I formally move that the Dáil agree with the Committee in Resolution No. 1.
FINANCIAL RESOLUTIONS—REPORT.
I desire to move:—
Before paragraph (3) to insert a new paragraph as follows:—
"That Section 16 of the Finance Act, 1920, shall be amended by the substitution of one-sixth for one-tenth as the proportion of earned income to be allowed as deduction."
The amendment means, in effect, that one-tenth allowance which is now given in the case of earned income, as against unearned income, should be made one-sixth. I do not think it will need very much argument to commend this amendment to the Dáil. It is true that relief ought to be given—and the principle has already been recognised—to the income which is entirely earned, as against the income derived from investments, dividends, interest, and so on. In my opinion, however, one-tenth is not sufficient; it is not a sufficient distinction to make between earned and unearned income. If this proposal is carried it will almost entirely benefit smaller income-tax payers, such as the man who is paid a small salary. I think it will be generally admitted that the class of man who pays the greatest tax in proportion to his income is the person who is taxed under Schedule (E). That is, the person who has a fixed salary or income like the civil servant or a public official. If we could have a return from the Minister as to the number of people who pay taxes under the various schedules, it would be shown that those who pay under Schedule E pay a very considerable proportion indeed of the revenue from income tax. In Great Britain, this year, relief has been given to income tax payers by increasing the allowance from one-tenth to the figure that is mentioned in this amendment. I think that, in itself, should be an argument—I do not put it forward by any means as the chief or principal argument—in support of this amendment. The man north and south of the border should, I think, get the same relief so far as earned income is concerned. As I said, it will mainly relieve the small income tax payer. I have been making a rough calculation as to how it would affect, say, a man with an income of £400—a married man with two children. I find that by passing this amendment we would relieve him to the extent of £2 13s. 4d. annually in tax. That is not a very big relief, but still it is something to the man whose salary is in or around the figure I have mentioned. In addition to applying to "Schedule E" people, this relief would also apply to farmers —I mean the farmers who do pay tax —and others who pay tax on the basis of earned income. My amendment is such a reasonable one that I hope it will be accepted by the Minister, or if not that the arguments of those who will, no doubt, support it will prevail on him to alter his decision. I move the amendment.
I would like to say, in regard to this amendment, that it is admitted that one-tenth is not a sufficient allowance for earned income. Previous to the inauguration of the present system in regard to income tax, there was an allowance of 25 per cent. It is clear that a person who depends on earnings and who, if his labour ceases for any reason, will have nothing to fall back upon, ought not to pay tax on as high a rate as a person who is getting his income from investments. That is clear enough. But it is really a question of money. I assume that Deputy O'Connell meant to bring us into line with what has been done in England. As a matter of fact, he goes a good deal further, because he does not limit the amount of the one-sixth allowance to £250. On the assumption that he did that, we have gone into the matter as well as we could in the time, and the calculation we have arrived at is that to put ourselves on a parity with the British, in respect of the one-sixth allowance on earned income, would cost in a full year £250,000. Moreover, a good deal of that would be felt in the present year. We have, in deciding to reduce the income tax from a 5/- rate to a 4/- rate, calculated on a great deal of speeding-up in the collection of arrears.
But that is a thing there is a limit to, and we do not believe that any further remissions, beyond the 1/- reduction, will do much to bring arrears in at a speedier rate. We would certainly lose at least £100,000 in the present year by the adoption of this particular amendment. We have gone as far as we could possibly go in the matter of tax reductions. I think anybody who has meditated on the figures I gave in the Budget will agree that we went to the full limit of what was legitimate in our tax remissions. It would not be possible to accept this amendment without finding some other means of raising revenue. I do not think that we are yet sufficiently stabilised to take any risks in the matter of our financial policy and procedure. We will have to borrow considerable sums during the coming year, even apart from the Shannon scheme. When we take the Shannon scheme and such other schemes into account, we will have to borrow very considerable sums. We cannot adopt a policy which would prejudice us in getting that money on fair and reasonable terms. I have every sympathy with the principle of this amendment, and I did consider whether we should not give less than a one-shilling reduction and give some special allowance to people with smaller incomes. But, after very careful consideration, I came to the conclusion that, as we were looking for some stimulation of industry, the best thing, in all the circumstances, was to have an all-round reduction of one shilling. I feel that it is impossible for us to agree to this amendment. If a time comes at all soon when it is possible to contemplate further reduction of income tax, it will be a matter for consideration whether we should not rather try to do something in the way of reliefs to the poorer tax payers than spend anything we can afford for income tax reduction on the reduction of the standard rate. At the present time, I have no option at all but to ask the Dáil to refuse to agree to this amendment.
I hope all those who argued in favour of equalisation between the British income tax rates and the Free State rates will be prepared to support this amendment. A great deal was said in favour of the equalisation of the two rates of taxation, and that, apparently, with other possible arguments which the Minister had up his own sleeve, induced a reduction of one shilling on the basic rate. I think it cannot be urged that only the basic rate should be equalised. The other reductions or allowances or exemptions are included, or should be included, in any argument for equalisation. To reduce the rate to 4/-, in anticipation that that would be the rate in England, and then to refuse to increase the exemptions is not to equalise the income taxes. It is practically saying to the wealthier income tax payers: "We are going to give you an advantage, but we are not going to give a proportionate advantage to the poorer income tax payers." The case for equalisation, if it had any force at all, is just as forcible in connection with the amount of the exemption, and if there cannot be that kind of equalisation, I am inclined to think that the Minister's proposal to reduce the rate to 4/- ought to be changed and that the higher incomes ought to pay a higher rate of tax, so that the lower incomes may have greater exemption. If there is not to be equalisation all round, then let us throw away the case that was made in respect of equalisation.
We are at a disadvantage in discussing this matter, inasmuch as we have not the bases of the Minister's calculations. We have not any figures to show the number of persons paying the lower rates of tax, the amount of their assessments, and so on. The Minister has given us an estimate, but I take it his estimate is not based upon anything like reliable figures. Had they been reliable figures they would, no doubt, have been circulated. He estimates that the acceptance of this amendment might cost £250,000. Possibly the Minister can help us by saying what would be the rate requisite on the higher incomes to save that £250,000. The greater justice would be done in this matter by equalisation in respect of exemption rather than by reduction of the rate, as a whole, to 4/-. As I say, we are not competent to discuss this matter with knowledge in the absence of precise figures, or even approximate figures, of the number of persons that might be affected by this exemption, the number of persons who are paying taxes upon the higher incomes, and in fact, all information respecting the numbers of the various classes of income tax payers. I would press for the acceptance of this amendment or, at least, that we should have very much more information to prove that it is impossible from the standpoint of the Minister for Finance, because it would cost us £250,000, as a whole, or £100,000 this year. I think the case made for the amendment by Deputy O'Connell is one that has not been met, and I hope that we shall get some support for this proposition.
The Minister has received this amendment very sympathetically. I think we ought to recognise that, in proposing the Budget to the British Parliament, the Chancellor of the Exchequer derived very considerable kudos from his effort to relieve the small wage-earning, or salary earning, community. Deputy Johnson, in dealing with this amendment, talks about equalising the position here with the position in Great Britain. I would say that the positions ought not to be equalised, as far as income tax collection is concerned. On the contrary, I maintain that the trading community here, or the community as a whole, are not able to bear the same weight of income tax as is borne in Great Britain. So far from the rates being the same, there should be a very strong effort on our part to bring the rate more within the power of the people of the country to pay. Deputy Johnson talks largely to the gallery in talking about big incomes and the taxation of big incomes to relieve the smaller incomes. That, of course, would be a very popular move, but in this country I think the game would not be worth the candle. Big incomes are so few in this country that a tax would need to be overwhelming and overpowering if it were to make up for the loss of tax brought about by remissions in the case of the smaller incomes.
I would like to emphasise the fact that the merit of the reduced income tax which the Minister for Finance has proposed this year is, that it is, and must be, a very considerable benefit to the community as a whole, because the real and urgent need as far as the development of business and, generally speaking, the stabilisation of industry, is concerned, lies in the provision of a larger amount of capital than is available in this country at present. Capital is not to be got by a wave of the hand or by calling for special means of getting it. The accumulation of capital in any country is a laborious business, and we must recognise that this country is to-day suffering very severely from the loss of capital that has been occasioned by unsettled conditions, which have led to the transference of capital from this country to others. I think, and I respectfully suggest, that our immediate, our urgent need is to induce capital by every means in our power to come into the country to enable the development of industry and the general development of the country to take place.
Amendment put.
The Dáil divided: Tá, 22; Níl, 31.
Tá
- Pádraig Baxter.
- Seán Buitléir.
- John J. Cole.
- John Conlan.
- Darrell Figgis.
- Connor Hogan.
- Tomás Mac Eoin.
- Risteárd Mac Fheorais.
- Pádraig Mac Fhlannchadha.
- Patrick J. Mulvany.
- Tomás de Nógla.
- Criostóir O Broin.
- Tomás O Conaill.
- Aodh O Cúlacháin.
- Liam O Daimhín.
- Eamon O Dubhghaill.
- Mícheál O Dubhghaill.
- Seán O Duinnín.
- Donnchadh O Guaire.
- Mícheál O hIfearnáin.
- Pádraig O hOgáin (An Clár).
- William A. Redmond.
Níl
- Earnán de Blaghd.
- Thomas Bolger.
- Seoirse de Bhulbh.
- Próinsias Bulfin.
- Louis J. D'Alton.
- Máighreád Ní Choileain Bean
- Uí Dhrisceóil.
- Patrick J. Egan.
- Desmond Fitzgerald.
- John Good.
- William Hewat.
- Seosamh Mac a' Bhrighde.
- Liam Mac Cosgair.
- Pádraig Mac Fadáin.
- Seoirse Mac Niocaill.
- Liam Mac Sioghaird.
- Martin M. Nally.
- Peadar O hAodha.
- Seán O Bruadair.
- Risteárd O Conaill.
- Partholán O Conchubhair.
- Eoghan O Dochartaigh.
- Séamus O Dóláin.
- Peadar O Dubhghaill.
- Pádraig O Dubhthaigh.
- Eamon O Dúgáin.
- Aindriú O Láimhín.
- Séamus O Leadáin.
- Fionán O Loingsigh.
- Máirtín O Rodaigh.
- Seán O Súilleabháin.
- Liam Thrift.
Tellers:—Tá: Tomás O Conaill and Pádraig O hOgáin. Níl: Séamus O Dóláin and Liam Mac Sioghaird.
Amendment declared lost.
I move:—
Before paragraph (3) to insert a new paragraph as follows:—
"That section 21 of the Finance Act, 1920, shall be amended by the substitution of forty-five pounds for thirty-six pounds and of thirty-six pounds for twenty-seven pounds as the deduction in respect of children."
I hope this amendment will have a better fate than my first. It certainly deserves it. It proposes to increase slightly the allowances which are granted to income tax payers on account of children under the age of sixteen. I think it will be generally recognised that the relief which is granted to an income tax payer on account of children is at present too small. What exactly does it mean? The relief that is granted for the first child is £36, and for each other child under the age of sixteen, £27. For three children the relief granted is £90, and assuming that the taxpayer is paying at the half standard rate his total relief under that head is £9. The fact that a man having three children, as against a man who has none, gets relief amounting to £9 does not, I am quite sure, meet the situation that the father is called upon to face. I think one of the worst features of our income tax regulations is the meagre relief that is given to a man who is rearing young children and upon whom greater burdens fall than on any other member of the community. A man with three children who has a salary of £400 a year has to pay in income tax £4 10s. We hear a good deal of complaint from the farmers as to the amount of taxes and rates that they have to pay, but I think that there can be no comparison whatsoever between a man who is getting a salary of £400 a year and a man who has a farm of one hundred and fifty or two hundred acres of good land. There can be no comparison as to how each of them stands in so far as his share of this world's goods is concerned. But the man who is paid the salary and who stands all the risks that such a man is faced with, of losing his employment and so on, has to pay a greater tax than the farmer I speak of, and I think that the same applies, in a lesser degree perhaps, in the case of a business man. But that is not the point I want to stress; it is the fact that the person who has the greatest share of taxation of various kinds to bear is the man who is rearing a family. I should have liked to make the figures in this amendment very much higher, but I have put down what I think, in all the circumstances, are reasonable figures, and figures that can easily be accepted by the Minister without any great cost to the State.
It really means in effect for the greater number of taxpayers a relief of 18s. per child. To the man who has an income of £400 that I spoke of it would mean that instead of paying £4 10s. he would pay £1 16s. It is not a very big relief, but it is sufficient to buy one pair of boots for each child in the year, which to a man having an income of that figure is a considerable concession. I strongly recommend this amendment to the Dáil. I do not believe it will cost the Exchequer very much, and it will be some compensation to the man with a family, on whom the new protection duties will fall most heavily.
I hope this amendment will meet a different fate from the last one. To my mind it does not go far enough. The allowance made for children is based on the English system, by which there is a higher allowance given for the first child. I cannot understand why we should follow the English standard, which is evidently based on the idea that large families are not desirable from the State point of view. It seems to me a peculiar reason. There is no doubt that the man with a small family of one or two is in a much better position than the man with six or seven children. Every additional child means extra expense. Why the man with one child should be given a higher amount proportionately than the one with three or four, I cannot understand. This code, which we have adopted from England, gives expression to the idea that large families are undesirable, and I think is most objectionable. It might be desirable in England, which is over-populated, but is not desirable in this country. I hope the amendment will be accepted.
It is not correct to say that we have not considered this matter. We have given a great deal of consideration to it. We have only a limited amount of money available for any form of relief in taxation, and, having regard to the large number of people who are not income tax payers, we felt that we should give the greatest possible portion of that money to the relief of indirect taxation. We could have taken less off sugar or tea, and given further remission in income tax, but we felt the course we took to be the wisest.
In regard to income tax, we felt that in the circumstances of this country the best thing to do was to reduce the standard rate to what we believed would be the British level. One of the difficulties in this country in dealing with income tax is that we have some 150 millions or 160 millions of Irish money invested abroad. That money can be lost to the nation by driving out, because of taxation, the people who own it. For that reason it is difficult for us, no matter how necessary it may be even from a revenue point of view, to have a higher income tax than the British rate. It is, in fact, desirable, that our standard rate should be lower than the British. In any case, if we keep it higher, there is going to be a loss of capital to the nation. When we believed that the English rate would go down by sixpence we felt it necessary that we should bring the standard rate down to the British level.
Why did you not eliminate the corporation tax?
I am talking about income tax at the moment.
It is all the same.
No, it is entirely different. We brought our tax down by the measure we thought it necessary to bring it down. We felt that having done that, in the circumstances that exist here, the best thing was to give our other remissions in indirect taxation to the largest possible degree.
If we accepted this amendment it would mean a loss to the revenue of about £100,000 per annum, a sum which we could not afford to lose, budgeting as we are close to the margin. If we accepted the amendment, it would be necessary to recoup ourselves in some other way. Instead of doubling the agricultural grant we might have to give an addition of only five-sixths to the old grant, and get the £100,000 in that way. We might lessen some remissions of taxation, but we certainly cannot, budgeting as we are very close to the margin, adopt an amendment like this without taking some measures to recoup the Exchequer.
I believe that there is a better case for this amendment, apart from the cost, than there was for the previous amendment. I believe that before, or concurrently with, any further reductions in the standard rate, some increase in these allowances should be given. That can only be done by putting on certain taxes of what is called a luxury character next year, when we have time to work them out, and if it is thought desirable to give relief in income tax. You cannot impose taxes of that sort right off without a good deal of consideration. They cannot be imposed now. I see no means of filling the gap that this would leave at this stage. However commendable the idea is in itself, and however much we may sympathise with it, it is not one that we can adopt at present. As a matter of fact, more relief always goes in these cases to the people who are a little higher up, although that may not weigh very much with the Dáil. Where the people are poorer it simply means we lose half the standard rate of the tax, but in the case of other people we would lose at the full standard rate. That is incidental to this. It is worth bearing in mind, when we realise that other taxation would have to be imposed to fill the gap. That taxation, if we did not take care to have it of the right sort, might fall more heavily on the people who get less benefit from these particular allowances.
The Minister, a little while ago, when we were discussing an Estimate, I think, pointed out that the increase in the index figure of the cost of living would impose an extra charge, based upon the 95 per cent. figure, estimated at £85,000. Civil Servants are practically the only large body of employees within the income tax range who are in any way met, shall I say, in respect to bonus when the cost of living rises. Without going into the merits of the sliding scale of bonus, it has to be borne in mind that the other elements in the community who are income tax payers, but on small pay, are bearing the burden of the additional cost of commodities without any recompense at all. When that class of income tax payer is a married man with a family, the case for greater exemptions in respect to children is a very strong one, indeed. I realise that the Minister will find himself in a bit of a quandary. He wants to know how he is to raise this £100,000—whether it should come from the farmers, or from the sugar or tea consumers. I think the case for this amendment is a stronger one than the case for the flat rate reduction covering all classes of income tax payers. The Minister points out, what is no doubt a fact, that the lower incomes in effect pay income tax at a lower rate, by virtue of the exemption, than the higher incomes are asked to pay, and that, as a consequence, such a reduction as this would really give a greater advantage to the more wealthy section of the population. No doubt that is true, but in this, as in every other question of income tax payment, one has to think rather not of what people pay away out of income, but what they have left after paying their income tax. And in this case, where the family allowances are deducted, but where the incomes are small, the ability to carry on, as they are expected to carry on, is lessened by what I think is a meagre allowance in respect of the children. I think that the Minister should find some other way of finding this £100,000, and it is not at all unreasonable to ask that there should be an increase in the allowances for children. A £3 reduction, I think Deputy O'Connell mentioned in the tax on the £400 income, is going to make a very big difference to the individual, and the more children in his family the greater the benefit will be. It is, as a matter of fact, a serious strain upon the civil servant, the teacher, the small trader, and the lower income tax payers amongst the farmers, to have this allowance kept at the lower rate, as it has been for some time. I think the case for an increase is made, and I would hope that the Minister would relent a little more than he has done, not merely by showing verbal sympathy, but by an active adoption of the proposal of Deputy O'Connell.
I confess that I am heartily in sympathy with this proposal of Deputy O'Connell, being a married man. Deputy Johnson has put the case on the right grounds—that is, that we, a certain section of the community, have benefited, or at least, have certain compensations, on the principle that the cost of living has gone up. Certainly, the cost of maintenance of children has not decreased since the war. I am wondering though, how the Minister got his figures that a concession of this sort would cost £100,000. Are there any census figures available? That is what I wanted to ask him. The numbers of married income tax payers, and the size of their families, is a rather complex schedule I am afraid. I do not know whether we could get any table that would lead us to make a more reasonable proposal, if the Minister thinks this unreasonable.
Speaking from a different point of view to the last speaker, and arriving at the same conclusion, I would like to support Deputy O'Connell's proposal. This whole Budget is, to my mind, largely a bachelors' Budget. New taxes are to be imposed, some upon bedsteads, others upon blankets, more upon furniture and all the various forms of clothing, and this proposal that we are now discussing would do something, at any rate, towards inducing people, perhaps, like myself to leave the position that we now occupy and enter the realms of holy matrimony. The Budget, as it stands, certainly does not offer great inducements in that direction, and the principle involved in the proposal of making allowances for children is, of course, a distinctly fair, a just and equitable one. The proposal that an increase shall be made from £36 to £45 is not a very great one and, though the Minister has said that it would involve a sum of £100,000, I am sure we will have a response, and I am also sure a generous one, from the Farmers' benches to the proposal that he made, namely, that the Agricultural Grant should be only increased by five-sixths, and that this £100,000 which we will lose, if we pass this amendment, should be made up thereby. I, for one, would not be against that proposal.
Waterford again.
I am sure that the farmers, with their customary width of view, breadth of vision, wide outlook, and ready response to Ministerial proposals, will come forward now and adopt the suggestion of the Minister. Perhaps, even if that does not take place, there might be other means of raising this £100,000. I think it might have been almost better if the whole of the remission had not been made upon the tea duty. I do not know that the price of tea has gone down yet. I do not know whether it will, and I very much doubt whether, when it does come down, it will remain down to the extent of the reduction that has been made in the duty. At any rate, there are other means of making up the deficiency and, of course, the reply that the Minister has made to this proposal is the natural and—is, without offence, I may say—stereotyped reply that will be made, and, to a certain extent, must be made by the Minister to every proposed amendment to these financial resolutions.
The Minister has framed his Budget. He has budgeted for a certain margin. He has got to find a certain amount of money, and he says in reply to the various proposals made to amend those resolutions: "I would be only too delighted to do it. I thoroughly agree with you. I sympathise with your object, but what can I do? I have got to find the money, I have got to find my margin, and if you can suggest any more equitable way whereby I can make up for this remission by imposing other taxes, or lessening other remissions, I am prepared to do so." That must inevitably be the attitude of any financial Minister, and I thoroughly sympathise with him in the position that he must necessarily find himself in. But, all the same time, he need not be, on all occasions, absolutely obdurate. There may be some items on which, perhaps, on due consideration, he could bend. This not being a very great matter in the point of view of money, but of considerable amount and of considerable importance in the point of view of public justice and morality, I think it would be a wise thing for him if he possibly could to adopt the suggestion that has been made.
