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Dáil Éireann debate -
Thursday, 31 May 1928

Vol. 23 No. 20


The Dáil went into Committee.
(1) Income tax shall be charged for the year beginning on the 6th day of April, 1928, at the rate of three shillings in the pound.
(2) Super-tax shall be charged for the year beginning on the 6th day of April, 1928, at the same rates as those at which it was charged for the year beginning on the 6th day of April, 1927.
(3) The several statutory and other provisions which were in force during the year beginning on the 6th day of April, 1927, in relation to income tax and super-tax shall, subject to the provisions of this Act, have effect in relation to the income tax and the super-tax to be charged as aforesaid for the year beginning on the 6th day of April, 1928.

I move Section 1. This is the section which fixes the rate of income tax and the rate of super-tax.

There are two amendments down to this section dealing with practically the same thing. The first amendment is in my name and the other in the name of Deputy MacEntee. Deputy MacEntee's amendment, if passed, would not cost as much as mine, but it would satisfy me. If Deputy MacEntee's amendment is moved I am prepared to withdraw mine and support his.

Deputy O'Connell's amendment is the wider, and that is why it comes first. It proposes to make the greater change.

Amendment 1:—Before sub-section (2) to insert a new section as follows:—

Section 16 of the Finance Act, 1920, is hereby amended by the substitution of one-sixth for one-tenth as the proportion of earned income to be allowed as reduction."— (Tomás O Conaill)—not moved.

On behalf of Deputy MacEntee I move amendment 2:—

To insert before sub-section (2) a new sub-section as follows:—

Section 16 of the Finance Act, 1920, is hereby amended by the deletion of the words "equal to one-tenth of the amount of that income" and the substitution therefor of the following:—

(a) in respect of an income of less than £400, equal to one-sixth of the amount of that income; and

(b) in respect of an income in excess of four hundred pounds, £66 13s. 4d., together with a sum equal to one-tenth of the amount of that income in excess of four hundred pounds.

I rise to support this amendment. It will be seen the amendment proposes to give a greater proportion of relief than is given at present in the case of small earned incomes. In this case the limit to which the one-sixth relief would apply is put at £400, and above that figure there is lesser relief given. In Northern Ireland and Great Britain, for the past two or three years, the amount of relief given is one-sixth up to a higher limit than is indicated here. I think we have the Minister's own statement, made two or three years ago, that even one-tenth was not a sufficient distinction to make as between earned and unearned incomes. A case has been made so often for this that there is hardly any necessity to go into it at any great length. I have taken this proposal of Deputy MacEntee's in preference to my own because it is not so wide, and therefore would not cost so much from the revenue point of view if it were agreed upon. I trust the Minister will see his way to grant this concession that has been pressed upon him from various parts of the House for a great many years.

I am unable to accept this amendment because of the cost that would be involved. I have had an estimate prepared of the amount of revenue that would be lost if this amendment were accepted. The amount is about £100,000. The Deputy is quite correct in saying that this matter has been the subject of discussion in this House on former occasions. He is also correct in saying that I have admitted that there is a good deal of force in the arguments that have been used. But there is another side to the case. We cannot give reliefs on the scale that can be given in Great Britain without losing a much greater proportion of our revenue. Reliefs which, in the British case, might perhaps cost one-tenth of the revenue would be likely in our case to cost say one-fourth of the revenue. A much greater proportion of British income tax is obtained from people with very large incomes than is the case here, and consequently exemptions of this character do not affect the total revenue to the same extent.

I cannot see that we will necessarily be able to follow the British precedent in the matter of reliefs because of the conditions being different. I do admit, however, that we must take note of what is done in countries that are close to us and in countries with which many people in this State have a great many relations. Consequently, I admit that our attitude cannot remain unaffected by reliefs that are given in Great Britain. As these particular classes of reliefs for the small taxpayers, either by way of exemption of portion of earned incomes or of allowances for children, have been increased in Great Britain, I do feel that we have reached the position where, to some extent at any rate, we must follow suit. If we are to follow suit without increasing the rate, we can only do it by a reconsideration of our whole scheme of allowances. At present allowances in respect of children and in respect of earned income are given to the very rich as well as to the very poor. Even this proposal, moved on behalf of Deputy MacEntee, will give a greater relief to the rich man than to the poor man. A man with say £400 per annum would get about £2 per annum relief if this amendment were passed. A wealthier man would get double that.

