incontestable, that taxes should not be continued which, of their nature, are not adapted to the special circumstances of this country. The application of the principle depends upon a right appreciation of the facts. If the facts are not altogether as he presents them the principle will not apply, with the result which he has raised. On an earlier occasion I referred to the public panic with regard to these taxes, and spoke then—I need not repeat it—about the operation of the British Act of Parliament which came into operation in August, 1921—the Safeguarding of British Industries Act. The Deputy evidently has his mind upon that Act and its operations to some extent at least. But that was in the nature of protection. I gave instances of the British firms that produced photographic plates and films, and the combination of British manufacturers of lenses and optical instruments who appealed to the Board of Trade in accordance with that Act and succeeded in convincing the Board that their industries were threatened, because the German producers, owing to the difference of the exchange, were able to put their special and highly efficient instruments upon the English market at a price lower than the cost of making them in England. Deputy Johnson pointed out that some of those taxes which are now in question were not imposed by way of protection, but, as he rightly states, they were imposed to prevent the purchasing in Great Britain during the war of goods produced abroad, and which would have to be paid for. In brief, it was to stop the exodus from England of funds that were needed at home.
It is at this point that I join issue with Deputy Johnson. I quite agree with him we have no films, photographic plates, or sensitive papers that are hurt by the competition. Unfortunately the manufacture of lenses, which was one of the great things of Ireland long ago, has departed from Rathmines. There is no lens or optical instrument industry to be affected by the competition. As regards the legislation promoted in England to prevent the outgoings from England, we are on all fours to-day in the Free State. I think Deputy Johnson would adopt the principle that exports pay for imports, or rather imports are paid for by exports. Unless we can induce the countries from which those things, cinema films for example, are imported to buy our products, how are we to pay for them? Remember, too, they are luxuries. All these kinematographic films for picture palaces no doubt provide beneficial and useful enjoyment for the people; but all the same, strictly regarded, they come under the category of luxuries Surely it is a wise policy on the part of the Finance Minister to attempt two things by the continuance of these taxes. Firstly, to have a greater inflow into Irish ports by direct trading; and, secondly, to save us from the necessity of paying for those things otherwise than by paying for them with our own products by way of exchange.
I may be utterly wrong in what I am going to say. It is a matter of fact, and the Minister will correct me if I am wrong. Deputy Johnson and the public who write letters to the newspapers are under the impression that there is going to be a double tax upon these things, instead of a matter of book-keeping. When they are imported into England a duty is charged there and paid there. When they come along here into Ireland for use in cinemas they will not have to pay a further tax to the same amount, but there will be a financial adjustment, not a double tax. Now, the reason why there is such an outcry on these things is very easy to understand. There are firms, like Pathé, that have monopolies. There are certain firms that will give their product only to certain agents, and these agents have a monopoly in the distribution. You try to buy a Goerz product anywhere in Ireland and you will find that the shopkeeper from whom you buy will have to get that product from a Dutch agent in London who has the monopoly of the Goerz product for the British Islands.
Similarly, try to get certain films for exhibition in any of our picture palaces here in the city. It cannot be done. You must get them through the accredited agent, who has his profits accordingly. These people wish to have an arrangement by which someone in London is to have absolute control, not merely over the British, but over the Free State trade as well, and it pays them to raise this panic in the papers and frighten the people by saying that not merely is their beer going to cost them more, but their film pictures are going to cost them more. It is quite a simple matter for a house in Ireland to arrange with those firms and get the agencies lodged here. That is a good thing to do. It is promotive of Irish business here. Why should some of the great film-producing firms of America or of Italy not send those things direct to Ireland? There are many things, I happen to know, which the Italians would like to buy from us. There is a proposal at the present time to have two large steamboats in direct communication between one of the Italian ports and Dublin. For all that we send out they must send us something back. We are not going to export our assets, but our products. I think that the proposition is thoroughly reasonable; that the very explanation that Deputy Johnson began with to account for Great Britain imposing this tax is the very reason why we should impose it. It is to prevent the balance in the books of those other countries from which those things emanate being against us. It is a useful, healthy measure to get the balance right.