I do not propose to vote for this amendment, not that I do not agree that the relief which Deputy O'Connell claims is not properly claimed, but, if I might say so, I think Deputy O'Connell is only tinkering with the subject.
Mr. O'CONNELL
We will be satisfied for small mercies these times.
My view on the collection of income tax, on small incomes, is that the game is not worth the candle. Deputy O'Connell laid down the position——
Mr. O'CONNELL
Raise the limit to £600.
That is something nearer my point of view. Deputy O'Connell laid down the position that a married man with three children gets off a certain amount of income tax, leaving a certain proportion to be paid, but if he carried on his good work and has a family of 10 or 12, the amount of deductions that come off his income tax abolish it altogether, and in that particular case a man with a large family, having got his rebate off sugar and tea, has got relief all round. But, seriously, I do claim, considering the annoyance and the general result of this income tax on small incomes, that it would pay better, in my judgment, to get the money some other way and some simpler way than having this elaborate machinery inquiring into every man's circumstances, in minute detail. The ultimate result is that the State gets nothing out of it at all. If a man has a certain family he can get certain relief. I think it has been made plain to this House over and over again that if a return, showing the sources from which income tax comes, were available, it would be very helpful to the Deputies in forming an opinion on the matter. I claim that a lot of these taxes are not worth the candle. You have an elaborate staff spending their time going into a collection which, when allowances are made, do not leave a certain margin to pay expenses.
I was glad to hear——
I would like to remind Deputy Gorey that, on the Report Stage, second speeches are not allowed.
I want to ask the Minister a question. It contains a suggestion which, perhaps, might meet Deputy Redmond: Has the Minister any knowledge as to how much he will gain if he refuses an earned income allowance to those who are unmarried?
That is not one of the things I have investigated. I would reply to another point that Deputy Alton raised. I explained, at great length, to the Dáil, that we have not yet reached the stage where we can publish statistics in regard to income tax. But we have certain information in the office from which a fairly reliable estimate can be made, and we just simply have used that. It might be 15 per cent. out.
Amendment put.
The Dáil divide d: Tá, 25; Níl, 32.
Tá
- Pádraig Baxter.
- Seán Buitléir.
- John J. Cole.
- John Conlan.
- Bryan R. Cooper.
- Sir James Craig.
- Séamus Eabhróid.
- Darrell Figgis.
- Connor Hogan.
- Tomás Mac Eoin.
- Risteárd Mac Fheorais.
- Pádraig Mac Fhlannchadha.
- Patrick J. Mulvany.
- Tomás de Nógla.
- Ailfrid O Broin.
- Tomás O Conaill.
- Aodh O Cúlacháin.
- Liam O Daimhín.
- Eamon O Dubhghaill.
- Mícheál O Dubhghaill.
- Seán O Duinnín.
- Donnchadh O Guaire.
- Mícheál O hIfearnáin.
- Pádraig O hOgáin (An Clár)
- William A. Redmond.
Níl
- Earnán Altún.
- Earnán de Blaghd.
- Thomas Bolger.
- Seoirse de Bhulbh.
- Próinsias Bulfin.
- Louis J. D'Alton.
- Máighréad Ní Choileain Bean
- Uí Dhrisceóil.
- Patrick J. Egan.
- Desmond Fitzgerald.
- John Good.
- Patrick Leonard.
- Seosamh Mac a' Bhrighde.
- Liam Mac Cosgair.
- Patrick McGilligan.
- Seoirse Mac Niocaill.
- Liam Mac Sioghaird.
- Martin M. Nally.
- Peadar O hAodha.
- Mícheál O hAonghusa.
- Seán O Bruadair.
- Parthalán O Conchubhair.
- Séamus O Dóláin.
- Peadar O Dubhghaill.
- Eamon O Dúgáin.
- Aindriú O Láimhín.
- Séamus O Leadáin.
- Fionán O Loingsigh.
- Séamus O Murchadha.
- Máirtín O Rodaigh.
- Seán O Súilleabháin.
- Mícheál O Tighearnaigh.
- Liam Thrift.
Tellers.—Tá: Tomás de Nógla, Tom ás O Conaill. Níl: Séamus O Dóláin, Liam Mac Sioghaird.
Amendment declared lost.
Mr. O'CONNELL
I beg to move amendment No. 3:—
Before paragraph (3) to insert a new paragraph as follows:—
"That Section 21 of the Finance Act, 1920, shall be amended by the substitution for the deductions at present specified in that section of a deduction of eighty pounds in respect of any child who is over the age of sixteen years at the commencement of assessment and who is receiving full-time instruction at any university, college, school, or other educational establishment."
This amendment proposes that an increased allowance should be given in the case of any child who is over 16 years and who, at the commencement of the assessment period, is receiving full-time instruction at any university, college, school or other educational establishment. The main argument the Minister used in objecting to the other two amendments was the cost it would mean to the Exchequer. I feel quite certain he will not be in a position to use that argument so far as this amendment is concerned. At present an allowance is made for all children under 16, and for any child over that age who is receiving full-time instruction at a university, college, school, or other educational establishment. It seems to me altogether ridiculous that a similar allowance should be made in the case of a child and a boy over 16, who is costing his parents a very considerable sum for his education and maintenance and whose earning power is held up as it were. As a case in point, I have a boy of 19 years in a university, and I have also a child of as many months. I get the same allowance for both. That is not equitable or fair. It is not fair that a boy of 18 or 19, who is being maintained at a university, should receive only the same allowance as a child of a little over 12 months.
Although the sum involved would not be much, the acceptance of this amendment might just mean that a parent would continue his child's education for a year or two longer, rather than send him out to work. The acceptance of this amendment might mean this difference: a parent, considering what he should do with his boy or girl who has reached sixteen years, may decide to give them an extra year or two at college instead of sending them out to work. It will mean a small sum, comparatively speaking, but the psychological effect of it will be that in a great many cases it will induce the parent to keep the boy or girl a little longer at school. I need not follow up that argument. The advantage will not only be derived by the boy or girl, but by the community as a whole. We would have the type of person who would be educated up to 17, 18, or 19 years, and if we had more of that type it would be all the better for the community. The sum involved will not be much. The Minister suggested that the proposed relief would go in a greater measure to those who had higher incomes. Take the case of a man with three children. Before he could get any relief at the higher rate he would want to have an income of £600 and over. If there were more than three children, the income would have to be greater before he would have to pay the full standard rate of tax. The general class of taxpayer who will benefit by this will, in my opinion, be the man with the smaller income, who will be paying at the 2s. rate. At present, £36 is allowed for a child, and I am proposing to raise that to £80. That is, £3 12s. is the amount of relief now given, assuming the case of the eldest child; or £2 14s. would be the amount of tax if there was more than one child. I suggest that amount should be increased to £8 in the case of a child over 16.
The number of children over 16 for whom income tax relief is allowed must be comparatively small. If under the previous amendment the cost would have been £100,000, the amount which this would cost would be very small, indeed. I do hope that the Minister will accept this amendment, and thereby give encouragement to the father of a family who is anxious to give the best education he can possibly afford to his children. The extra amount would do no more, possibly, than buy books for the child who would be at school at that age. There is not much need to argue at any length in favour of the acceptance of this amendment. I think the expression of opinion which was given on the last amendment—the considerable number of Deputies who voted in favour of greater relief— should show the Minister what the feeling of the Dáil generally is on this matter. I think he will meet the views of the Dáil if he accepts this amendment as it stands.
I second this amendment. I would like to emphasise that there are a considerable number of people who would like to give their boys and girls longer education than the primary system affords. Deputy O'Connell rather emphasised the question of university education, but there are other classes of educational establishments. The boy or girl of seventeen or eighteen may be at another class of school—a secondary school or a full-time trade-preparatory school, or a technical school. In respect of the general school-leaving age, many of us had hoped that sixteen years would have been the normal age for leaving school—or rather, should I say, that no child would be leaving school under sixteen years. But if there is to be any encouragement given to parents to allow their children to remain longer at school, this amendment should give an indication of the wish of the Dáil in the matter. The case made by Deputy O'Connell is sound; there is a distinct sacrifice called for by the income tax payer who has a small income—I am not now referring to Deputy Gorey or Deputy Sir James Craig—who keeps his boy at school longer than the usual period, even though he is a scholarship winner. There is an extra charge on the parent in such circumstances, and this amendment would give him considerable relief. Further, it would be an indication by the Dáil that it is our desire to encourage parents to allow their children to remain at school for as long a time as possible and to encourage the higher education of the youth of the country. I hope the Minister will accept this amendment. The amounts involved by the different proposals are on a declining scale. The first, we are told, involved £250,000; the next, £100,000; and this one, which I suppose will involve £2,000 or £3,000, will not, I hope, be refused.
This is an amendment which I have not had an opportunity of examining. I have not yet had time to have an estimate prepared as to the probable cost it would involve. I would suggest that Deputy O'Connell should leave this amendment over until we are considering the Finance Bill in Committee. As it is a relief proposal, it would be even more appropriately dealt with then. I will promise to consider it in the meantime. I believed that the sum involved would be small, and I will promise to give it consideration.
Would the Minister say if he has had any case brought to his notice by the Revenue Commissioners in which a man who has a boy at an ecclesiastical college in Dublin was refused the allowance for the upkeep of the boy which he is entitled to by law? When this man went to the Income Tax Office he was told that a ruling given by the Commissioners prevented his getting the allowance.
I will look into the matter but, of course, anybody who is wrongly charged has a remedy. I do not say that that should preclude my inquiring into it, but where the law provides for certain relief, if a person is refused it, he has a means of securing his rights. If the Deputy will let me have the name of the person concerned, I will look into the case.
Mr. O'CONNELL
I am glad that the Minister has given an indication that he will examine this proposal between now and the time the Finance Bill comes before us. I hope he will find that the amendment is one that can be accepted. Having regard to the Minister's promise, I ask the leave of the House to withdraw the amendment.
Amendment, by leave, withdrawn.
I move the amendment standing in my name:—
Before paragraph (3) to insert a new paragraph as follows:
"That the annual value in Saorstát Eireann for the purpose of income tax under Schedule B shall be taken to be for every twenty shillings one-third of the annual value of lands, tenements, hereditaments and heritages chargeable in respect of the occupation thereof."
The avowed object of this amendment is to revert to the pre-war basis of income tax assessment in respect of the occupation of lands, or what is technically known assessments under Schedule B. In the pre-war days a man would require to hold land to the annual value of something like £480 before he became liable to the tax. During the Great War the position was radically altered. As a war measure, and to help to pay war costs, the British Government raised the basis of assessment three times. In other words, they based it on the valuation, and, at a subsequent stage during the Great War, they put it on twice the valuation. Land was paying well during that period—that was in 1919—and they put it at twice the valuation. It is true that we have reverted to the basis of the single valuation within the last few years, but I submit that that, in all the circumstances, is scarcely enough. The Minister can object. He can say, as he has said repeatedly, that very few farmers are paying income tax. Conceivably! But why? Does he mean that they are not assessed for income tax? They are undoubtedly assessed. Purchased tenants, whose valuation might be £80, £90, or £100, who are paying a land-purchase annuity of £50 or £60 to the Government, are assessed for income tax. It is questionable whether they are really liable or not, but the income tax man has a very fine system when the farmer tries to evade the net of Schedule B. He has Form 79D. Paragraph 5, page 1, of this form says that. "If the farmer has already complete accounts, properly made up, said Commissioners may accept copies of them in lieu of accounts drawn up on pages 5 and 6 of this Form, but, in any event, the particulars required by pages 2, 3, 4 and 7 of this form should be furnished and the account should be certified in the manner set out on page 8." In other words, the Revenue Commissioners have made this form as complicated as possible for the farmers. In the British regime there was a simplified form, and this form still obtains on the other side of the Channel. But this form here seems to be a Yankee innovation. Something approximating to it is issued on the other side of the Atlantic. The Minister knows that there is such a thing as "ca canny."
Would the Deputy give us the translation?
He will have to go over to Scotland.
I have not got the Scotch accent, but it might be better for us if we had some of the Scotch instinct. The Income Tax Commissioners first assess the farmers under Schedule B. Then, knowing that land is paying badly, and that the farmer is not really liable for tax, they insist on a liability which is non-existent and issue, as an alternative, this complicated form, with the result that sooner than face the ordeal of filling this form, or pay for expert assistance in getting it filled, the farmer prefers to pay under Schedule B on a valuation which is absurd and grossly excessive. The accounts which it is necessary to keep are very complicated. Even the value of the stuff consumed in the farmer's house has to be shown on this statement. This system is scarcely fair. I submit that the Minister cannot have the usual complaint that this concession would cost a very large sum. That cannot be so, if what he says is true, that farmers notoriously do not pay income tax. He would lose very little, therefore, by reverting to the pre-war standard. As an alternative, let him do away with 79D and restore the simplified form.
I said in my Budget statement that considerable income tax is paid on agricultural land, but that it is not paid by the farmer who lives by husbandry. It is paid by the farmer who has investments or a shop or some other means of income and he gets his allowance against that. I quoted certain cases that show, I think, that the claim put forward by Deputy Hogan has very little to commend it to our consideration. As a matter of fact, the adoption of his amendment would cost the Exchequer £180,000. If I thought that the Farmers' Party was representative of the farmers of Ireland, I would say immediately: "You can have this, and I will take it off the Agricultural Grant." But I know that if they agreed to such a thing, they would not be representing the farmers. I quoted the case of a farmer who had 130 acres of freehold land, with a Poor Law Valuation of £128. That would be a very substantial farm. In the case of such a farmer, under Schedule B, as occupier, there would be £128 Poor Law Valuation, less earned relief——
Does the Minister realise that that really means a net profit of close on £2 per acre?
I do not think so. You would have £128 as occupier, less earned relief £13, less part of personal allowance—this is assuming the man is married—£115, wiping out the whole of the £128. Under Schedule A there would be £128 valuation, less one-eighth for repairs, £16, less the balance of his personal allowance, £110, making it £126. The result is that he would be liable to pay a tax on £2, or 4/- tax for the year. That is a case that illustrates the fact that farmers, as farmers, do not pay income tax.
How do they pay?
They pay it as shopkeepers or in some other capacity— that is, farmers who have some other business or who are holders of investments. Take again the case of a man who holds a farm with a Poor Law Valuation of £240, paying a purchase annuity of £195. If married, and if he has no other income and the interest portion of that farmer's annuity would be eleven-thirteenths, £165, he is assessed under Schedule B at £195, the annuity being less than the valuation. He gets an earned income relief of £19 10s. Then take part of his personal allowance on £175 10s.; that wipes out any liability under Schedule B. Coming to Schedule A, he is assessed on the poor law valuation of £240, less one-eighth for repairs, £30. Then there is deducted also the interest portion of the annuity, £165. You then have the personal allowance, £45, completely wiping out that liability under Schedule B. You see then that a man holding a farm valued at £240 for poor law purposes, if married, and with an annuity of £195, would not be liable to income tax at all. There really is hardly a farmer paying income tax who has not an income from some source other than his farm, and I think it would be quite wrong to pass this amendment and to put £180,000 a year on some other section of the community, to raise it by some new system of taxation.
If there are farmers who have bigger farms than those with which I have been dealing in these examples, or who have smaller annuities, I think that they ought to keep some accounts. If they do not keep accounts and are not able to show that they do not make profits, I think it is only reasonable that they should be charged. As to the form, I stated, in reply to Deputy Hogan on a previous occassion, that if the Farmers' Union, or any representative body of people, could suggest a simplified form in conference with my representatives I was prepared to adopt a simplified form. I desire that the form should be as simple as possible, but it is not possible to give people relief when they will not supply any figures, or supply sufficient information to show that they are entitled to relief. This is a question about which there has been a good deal of agitation, but it is a question that has no merits. We would simply be relieving a certain number of people who actually hold investments or who own shops, at the expense of the general community and of the big bulk of the farming community, and I think that the Dáil certainly should not agree to such a proposal.
I feel rather grateful to Deputy Connor Hogan for extracting the statement of the position given by the Minister for Finance. But I do think that the farmers will require to elevate their ideas of their own position. My duty is to voice the claims of trade and commerce for relief, because it would seem that they are being exceptionally taxed for the benefit of the farmers.
Then you tax us in turn to pay your taxes.
It is like taking in each other's washing. But seriously, the farmer must, I think, recognise their obligation to bear a fair share of income tax, and after a discussion of this kind I think one has to come to the conclusion that on the valuations as they exist, and calculating the income on the valuations, practically no income tax is paid by the farmers, and I do not think that they are contributing their fair quota of income tax. I must confess that, on the statement of the Minister for Finance, it appears to me that we in trade and commerce have been very considerably overburdened in this matter.
The next amendment, which is in my name, deals with the same thing as this, except that I suggest that the reduction should be half the valuation rather than to one-third. If Deputy Connor Hogan's amendment is not passed, I do not suppose, after the statement made by the Minister, that there is any use in pressing mine. Therefore I will say what I have to say on this amendment. I would like to point out that we are only asking the Minister to bring us back to the state of affairs that existed before 1915, and that if this system of assessment was just in pre-1915 days it ought to be just now. My idea in putting down half the valuation was that some people might say that farmers are getting more for their produce than they got in 1915. That is rather doubtful, but to allow every possible benefit of the doubt to the other side I placed it at a half rather than at a third. The fact of the matter is, that farmers are getting very little more for their produce than they got in 1915, and I think it is generally accepted, and accepted by the Minister for Agriculture, that their profits, where they make profits, are not greater than they were in 1915. The Minister knows that it was simply as a convenient arrangement that the valuation was taken as the basis on which the assessment under Schedule B was to be made.
When were the valuations made?
They are very old. It is either the valuation or the annuity, whichever is the lesser. It is generally agreed that there is difficulty in keeping farming accounts, and also that the type of farming accounts that are required for the income tax people are complicated, and apart from income tax purposes they are of very little use to the farmer. If a farmer has to keep any real record of his profits or losses in the different branches of his business he has to keep costing accounts, and costing accounts in farming are very nearly impossible.
The result is that his bank book is just as good an account for the average farmer who pays income tax as the account which he has to keep for the income tax people, and most farmers decline or do not wish to keep the accounts that are required. Further, it is the case that a great many farmers are unable to keep accounts. Whether that is the farmer's fault or not, I will not say; it may be the fault of the educational system. But many farmers are unable to keep them, and I certainly would say that ninety-five per cent. of them would be unable to deal with that new form 79D which is issued in a case where a farmer has declined to keep accounts, but maintains at the end of the year that he has made no profit. In my opinion that form in its present shape is simply supplied to keep the farmer off, to make him pay on the assessment as based on the valuation. The Inland Revenue people must know that it is impossible to fill up these forms accurately. It is quite impossible for the farmer to distinguish between the milk he sells and the milk he consumes; the potatoes he sells and the potatoes consumed by himself, his family, and his workingmen, and the dozens of other different things in which complications arise. Anybody who knows farming knows that it is impossible to segregate these things, and the Inland Revenue people also know it quite well.
There is also another aspect of it. The Minister says that it is notorious that farmers do not pay income tax. It is a fact, and the Minister knows it, that there are some farmers who have an income in addition to that which they get from their land. I suppose that they are entitled to have investments, that if after profitable years they have saved money they are as much entitled to have investments as anybody else, and they have to pay income tax in connection with these investments. Then they are faced with this treble assessment. We are only asking to be brought back to the arrangement in force before 1915, and I think we are not asking anything very unreasonable. We are not taking up the attitude that we are constantly told we do take up, of asking for something for nothing. It is dinned into us every day that the farmers are asking for something for nothing. I am inclined to think that the farmers will get very little from anybody, and that the more they talk the better chance they have of getting something. I do not agree with the Minister in regard to this matter, and I think that this amendment ought to be pressed. The farmer finds himself in a different position from other members of the community owing to the fact that he has to pay income tax on a higher assessment of valuation. I cannot follow Deputy Hewat's line of reasoning at all. I do not know how he makes out that the business-man has to pay more than the farmer. The farmer is paying on a higher basis than in pre-war days.
Does the Deputy think that the business-man is not?
I think that this proposal is quite reasonable.
The farmer used to be a sort of Ishmaelite—every man's hand was against him. The Minister went a certain distance with regard to income tax on farmers, but Deputy Hewat, representing the business section, went farther, because, as I understood him, he claimed that instead of giving them a remission or relief from income tax, the income tax on farmers should be increased. It has been said that farmers pay no income tax. I know a case of a farmer who from 1915 to 1917 paid upward of £500 in income tax, and since then he had to meet a claim for over £400. That disposes of the claim that farmers pay no income tax.