It seems to me that if we are to aim at giving greater reliefs to the poorer taxpayers we must examine the whole system. I see no reason why, in the case of a man with one, two, three or four thousand pounds a year, 25 per cent. of his income should necessarily be at half rate. It is half rate at present. That is because there is uniformity throughout, and all reliefs are given to the rich taxpayer as well as to the poor taxpayer. If we are to give additional reliefs to the poor taxpayers I feel that we must examine the whole system and I would propose to have a departmental examination carried out and to have a scheme for the re-casting of reliefs prepared that would enable us to give concessions to the poorer taxpayer either by way of exemption of a greater proportion of earned income or of greater allowances in respect to children. But that is a matter which presents a good deal of difficulty and great care would have to be taken in the drawing up of such a scheme to see that it did not involve injustice and that it did not make the lot of certain classes of taxpayers worse than it is at present. It is not a matter that can be done now.

I feel unable to accept this amendment now. If the amendment were passed, there would be, as I have stated, a loss of revenue to the extent of about £100,000 a year, and that loss would have to be made up. It could not be made up at this juncture by a re-casting of the system of reliefs because that would take too long. It could only be made up by some fresh imposition of taxation. I am not able to say at the moment what amount could be obtained by a recasting of relief, but it is quite clear that by going over the whole system a substantial amount could be obtained that could be devoted to the relief of the smaller taxpayers, I would propose a scheme prepared along these lines recognising the increase of these reliefs in England, and the feelings of the people in regard to them make it necessary for us to go some distance in that direction. However, it is impossible at the present stage to accept an amendment of this kind unless we went out for an increased rate, or the imposition of a new tax to make up the amount of revenue that would be lost.

Is it not strange that the Minister has not already held an inquiry of the type indicated? With the experts at his disposal, an investigation such as is necessary for overhauling the reliefs would not take the long time he seems to think. It would be possible surely to get work of that particular character done in a fortnight or three weeks at most. As this burden is to press on the taxpayers for a year I think the Minister, if he is to have a re-casting of the whole question of reliefs, ought to be prepared to set up an inquiry at once so that the taxpayers this year would have the benefit of it.

It would be impossible. At this stage if we were to make substantial changes of the character indicated it would interfere with our collection. Preparation has to be made in advance for things of this character, and with any attempt to rush them through, while theoretically you might concoct a scheme it might have faults, or you might succeed in getting it through without faults, but the passage of it and the disturbance it would cause in the case of nearly every taxpayer would involve delays in the collection of taxes which would mean that our collection would be substantially short for the year.

Does not that mean that practically all the amendments are ruled out? There would be the same difficulty in respect of any one of them if passed, so that we might as well not consider them at all.

Any amendment which involves a substantial loss of revenue is impossible of adoption at this stage unless we are prepared to find the revenue that would be lost by some other means. In my Budget proposals I provided for the collection by means of an extra staff, and other methods, of £250,000 more than the Revenue Commissioners had estimated as the amount that would be obtained. If I had not devised a scheme to obtain that amount of money it would have been necessary to impose taxation to obtain it in some other way. If we are to make changes in regard to income tax by relief at this stage—which means a reduction of this year's collection—we must, in order to keep ourselves right and face to face with people from whom we would be borrowing money, take some other means of replenishing the Exchequer to the extent it would be cut short by any steps now taken.