I do not think that the case as stated by Deputy Magennis is quite true. I think he has misrepresented the facts so far as the film industry is concerned. What it is proposed to do is to extract from film renters a penny per foot for every film shown in Dublin, no matter where it comes from or what agency it comes through. The film renters and those engaged in the cinema houses suggest that the same proposal that was made by the President yesterday in connection with another tax should apply to this; that the tax should remain as it is, and that this Government should make representations to the British Government for a share of the penny per foot already paid on films coming to Ireland. If that is done the film renters are perfectly satisfied. As it is now it means that for some films coming to Ireland the penny per foot will be more than the value of the picture itself, and the cinema houses say that the cost of getting these pictures from the film renters will leave it impossible for them to continue the trade. They ask that the Government shall divide the penny tax that England gets on every foot of film, that when the film comes to Ireland the Irish Government should get their proportion of that penny. If they do that it will satisfy all parties. I think it is a feasible proposal, and that something ought to be done in that direction.
It is a well-known fact that the cinema houses of Ireland pay a very handsome duty to the Government; they are unpaid tax collectors. For every person who goes to see a film picture the Government gets from a penny from the low-priced seats up to 3d. from the higher-priced seats. From that point of view the Government ought to take into consideration the value of picture houses as tax collectors. Another point of view raised by the film men is that when the penny per foot is put on cinema films in England they have 4,000 houses to recover the penny from and 4,000 houses to rent their films to, whilst in Ireland, when a penny per foot is put on, they have only from 100 to 150 houses to recover the penny from and they say it is an impossible proposition. I have already put papers before the Ministry supplied to me, as I am sure they were supplied to almost every Deputy, setting forth the claims of the cinema men and the film renters. If the proposals in these papers can be considered by the Government I am satisfied that the cause for complaint will be removed. Before going on with the tax I would suggest that the Government should call in film renters and cinema men and ask them to show them some way in which a tax can be levied which will produce revenue. I am satisfied revenue is required, and the Government are right in taking every possible advantage that comes before them to get money, but they ought to do it in such a way that it will inflict the least possible harm. I am satisfied if those in the trade are called in to consult with the Government they will put forward proposals which will produce revenue and at the same time cause the least possible harm.
I do not know that it would be possible to give any undertaking with regard to the point raised by Deputy Johnson that there should be consideration of this question of fiscal policy between now and the introduction of the Bill. Fiscal policy covers a very wide field, and to deal with it in this piecemeal fashion and in this particular way does not exactly appeal to me. Yesterday I explained at some length what our proposals were with regard to the 4 per cent. tax-compounded securities, that we had to stake a claim. Much the same thing would occur in this case. We are staking a claim and fixing our position. If you want to enter into any negotiations you do not certainly enter into them when you have got nothing to give away with any advantage to yourself. There is something to be given away once you take up this position. There is nothing to be given away if you do not take up this position. If there be any case for stimulation of the watch-making industry I think it certainly arises if those engaged in that particular manufacture know they are going to have an advantage over outside competitors. In the same way, I think, with one exception, we have no motor car industry in this country. There is only one firm, I think, engaged in that industry, and that firm is already under exactly the same disability, if I might call it, as firms in England exporting cars into Ireland. If you do not take up that position and say you are going to impose these charges you have no case to bargain with, supposing it should appear to you, after consideration, that it was a case in which you would like to make a bargain. If there are firms contemplating the manufacture of cars, with this advantage in their favour this is certainly an opportunity for them to consider it.
I do not know as regards the film business that there has been an excellent case made. If a tax of ld. can be recovered from 100 houses the tax appears to me to be very small—merely the 100th part of a ld. per foot, supposing that were the charge. If there are 150 houses it would be the 150th part of 1d. That certainly, I think, is a tax that would commend itself to the most economically-minded cinema house owner.
ld. per foot on every house.
I do not think that is the case. That is not the case made by Deputy Johnson. The question arises is there a likelihood at all of any such firm starting work here. There is not. However, the people will be afforded an opportunity in the 12 months coming of knowing whether it is the case or not. They will not be able this time 12 months to say we did not give them an opportunity of making up their minds on that. This resolution is not of very great importance, but it is important at least to this extent, that you must take up a certain position with regard to other nations. Even at the present moment we are in what is called in diplomatic language the "most-favoured-nation" position as far as Great Britain is concerned. The proposal is that we should give even better terms than the most-favoured-nation terms. That does not appeal to me. I do not think it would be good business.
Question put: "That the Dáil agree with the Committee in Resolution No. 6."
Agreed.