How many acres has he?
I am not aware.
Has he any investments?
He has investments to some extent, but the great bulk of the claim was based upon his occupation of land held under the Land Commission and also on the eleven months' system. The case has been put before the Revenue authorities. I do not know whether he has got any relief, but I certainly think he deserves it.
As it seems to be the fashion to-day for every section represented here to air its grievances about taxation, I should like to mention the case of poor law medical officers. Take a dispensary doctor who has a motor car. He has to pay a tax of £18 or £20 on that car, and he has also to pay the import tax.
If he is not a farmer the matter does not arise on this amendment.
I welcome the Minister's promise that he will go into the matter of this very intricate form if suggestions are made to him by the farmers' organisations. That would be a great relief, because a great many farmers are paying income tax on their valuation owing to inability to fill this form. The promise of the Minister to simplify the form is something. I would ask him to go into the matter immediately and have the form put in a shape that any landholder can fill it. There is great difficulty in filling the form at present. Not one-tenth of the farmers are in a position to fill it properly.
As a farmers' representative I am always anxious to support any claim put up by the farmers, if I am satisfied that it is a reasonable and good one. But I would like to have some evidence that this proposal is one I can support. How many farmers do, in fact, pay income tax? I mean farmers dependent entirely on the proceeds of their farms— I do not refer to those who have other sources of income mentioned by the Minister. A considerable number of my own class are involved in that, and they pay a considerable proportion of the tax on agricultural land. The man who, as an agricultural holder, pays income tax must be a man with a very considerable farm as compared with the vast number of farms in this country. Looking at the particular case quoted in the Budget statement, I believe that the man who has 130 acres of freehold land in Meath is a very considerable farmer, as we know farmers in the West.
I venture to say that the number of farmers west of the Shannon who are called upon to pay income tax, unless they have investments or some other property, is infinitesimal, and not worth mentioning. The case that is being made, in so far as it is being made, is on behalf of the big landholder. The case is that the particular basis of assessment is not a fair basis. If it is not a fair basis, the farmer is given the alternative of filling up a form under which he is asked to keep accounts and show his receipts and expenditure. He is only taxed then on whatever income he can show he has made during the year. The objection to that is that the farmer should not keep accounts. This point was raised when this matter was discussed before, and I was extremely surprised and sorry to hear representatives of the farmer community objecting to any farmer being asked to keep accounts.
One of the reasons why agriculture here is so unprogressive in many ways is the objection which many farmers have to keeping even the simplest accounts. The particular type of farmer who is concerned in this matter is a man who can afford to pay somebody to keep his accounts. I have no hesitation in saying that if such a man did pay 50/- or £3 per week to a person to keep his accounts it might be very well worth his while. We know how farmers keep on doing things without knowing what particular branch of their industry is paying or what branch losing. In a great many cases they have no system. The complaint here is that they are asked to keep accounts as an alternative to being charged on the valuation, which, on the whole, is a very reasonable basis indeed. As I say this particular proposal affects only a very small proportion of the farming community—those who are big substantial farmers—and unless some better case is made for it, I certainly cannot support it, because I see the danger there is from the point of view of the farmers whom I represent. It might happen that the Agricultural Grant, which will mean a good deal to them in relief of rates, might go to the relief of this particular class of farmer who can better afford to pay the tax than the small farmer whom I speak for.
With reference to Deputy O'Connell's criticism as to the attitude of our Party with regard to farmers keeping accounts, no one has suggested that farmers ought not to keep accounts.
Mr. O'CONNELL
Deputy Wilson did.
Someone behind me says that if they kept accounts they would give up farming very quickly. It is the easiest thing possible to criticise farmers. It is very popular in this House. There are no speeches so popular as those of Deputies who have nothing to do with land, and who understand very little of the difficulties of the people on the land. All the wisdom is on the side of the men who left the land. The foolish people are those who stayed on it. Everybody wants to have a fling at them. Deputy O'Connell is criticising the people whom he claims to represent, because the argument for the big farmer keeping accounts applies equally to the small farmer. His margin of profit is smaller and the necessity for trying to balance his budget is perhaps greater, as it is a matter of life and death with him. I do not know why Deputy O'Connell has not advocated that policy in his constituency.
Mr. O'CONNELL
I am prepared to do it.
I did not know before what the Deputy's policy was. There is no doubt it would be advisable for farmers and business men to keep correct accounts, but where are we to start with this? We must start with the primary schools, with our educational system. I do not want to be too critical of anyone.
Mr. O'CONNELL
If the children were sent they would be taught.
I hope they would be taught. Perhaps we might say that if they had to be taught all the things necessary, sometimes there would be difficulty with some of the teachers in showing exactly how farm accounts should be kept. One of the reasons advanced by Deputy O'Connell for his opposition to this amendment is that if farmers do not keep accounts they are not able to show exactly the position they stand in in regard to the making of a profit, or a loss, which is more general with them for the last couple of years.
There is no indication on the part of the Minister that the keeping of accounts by farmers will make him change the basis of his assessment. That is what Deputy Connor Hogan has tried to get the Minister to agree to. I want to make it clear that we do not advocate that farmers should not keep accounts. We have given considerable thought to this question of costings for farmers, but it is a very complex and difficult problem. What Deputy Doyle said is true: there is a very small percentage of farmers who can keep accounts correctly. There is no use in saying what people should do if things were different to what they are. We know what the conditions are for the farmers to-day. There are educational facilities that have not been placed within their reach. In the light of these facts, it is not fair for Deputies to have a fling at the hardest working section of our community for not doing things that they were never trained to do.
I did not intend to say anything on this matter, but I think it is my duty to intervene, in view of some statements from the Farmers' benches that they are continually being reproached with wanting something for nothing. I have been looking at the Order Paper and examining what would happen if we took the advice offered with regard to this very important matter of taxation that is before us. Three amendments have already been considered. Two of them, if accepted, would mean a loss to the Revenue of £350,000. This amendment, if accepted, would mean a loss of £180,000. That means that the people of the country would have to find £530,000 by some other form of taxation or that some remissions already granted would have to be reimposed. Looking down the Order Paper I find quite a number of other amendments which, if accepted, would bring the total loss up to about £1,000,000. That would mean the imposition of other taxation, or not granting some remission which we have already made. I say, with all respect to Deputy Baxter, that the farmers have been almost invited not to keep accounts, by reason of this recognition of public policy on the part of their direct representatives here. That is not balancing the Budget, and it is not good business to pretend that we can give those advantages that have been asked for and voted for, and that are going to be asked for, without realising that they are going to cost something and that it will mean the imposition of some other taxation, or have already given.
I have spoken to farmers wherever I have met them. I have advised the keeping of accounts. I think it is advisable, but some of them laugh at this. I know one of them. I have very good reason for knowing him; he is a great friend of mine. He has already paid in income tax something like £2,500 for a couple of years, and the income tax authorities would not talk with him until he paid them. He then got a bill for £2,500 more. I believe, if he kept accounts, that he would not be assessed for more than £1,500, instead of the £5,000 he has been assessed for. Deputy Heffernan asked if a farmer saved money and reinvested it had he not got a right to it. Deputy Hewat, or any other man in commerce who saved money and put it into investments. could say the same thing—should not they be relieved from taxation in respect of these investments?
I did not suggest anything of the kind. I did not suggest that they should be relieved from taxation on investments. I suggested that they should be brought back as farmers to the basis of assessment on land valuation.
The case that was made, as I understood it, was that the method of assessment in connection with land was too high. I think he destroyed his case when he said that if they happened in a good year, or in two or three good years, to save some money, which could be put into investments, that they should be assessed not on the capital as it were, but on the profits of the investment. I do not see how you could possibly justify a case of that sort. It would amount to this, that if Deputy Hewat, in his business, made £10,000 and invested it, he would say to the Revenue Commissioners: "You cannot touch that £10,000, but I will allow you to touch the 5 per cent. interest on it." That would not be an economic proposition from the point of view of the Minister for Finance. I do not think it would be possible to entertain such a proposition. I think the farmers will admit that possibly 5 per cent. of the people who hold agricultural land are assessed in respect of this particular income tax. The Minister for Finance corrects me. He says 1 per cent. would be more likely to be correct. I firmly believe he is right. A case is made against the keeping of accounts. I kept accounts in respect of one holding while I was "on the run," and I got it excluded by the British authorities when they were here. That is a thing we are told you cannot do. I absolutely refuse to accept that.
All the farmers have not your education.
As regards my education, I left school when I was 14½ years of age, and I have been working hard ever since. I did not waste any time since. The position is that if the farmers' representatives persist in this there will be a trek from business. Business people who have made money will invest it in land, and try to escape their liability in respect of assessments on land. We were told a short time ago that the price of land was too great. I think it was Deputy Gorey who told us that he had warned banks that the price was excessive, and that it was leading towards a collapse of some sort or other. Relieve persons who have got money and who want to retire and have an easy life, reduce this assessment, and the competition will be very much greater. That the farmers work hard nobody denies. Nobody denies that they work long hours and that their conditions are extremely hard. We admit that. But they have certainly got one advantage, and that is, that they are out in the fresh air. Judging by the appearance of the representatives on the Farmers' benches I would say that I would like to be assessed at this price.
Amendment put and declared lost.
Amendment 5.—In paragraph (3), line 14, after the word "provisions" to insert the words "by this resolution and."
Amendment 5 is consequential.
Amendment not moved.
Amendment 6.—After paragraph (3) to insert a new paragraph as follows:—
"That in so far as the provisions of the Income Tax Acts apply to the assessment of income derived from the occupation of land, from the 6th April, 1925, such incomes shall be assessed in cases where the payers elect to have their assessment for income tax made under Schedule B, as if the true income were one half of the Poor Law Valuation (or one half the Land Commission Annuity)."
I withdraw that amendment.
Question—"That the Dáil agree with the Committee in Resolution No. 1"— put and agreed to.
I move:—"That the Dáil agree with the Committee in Resolution No. 2."
I explained to the Committee that this resolution is for the purpose of making certain people who are citizens of Saorstát Eireann—for instance, a Belgian, or an Italian—in virtue of the Constitution, but who are not born here, liable to taxation in the same way as the rest of the citizens. If an Irishman, domiciled here, were to leave the country; if he were to sell his house, for instance, and live in hotels, pleasure resorts, or anything of that sort, living here only for a period of three months in the year, we would get income tax from him, in the same way as if he were never out of the country at all. A person such as I mentioned, having the advantages of citizenship, should bear the responsibilities of citizenship. If he were not in the same position and were abroad, living only short periods here, probably he would escape our taxes altogether. The resolution will simply rope these people into the same position as the native-born Irish people.
Question put and agreed to.
I move, "That the Dáil do agree with the Committee in Resolution No. 3."
I also explained this resolution on Committee Stage. It follows a clause passed by the British in their Finance Act of last year. It simply confirms the practice that has always prevailed in income tax administration. It appears that a year or two ago, in one of the British courts, a Judge expressed some doubt as to the legality of the practice, and, although he did not decide against the practice, or against the Revenue Commissioners in the matter, the fact that he did express doubt caused the British authorities to think that it was wiser to make the matter clear by legislation. We are in the position that our courts would be likely to entertain the same doubts as the British courts, and we feel that it is necessary that we also should put the position beyond any doubt. The question that is dealt with will only arise if there is a change in the rate of income tax. For instance, a company will declare its dividend next June with 4/9 tax deducted. For a period of nine months the tax has been deducted at the 5/- rate, and for a period of three months it has been deducted at the 4/- rate. Or you might have a company next December declaring a dividend, and showing on the dividend that the tax had been deducted at the rate of 4/3 in respect of the first quarter of the year and at the rate of 5/- for the remaining nine months. The taxpayer, of course, is entitled simply to a certain amount of relief, at the standard rate, £135 a year, or £225, if he is married, or greater amounts if he has children, and he will get that, and always has got it, under the existing arrangement, which is entirely equitable. As a matter of fact, people getting these composite warrants showing tax deducted, will have difficulty in seeing the composition. It is always the cause of trouble and disputation between them and the revenue authorities.
I would like to ask the Minister whether, when this rate has been in operation for about a year, it will be possible to simplify arrangements for the recovery of British income tax here, and for the British to recover Saorstát income tax merely by producing a certificate. Now that our taxes are at the same rate, will it be possible, merely by producing a certificate that British income tax has been paid, to obtain recovery without delay? Similarly, as regards Saorstát securities, in respect of persons resident in Great Britain. I realise that it will require some negotiation, but I think that the delays which have occurred in the past should not occur in the future, when the two rates of income tax are the same. The same amount of calculation is not required as to the amount of refund.
Probably the rate in both countries being the same will simplify matters to some extent, but in order to get an entirely satisfactory arrangement for giving double taxation relief we must get a new basis. That is recognised, not only on our side but on the British side. I have had personal correspondence recently with the Chancellor of the Exchequer, and the Revenue authorities on the two sides are exploring the matter afresh and in the light of certain new matters, with a view to getting a very much simplified system put into operation. I have hopes that, by this time next year, I may be in a position to announce a great simplification of the matter.
I hope the Chancellor of the Exchequer will recognise that the Minister for Finance is his teacher, and has longer experience than he has.
Question put and agreed to.
I move Resolution No. 4. The resolution deals with the McKenna duties.
I move amendment No. 7:—
"To delete paragraph (2)."
I think this matter has been fully discussed already, and I do not intend saying very much about it, beyond that the Minister knows why the taxes were imposed. They were imposed for a special purpose, and that special purpose has now ceased to exist. The idea I had in my mind in putting down this amendment was that motor cars should not be regarded as a luxury; I think they should be regarded as a necessity of life at the present time. I think the number of people to one motor car in Ireland is very much greater than the number of people to one motor car in other more progressive countries, and if we remove this duty off imported motor cars we will cause much greater use to be made of motor cars. My opinion is that, to a very great extent, motor cars in this country are used for business purposes. I think the number of motor cars that are used for joy-riding, outside the city of Dublin, must be very small, and the whole train of progress should be towards getting motor cars used more commonly. We are working very hard to improve our roads, and one of the greatest reasons for improving our roads is to allow for continuous motor traffic. While we continue to maintain these very high duties on motor cars, and while the revenue duties are not protective to any real extent, we will prevent the general use of motor cars in this country. I would like the Minister to consider the matter as favourably as he can. I know they bring in a very considerable revenue, but I think it would be a mistake to look on those taxes as permanent taxes—taxes that can be relied upon for all time to produce a very definite revenue.
If the Minister does not accept the amendment, he should keep the principle of it in mind. At some future time he might realise it is a very necessary thing to remit this duty and allow motor cars freely into the country to be freely used, and so permit us to keep in touch with modern development.
I do not suppose that Deputy Heffernan expects this amendment could be accepted. I have already said it is a very important source of revenue. Since we must have revenue taxes, I think the duty on motor cars is a good tax. I know motor cars are used for business, and it would be a very great handicap to business if we could not have motor cars, or if we had a prohibitive tax on them. On the other hand, I know motor cars are very largely used for the purposes of pleasure, in addition to business. I know a good many people who own motor cars and, so far as I can judge, they use them for pleasure more than for business. There are people like Deputy Sir James Craig who, I have no doubt, use their cars entirely for business. Doctors do, as a rule, and perhaps other people do so, too. But there are others, and I believe they can carry on their business just as efficiently without motor cars.
But that is not the way in which I wish to argue. We imported one million pounds' worth of cars last year. I know that motor agents say their business is just bordering on a state of bankruptcy. I have had them in many times; they tell me they are on the point of collapse, and they will find it very difficult to carry on. All the same, more cars than ever were imported last year, as was indicated in the additional sum derived from revenue. There is nothing to indicate that in the coming year we will not have another million pounds' worth of cars imported. It is certainly a commodity that is well able to bear the tax. We are not going to cut off the importation of motor cars by imposing this tax. It is a tax that is not too difficult or too expensive in its administration, and it gives us a good revenue, which otherwise we would have to raise by some form of indirect taxation. I do not suppose we can, in any way, increase direct taxation. You must consider a sum like £300,000. If anybody cares to look over our import and export lists he will see that it is not easy to select commodities which will give us anything like £300,000 in revenue without a big increase in the cost of living. There are taxes of the luxury type that could be applied, but it would be very difficult to get big sums in revenue from them. I do not think we could very well dispense with this particular tax at the moment.
I do not wish to refer too much to the Ford industry in Cork. I do regard it as important, nevertheless. If it were to continue to expand there, it might have very important consequences for the city and for the south generally. We all know that the existence of any industry facilitates the starting of new industries. We saw that very clearly in the case of Wexford. When business was good from agricultural implements you had other firms being started there, simply because there were skilled people in the trade and there was a general idea in regard to doing that particular sort of work there. There is no doubt that an industry like Ford's at Cork is important. There are difficulties, certainly. I do not say that the removal of the tax would cause them to go, and I do not say that the keeping on of the tax would cause them to stay. It is more likely that an industry of that type will be developed, and I regard it as very important that it should be developed here. I think that other industries will grow up from it and that it may be the nucleus of very great things.
Amendment put and declared lost.
In the absence of Deputy McCullough, I desire to move amendment No. 8:—
At the end of paragraph (2), line 8, page 2, to add the words "save that in the case of musical instruments, including gramophones, pianolas and other similar instruments and accessories and component parts of musical instruments, the amount to be charged, levied and paid shall be an amount equal to twenty per cent. of the value of the article."
He asked me to move that resolution for him.
I am satisfied with that statement of the case, and on that basis I will take a vote on it.
Mr. DOYLE
Perhaps the Dáil would postpone consideration of the amendment until Deputy McCullough would be in attendance?
The Dáil cannot postpone consideration of it.
At any rate, there will be many opportunities for proposing such a matter as this. A more appropriate time would be on the Committee Stage of the Finance Bill.
Amendment put and declared lost.
I desire to move:—
At the end of paragraph (2), line 8, page 2, to add the following words:—"save and except that the customs duty charged on motor cars, motor cycles, and the parts thereof shall not be charged in so far as they apply to the importation of requisite parts for motor-cars or motor-cycles which are certified as being required for the repair of motor-cars or motor-cycles, and of which the value of any packet or parcel of such spare parts is certified not to exceed the sum of two pounds sterling."
I am much stronger on this amendment than on my previous amendment. The purpose of this amendment is to see that spare parts for motor cars and motor cycles are allowed in free of duty up to a certain limit. I had a similar amendment last year suggesting that the value of a parcel to be allowed in free would be one pound. I have increased it to two pounds this year. Everywhere we go we hear a great deal about the inconvenience caused by Customs delays in regard to the importation of spare parts for motor cars and motor cycles. There are very many different types of cars used—cars manufactured in England, America, Italy, France, Germany and elsewhere —and it is quite impossible for any motor firm, no matter how large, to keep a complete stock of spare parts. The result is that when a part gets broken the motor agents have to send to England to get spares, and then comes the Customs delays.
took the Chair.
Even the ordinary Customs delay is sufficient to retard the trade very much, and causes a great deal of annoyance and inconvenience. Emphasis must be laid on the matter of annoyance, because it is that, more than anything else, people object to. Motor cars and motor cycles are occasionally held up for some trivial parts costing a few shillings, and frequently it takes three weeks, and even longer in some cases, to get those parts through. Complaints are universal with regard to incovenience. I am not sure my amendment will serve its purpose. Perhaps there is some alternative method which could be devised. I am willing to withdraw it if the Minister will endeavour to devise some formula which will cover the matter.
The adoption of this amendment would not serve the purpose Deputy Heffernan has in view. It would still be necessary to go through the Customs formalities and it would still be necessary to establish the value of articles allowed through. Possibly in a case like this, the Customs people would have to be more strict than they are at present. If an article is now valued at £1 10s. there would be a duty of 10/- if it pays the full rate, and if it seems to be correct the Customs people will probably take it without too much evidence. They will accept £1 10s. as being the value. If it is valued at £1 10s, and if this amendment were in force, they would think there was an attempt to get out of paying the duty that would be due on an article worth two ponnds, and they would imagine it was being falsely represented as below the two pounds' standard in order to get it through free of duty. I believe this amendment would not tend to hasten the Customs formalities, but would probably retard them. I believe the effect of having the arrangement as suggested in the amendment would be to delay things.
In regard to this matter, I would like to say that a great deal of blame is thrown on the Customs authorities, and it is not altogether deserved. I have gone into a number of cases where complaints were made, and I believe that the delay that has occurred is not fairly attributable to the Customs. I believe it is due to the importers or their agents. Very often people will make no attempt to assist the Customs authorities in getting their goods through. People send for articles across the water; they get invoices and they do not forward them to the Customs authorities. They do nothing to facilitate the Customs, and yet they expect the goods to be cleared quickly. Until people will make an effort to facilitate the Customs it will not be possible to improve the position. I took this up with the Customs people last year as the result of discussions here, and I had various conversations as to the best means of facilitating the passage through the Customs of motor parts, and generally speeding up the whole business. It was arranged that everything possible would be done.
I do not know whether anybody outside could put up specific suggestions as to how things might be done. Sometimes an outsider will have suggestions that do not occur to the people actually dealing with the matter. I would be glad to have their suggestions. As a matter of fact, where the importer does his own part properly and takes the trouble of finding out what to do, and does it, there are not very great delays at all in getting goods through the Customs. If there is some delay inherent in having a Customs system and in having dutiable goods coming through, you will not get rid of it by introducing a new complication, and that is what this amendment amounts to. If goods are sent to the value of £1 15s., and that seems reasonable in the view of the Customs officer, there will be no reason for him to question it and he will get the duty on that amount. If he gets goods worth £2, and the claim in respect of them is put at £1 15s., he naturally will be more suspicious, if this amendment were adopted, than he would be in the past, and the purpose that the Deputy has in mind will not be served in that way.
The Minister has just brought a general charge against the importers of motor parts. I think if I or any other Deputy had made that charge against the officials of his Department, he would have asked us for details. I do not think it is quite fair for the Minister to come here and, without giving details, to make a charge of that kind against a respectable trade.
There is a difference in the respective positions. I have a certain responsibility for administration of the Customs, and I would like to get details of any charge in order that I might discharge that responsibility. I do not believe that any Deputy of this House has the same responsibility in respect of the behaviour of any importer.
That is all the more reason why a charge should not be made, and made in such a form that it cannot be rebutted. If a charge is made against the Minister's officials, he can get information and rebut the charge. In this case we are in the position that a certain charge—which will appear in the newspapers to-morrow—is made, supported by no evidence beyond the Minister's word—to which I attach great weight—and there are no grounds given on which a rebutting statement can be brought forward. Nevertheless, I think there are importers of motor parts and repairers who are at fault in this matter. But who are they? I think they are mostly small firms down the country—people who have bought a Ford car, or two cars, and who are hiring these vehicles. They find that they cannot clear their goods through the Custom House here unless they employ some agent who makes a speciality of the business, and who will charge them, for doing the work, 50 per cent. to 100 per cent. on the value of the part that is to be cleared. That, I think, is the main case for Deputy Heffernan's amendment. It deals with parts that cost very little, and that are not worth the trouble and the expense of getting an agent in Dublin to clear through the Customs. I would ask the Minister for a moment to put himself in the position of a person who uses a motor car. I am not quite sure whether he uses a car himself or not.
No.
I do not either. The Minister and I share a joint misfortune. I sometimes take a taxi. To a person who uses a car, it is, in the first place, a source of exasperation that, owing to some accident, the car cannot be used. It is a source of added exasperation when you go to the agent for your car and are told that the spare part is not in stock and must be obtained from England. I cannot say that all English manufacturers of cars are very businesslike in dealing with demands for spare parts. Then comes the crowning exasperation, when you go to your repairer a week later and are told that the part has come but that it is held up in the Customs. It may be the fault of the repairer; it may be the fault of the English manufacturer, but the person who is blamed is the Minister—inevitably. If that can be obviated, it should be obviated. It is not really a good thing to have all these little rankling sores with regard to petty matters of this kind. You meet a man going home in the train and he says, "I cannot use my car for a fortnight because of that (adjectival) Minister for Finance." These are petty things, no doubt. If our population consisted entirely of philosophers we should disregard these inconveniences. But in practice, we do not.
There is another form of annoyance which Deputy Heffernan's amendment would tend to mitigate—that is, the annoyance of being charged duty on parts dispatched here under guarantee. It is the practice of motor car manufacturers, of whom we have not many in the Saorstát, to guarantee their cars for a certain period and to replace any parts found defective. These are very often very small parts indeed. At present I believe—I may be wrong—that duty is charged on those parts returned under guarantee. At any rate, duty is charged in the first instance, and it is not at all easy to get the duty refunded. The proof required for a refund is proof that I hope will not be required from us when we reach the next world; it is proof that would convince an archangel.
Regarding this matter, not from a Departmental point of view, but from a psychological point of view, can the Minister make any suggestion? After all, it is his responsibility to mitigate these grievances as far as possible. We have put up various suggestions from these benches. The Farmers have put up various suggestions. The motor dealers have put up various suggestions. They have all proved unacceptable. Cannot the Minister put up some suggestion? He and his advisers, knowing the technique of the office, have knowledge of the various difficulties that we, groping in ignorance, find confronting us and making all our suggestions unavailing. If the Minister cannot put up a suggestion, will he accept a suggestion to appoint—I know he will consider this a nightmare of mine—a very small Committee on which motor dealers and motor users would be represented, to talk over these matters with his Ministry and see whether some plan could not be devised to remedy matters. If he were prepared to do that, I should recommend Deputy Heffernan to withdraw his amendment. We all find ourselves in difficulties in drafting amendments of this kind. Deputy Heffernan realises that it is very difficult to draw a hard and fast rule, and if the Minister could see his way to accept the suggestion I have made, I believe it would tend to relieve the exasperation that is felt and would tend to convince the public, as a whole, that they are not being merely ground down by bureaucratic rule but that some attempt is being made to remedy their grievances.
Not being a poor man, like Deputy Cooper, I can speak with some experience on this matter. While I agree that there is some case for examination with regard to the grievance with which this amendment deals, I think that Deputies are inclined to exaggerate the inconveniences that occur. The agents and importers have taken steps to meet the difficulty to a large extent. Take the case of the Ford car. Most of the Ford parts can be got without coming through the Customs. They can be got from Cork. That is the car most generally used. So far as any of the standard types of cars are concerned, the distributing agents in Dublin generally import parts in bulk, and there is not any great difficulty to a man down the country desiring to replace a part of his car. At the same time, I think there is a case for examination, especially in respect of small parts and parts of cars not generally used. I suggest that the Minister should look into the matter. I do not think from what the Minister has said that the amendment would be practicable, but I think a way might be found to meet the complaints made by Deputy Heffernan and other Deputies.
I am quite prepared to accept the suggestion made by Deputy Cooper. I am only anxious to find a way by which we can simplify the matter or remove the difficulties that exist. I would be quite prepared to set up a small committee, of which importers or users would be members, to examine the matter and see if a solution of any difficulties that exist can be found.
In view of the Minister's assurance, I am willing to withdraw this amendment. I hope that the people in the trade, who are much more interested than I am, will take note of the Minister's statement and put forward their views, because I put down this amendment without being advised in any way by members of the trade.
Before this matter is disposed of, I would like to put a question to the Minister. Suppose a proposal were put forward which would get over the difficulty of making a charge on these spare parts, would that do away with the delay at the Customs? I can quite understand, in connection with the proposal we have just considered, that as long as there is any Customs charge, or the probability of a Customs charge, there must be a Customs examination. If we can eliminate the Customs examination by eliminating the charge, would the Minister be prepared to consider a proposal based on that aspect of the question. And would that do away with the delay that seems to cause a lot of trouble and contention?
I do not know whether I understand the Deputy aright. Does he mean we should schedule, in an instruction to Customs officers—I am now thinking of the administrative side —certain articles that should not be taxed?
The Minister, I understand, in discussing this matter before, mentioned that there was considerable revenue from motor parts, and that if we were to do away with this revenue we would alter the balance in his budget. It seems to me that if you tax motor parts at all, it means an inquiry at the Customs. And this is the cause of all the delay. If we could get at the root of the trouble by doing away with the duty, would we not do away with the Customs inquiry and the delay that occurs there? There is an intention on the part of some of the motor people to put up a proposal by which the duty might be eliminated and recovered by other means.
That would certainly do away with such delay as occurs, but I am not to be taken as setting up any Committee to inquire into that aspect of the question. I am quite satisfied that we cannot eliminate the duty on parts, so long as we retain the duty on cars. The only way we could get rid of the duty on parts would be by deciding to abolish the duty on cars altogether. There might be a possibility of scheduling certain classes of small parts, such as nuts, and instructing Customs Officers that charges were not to be made on them. You could get rid of delays in connection with certain classes of small parts in that way. As for relieving motor parts of duty, I do not think that can be entertained. It has been examined a great deal, and I do not think it is practicable.
Would the Minister, in setting up this Committee, not allow them to consider that aspect of the question, or any proposals in that direction. I do not want to forestall what these people will put forward, but I think they have proposals of a kind which will be worthy of consideration, and which would possibly justify the Minister in doing away with duty on parts, and thus avoid all the trouble and delay that have arisen.
I was rather thinking of a committee to look at the administrative aspect of the thing, a committee that would have regard to formalities and methods of dealing with the thing. A committee that would deal with a matter of policy would be of a different type, and I would not be prepared to refer this to that kind of committee. But I would be very glad to have an alternative suggestion, and I would consider it. I do not suppose that such a suggestion could be put into force this year, even if it commended itself to us. But I do not think that that is the sort of suggestion that should be examined by such a committee.
I would like to mention a proposal that has been put to me. The motor users have said that at the moment there is no tax on motor tyres, and their suggestion is that a tax should be put on them. I believe all parties agree to that and to take the tax off motor parts. That is a proposal that might be considered. It is a practical proposal, and I wondered if the committee would have an opportunity of considering that proposal, but seeing that the Minister will not give it that opportunity I have to put forward that proposal on their behalf now.
If I were to entertain such a proposal as that it would be considered in the Executive Council, and a resolution would have to be brought in here and passed on the same day.
Amendment, by leave, withdrawn.
I move:—
At the end of paragraph (2), line 8, page 2, to add the words, "except that cinematograph films, which are certified by the Film Censor to be of an educational character, shall not be subject to import duties."
In the debate following the introduction of the Budget I mentioned a particular case that came under my notice, and with which I had to deal, where an educational lecture to be delivered under the auspices of a local association of farmers had to be abandoned on account of this tax. We had arranged with a gentleman who had lived in Denmark for a considerable time, and who had been presented with a set of films depicting farm life and methods in Denmark, to deliver a lecture on his experiences and knowledge of Danish farming conditions. I think everybody will acknowledge that lectures of that kind are very useful, and should be encouraged by every means at our disposal. But this gentleman found when he came to get these films into the country that the tax was too high, and on that account we were not able to have the lecture. It meant that the money we expected to get at the doors would not recoup this man for the amount of the tax he would have to pay, and for his travelling expenses. I have found it rather difficult to frame an amendment which would cover the kind of case I have in mind, because I have not been sure whether it would be advisable to allow in free of duty films of an educational nature to be used by the ordinary cinematograph houses. I think it might be extremely difficult for the Censor to distinguish between films which are to be regarded as educational and other films, and my intention was to draft an amendment which would simply allow films of this character, to come in free when they were to be used apart from cinematograph houses, but I was unable to draft an amendment which would exactly cover that case. It might be very hard to define exactly what was a cinematograph house, showing pictures for profit, as against a society showing pictures for educational purposes. But I put it to the Minister that the idea contained in this amendment is a good one, that it is advisable in the interests of the country, in the interests of education, and in the interests of the uplifting of our people, both from the agricultural and from other points of view, that we should have films of this kind shown throughout the country. As at present the tax acts to a certain extent as a stoppage of this form of education, I suggest that the Minister might consider my amendment with a great deal of care, and, if in its present form it does not meet his requirements, that he should look into it, and at a later stage bring in an amendment to do what I propose.
The Minister promised on the last occasion that this matter was raised to look sympathetically on the proposal from the administrative, and also from the revenue point of view. I hope he has been able to come to a conclusion which will embody the idea contained in this amendment, but I hope it will not be such a decision as would confine the term "educational films" to those which are only likely to be exhibited in a school or before a particular educational association. I rather hope that the character of the films will be taken into account in such a way that the wider theatre-going public will have an opportunity to enjoy and to take advantage of these films, and that we should aim rather at encouraging the ordinary picture theatre proprietor to show a much larger proportion of pictures which are of a distinctly educational character. I do not think that the administrative difficulties are so great. All films are now censored, and if a proposition of this kind were passed I take it that a proprietor of a cinema theatre would make application for a special certificate where he could claim that the picture was of an educational character. I understand that they have, or had some time ago, a kind of trade description for educational pictures, and I have no doubt that that would be of use to them in making their claims for the scheduling of educational films. Probably some discrimination would have to be used in the description that would be given to the Censor, but once we have got the censorship we would only be extending the idea, and I think a clear line might easily be drawn between a picture of an educational kind and other pictures. The general machinery of the Film Censor's department would be available both for the original censorship and the appeal, and I think there are a certain number of people on the present Appeals Committee who would be qualified to decide whether a picture should be called an educational picture or not. I hope if a decision favourable to the main idea contained in the amendment is come to that the purpose will be borne in mind, that it is for the wider public that the great advantage will come, not merely for people who would go specifically to see an educational picture. If picture houses could be induced to show a larger proportion of pictures of educational value by a reduction in the prices—and more especially this would apply, I think, to the picture houses which cater for children—the value would be very great indeed. There are a number of houses which give special performances for children at low rates. I think if the pictures of educational value shown by these houses were to be obtained at a lower rate or rent than others it would be an added inducement to the proprietors to show that class of picture to the children, and that would be a very great gain indeed.
I hope that the Minister will accept the amendment in essence. He gave, as Deputy Johnson has said, an undertaking to look into this, and I hope he has done so with favourable results. There is every reason why relief in tax should be given to pictures of an educational value. I think everybody will agree that there is a very great scope for educationalists in the country to-day, and I want to support the point of view advanced by Deputy Johnson. There should be a demand amongst our agriculturists for information regarding the methods of our competitors in other countries, and the educational branch of the Ministry of Agriculture should use such films as these. I think it is imperative that they should use them at once to teach our farmers everything that is to be known about improved methods of conducting their industry. On the other hand, people in the towns and cities should be given every opportunity of seeing what the conditions are in other walks of life, and I think if all of us knew more about conditions of which we have at present no experience, the standard of education all round would be improved. While the picture-going crowds in the cities perhaps crave for a film of a certain character, there is no reason whatever why films of another type should not be just as acceptable to them, and I think it is very largely a matter of the taste that we should try to cultivate in the picture-going public. On the other hand, what the Ministry of Agriculture should do is to train the young people in the rural districts in the methods they should adopt, and I cannot see any other means to stir up interest, to get a larger number of people together to lectures, and get a larger number of people to take an interest in matters that concern them than by cinema displays. I can imagine a lecturer in agriculture in a rural district exhibiting a film showing different types of cattle, crops, and other things, the good and the bad, the growth, feeding, bringing to market, treatment at the market, bad treatment and good treatment, transit to the slaughterhouse, curing, and the rest, comparing good animals with bad, the growth and development of animals under favourable treatment and under unfavourable treatment, the sale in the shops, showing the value of what has been treated well and what has been treated badly. All that could be taught to our people to-day, and that is what, I think, our Ministry should concentrate on. Then there is the question of the growth of crops, the better choice of seeds, the crop that is grown from good seed, the crop that is grown from seed badly chosen.
All these things could be portrayed to the young people in a way that is not possible by means of a lecture alone. The experience of agricultural instructors is that it is a very difficult thing to get anything like a good attendance at a lecture, no matter how able the lecturer would be. It is true that the older farmers may come, men of forty and fifty years of age, but it is altogether beyond the powers of the lecturer to get the young people of about twenty years of age to come, and it is in these people that the future development of the country lies. If we were able to interest the younger farmers, if we could get them to attend lectures, to hear and to see as well, if if we could get them to discuss amongst themselves the improved methods they would be shown, and try to put what they had seen into operation, we would surely improve our methods, improve our education, raise the standard of living in rural districts, gradually but surely develop our agricultural industry, put it on the economic basis that it has not at present, and by doing that raise the whole standard of living, and increase the prosperity and the progress of the State. In this amendment lies the means by which that end can be attained.
The Minister is so slow in saying he is going to accept this amendment that I am beginning to entertain some fears that he is not going to do so. For that reason I should like to impress on him the necessity for doing something to meet the amendment. Deputy Baxter has put up an extremely good case with regard to the rural population. I am looking at it from another point of view, because it has been put before us in another place that there has been practically nothing done in the rural districts to amuse the young people, and to counteract the so-called evil effects of the publichouses. It would be a great boon if the people were provided with cinema entertainments not altogether of an educational nature, but of an amusing nature, intermixed with films of an educational value. Films of an educational value should be allowed in free of duty.
I had an experience some time ago of a film being brought over here dealing with child welfare. It was one of the most important films that I have had any experience of. This film was held up in the Customs, and the people concerned did not know there was any duty to be paid upon it. The meeting duly assembled, but there was no film to show the audience. Afterwards I had considerable difficulty in getting this film sent back again without having to pay the duty on it.
The chief difficulty that the Minister will have is to decide as to what is an educational film. With Deputy Johnson, I think that we ought to get beyond the merely educational film, as suggested by Deputies Heffernan and Baxter, such as showing farmers what is necessary for them, and showing people interested in child welfare what could be done. There are films of a higher educational character which, I think, Deputy Johnson had in view.
If the Minister has decided not to accept this amendment I hope that he will reconsider his decision. Deputies feel strongly that the people will benefit by educational films that could be introduced along with the amusement films. I do not want to do away with the amusement film, but I think the people would be more inclined to go and see the purely educational films if they were interspersed with others of an amusing character.
resumed the Chair.
This amendment is rather important, as it leads to the larger idea that Deputy Johnson has put forward. There is nothing so important to this country as education in all its branches. It is not alone a question of what it means to the farmers, but what it means in every department of life from an industrial and artistic point of view. It is quite as necessary for the people of the towns as it is for the farmers to learn to do work as well as it is done in Denmark, Canada, the United States or other countries. I ask the Minister to consider this amendment carefully from the point of view of leading up to one of the most important things in the building up of the nation: that films of an educational character should be allowed in free. There will be difficulty in dealing with such films, but this proposal would help the censor in dealing with a class of picture that is not desirable. I certainly would not confine the showing of these pictures to halls or places of an educational character. I should like to see them shown in the picture houses. If the owners of cinemas are allowed to get in such pictures on exceptional terms they will be more inclined to show pictures that will be of value, whilst at the same time producing pictures for amusement purposes.
I am prepared to accept the substance of this amendment. I am not sure that in its present form it will do, but I will undertake to bring in a section or sub-section in the Finance Bill to cover the matter. I do not anticipate that any great administrative difficulty will arise. At any rate, after a year's trial, if any difficulty is found in distinguishing between educational and other films we can legislate further in the matter. So far as I have been able to examine the matter I do not think it will be difficult to deal with. Allowing even for a considerable increase in the number of educational films imported, the cost will only be a few hundred pounds. I would like the Deputy to allow the matter to stand over until we have time to get a section drafted.
I desire to thank the Minister for accepting the substance of the amendment, and in view of the undertaking given I ask leave to withdraw it.
Amendment, by leave, withdrawn.
Question—"That the Dáil agree with the Committee in Resolution No. 4"—put and agreed to.
Sitting suspended at 6.30 and resumed at 7.15 p.m.,
in the Chair.
I move: "That the Dáil do agree with the Committee in Resolution No. 5."
I think I dealt with this matter at some length in my Budget statement. The value of ordinary household soaps, as shown in the import returns, is well under £3 a cwt., whereas the value of the toilet soaps goes up over £8 a cwt. It is obvious, apart from any other arguments, that if a rate of duty is just sufficient to be effective in the case of ordinary household soaps it is hardly likely to be effective for the toilet soaps. I have stated also that there is little doubt if the toilet soap industry is to be put on any sort of definite basis here, and if it is carried to the full extent to which it can be carried, having regard to the needs of the country, that there will be no necessity, after a very short time, to continue to charge a duty on ordinary household soaps. The toilet soaps, which are the profit-making end of the industry, will enable the makers to carry on the other class of manufacture without any tariff protection at all. We feel, at any rate, that 10 per cent. has not proved enough to stimulate the making of the toilet soaps. We feel also, in view of the great divergence in value between toilet soaps and household soaps, that what would be just sufficient to cause the household soaps to be made here would not suffice to lead to the making of the toilet soaps.
Question put and agreed to.
I move: "That the Dáil do agree with the Committee in Resolution No. 6."
Amendment 11: "That the Dáil do not agree with the Committee on Finance in Resolution 6." (Deputy Heffernan.)
As my amendment is a direct negative, it can be dealt with when the main motion is being put.
I move amendment 12:—
In paragraph (1), line 28, after the words "wearing apparel" to insert the words "as set forth in the schedule attached hereto."
That is an amendment which would have to be considered at this stage, and not in Committee on the Finance Bill, inasmuch as the Schedule referred to would have to be prepared. The general advantage that I suggest could be achieved by the amendment would be that instead of leaving the specification of the articles to be taxed to lists furnished by the Revenue Commissioners to the various officials who have to administer this part of the Budget, the Minister should set forth exactly what the various commodities are, and everybody would know exactly what articles were to be taxed. I do not think it is excessive to ask that such a schedule be put into the Finance Bill, when it is prepared, because there is such a schedule. I was shown a copy of one by one of the Deputies in the Dáil to-day. It is being used up on the Northern border as a guidance to the Officers, showing them what articles should be taxed and what articles were dutiable. I suggest that it would lead to a great deal of simplification, both for the public information and for the authorities concerned, if that schedule were to be embodied in these financial resolutions, with a view to having it in the Finance Bill, in order that everybody might know exactly what were the articles covered by the rather general terms of Resolution No. 6.
I think inside the terms of the Resolution it would be much easier to specify the articles that are not covered. I do not know whether Deputy Figgis thought over this much. He will see that the supplying of a schedule for the guidance of officers, a schedule that is not statutory, is quite a different thing to preparing a schedule which is to be statutory. Any error in the making up of a schedule might lead to the greatest anomalies during the course of the year. It is very difficult in these matters to draw up complete schedules. The more complete you make them the more definitely do they exclude the things not mentioned, if you happen to fall into any error. People will have no difficulty in deciding what are the articles taxed, I assure you, and I do not think that, even as it stands, there should be much difficulty for a Deputy to make up his mind as to the class of goods that are included in the term, "all personal clothing and wearing apparel whether completely or partially manufactured and all component parts." I think the meaning of that is fairly clear. If members of the public do entertain any doubts they can be resolved. Later on, when some time has elapsed and some experience has been gained, it would be very easy for the Revenue Commissioners to publish for the guidance of the public a general schedule which would not be statutory, and which would not prevent the Commissioner collecting duties on any articles that did not happen to be mentioned in it. I certainly would not like to agree to a schedule being inserted in the Act.
Would the Minister undertake, at the earliest possible moment, for the convenience of the public, to publish such a list, as he has mentioned, without making it a statutory schedule?
Yes, if there is any evidence of a demand from the public. I do not know whether the Deputy is speaking just for himself, or whether he is speaking for any body of public opinion. But if there is any evidence of any desire on the part of the public, I certainly will agree to have it prepared.
I will not press the amendment.
Amendment, by leave, withdrawn.
Amendment 13.—In paragraph (1), line 31, after the word "wearing apparel" to insert the words "and all cloths and clothing material of the descriptions specified in the schedule attached hereto for the manufacture of personal clothing or wearing apparel.
This is a separate matter. I do not pretend to adhere to the drafting of this amendment, because I think the purpose I wanted to achieve in it would be covered far better by letting the whole matter be referred to the Minister's own drafting staff. It has been argued here so much by several Deputies that I do not think it is necessary for me to say a great deal about it. It is with the intention of letting cloths and clothing material, manufactured in the Free State, be covered by the tax that is being levied on wearing apparel. This case has been represented very strongly to me, by one or two parties from the south and west, that if the homespun industry and certain other industries in which wearing material cloths are manufactured in the Free State do not receive the benefit that is being given by this Resolution to manufactured clothes mills that are now working and that have only been kept going in anticipation of some such duty as this, would have, in the course of the next few weeks or months, to consider very seriously the question of closing down. I think the very fact that when this resolution was first moved before the Dáil several Deputies at once came to the conclusion that it was a tax on cloth as well as on manufactured clothes, and pressed that very strongly, is of itself some indication that there was a general desire for this type of protection. If protection is required— and I have myself agreed that the protection given in this particular Resolution, in spite of all the hardships and inconveniences that it will cause, will be a substantial benefit and ought to be attempted—and if a general case be made out for manufactured clothes, then surely a much stronger case is apparent for the protection of homespun cloths and the manufacture of clothing materials of this kind in Ireland. As I say, I do not stand over the wording of this amendment. I am just putting this forward as a test, and if the Minister accepts the general substance of the Resolution, it would need to be drafted far more carefully, particularly for the purpose of inclusion in the Finance Bill. But I urge him to let suitings be covered by the same measure of protection that the Dáil has agreed to give in the general purpose of this Resolution.
Do you include shirting—linen and cotton?
I did not intend to include linen and cotton. I was thinking more particularly of homespuns and tweeds and cloths of that kind. I have not had the case for shirtings put before me at all, but I have had the case put before me very strongly for these particular forms of cloths, so much so that it has been made quite clear to me from a showing of the figures themselves that certain factories that are now in existence will be compelled to close down unless some such form of protection is given. I have therefore kept particularly to that particular type of cloth in respect of which representations have been made to me, and where I have been able to make enquiries. We have not extended it to those other matters. With regard to the wording, the wording here means only—I do not know how best to describe it, except as—cloths and clothing material. If the amendment were accepted in its general substance, it can be drafted conveniently to cover exactly the kind of case where a tariff is required in this country.
This was discussed, I think, in Committee, and I referred to the Budget Statement. The Government gave very careful consideration to the question of whether or not any tariff can be imposed on cloth as distinct from clothing and they came to the conclusion that in the circumstances it would be impossible to impose a duty on cloths. That would mean that we would have a tariff, a two-tiered tariff; if we put fifteen per cent. on cloths, we would have to put an additional fifteen per cent. above that on clothing. The meaning of that would be that the cloth would suffer a tax of thirty per cent. We do not believe that we could put on an article such as clothing, which is a necessary article, an article not like furniture, an article requiring frequent renewal, such a tax as that. I think that the Deputy will see that to put a thirty per cent. tax on any article of clothing would be to go too far in the circumstances. To put a tax on cloth, and not to put a higher tax on clothing would be simply that we would knock out the making of the clothing here and cause unemployment in that way. We are trying to meet the difficulty, which the woollen industry is suffering, by a tax on a certain class of goods which are not made up, such as blankets and rugs. I do not think it is possible to go farther in the matter than that.
I would like to say on that point that I think the Minister would need to bring some evidence to bear, at least to assure us, that he has thought very carefully about the matter before he asks us to believe that he would require fifteen per cent. on cloths, or linen, or cotton.
I am not to be taken as stating fifteen per cent. It might be that it would require another fifteen per cent. above that, whatever the tax would be.
I have gathered certain information by which I am led to the conclusion that five per cent. or seven and a half per cent. on imported woollen cloths, and, perhaps, a smaller thing in regard to linen and cotton, would go a long way to equalise the position as between the Irish manufacturers, in respect both to linen and woollen goods, and English, Scotch and North of Ireland manufactures. The difference of, say, ten per cent. as between the duty on cloth and the duty on the finished article might be found to be quite sufficient when the supply of the home-manufactured cloths would be increasing. I am not in the position of being able to argue the case from the figures, but it seems to me there is a stronger case to be made for the duty on imported cloths, even of five per cent. or seven and a half per cent., without increasing the duty on the manufactured apparel that the Minister has suggested. The revenue side of it would not be affected very much. In fact it would be benefited. I think the protective side, so far as there are manufacturers of men's and boys' clothing, shirts, and that class of under garment, would be able to maintain their position as against the manufactured imports. I certainly would like to have the case against the general proposition in Deputy Figgis's motion much more strongly met than the Minister has met it before I would be convinced that it is reasonable and right. Though the manufacturers may have been talking in terms of fifteen per cent., twenty per cent. and twenty-five per cent.—whether they have or not I do not know—but eighteen months ago and two years ago, I had reason to believe that a much smaller duty than that would make it possible for the home manufacturer to meet imports on level terms at any rate, and I think that it is well worth considering whether that could not be met even at this stage.
I am not supporting the Government, but I am opposing the amendment.
Explain.
It seems to me that this is a proposition of giving protection to an article which, if anything, should be able to compete and hold its own with any part of the world. I refer to the manufacture of cloth in Ireland. In the past the manufacture of cloth in Ireland has done so. As we know, several of the most prosperous manufacturers of cloth in the past exported the main bulk of their output, or a very considerable bulk of their manufacture, to America, in spite of the tariff against them there. Now, of course, in opposing this, I must not be taken as being in support of the tax on clothing, but at all events, I am opposed to the putting on of this duty, on the ground that it is not justified, and that it is putting an extra tax on the consumer. Last year when the Minister introduced his experimental Budget, it was perfectly obvious that this sort of claim would multiply and fructify, on the basis of the experiment. It seems to me to be a case of facilis est descensus Averni. This amendment is in that direction. Now I do not know whether the claim comes from the manufacturers or whether it does not, but whereas the consumer is going to be put to a great deal of inconvenience, and to a great deal of extra expense in connection with his clothing, but setting on top of that another tax which, in my opinion, is not going to be justified in any way is, I think, putting on the back of the consumer a charge which he ought not to be called upon to bear. He is already, I think, owing to the experimental Budget which was introduced, called upon to bear a very heavy burden. In saying that I recognise the path we ventured on, and I do not know whether it is Avernus or not. We have only entered on it, but all my efforts will be to put the brake on it, not with the idea that we can prevent the tariff, but in order to stop the avalanche.
Deputy Hewat has apparently given a new conception to the Committee the Minister promised, on motor parts if he is going to give brakes to avalanches. I would like to give a few more reasons to Deputy Johnson as to why this amendment should not be proceeded with. In the first place, it is a tariff on raw material and the general opinion of political economists is that taxes on raw materials are not justified. The chief difficulty is to discover what is unmanufactured raw material. Probably, Deputy Johnson will say, "Wool as it comes off the sheep's back." In practice it is doubtful whether the Irish tweed factories are able to supply the demand for tweed and cloth needed for making-up. Indeed they are not at the present time.
There are over 900 looms idle.
Deputy Byrne tells me there are over 900 looms idle. Is that sufficient to supply all the cloth used in the Saorstát? I doubt it. There is a certain amount of skill needed to manipulate a loom. There are not at the moment enough skilled hands. So if this amendment is carried it is a tax on raw materials and an addition to the cost of living. If Deputy Byrne interrupted me with his statement that there were 900 looms idle I should like to inquire into the age of those looms. Are they modern? Is not the trouble that the machinery is out of date, and that we have not kept up with the times? There ought to be a big export market for Ireland, and we have allowed the Scotch to collar it.
Woollen firms all over the world are complaining.
The only reason I can advance for that is the growing tendency towards unity. I have no doubt the woollen firms resemble the farmer. I believe Scotch woollen firms have a big market in the United States. They are improving that every day. I do not believe our manufacturers have done the same. They have not tried to study the fashion market or to force fashions on people. When we were considering those resolutions in Committee the Minister said, with reference to the soap duty, that it would give employment to Irish chemists. I hope this wearing apparel duty will give employment to Irish artists and that the woollen manufacturer will try and strike out distinctive lines and get them worn not only here but overseas.
How can you wear a line? I do not know how you can wear a line.
"Line " is, I believe, a technical term in the trade. I do not know if Deputy Figgis has read any of the literature connected with the Shannon scheme. If so, he will find the statement that it is axiomatic that firms that use out of date machinery must go out of trade. The trouble in the Free State tweed trade is not the need of a protective tariff, but that they are using out of date machinery. I see no reason to believe that those tariffs would enable them to get up to date machinery. I believe their hope of development lies in the development of the blanket and rug business. I am acquainted with firms who make tweed and also rugs and blankets. I believe if they developed that side they could employ their 900 looms for that purpose. They will be better off than by seeking to put a tax on raw material and increasing the cost of clothing.
There is one observation which should not be let pass without some correction. Deputy Byrne says that 900 looms are idle in the Saorstát. My information is that the total number of looms in the Saorstát is 873. Unless there are no looms working there cannot be nearly 900 idle. With regard to the 7½ per cent. of which Deputy Johnson was speaking, I have had advisory committees on most of those subjects working with me during the year. At no time was any tariff suggested about the region of 7½ per cent. Woollen manufacturers started with a demand for 25 per cent., and only after great trouble could they be brought to consider the possibility of one at 22½ per cent. The sort of promised suggestion about this two-tier difficulty was 15 per cent. on woollens and something to be raised to 33 per cent. on clothing. That was believed to be useless to the trade. Nothing in the region of 7½ was any good, and I do not believe anything in the region of 15 is any good. When you get higher than that you have to consider the two-tier difficulty, and whether it is worth while putting a tax on wearing apparel. Consider that you are taxing the raw material and driving out of existence the Irish handicraft tailoring trade which is in a very bad way. Not one of those 900 looms has been used to produce cloth of two types, the finer types of suitings on which the handicraft tailors are employed or the lower types of worsted or shoddy material which is mainly used in the country. Those are not the type of cloth that are produced by the Irish mills. It would mean that the handicraft tailoring trade would be nearly wiped out in this country by the imposition of this tax on woollens of the higher type. As the looms do not turn out the other types, the cloth worn mainly by the labourer and farmer in this country, the farmer and labourer would have to pay for the cost of the imposition whatever may be decided on.
Amendment put and declared lost.
I beg to move amendment 14:—
Before paragraph (2) to insert a new paragraph as follows:—
"That whenever the Revenue Commissioners, or any officer or officers appointed by them are satisfied that any personal clothing or wearing apparel carried in the luggage of persons travelling are intended bona-fide for the personal use of such persons they may permit such article to be imported without payment of the duty mentioned in this resolution.”
In regard to this amendment, I was asked earlier if I had not meant new personal clothing or new wearing apparel. I did not mean that. I meant exactly what was expressed by the wording in the amendment itself. The matter raised in this amendment is a matter that can be met by administration, as it is met in other countries by administration. The intention is to secure an ordinary course of administration for the convenience of travellers. Cases that have occurred in the last week or ten days have shown the necessity for some such amendment, either an amendment in the Statute, or some regulations to the officers which will be an instruction to them to proceed on the lines mentioned here. One case was mentioned to me. A person came to complain that he had actually taken a certain article of clothing from this country to England and worn it once there, and on coming back again he mentioned the fact to the Customs officer, but duty was charged him on it. It looked as if it was not worn. Even though it had been worn there was no proof unless one was able to produce the actual shopkeeper to prove that he had made the article in this country. At any rate, the demand was made at Dun Laoghaire and he paid the duty rather than go to any trouble about it. Those of us who have been abroad at all know that in other countries such as France and Italy, duties are placed upon clothing, but in the case of travellers no very close scrutiny is ever made in these matters. The Customs officers generally search for more obvious articles and commodities that would be taxed and ordinary things are allowed through in the ordinary course of events. I think that ought to be done in this country. Experience will point in that direction in order to give every possible encouragement to travellers to come to this country whether as visitors or as persons journeying to and fro.
The Minister may reply that provision of this kind will lead to a certain amount of evasion of the duty, possibly to deliberate evasion of the duty. There is that possibility no doubt, but I think the advantage that will be gained will outweigh any disadvantage of that kind. It will make for the convenience of travellers, and I think anything that makes for the convenience of travellers and leads to less exasperation and irritation on their arrival in the early hours of the morning at Dun Laoghaire and also in the case of people who are citizens of this country travelling to and fro will be of great advantage. It is quite obvious that it would be very much easier for the officers examining luggage if they had some direction given them of this kind.
Before the Minister replies, I would ask him what are the regulations in connection with this particular section? Representations have not been made to me but I have heard discussions on the question. I am not speaking from any representations made to me——
You are not so approachable.
I want to know how many suits of clothes a person coming in to this country from England or anywhere else, can bring with him. If Mrs. So-and-So comes over with a new for coat, bought, say, on the Continent or in England, and wearing it, what is the method of examination going to be. If I, for instance, go over to England and get a suit of clothes made there and come back wearing that particular suit, and with another suit in my bag, what arrangements are to be made in that instance? I understand it is the opinion of people engaged in the business here that they may give up the idea of making up high priced clothes in Dublin. The present difference in the price between here and England is so great with 15 per cent. added to the amount that a man can go over to England, buy a suit of clothes and spend a week free there on the difference between the English price and the Irish price. When it comes to high-class ladies' clothing, fur coats and things, running into one hundred guineas, the difference would mean about a month on the Continent. It may mean that or more. I should like to know what provision is to be made in this connection? I can see the case Deputy Figgis has made for his amendment 13, which would bear altogether upon the poor. But this particular amendment is, to my mind, designed to give the well-to-do people with incomes a distinct means of evading this duty. I want the Government, when they make this regulation at all, to make it water-tight for the people who can afford to pay and not to make it water-tight only for the people who cannot afford to pay, and allow the others to evade it. Reading between the two motions here, one would have the effect of keeping the heel down upon the poor, while the other would let the rich off scot free.
I am satisfied, quite apart from what Deputy Gorey said, that the intention and meaning of this amendment will, if given effect to, remove a good deal of the irritation and inconvenience which, I am sure, the Minister does not intend by the language contained in the resolution. If no regulations have been issued, and I have not seen any, nor am I aware of any, which would give a more detailed explanation to the Customs officers than is contained in the actual wording of the resolution, I think there is likely to be probable difference in applying it in different places. It leaves a great deal of discretion in the hands of the Customs officer or the Preventive officer, and that discretion may be wisely used in one case and unwisely in another. Deputy Figgis's amendment, however, does not meet the point as far as I can see. It says: "That whenever the Revenue Commissioners or any officer or officers appointed by them are satisfied." That leaves a great deal of discretion in the hands of the Preventive Officer or Customs officers in the same way as the wording of the resolution does. I remember on one occasion when I had to deal with a Customs officer who was not satisfied that a coffin contained a corpse. He went so far in dealing with me as to suggest that the coffin, containing the remains of the poor old gentleman who was making his last excursion, should be examined, and that probably it might be found that the coffin contained ammunition and arms instead of the remains of an individual. The main point that I wish to make is this, and in this matter I am speaking from experience and close observation of the activity of Customs officers since this duty came into operation.
took the Chair.
There are only two or three ports in this country, such as Cobh, Dun Laoghaire and one other probably through which people come into this country as passengers. The ships which bring them do not carry merchandise or goods. They simply carry passengers' luggage which, I believe, is defined as articles that are supposed to be worn or used by the passenger on his journey. I have known, in the case of highly-placed officials and representative public men coming into this country, that they had with them as luggage fifteen or sixteen boxes or trunks. Perhaps they might be going to the Viceregal Lodge. I assume, if they were, the trunks and the boxes would contain as many as 20 suits for the owner's use at functions while dining and wining in the Viceregal Lodge, and while they were being entertained by Ministers and other people in this country.
Not now.
I speak from experience, sir.
Deputy Davin must have been at the Viceregal.
Deputy O'Connell is obviously referring to the experience I have had in witnessing the arrival of such large quantities of luggage for the use of these people. I have known, and I do not think it is any secret to the Minister for Finance or to the Revenue Commissioners, that the luggage accompanying these people has not been examined. I am not quite sure whether or not they had a diplomatic passport or whether they diplomatically got in touch with some highly-placed official which excused them from the ordinary examination applied to other people's luggage. I am perfectly satisfied that if there is to be an examination of every box, trunk and parcel that comes with a passenger through any of the ports in the Free State, it will cause an amount of inconvenience which, I am sure, the Minister for Finance is not anxious to be a party to. In the long run that would prevent people from coming to this country, and that is the main point I wish to make in supporting the amendment moved by Deputy Figgis.
The real intention, if I understand it rightly, of a Customs examination is that it should be of a preventive character—a spot check, so to speak, but not an examination of every parcel or of every costume that may be packed in a trunk or a box. On the Continent, as Deputy Figgis explained previously, a Customs officer comes along at a border station and inquires if the passengers in the train have anything to declare in the way of dutiable goods. I have passed through five or six border stations on the Continent, and can therefore speak from experience. The Customs officer, when he puts the question, looks at the face of the passenger and tries to judge from the expression on his face whether the answer given is an honest and straightforward one to a direct question. When the Customs officer enters the railway carriage, there may be fifteen or sixteen passengers in one compartment. As a rule, only the luggage of one passenger is hauled out for examination. I suggest that the same system could be easily carried out in this country. If such a system were put into operation here you would, I think, gain a great deal from visitors who now go to various places on the Continent.
I have been observing the methods adopted by the Customs officers, particularly at Dun Laoghaire, since this duty came into operation, and I can say candidly—this is to the credit of the Minister's officials—that they have not gone out of their way to impose any undue hardship on the people coming into this country. The point I want to make is this, that if any large proportion of the 200,000 Americans who are stated to be on their way to Europe are to come to this country, as we hope they will, and if the examination of their luggage is to be carried out, strictly in accordance with the wording of this Resolution, at the ports of Cobh and Dun Laoghaire, then a week will certainly have elapsed before these people will have succeeded in getting through the Customs barriers. It is well known to everyone that Yanks and Irish-Americans coming to this country bring very large trunks with them. The examination of a large number of trunks is a very tedious process.
If the passengers who arrive here, Irish-Americans or people who have never visited the country, be held up at the ports for two or three days while the examination of their luggage is proceeding—and that is a thing which I say is quite conceivable—the result will be that that may be their last as well as their first visit. They will leave the country disgusted, and by retailing their experience to their friends may prevent twenty other people coming to the country who, under different conditions, would have come here. I do not know that the wording of the amendment moved by Deputy Figgis quite meets the case or the difficulties that, I know from experience, do exist. I would like to hear what the Minister has to say on the matter. Perhaps if more suitable phraseology were used in the Resolution, it could be made plain that no undue hardship is intended to be imposed on people visiting this country. That is an important point and ought to be attended to at once.
Deputy Gorey is anxious to know how many suits of clothes and how many pairs of boots, and so on, a passenger can bring with him into this country. He seems anxious to know how many cheap suits he may bring with him after making purchases in some house on the Strand in London. I hope the Minister will make his mind quite easy on that point. I trust that on the next occasion the Deputy visits some of the shops in the Strand in London that he will not be allowed to bring in any more of those cheap suits that he brought here on the occasion of his last visit. I understand that a memorandum has been sent to the Revenue Commissioners suggesting, for the purpose of removing any inconvenience that is likely to be caused either to people coming from the Six Counties into the Saorstát or coming into the port at Dun Laoghaire, that a Customs examination station might be set up at Westland Row or Amiens Street station where heavy luggage, such as travellers' baggage or other heavy luggage of that kind could be examined. If such a station were established it would save people from missing their trains, and from other inconveniences that they are subjected to at the present time. I do not know whether or not that suggestion has yet reached the Minister, but I submit to him that it is a most important one, and is deserving of his attention, in view of the fact that the number of people travelling into this country this year is expected to be ten times greater than is usual in normal times.
I have also noticed that there is a very easy way for passengers to evade the payment of duty on new clothes, on ladies' furs, costumes and other things. I have noticed myself, since the enforcement of the new duties on wearing apparel, that an extraordinarily large number of people walk ashore from the boat at Dun Laoghaire attired in new fur coats and costumes. They wake up in their cabins as the boat approaches the port, and then, I suppose, dress themselves in the new clothes, and walking ashore, leave the old ones in their suit cases. That is one way in which the duty can be and is being evaded. There is always a loophole in the carrying into effect of even such a water-tight Resolution as the Minister has put down in this case. The main point I want to make is this, that at passenger ports, as distinct from ports where merchandise and goods are received, that some consideration should be given to people arriving through the passenger ports of this country. I hope the Minister will make it clear to people likely to be inconvenienced as the result of a wrong interpretation being put on the Resolution as it stands by Customs officials that no such inconvenience is intended by him.
I think that this discussion is not leading very much to reality. Perhaps it would satisfy Deputy Davin that anybody wearing tortoise-shell glasses and speaking with a pronounced American accent would be let in practically without any examination. On the other hand, to stop the loopholes that he dealt with, any person answering to the description of Deputy Figgis would only be allowed the suit he wears. The position is this: the duty is imposed on all wearing apparel just as it is imposed on all spirits and tobaccos. It is always recognised that people may bring in a certain amount of tobacco and spirits without any duty being charged on them. We think it is unnecessary to have any specific provision in the Bill to enable the Revenue Commissioners to exempt certain articles. That can all be effectively done by administration. As a matter of fact, the Customs officers have instructions that all articles of clothing shall be admitted free of duty, provided they are not excessive in number, having regard to the requirements of the particular traveller, and provided that the Customs officer is satisfied they are bona-fide the private property of the traveller.
What does the Minister mean by excessive in number? That may be differently applied by Customs officers at various ports.
It is really all a case of discretion on the part of the officer. For instance, Deputy Figgis would only be allowed a certain amount, as he is more or less suspect, and, on the other hand, Deputy Davin would be allowed to take in anything he would bring with him free.
Provided he cultivated an American accent?
Yes, an American accent. It is really a matter where there would have to be discretion. You could not specify that a person must have one suit of clothes, two neck-ties, half-a-dozen collars, and so forth. We feel also, as some people might systematically endeavour to avail of the loopholes which, as Deputy Davin points out, must always exist, that the position should be that all articles of clothing are liable to duty, and it is definitely a concession to admit them free. You might have people living on the border who could cross the frontier 25 times a day with a certain amount of clothing, and we should certainly be able to stop that. If people went to Holyhead or to London very frequently, and returned with new fur coats—a different coat every time—we would, of course, stop that. In the ordinary way there will be no further examination of luggage than before the tax went on, unless there is something that arouses the suspicious of the Customs officers. I do not think anybody need fear that there will be annoyance sufficient to make people refrain from visiting this country who would otherwise visit it. To use Deputy Davin's words, we will give every consideration to passengers. We are already doing that, and instructions to that effect have been issued. If those instructions are not sufficient there will be further instructions issued. There will always be power to give exemptions, provided very large amounts of money are not concerned.
Does the Minister admit that the Customs examination is more a spot check than a careful scrutiny in connection with bags and parcels coming in?
Certainly; it does not pretend to be more than a test and a check. The question of having an examination centre at Westland Row is a matter that has been under consideration, but no decision has been come to in regard to it. If there is reason for it, we will have that done, I think that Deputy Figgis was moved to put down this amendment, not so much because he was convinced it was necessary, but because there was a corresponding provision in the section dealing with furniture, and he thought he would make this resolution more symmetrical. Furniture is a different matter altogether. There you have a single consignment consisting of furniture valued for hundreds of pounds, and the duty may amount to two or three hundred pounds on that single consignment. It was felt that where such large sums would be involved, it was undesirable that the matter would be dealt with administratively. Heretofore we admitted pianos free, but when we put the tax on all furniture it became a bigger matter and meant that very big sums would be in the hands of one individual officer. In the circumstances we thought it necessary to make a special provision legislatively. We feel the thing can be dealt with in the same way as the bringing in of small quantities of tobacco and spirits.
There is just one point that I would like to mention. I agree with the Minister that so far as my observation and my information go, the Customs examination at Dun Laoghaire on wearing apparel has been conducted in a considerate spirit and in the same manner as it is conducted at Calais, Boulogne and various frontier towns in France, Switzerland, and Italy. But whatever instructions are issued they are not being complied with uniformly, and that is why the amendments would seem to be of value. At Rosslare, for instance, instructions are being interpreted very differently.
And Dundalk.
I do not know anything about Dundalk. I am speaking of a concrete case that I am aware of at Rosslare. A member of the British House of Commons, a man of some position, whose father sat in the British Cabinet, was coming over to Ireland. He had with him three dress shirts. I do not think that number could be considered excessive. They were newly washed and laundered. The Customs officials said they were new dress shirts. As a matter of fact, they were two years old. He was told he would have to pay duty on them. I think that is a very unreasonable case, and it would be so, even if the shirts were new. There is the case of a bona fide traveller who was not a dealer or a dealer's agent, and surely he might be allowed to bring in a few shirts. It was unwise to charge duty in that instance, even if he was not a member of the House of Commons. I will give the Minister the name of the gentleman, if he likes me to. Even if he was not a member of the House of Commons, the duty should not be exacted in that manner. Such a proceeding creates odium and bad feeling, and it discourages people from coming to Ireland on their holidays. I have not the gentleman's authority to quote his name, but I will give the Minister his name privately if he wishes. I am satisfied that the case is a true one.
What we want all round is the spirit that inspires the Customs officials at Dun Laoghaire, which is admirable. That should be spread through all the Customs officials in the Free State. If the Minister can promise to do that, then Deputy Figgis might withdraw his amendment because the spirit of it is being observed. If the Minister cannot promise that, then it would be well to have a statutory basis for that principle, and that statutory basis is supplied in the amendment before the Dáil.
Deputy Cooper should realise that this duty has only been a few days in operation, and you cannot get all the Customs officers exactly to understand the new position for some little time. I will guarantee to the Deputy that the same methods will prevail in regard to wearing apparel as prevail on the Continent and elsewhere.
As the decision on this amendment will govern my amendment further down, there is a point that I would like to draw attention to. The Minister has mentioned that somewhat similar provision is made with regard to furniture. I think that provision is a little wider. It says if the furniture had been previously used by the importer, his family, or household. I heard of a case the other day—I suppose it is one which the Minister will say could only arise when the duties are imposed for the first time—I heard of a married lady who, at Dundalk, was coming back into the Free State. She had some of her husband's garments and they were not looked upon by the Customs authorities as being personal luggage belonging to the lady and she had some difficulty in getting through. If that point is not made clear, either in the instructions or in some way, difficulties may arise because ladies may have children's clothing. They may have some of their husband's garments, or, on the other hand, the husband may have some of his wife's garments. Such things happen and are not unknown. The rule will want to be relaxed somewhat, and my difficulty is as to whether that can be done constitutionally under the wording of the resolution.
The wording of the resolution appears to be very definite. Why should an equally definite resolution with regard to furniture have these other clauses? In the case of wearing apparel it should not be necessary. The wording with regard to the wearing apparel is this, that "a duty shall be charged, levied and paid on all personal clothing and wearing apparel." Then the exceptions are set out in the following section. There is nothing at all that would lead one to believe that wearing apparel which had been worn, would be free and exempt from the duty. I believe in what has been said that a great deal of alarm has been created by this proposal, and I think as a result of this discussion we ought to make it clear that we are putting this matter in such a way that it cannot cause any trouble or any interference with the tourist traffic. That would be exceedingly undesirable, and if it is necessary to alter the Bill in order that the matter might be made clear for the different Customs authorities, I think it is only in the interests of the Free State that that should be done. If we leave the Bill as it stands, and even if the orders are made clear and widely circulated by the Minister, I suppose still we will have different Customs officials putting their own interpretation on them. I hope it is a matter that will be cleared up, because it is a matter that should be made clear, and if it is not, I am satisfied that it will result in an immense amount of injury to this country.
The amendment of Deputy Figgis is not really going to make any difference in practice as has been explained by the Minister and as most of us have had experience of. "Whenever the Revenue Commissioners or any officer or officers appointed by them are satisfied" and so on. When they are satisfied that the luggage is personal clothing, they allow it through, free of duty. The practice, as we all know, is that there is no duty charged upon collars, that we bring in our hand bags, although nominally and strictly, according to the law as it will be, and according to the resolution as already passed, we are entitled to declare them as dutiable. I suppose not a single traveller, since the resolution was first passed, has declared that a collar that he carried in his luggage was dutiable or declared that he had dutiable goods when he had only a collar. I imagine that anything contained in this had its parallel in every country which has duties upon clothing, or in fact upon anything that a traveller would normally carry in his personal luggage.
There has to be, if there are to be any duties, a very general direction given to officers. I think there has to be an all-inclusive section dealing with the particular application of the duty. I imagine in this case there will be quite a good deal of dutiable property brought into the country on which no duties will be paid, brought in by travellers and individual passengers. We are not going to prevent that class of traffic by propositions of the kind, which Deputy Figgis put forward. I think, only when it is seen that there is a big material monetary advantage to be derived from a trade in it, there is not going to be much advantage to the individual traveller smuggling in half a dozen suits, as the amount of duty is not enough. You cannot compare it with the duty on spirits or tobacco. A duty of fifteen per cent. is not sufficient to encourage the risks that will be incurred by a smuggling traveller.
I really do not think that there is any occasion for the amendment of Deputy Figgis, and I imagine that in practice, when the Customs officers have a little more experience, that the irritation that has been complained of will vanish provided the Minister and the Commissioners look with reason upon the travelling public and the necessity that travellers have for carrying with them a reasonable amount of luggage. I assume that commercial travellers, for instance, who are coming to and fro, will be looked upon and will soon become known as travellers, as men who are travelling constantly, and will be allowed an ordinary, reasonable amount of luggage for their needs. The question of travellers' samples will no doubt be brought forward at a later stage, but I do not think there is occasion for the amendment of Deputy Figgis, particularly when it says that the officers are to be satisfied and are to use their discretion, which is exactly what is happening to-day.
Having regard to the Minister's statement, I am prepared not to press the amendment. I would like to say, while making that statement, that one or two cases have been brought to my attention where the officers in question, while acting with all courtesy in the matter, did feel that they had to act more strictly than experience might have taught them. However, I am not pressing the amendment, because the matter will be met administratively rather than legislatively. That is the better way, I think.
I would like to bring to the Minister's notice a matter that concerns certain members of this House and a large number of the general public. Travelling from Dublin to their homes in Donegal, they have to pass through two Customs authorities. That is on the Great Northern Railway. That is intensified by the new duties, and it is more intensified still in the case of people travelling from London and going to any part of Donegal. The traveller from London lands at Dun Laoghaire and has his luggage examined there. When he gets to Portadown, Belturbet or Newtownbutler his luggage is examined entering Northern Ireland. On leaving Northern Ireland again, say at Lifford, Ballyshannon or outside Londonderry, the luggage is again examined getting from one county to another. That will cause a tremendous amount of inconvenience. In the past summer, when we had not the large number of visitors we expected, it did cause a tremendous amount of inconvenience and irritation. I would suggest that a disposition of the Customs work could be made, particularly when passing through Northern Ireland, that would relieve the passengers of this triple examination. I think it could be done by having the luggage sealed or by some method of that kind. The luggage could be sealed by the Free State Customs officer. That seal could be inspected in the luggage van by the Northern Customs officer, and the luggage could be claimed on re-entering the Free State. I put forward that suggestion in the hope that something can be done in the matter.
The question of a sealed luggage van could be considered. I do not know whether luggage in a van from which goods were being taken and put in could be dealt with in that way. The question of the sealing of the van can be examined at any rate.
On the Continent individual pieces of luggage can be sealed.
Goods are not carried with luggage, because luggage goes on a passenger train. It is not an uncommon thing to have a passenger luggage van sealed.
I think there will be no difficulty, because we already allow sealed goods waggons to go through without further examination. If there was sufficient luggage to require a van I do not think there would be any great difficulty.
Amendment by leave withdrawn.
I beg to move Amendment 15:—
Before paragraph (2) (b) to insert a new sub-paragraph as follows:
"on hats, or on any component parts and accessories thereof, nor."
This is one of a series of amendments which I have put down for the purpose of obtaining a little information. We have been asked to agree to a general tariff on all articles of wearing apparel. So far as I can judge the general mind of the Dáil, it is prepared to agree, always with the exception of Deputy Hewat, who is a Free Trader, to tariffs under certain conditions.
The last of the Mohicans.
The conditions, to my mind are, that it should not unduly inflate the cost of living, that it should promote Irish industry, and that the industry that is to be protected should show that it is capable of expansion and capable of meeting all Saorstát demands within a comparatively reasonable time. I do not think those are unfair conditions to lay down. Up to the present we have no information as regards those last two conditions, so far as the duty on hats is concerned. All the information that I have been able to gather I have obtained from the Minister for Industry and Commerce, and I put down this amendment more with a view to getting more information from the Minister for Industry and Commerce than from the Minister for Finance.
The Minister for Industry and Commerce last week informed me that there are three factories in the Saorstát at present making men's hats and they at present employ 20 persons. As far as the Minister was able to tell me, there is no manufacture of women's and children's hats in the Saorstát at all. How long will it take that industry to expand before it can fulfil all our demands? In the meantime are we to pay 15 per cent. duty whenever we want to buy a hat? As I say, I am asking for information. It is possible that you may expand the existing industry of making men's hats which now employs twenty people. No doubt, added machinery will enable it to expand possibly 300 or 400 per cent. and employ 80 to 100 people, instead of 20. But is that sufficient justification for raising the cost of living at any rate by ten per cent., possibly not the full 15 per cent.? If it is so, why not confine the duty to men's hats and allow hats that we do not make in the Saorstát at all to come in free of duty—women's and children's hats?
It may be that the industry of making women's hats will arise. Miracles sometimes happen. If the Minister is counting upon a sudden rising of such an industry, I would beg him to bear in mind that for the manufacture of women's hats that will appeal to women a considerable amount of skill is needed. I do not know whether any Minister has ever tried to trim a lady's hat. I have on one occasion, in the cause of charity, and not even in the cause of charity was one of the sex even meek enough to wear it. So that, as I say, I am only asking for information, but I do want some justification of the tax. It is to promote an infinitesimal industry where men's hats are concerned, and an industry that does not exist and is rather unlikely to exist where women's are concerned. I would ask the Minister for Finance to consider, if he can reconcile it with the narrow margin that he has maintained, whether it would not be wiser to drop the tax in respect to this particular item.
The Deputy says he has put down the amendment as an endeavour to get further information. He asked about men's hats, and I specially referred in my reply to men's felt and bowler hats. I do not think I said I could not discover any trace of children's or women's hats being made.
The Minister said he had no information.
I had no information. The Deputy has laid down three conditions which must be fulfilled if objectionable tariffs are even to be tolerated. One is that there must be no rise in the cost of living.
No serious rise.
No serious rise. The others are that they must be a help to Irish industry, and there must be an industry capable of expansion to meet the needs. I wonder does the Deputy really believe that a tax, even fully imposed on the articles to be bought in the coming year, and the full value of the duty on men's felt and bowler hats, would cause the cost of living figure to rise one point? I do not believe it will cause it to rise .5 of a point.
Are they included in clothing or are they luxuries?
Things to cover the head are included. This is a great cap-wearing population. There are certain firms that make caps. There are people who will wear caps in preference to hats, and the people who will wear caps are the majority. I do not believe that the additional duty, even if it were all passed on, and even if no hat-making was to take place in the country, would cause a rise of half a point in a full year in the cost of living. That is one of the points.
With regard to Irish industry, if this tax on hats helps to foster the industry of cap-making, then it has done something. There are certain firms in the Saorstát capable of supplying a certain amount of the headgear required by men. In addition to that, I should say that, even prior to the question of a tariff on hats, I had got a very definite offer from a foreign firm with regard to the establishment of a hat factory in Dublin. Although I cannot say that that project has come to achievement, it is well on the way to it. If that one factory be established, I think we will be in a position to deal with most of the felt and velour hats that men will require in this country.
With regard to ladies' hats, I talk with much more diffidence. I understand the difficulty in ladies' hats is as it is with regard to caps, namely, that they must be varied in design, and the whole object is to get something which nobody else has, that what you might call massed production is frowned upon, and if a lady walking down the street finds eight examples of the particular hat she is wearing it is enough to make her burn the article. Consequently it seems to me that as I understand there are very deft, capable, and artistic designers of that type of hat in this country, and as it requires specialised production singly of the article, I do not see why there should not be an expansion in the trade already done in a small way.
Would the raw material, the shape and so on, be allowed in free? These designers do not create their own hats; they trim them.
Certainly, and at the moment the larger apparel shops in Dublin, to take Dublin alone, employ a considerable number of designers to design hats, and not in every case is the raw material likely to be taxed out of existence by any import duty we are putting on. Certain things will be taxed. They may in the course of the year disappear from ladies' hats, but, personally, I would not notice the difference if they did disappear, and I do not know if any Deputies would notice the difference. I am informed that quite good ladies' hats can be made out of the raw material which is easily imported into this country. So far as ladies' and children's hats are concerned, there is no great difficulty. With regard to men's hats, there is a chance, not merely of an expansion of an already existing industry, but, one may almost say, the starting of a complete new industry in hat-making, and, in addition, there is the impetus that will be given to cap-making.
I shall believe that we are a cap-wearing population when I see a Minister coming to the Dáil wearing a cap. Otherwise I think the Minister for Industry and Commerce has made his case. If there is any prospect of a factory for making hats I will not oppose the duty and I will ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
I move:—"After paragraph (2), (c), line 43, to insert a new sub-paragraph to read as follows":—
"On all personal clothing and wearing apparel that has been used by the importer or by his family or household."
This amendment is somewhat similar to that proposed by Deputy Figgis, but I think it is in more definite terms. It is exactly the same wording as has been included in the exemption list for furniture. The subject has been fully discussed on the other resolution, so I do not propose to take up the time of the House discussing it further, but I would press it on the Minister so that even an officious Customs official, and there are some, may understand very clearly what was in the mind of the Minister. I think that a clause of this kind ought to be embodied. It would then put the whole question beyond doubt. Furthermore, it would tend to allay that feeling that has been excited over these proposals. For these two reasons I would urge on the Minister that this particular amendment, exempting used apparel from the operation of the clause, ought to be included and, having included it, I urge that it should have the widest possible publicity.
I think I have already dealt with one of the reasons why I think this amendment should not be incorporated. There may be cases of people who travel frequently and habitually across the frontier, carrying goods which may actually be their private property and which they may be wearing, and we may want all the powers we would have in the unamended clause to deal with them. You cannot give the Revenue Commissioners a discretionary power without imposing on them an obligation always to exercise it provided they have proof that the conditions have been complied with. Conditions may be technically complied with and may be only complied with to evade the duty. We feel that in this particular case the system that enables people to bring over with them sweets, chocolates, spirits, or tobacco which they have been using and which has always operated in respect to the Customs, covers the case and is sufficient.
ACTING-CHAIRMAN
Does the Deputy ask leave to withdraw the amendment?
Provided that the matter is made quite clear. I hope that this discussion will have impressed that on the Minister. It is absolutely essential to make that clear so that people coming into the country will not be penalised.
I think it is quite clear. I never heard of people failing to go to France because of certain articles taxed there.
Amendment, by leave, withdrawn.
I beg to move:—"After the word ‘and,' paragraph 4, line 53, to insert the words ‘re-sale or for.'" Partially manufactured goods in this resolution are allowed to be subsequently exported and a refund is made of the duty, provided the Revenue Commissioners are satisfied that they have been exported in the ordinary course of trade, but as the Minister has pointed out, he is anxious that these costumes should be made in this country. I will leave out hats for the moment, because after what I have heard from the Minister for Industry and Commerce, I cannot pose as an authority on that subject. All these costumes that I know of have a certain amount of trimming, even in these days of what you may call plain costumes. I am told that such things as ribbons, feathers, trimmings, and artificial flowers, to mention only a few, are necessary in the preparation of these costumes.
These items might be called the raw materials for the making of a costume; they are of much the same character as the cloth with which the costume is made. What I want to do is to make sure that the purchaser of these garments will not have, in addition to the extra cost of having them made up here, to pay a duty on the raw materials, because it is obvious that if the purchaser has to do that, in addition to the extra expense of having the costume made here, it would be cheaper to buy it outside the country, because after what the Minister for Industry and Commerce has told us, we cannot expect to have mass production of these articles, particularly in a case like this where we will only manufacture for consumption in the Saorstát, and where the conditions of manufacturing will be somewhat different from those, say, in England, where they deal with very large orders and manufacture for different countries. While they in England might manufacture on a mass production scale, that would be impossible in the case of the Free State, in view of the comparatively small amount of trade that there will be.
The cost of manufacture, then, must naturally be increased. If, in addition to the cost of manufacture, the duty on these trimmings is imposed the cost of the article will be in excess of the cost of the imported article, even with the fifteen per cent. duty added, and we will continue to purchase these articles from the other side instead of having them made here. Therefore, unless some provision of the kind I propose is made it is quite obvious that the Minister will defeat his object. I am sure that it is only necessary to draw his attention to this in order to have the matter put right, and the words I suggest would enable goods solely manufactured in the Free State to be made from raw materials which were free of duty. The Minister has told us that it is not intended to put any duty on the cloth from which these costumes would be manufactured, nor is it, I am quite satisfied, his intention that any of the trimmings or other materials used on costumes should be subjected to the tax.
I am afraid that this will go very much further than the Deputy suggests. This will enable a suit to be sent in free of duty that merely requires a few stitches to finish it. The acceptance of this amendment would defeat the entire purpose of the resolution, and consequently we could not think of accepting it. It would mean that an article is to be admitted free if it is for further manufacture and re-sale. Further manufacture might mean putting a button on a suit.
Would the Revenue Commissioners not have to be satisfied?
I do not think that the thing could be met in that way. It would be very hard to decide at what stage of partial manufacture you would admit an article—how much would still require to be done. The Deputy has referred to ribbons. Ribbons in the roll might not be charged at all; they will be treated in the same way as cloth. Braid in the roll, or in whatever way it is put up, will not be charged duty. If there are other articles which might be classed as accessories but which ought really to be regarded as raw materials we could consider them before the Finance Bill comes along, and we could specifically exempt the things which might be included as accessories, which really ought to be regarded as part of the raw material. I am thinking now of feathers. It seems to me, without having given very much thought to it, that feathers might very well be exempted from the scope of the duty; they will not be produced here, I presume.
All the points that the Deputy wants to cover could be better covered by specifically exempting certain things that might be necessary in the manufacturing, rather than by giving the Revenue Commissioners a discretion which it would be very difficult indeed for them to exercise. If you do give a discretion to the Revenue Commissioners to admit a certain article, subject to certain conditions, the conditions would be such simply as would satisfy them that it was bona fide introduced for further manufacture and re-sale. But I do not think that the Revenue Commissioners could say: “There is not a sufficient amount of further manufacture to be done on that article, and we refuse to admit it.” They could only have regard to actual compliance with the conditions set out, and I think to adopt an amendment like this would certainly put the Revenue Commissioners in an impossible position. I will have further consideration given to the question of millinery before the Finance Bill is introduced, and I will see whether any articles are used in the making up of hats which ought to be specifically exempted from taxation. As far as suits and dresses are concerned, I do not think any of the materials would be subject to the duty. Such things as cloths, lining, braid, or ribbon would be free of duty.
I think that there is a case for something of the kind that Deputy Good has urged. Some countries undoubtedly thrive upon completely finishing partially manufactured articles which are imported.
Of course, if they are brought in partially manufactured to be re-exported, they are admitted free of duty.
Yes, I understand, but supposing they are not brought in for re-export. I am trying to think of instances, which is not easy at the moment, but I have in mind a possible case. There used to be something in the nature of a thriving kind of suede glove manufactory in Tipperary; I think there was another in some part of Cork. I understand that that is gone completely. I think I am right in saying, it is quite within reasonable probability, that the gloves were only finished there, that they were cut out elsewhere, because they were a special design, a special make. That is the kind of case that might be repeated, gloves brought in, in a partially finished condition, for Irish consumption when completed, but completed here by specially adept stitchers, let us say. That is a possibility, and I would like that there should be sufficient elasticity in the imposition of these duties to make possible the development of a finishing trade in partially-manufactured articles. We know that in the North of Ireland there are factories which do a particular part of a garment.
You have in the linen trade all the varying stages, from the growing of the flax to the finishing of an article of apparel, and there is a good deal of division of labour and specialisation. But I can imagine this happening: that goods, which are partially manufactured, can be produced much more satisfactorily and, perhaps, at such a price that even, with the duty of 15 per cent., we could not possibly compete; yet the finishing of that article might be done quite satisfactorily here for consumption within the Saorstát. We should make it possible to encourage that finishing trade. The discretion is a wide one, I know, but the Commissioners have to be satisfied and the conditions are such "as the Commissioners shall think fit." The discretion is a wide one, but I think there ought to be sufficient elasticity in this matter to allow of the possibility of the development of a finishing trade, even though the whole garment cannot be completed satisfactorily, efficiently and economically within the Saorstát. I hope the Minister will give further consideration to this matter before finally closing the door.
I am always prepared to consider the matter, but I think if we can get specific cases it would be much better to deal with them by specific enactment. This phrase that we find in the Revenue Act, "Subject to such conditions as the Revenue Commissioners may think fit to impose," applies to such conditions as will ensure that it is a bona fide transaction. They are not really supposed to judge of the wider matters.
If I get cases and send them to the Minister, will he deal with them when he comes to the financial resolutions in the Bill?
Yes.
I ask leave of the Dáil to withdraw the amendment.
Amendment, by leave, withdrawn.
I move the next amendment, which is as follows:—
To insert a new paragraph before paragraph (5) as follows:—
"That whenever the Revenue Commissioners are satisfied that any imported wearing apparel has been subsequently re-exported to Northern Ireland or elsewhere they may, subject to compliance with such conditions as they may think fit to impose, refund the duty paid on those articles."
This amendment deals with another aspect of the question, which we have been considering at some length. This amendment proposes that whenever the Revenue Commissioners are satisfied that imported wearing apparel has been subsequently re-exported to Northern Ireland or elsewhere, they may, subject to compliance with such conditions as they may see fit to impose, refund the duties on those articles. There has been a very considerable trade in better-class articles of this sort between this city and Northern Ireland. I have been informed that the better-class trade in costumes even with Northern Ireland is transacted with the city, and I am told that it is a very considerable trade. It is quite obvious that if these articles, when brought in here, have to pay duty and are then resold in the North of Ireland, it would be cheaper to bring them into the North of Ireland direct from London.
When these articles are imported here, they are subject to a 15 per cent. tax. They are sent from here to the North of Ireland. Consequently, there is that 15 per cent. added to them. If those articles are imported direct to the North of Ireland, they come in without the 15 per cent., so that that trade, which is of considerable importance between the city and the North of Ireland, will be altogether killed, except some such clause as this is put in. Let me give an example that was given to me. A lady from the North of Ireland wanted to purchase a fur coat. It was an expensive fur coat. Three fur coats were ordered over from London, in order that she might make a selection. She selected one of the three coats—a very expensive one—and the other two, which had been sent on approval, were returned. As this matter stands at the moment, the duty paid on the two returned coats would not be refunded, with the result that the coats would not be brought over here on approval, and if the lady had only one coat before her, she would probably go elsewhere to make her purchase. That is a definite case which happened, and it only proves exactly the contention I make—that a considerable trade is done in better-class goods between the North of Ireland and this city. Unless some provision is made, by way of refund of duty, that will enable that trade to be continued, a considerable injury will be done to the trade and to the city, and that, of course, will be reflected in unemployment. I would ask the Minister to consider seriously this matter, and to accept this amendment in order that this trade may be continued in the future.
I should like to support Deputy Good's plea to the Minister. In retail trade of this kind Dublin is not only the capital of the Saorstát; it is still the capital of Ireland. Retail trade of this description, in comparatively small but comparatively valuable imported articles, is still carried on by commercial travellers and others who reside in Dublin. Deputy Johnson and the Minister may put up a case against that. They may say that this is not a trade we should encourage. But I do not think they will disagree with me when I say that abrupt interference with trade of this kind—or trade of any kind—is to be deprecated, and that changes of this kind should be made as gradual as possible. If the Minister chose to make the regulations terminable two years hence or three years hence, the interests involved would be able to readjust those things, but at the present time unless some amendment of this kind is adopted, or unless some provision is made in the Finance Bill, all travellers' samples brought into the Saorstát— the Minister nods dissent—but as far as I can see, travellers' samples brought into the Saorstát, offered for sale in Dublin and offered for sale in Cork, and then exported again to Belfast, may be liable to this duty. They will certainly be liable to this duty if, being comparatively small articles, they are imported by post. The Minister's regulations, as regards travellers' samples, only cover those imported in bulk. I believe that travellers coming to Dun Laoghaire within the last ten days have been told that they must not bring in their samples there; that they must take them by the North Wall. As they are not allowed to take them direct from Dun Laoghaire to the North Wall, that involves sending them back to England and shipping them from Liverpool. I hope I am correct in that. But, at all events, that is my information.
Any interference with channels of trade of this kind should be done as gradually as possible. There are people whose livelihood is bound up in the importation of foreign goods. They dispose of them in our markets and return unacceptable goods to various cross-Channel wholesalers. The Minister may want to abolish that kind of trade. If he does, let him do so gradually. Let him give not merely the notice we have had in this Budget, but a year or two years' notice, during which, under licence, the existing state of affairs may continue, so that the persons engaged in the trade may readjust themselves.
I want to deal with the aspect of this matter that Deputy Cooper touched upon in the latter part of his statement. The case that one may make in regard to wearing apparel would apply just as effectively, I think, to any other article that may be subject to a tariff. In the case of wearing apparel, which is the subject under discussion, the effect of the resolution would be that travellers' samples, which Deputy Cooper spoke of, would be liable to duty, and that that duty would not be returnable. I differ from Deputy Cooper in his view regarding one of the essentials of the tariff, that there should be a prospect within a reasonable time that the requirements of the Saorstát will be capable of manufacture in the country. I do not think that should be an essential condition of a tariff.
I think that for a long time, possibly for generations, there will be a considerable trade with other countries in certain items of wearing apparel, as well as other commodities. That will necessitate samples of these commodities coming into the country, and, presumably, will necessitate travellers for a long time, until a reasonable scheme of distribution of commodities is evolved. While we have this system in vogue we have to legislate accordingly, and it seems quite reasonable to suggest that samples being brought into the country for the purpose of facilitating the people of the country should not be made pay an additional tax. That is to say, to pay a tax in addition to the ordinary tariff we are imposing upon articles for sale, because when we are speaking of samples we are assuming they are not brought here for sale, but are the basis for sales and the proof that they are not brought here for sale will be that they have to be re-exported. I hope the Minister will give us some assurance that some provision will be made for a refund of any duties that are imposed on travellers' samples, whether on wearing apparel or on other things. I have no doubt he will be able to find out from his advisers if other countries have been able to meet this kind of difficulty in respect of travellers' samples, and whether taxes are imposed upon such merchandise in the ordinary course of trade. I think I am right in saying that exemptions are made, or a refund paid, in respect of samples in most other countries. No exception is made in the resolution.
I understand that in respect of boots there has been an arrangement made, but that is fairly simple, as travellers' samples usually consist of a left or a right boot only. They are not pairs. I am sure some Departmental regulation can be made, so that it will be possible for travellers to bring in their samples, register them, export them, and on exportation have a refund of the amount paid in duty in respect of such samples. I hope the Minister will give some satisfaction on this side of the case, whatever he may say regarding the point Deputy Good made.
I was also going to raise this question of travellers' samples. It comes up in two ways; one that was dealt with by Deputy Cooper and by Deputy Johnson, travellers' samples coming from abroad for trade in the Free State; and also travellers' samples going from the Free State for trade in Northern Ireland, and then coming back. I have no doubt the Minister has considered it and has probably made regulations. I think it is very important that he should state clearly what these regulations are. I heard of one case where a traveller from a County Dublin firm was in Northern Ireland with samples at the time the Budget Resolution came on. On coming back with the samples he could not get them in without paying duty on things that were made in County Dublin. I am also informed of regulations by which travellers' samples that come over with travellers are exempt or subject to special regulations. I hope the regulations do not take that form, as it seems to me that that would strike a great blow at Irishmen who are acting as travellers for foreign firms. If that were so it would clearly pay foreign firms to send their own travellers in with samples instead of sending their samples to Irish agents. It is very important that the Minister should have an opportunity of stating clearly what the regulations are.
I desire to support the previous Deputies on the question of travellers' samples. I am informed there are one thousand men in the Free State area acting as agents and making their living as representatives of cross-Channel firms. They work, largely from Dublin, in Northern Ireland and have to cross the Border. It would be a great hardship on these men if, having paid duty on samples when about taking them into Northern Ireland, they could not get a refund of the duty on returning. I would suggest to the Minister, if it would not be too difficult a matter to handle, that he might allow travellers' samples in on bond, the same as is done in Australia. I think that would be the simplest way, to accept a bond from reputed firms and thus help travellers who are living in the Free State to carry on the trade they are doing with Northern Ireland. I have been informed by at least one representative of a big firm that if his company had to prepare two sets of samples, one for Northern Ireland and one for the Free State, the expense would be so heavy that they would give up business altogether. The effect of that would be to deprive a large office-staff of employment. This man has a large office in Dublin and he travels through the country with samples.
I do not know if this was done a short time ago in connection with motor-cars. The cars were brought to an exhibition recently held in Dublin, and some arrangement was made when the cars came in that the duty was paid. Several of the cars were sold, producing revenue for the Free State, but it was agreed that if any of the cars were going back the duty would be refunded. That happened recently and is probably known to the Minister for Finance. We are all anxious to help trade and manufacturers in the Free State. We are satisfied that there will be a big trade done across the Channel and internationally. Until we are able to cope with the demand here we should not be so strict that the effect of the tax would be responsible for driving a thousand agents out of business when, unfortunately, there would be no other employment for them. The case of about one thousand travellers deserves the consideration of the Minister and I feel satisfied that he will do something to meet them.
Deputy Cooper has said, and I think with a certain amount of justification, that a case has been brought under his notice where travellers' samples were held up, and the owner of the samples was advised that they should have been sent by the North Wall instead of Dun Laoghaire. I can quite understand the reason for that is that there is no recognised Customs clearance station at Dun Laoghaire, and, as far as I know, no steps have been taken for setting one up there if the accommodation were available. A case has been brought to my notice where, since the introduction of this duty, a traveller coming into Dun Laoghaire paid the duty on the samples. He afterwards went to the Six Counties area, where he did a certain amount of business, and on coming back was charged duty on the same articles. The receipt which he held, and which was given him at Dun Laoghaire, would not be recognised at Dundalk. There is something there to justify the complaint put forward by Deputy Good.
I know that travellers arrive at Dun Laoghaire with small quantities of samples. On the morning of their arrival these travellers have appointments with firms, and if they miss these appointments because they are unable to bring the samples with them, they lose the trade they would otherwise get. Samples have been held up in Dun Laoghaire, and I think some arrangement should be made, especially in the case of small parcels of travellers' samples—and these are the only samples allowed to arrive at Dun Laoghaire—to facilitate the travellers. These travellers do a trade, and must for some time continue to do so, in the Free State. I am told that 75 per cent. of the agents, or travellers, who do business in Ireland live in Dublin, or the Free State area, and the Government get income and other tax from them. There is also the point that a certain number of these agents, or travellers, have hitherto been in the habit of receiving stocks in advance. They retain the stocks until a particular article is replaced in the market by something more up to date, and when the articles they are unable to sell are being returned to England they are unable to obtain a refund of the duty they have paid.
I have a document here, which the Revenue Commissioners also received, in which complaints of this kind are made. I am informed that representations have been made, both in writing and verbally, and that they have been received with a certain amount of sympathy I hope that sympathy will result in an effective way being found for remedying the grievances which these people complain of, and that in the case of travellers who have been doing, and must continue to do, business in the Saorstát, and who arrive by passenger boats at Dun Laoghaire, Cobh, or elsewhere, they will receive facilities, and not be held up, thereby inflicting an injury on them that ought not to be inflicted.
I think there is provision made in the case of commercial travellers coming into the country. Whether that provision is all that could be desired or not I do not know. If it can be improved, we will try to improve it.
Will the Minister receive a deputation from the Commercial Travellers' Association to discuss this matter in a friendly way with him?
I am prepared to receive the deputation. There is an arrangement whereby travellers coming in with samples enter into a bond and need not pay duty, or make a deposit and have it refunded on going out of the Saorstát. I do not know whether the formalities there are too difficult to comply with. So far there is no arrangement made for samples coming in, but I see no reason why arrangements should not be made in their case also. I would be prepared to make arrangements in the case of residents in the Saorstát. However, we cannot allow goods in for sale here without paying the duty. That arrangement would be only in the case of samples for the purpose of effecting sales. With regard to samples going out of the Saorstát into Northern Ireland, or elsewhere, such as samples of goods manufactured here, there is ample power to meet that. I think it is being met sufficiently already.
I might give the Minister information of a case that came to my knowledge. A commercial traveller had to pay £28 to get his own goods. This was imposed in Dublin, and he could not get a refund.
That was an initial difficulty. I assume the difficulty was that there was nothing to show what goods he had taken out. In future a traveller must show what goods he takes out, and get a list initialled so as to get them imported free. The difficulty that did arise could have been settled if time had been allowed. This commercial traveller, I presume, wanted to get his goods in quickly, and he was willing to pay and avoid delay. In future there would be no difficulty in having samples of manufactures or products in this country sent out admitted free of duty.
Was special consideration given to cases where goods were sent out and brought in afterwards?
I would like to have notice of that. I think we can meet fully the case of travellers' samples. The point raised by Deputy Good is rather more difficult. The repayment of duty on goods that have been imported in the ordinary way, and that have been subsequently re-exported, is very difficult. The identification of articles means that very great care has to be exercised by the Revenue Commissioners, and the most stringent restrictions would have to be imposed. So far as I have examined the matter, it appears to me that in order to safeguard the revenue we would really have to make the restrictions so strict as to make the concessions nugatory. People would fill up all sorts of forms, and after spending a great deal of time and trouble to get the duty back they might not get it back, so that it would be better not to have the concession in the Act at all. I am prepared to consider the matter further if Deputy Good wishes, but, so far as I have been able to examine it, I do not think it is a concession that could be given. You will have all these classes of goods, and certain classes of goods manufactured here, and people wishing to export might try to palm them off as goods that paid duty, but that actually had not been paid, if you had not the greatest strictness in identifying the goods.
It is a matter of very grave difficulty. It is more difficult in the matter of clothes and articles like that, where the same class of article varies very widely in value, than it would be in the case of a thing like tea. You import so many pounds of tea, and you export so many pounds of tea, and the matter of the draw-back or rebate is very simple there. But you import a number of suits, say thirty to sixty suits, some of them valued at 15s. and some at £3, and then you export the ones valued at 15s. and claim on them as if they were valued at £3 each. It is a matter full of difficulties. I can only say that I would be prepared to look further into it. I would not like to be taken as giving a half promise that I would accept it.
I would like to point out to the Minister that this is quite a big trade and I am sure that the Minister does not like to do any injury to the trade. I am sure he is desirous of promoting it. I am satisfied that the different firms will co-operate with him in any way necessary for saving the revenue interests. But they are greatly upset with regard to these proposals with regard to this particular trade. Dublin has been the centre for the better class trade in Ireland, and we ought to try and continue that trade in our city and not force it to go elsewhere. I think each of us in the city and the Government and the trade itself should see how far they can co-operate in protecting this industry. I would ask the Minister not to turn this proposal down lightly, but to have a conference with those engaged in the industry and see whether some arrangements could not be come to that would save the trade from being driven out of the city.
I would like to meet a deputation of the people engaged in that trade in order to discuss the matter with them.
Would the Minister discuss the matter with the firms importing goods on approval?
I would consider it.
I do not ask the Minister for any further pledge.
Amendment No. 8, by leave, withdrawn.
I beg to move amendment No. 19:—
Before paragraph (5), line, 58, to insert a new paragraph as follows:
"That whenever the Revenue Commissioners are satisfied that any article of personal clothing, or wearing apparel, having been previously exported from Saorstát Eireann for sale to a firm or individual residing outside Saorstát Eireann, is being returned to the exporting firm by the previous consignee, they may, subject to compliance with such conditions as they may think fit to impose, permit such article to be imported without payment of the duty mentioned in this resolution."
This is the converse of Deputy Good's amendment. It has been put down to meet the case of a number of firms in Dublin, in the first instance, who export goods on approval to customers residing outside the Saorstát. Some of those customers are officials in Northern Ireland. Some of them are officers in the British Army and continue their custom to Dublin firms because they found they fitted them well. Some of them are people who left Ireland within the last four or five years. This is quite an appreciable and important trade. I know one firm whom I have consulted on the subject, and I was shown their letter file, and there were about from a dozen to fifteen letters from various customers outside the Saorstát, covering a period of a week, giving orders for goods to be sent, sometimes on approval, and even when they are not sent on approval, they are goods that are liable to be returned if they are found not to be what the person ordering them desired. In addition, there is a wider aspect of this question. There are various small industries. In Tirconaill and other places in the West there are cottage industries, lace and so on, such as embroidered lace, embroidered collars and cuffs for ladies' dresses, and the bulk of their business in this lace for ladies' dresses is an export trade. They send these goods for approval to Northern Ireland, to Great Britain, and even to France. The things that are liked are selected, and the things that are not liked are returned. I think it will be a pity if the Minister, by putting on duty, were to discourage this trade.
I could not help thinking, just now, when the Minister was explaining, how easy it was to settle these problems with regard to tea, and how difficult it is with regard to the variegated mass of things on which the duty has been put, that it was a pity he listened to the voice of the charmen on the Labour benches. He should have let this wearing apparel alone, because he is making complexities for all engaged in that trade and for himself. That is possibly out of order. Having finished it I now make that admission. But I do urge that this is not a wrecking amendment in any sense. It would be incumbent on the trader, exporting goods, on approval, thinking possibly they may be returned, to make a declaration to that effect. It might, I think, be possible for the Customs authority to fix some mark of identification on the goods, some small metal tag or something of that kind, which could be recognised when returned.
I see the danger of having other and more valuable goods substituted for them. I think these difficulties could be got over. If necessary, the exporters might enter into a bond not to do anything illegal; and where there was not an established reputation the Revenue Commissioners might make such a rule that would make it possible that this trade could go on. If they do not they will hit several firms in the city of Dublin who have lost a great many customers during the last four or five years, and who are, with difficulty, hanging on to the few customers they have left. If they lose any more of them they will find it impossible to carry on at all.
The case of goods manufactured in the Saorstát is fully met already. The goods produced in the Saorstát and exported are subject to certain conditions. There is in my own constituency a firm which sends out thousands of parcels a week. A good portion of these are returned, as they are sent out on approbation, and no difficulty is found in having this arrangement work. I am not satisfied that the arrangement could be extended to goods not manufactured here but exported from here and perhaps reimported afterwards. Where goods are made here it is fairly easy to make sure that they are actually the same goods which are returned, their export is actually effected by the manufacturing firm. The type of goods which that firm make is known, and there is practically no risk of fraud at all.
A list is made of the goods exported and you check that with the goods imported and really no difficulty exists in safeguarding the revenue, but if you extend it to goods, no matter where manufactured, I think that the risk of substitution of other goods is greatly increased. It might well pay a firm to export a certain number of, shall we say, blouses worth 10s. each and import blouses at three guineas each, and, of course, in the ordinary way, the check would be in counting the number of dozens of blouses to be sent out. On the other hand, if the thing were done by the manufacturing firm, you would see that the blouses coming in were the type which that firm were known to manufacture. I would hesitate to agree to any extension of the arrangements already existing or the powers we have.
Will the Minister say where those powers are?
There is general provision in the Customs Act which was re-enacted by the Adaptation of Enactments Act and enables goods to be reimported from the United Kingdom.
Will the Minister consider the possibility of goods exported elsewhere having their value declared and being themselves inspected by the Customs officer? The risk then is very small.
You are running up the cost of your administration.
The Minister always said that that was negligible.
I never stated that the cost of administration of the Customs was negligible. I think the Estimates will disprove that. If the Deputy can offer me, by way of information or argument, anything between this and the Committee Stage of the Bill, I will consider it. The matter may be raised in the Committee Stage. At present I do not see my way to agree to adding this new difficulty which would require a good deal of extra staff, more time and more strictness.
The Minister will lose more in tax than he will gain in revenue. I will withdraw the amendment, subject to putting down something else in the Finance Bill.
Amendment by leave withdrawn.
I move:—"In paragraph (5), line 59, to delete the words ‘pocket handkerchiefs and.'" This is one of my amendments seeking for information. Being penitent for my interruptions, I am going to save the Minister's time in making a speech. I am going to make a case for the taxation of pocket handkerchiefs. The case is that an industry for making pocket handkerchiefs is easy to create and will give a fair amount of employment to women who would otherwise contribute nothing to the home. It requires no great capital and skill, and a duty of this kind might reasonably be expected to give a certain amount of employment and cause a certain amount of money to be spent in the country that would otherwise be spent outside. That is the case I would make if I were on the Ministerial Benches.
I see two objections at least to the tax—First, it is easy to evade. A pocket handkerchief is a small thing, and a determined smuggler could smuggle six dozen ladies' pocket handkerchiefs, if he put them into his pockets and socks.
What would it be worth to him?
I am not an authority on the price of ladies' pocket handkerchiefs. I believe they cost a shilling each. Deputy Johnson can work out fifteen per cent. on six dozen handkerchiefs for himself. At the same time it will be admitted that this duty can be evaded, by anyone who wishes to evade it, on a comparatively large scale.
The second point I wish to make is that the duty on a small object like this, under our last year's Finance Act, produces an amount of irritation out of all proportion to the revenue raised. A pocket handkerchief is very often made use of as an inexpensive present at Christmas. There is hardly a family in the Saorstát which has not got relations in Northern Ireland, Great Britain or America. Consider the proportion of the relations outside who will think "What can we send as a present? A pocket handkerchief goes easily by post and does not cost much. Let us send pocket handkerchiefs." Then you have the frame of mind of the recipient who receives possibly six pocket handkerchiefs, and has to pay a minimum duty of 2s. 6d., and in addition, the 6d. statistical tax. All those petty duties cause irritation out of all proportion to their value, either in promoting industries or bringing in revenue. They cause people, who never think about the Government or the State, irritation.
The letters I get about those taxes are not from hardened old diehards or any people of that sort, but from very poor people who have had no thought of politics until they find the Government coming into their daily life. They have ignored the tea and sugar duties because they do not concern them. They used to pay them to the Customs and did not know they were paying them. All those duties on small parcels irritate, and if the Minister is determined to stand by this duty, I hope he will be able to give us a really convincing reason as to its ultimate effect on promoting industry. I give great weight and great value to that point. It will have to be a very considerable industry before it will outweigh the inconvenience and annoyance it causes.
Deputy Cooper in moving to remove pocket handkerchiefs from the list, has made a considerable case for it, but he did not mention one item. The returns show that £39,000 worth of pocket handkerchiefs were exported from the Free State. That, at any rate, is some consideration. If we have people here who have manufactured to such an extent that £39,000 worth of pocket handkerchiefs are exported they can easily double that so as to equal the imports of linen pocket handkerchiefs into the twenty-six counties.
Would the Minister say whether that £39,000 worth were manufactured altogether in the Saorstát, or only embroidered?
I believe they were mainly embroidered, because £38,000 of the £39,000 worth were exported to Northern Ireland. Be that as it may, there is at any rate some process of the manufacture of handkerchiefs accomplished here, and there is no reason to suppose that all the processes cannot be done here as well as in Northern Ireland. Two objections are put forward, one on the ground of the frequency with which handkerchiefs are sent as presents. As a person who has received a number of handkerchiefs in lieu of more valuable articles as presents, I am glad that there is a prohibition on their sending them.
How can you prevent the sending of them? You will receive them and will have to pay duty.
It is easy to drop a warning before-hand as to the sending of pocket handkerchiefs. There is a second objection, namely, the fact that the article is small and that smuggling may easily take place. Let me take another article—ties—to which the same two objections apply. Ties are frequently sent as presents, and generally are very objectionable presents, too. Ties are small articles that could very easily be smuggled. I wonder would Deputy Cooper move to remove ties from the list of apparel, or does he make the same distinction on principle as between a tie and a pocket handkerchief.
As a matter of personal explanation, I desire to say that I had drafted an amendment dealing with ties, and found that it was covered by another amendment.
There may be a considerable amount of smuggling in handkerchiefs. That is to be expected, but, on the other hand, all the handkerchiefs that people may want to bring in will not definitely be smuggled and if we could prevent a certain number coming in and get these made in the Saorstát, it would give a certain amount of employment. All that would be to the good, and it would be especially to the good on account of the special point to which Deputy Cooper refers—namely, that this is an industry which can be carried on in the home and used to supplement other earnings. It need not be carried on under factory surroundings, and it is quite well known that the making up of handkerchiefs is one of the standbys amongst women-folk in Belfast whose husbands or other male relatives are employed in the shipyards. Although there may be a legitimate objection, an objection which it may be hard to meet, with regard to the smuggling of the articles, if that be admitted, then we shall have to remove all small articles liable to smuggling from the list.
There is a further point to be noted. If you remove this very definite inclusion of pocket handkerchiefs as here under paragraph 5 of Resolution 6, I really believe that the Revenue Commissioners and their officials would be driven, by regulations, to rule pocket handkerchiefs out, because handkerchiefs are used as wearing apparel in such ways as a covering for the head.
I think the correct description of these is kerchiefs.
They are described as handkerchiefs in the advertisements which invite people to make purchases of them. Therefore I say it would be a matter of considerable difficulty to get the right shade of distinction and the proper limit drawn as to when a handkerchief was in fact not a handkerchief, and the Revenue Commissioners and their officials would, by reason of administrative difficulties, be driven simply to make a clean sweep—to say that anything that is a handkerchief was going to be ruled in under the heading of apparel, and that they would have to impose duty on it. On the point of smuggling in handkerchiefs, even admitting that they are articles capable of being easily smuggled, if that argument be pressed too far, the reaction would have to be that, in the case of innocent travellers who might land at Dun Laoghaire or innocent tourists about whom some Deputies are so much concerned when it became a matter of a protective duty, they might have to be subjected to a more minute examination than the Minister for Finance, earlier in the evening, promised. I hope, however, he will not stiffen on that point, but that while he keeps handkerchiefs included in the list of protected articles, certain steps can be taken to see that no great smuggling does go on.
I would ask the Minister to give attention to the point raised by Deputy Myles who stated that of the £39,000 worth of handkerchiefs exported, £38,000 worth were exported from Northern Ireland. It did appear that as regards the £38,000 worth of handkerchiefs, these were in the main imported first for embroidery. What I would like to ask is whether attention has been given to the possibility that the embroidery industry in Donegal may not continue if there is to be a tax on the import of handkerchiefs ready for embroidery. I wonder is that met in the regulations?
It is fully provided for already.
It is not very easy to distinguish unless there is a very careful discrimination between the handkerchief ready for embroidery and the handkerchief ready for sale. The only difference, I imagine, would be that the handkerchiefs ready for embroidery had not been laundered.
I desire to say that I had correspondence to-day from firms in Donegal and in Belfast on this matter in which satisfaction is expressed with the arrangements that exist. A difficulty does arise in cases where small parcels are sent through the parcel post. I would ask the Minister for Finance to see that where small parcels are sent through the post they will be dealt with as promptly as the larger ones are, so that the flow of this work, will not be held up or interfered with by the new regulations. The larger consignments by rail have been very promptly dealt with by the Revenue Commissioners, and what I am anxious about is that the same promptitude should be exercised in the case of the small parcels going through the post.
I also desire to take the opportunity of thanking the Minister for Finance and his Commissioners for the promptitude with which they have dealt with this work.
I will undertake to consider the question of parcel post consignments.
I ask for leave to withdraw the amendment.
Amendment 20, by leave, withdrawn.
I beg to move amendment 21:—In paragraph 5, line 60, to delete the words "and umbrellas." The umbrella industry is not one of the principal industries in the Saorstát. It ought to be, but it is not. According to the Minister for Industry and Commerce there are five firms in the Saorstát at present manufacturing umbrellas and employing 45 people. If my information is correct, all these people are engaged in repairs and not actually in the manufacture of umbrellas. As has been suggested, there is great need for umbrellas in this country, but I am sure it is not an industry we could very well promote, firstly, because we do not produce the raw material of umbrellas. That would have to be imported; and secondly, the manufacture of umbrellas requires a certain amount of skill. Possibly, Deputy Johnson is an expert at mending umbrellas, but the work would present considerable difficulty to me. I cannot find in the figures furnished by the Ministry of Industry and Commerce any indication that the Ministry will trip me up with an umbrella when I am dealing with this matter, as they did by throwing handkerchiefs in my way by saying that we have an export trade. Umbrellas do not appear separately; they appear to have come in under cover, and therefore I do not see any justification for imposing this tax. The umbrella is not an ordinary article of wearing apparel —it is an appendage. Whoever heard of a person dressed in an umbrella? Only a man whose clothes were stolen while bathing would do that. I do not see why the Minister has put umbrellas into this category. I do not believe we could ever make the umbrella industry a success here. We have not the skilled hands; we have not got the frames; we do not produce the metal necessary in their construction, and we do not produce the silk. We produce a little poplin; that is really our only silk industry. I do not think we could build up an umbrella industry in this country, and I believe we are increasing the cost of a necessary of life, for such the umbrella is in this country, by this tax.
The position here is, we import over 8,000 dozen umbrellas, at a cost of about £31,000. There are, as I said in reply to a question by Deputy Cooper, only five firms manufacturing umbrellas in the Saorstát, and these employ, approximately, forty-five people. When we speak of manufacture, I go further than Deputy Cooper and I state that the manufacture consists merely in assembling. All the materials are imported; the sticks, the ribs, the ferules are brought in and all the material for covering is imported. Leaving out of account the five firms and the forty-five employees, the sum of £31,000 worth of umbrellas are imported from Great Britain, where exactly the same state of affairs prevails. That is to say, in Great Britain the business is only an assembling business; Great Britain itself also imports the sticks, ribs, ferules and nearly all the covering. So that if Great Britain imports these things, and is able to work up such a trade that she sends over here nearly £31,000 worth per annum, I fail to see why manufacturers here or assemblers, even though they have to import all the materials, cannot do the same as is done in Great Britain.
With forty-five skilled hands?
Forty-five at the moment. As to the cost of living, to get back again to Deputy Cooper's assumption, is this going to appreciably raise it? I said here, in a previous argument, that the cost of living would not be raised by .5. It will not be raised at all by an increase in the cost of umbrellas, so that of Deputy Cooper's three essential considerations, number one, at any rate, disappears. There is going to be no appreciable rise in the cost of living by reason of this tax. On the other hand, there is going to be an aid to Irish industry here, an Irish industry, as I have admitted, founded altogether on imported materials, but our imports at the present time are from a country which itself imports these materials and which, only having assembled the article, sends the finished article over here, which we ought to be able to make equally well.
Has the Minister considered the effect of the British duty on silk? Will not that give us an advantage if we imported direct?
I want to emphasise this matter. We admittedly import all the materials, but we are faced with the fact that we bring in finished umbrellas worth £31,000 from a country which merely assembles the articles, and sends them here. If that is done in Great Britain it can be done here. We may have only 45 skilled employees at present, but we have a number of people very ready to learn and to become skilled, and I do not understand that it is very difficult to learn. One of those five firms did make an attempt to open out in one way, and to try to have the ribs manufactured in this country. That has not been a success so far. I do not know if the attempt was persevered in, but if this tax is put on, I hold it will not mean any increase in the cost of living but will give a good chance to an Irish industry that may be small at the moment, but that is no reason why it should not increase as the similar British industry has increased.
With reference to one point Deputy Cooper made, I think it is most probable that the imposition of the British tax on silk will not affect the matter at all. I presume silk, especially if the Excise duty is obtained, will be subject to drawback in exportation, so it will come to this country duty free.
I have tried to be reasonable, but even now I am not convinced. I am afraid we must have a division.
The Government will not resign if the division goes against them.
Amendment put.
I think the amendment is lost.
Division.
How many Deputies desire a division?
Deputies Cooper, Heffernan, J. Conlan and Baxter rose.
May we be noted as dissenting? It has often happened that when a division is called, the number of Deputies in the House who desire to vote are very few, and the number of Deputies who are summoned by the bell are very many. I do not know if I could create that precedent when I am challenging a division. If the Minister will let us go home, I will withdraw my opposition. The time the division will take will consume all the remaining time there is at his disposal.
A division has been called and it must take place.
The Dáil divided: Tá, 12; Níl, 47.
Tá
- Pádraig Baxter.
- John J. Cole.
- John Conlan.
- Bryan R. Cooper.
- John Good.
- Connor Hogan.
- Séamus Mac Cosgair.
- Risteárd Mac Liam.
- James Sproule Myles.
- Donnchadh O Guaire.
- Mícheál O hIfearnáin.
- Liam Thrift.
Níl
- Earnán de Blaghd.
- Thomas Bolger.
- Seán Buitléir.
- Seoirse de Bhulbh.
- Próinsias Bulfin.
- Máighréad Ní Choileain
- Bean Uí Dhrisceóil.
- Séamus Eabhróid.
- Patrick J. Egan.
- Osmond Grattan Esmonde.
- Desmond Fitzgerald.
- Thomas Hennessy.
- Seosamh Mac a' Bhrighde.
- Donnchadh Mac Con Uladh.
- Liam Mac Cosgair.
- Maolmhuire Mac Eochadha.
- Tomás Mac Eoin.
- Pádraig Mac Fadáin.
- Risteárd Mac Fheorais.
- Pádraig Mac Fhlannchadha.
- Patrick McGilligan.
- Seoirse Mac Niocaill.
- Liam Mac Sioghaird.
- Pádraig Mag Ualghairg.
- Martin M. Nally.
- John T. Nolan.
- Peadar O hAodha.
- Mícheál O hAonghusa.
- Ailfrid O Broin.
- Seán O Bruadair.
- Risteárd O Conaill.
- Tomás O Conaill.
- Parthalán O Conchubhair.
- Máirtín O Conalláin.
- Liam O Daimhín.
- Séamus O Dóláin.
- Eamon O Dubhghaill.
- Peadar O Dubhghaill.
- Pádraig O Dubhthaigh.
- Aindriú O Láimhín.
- Séamus O Leadáin.
- Fionán O Loingsigh.
- Domhnall O Muirgheasa.
- Pádraig O hOgáin (An Clár).
- Máirtín O Rodaigh.
- Seán O Súilleabháin.
- Mícheál O Tighearnaigh.
- Seán Príomhdhail.
Tellers: Tá, Major Cooper, Mícheál O hIfearnáin. Níl, Séamus O Doláin, Liam Mac Sioghaird.
Amendment declared lost.
Resolution No. 6 is now before the Dáil.
Would I be in order in moving the adjournment of the debate? It is rather late now for me to make any statement on this matter and I desire to do so.
What matter does the Deputy desire to speak on?
I hope the Deputy will prevent us having to vote against him.
The Deputy has only three minutes left.
I beg to move the amendment that stands in my name.
As I understand it, we are dealing with the main resolution. Before we pass to Resolution No. 7, I would like to say a word on No. 6, and I will make my remarks very brief.
The first amendment is mine. It has reference to Resolution No. 6, and it has not been discussed.
Deputy Heffernan has the right to speak against the motion—"That the Dáil agree with the Committee in Resolution No. 6."
But the Deputy desires to speak about an amendment.
My amendment has not been moved, and I am now moving it in opposition to the whole resolution.
You can now only speak against the resolution.
You are speaking against time now.
The Deputy is in order in speaking against the resolution.
I want to be in the position of putting this to a division if necessary.
You can have a division now if you wish.
The question is that the Dáil agrees with the Committee in Resolution No. 6.
Before that question is put, I would like to make a few remarks in regard to Resolution No. 6. I do not want to intervene at any great length——
In that case I will move the adjournment until to-morrow at 3 o'clock. I would like to give notice that the motion for the adjournment to-morrow will be after the Financial business is completed. If we have to sit until midnight, or the small hours, we must get the Financial Resolutions through.
Will we have an opportunity of discussing that motion to-morrow? I am very anxious to know if we are going to sit as late as this every night. It would not be fair to do so from this on to the 26th June.
The Dáil adjourned at 10.30 p.m. until 3 o'clock on Thursday, 7th May.