The purpose of the amendment is to call attention to the very serious discrepancy in the amount of the income tax as between unearned and earned incomes by the smaller income taxpayer. The rate of income tax here is 3s. in the £ and in Great Britain it is 4s., but in actual fact the possessor of earned income which does not exceed something in the nature of £380,000 in the Free State pays rather more in the way of income tax than in Great Britain. That only applies to earned income. With respect to unearned income the taxpayer here has undoubtedly a very great advantage. A married man, who has no allowances in respect of children, here on an income of £300 a year has to pay £3 7s. 6d., but a man with a similar income and in the same circumstances in England would only pay £2 10s. If a man had an unearned income and were living at his leisure and drawing his income from investments, he would pay £11 5s. here as against £15 on the same income in Great Britain. I think that is a very serious injustice. I believe—though I have not been able to secure the necessary data to make any sort of exact calculation, because although I put down a question intended to secure these figures the Revenue Department or the Ministry of Finance were not able to furnish me with them—that the remission asked for in this case will not cost anything like £100,000 a year. First of all, I have looked at the allowances which are granted in respect of earned income, and I find they amount approximately to only one-seventeenth of the total income payable, and at the same time they represent approximately one-tenth of the income which is earned income. I have not been able to make an exact calculation, but assuming that everybody would secure the maximum remission of tax under this amendment, I believe that the number of taxpayers in respect of whom it would be claimed would not exceed more than 30,000, so that at the very outside the amendment, I think, would not cost more than £60,000. On the other hand, you have a considerable number of taxpayers whose incomes range between £250 and £400 a year, and the amount of allowances in respect of them would be something in the neighbourhood of 30s. per taxpayer. I believe that by far the greater proportion of income tax is paid by people whose incomes lie between the range of £250 to £450. The maximum amount which can be claimed in respect of any income, as I said before, would not be more than £2 per head as regards the greater number of income taxpayers, under this amendment.

£4 per head.

Applied only to earned incomes. Remember, I am leaving out for the moment the inconsiderable number of people who do not have to pay over the 1/6 rate, and taking into consideration the fact, as I have said, that by far the greater number of income taxpayers have incomes not exceeding £400, the total cost of this amendment, if accepted, would be something in the neighbourhood of £45,000. The Minister may not see his way to accept an amendment which would cost that amount at this stage. There is another aspect of the question, and if he considers it he might see his way to do something and that is: The present condition of affairs presses most heavily on the married people. In the case of single people I admit the hardship is not so great. If the Minister would see his way to accept this amendment in respect of married incomes only, that I think, would reduce the actual cost to something like £30,000. If, of course, he cannot see his way to meet us, we will regret it, but if he gives a promise that he will endeavour, as already suggested, to set up a Departmental Committee and to have recommendations for next year's Budget considered and if he would have considered the whole question of allowances, accepting the principle that greater relief should be given to men with smaller incomes than is given under the present scale, I do not think that we would press the matter to a division.

There is just one preliminary point. I think the Deputy is making a mistake when he says that only relief to the extent of £2 is received by any taxpayer.

Any appreciable number of taxpayers.

But there would be a substantial number who would receive relief at the full rate and would be relieved to the extent of £4. There is that difficulty in the amendment and in practically all the amendments put down on the Order Paper, namely, that while they give relief to smaller taxpayers they give greater relief—in some cases double, and in others more than double—to the well-off taxpayers. I can only promise that I will at once set some of the officials of the Department to work on the re-casting of the schemes of relief so as to let the reliefs fall entirely, or almost entirely, on the poorer taxpayers so as to be able, at any rate, to go a considerable distance towards putting our reliefs towards smaller taxpayers in line with those given in an adjacent country.

I can quite see the Minister's difficulty. It is something, however, to have brought him even so far after five years of agitation of one kind or another. Do I take it that his statement covers the second amendment in regard to children?

In regard to amendment 5, I think the matter could be dealt with this year. Am I now to take it that amendments 3 and 4 are not moved?

I presume that the situation now is that amendment 1 was not moved and that leave was asked to withdraw No. 2. Amendments 3 and 4 will, presumably, not arise.

I am afraid that amendment 4 is not in order, and I would be prepared to argue a point of order on it.

It is the principle of amendment 4 that we want to raise.

Very good. Then amendment 2 is withdrawn, and we will leave the point in regard to amendment 5 to be raised when we come to it.

Amendments 3 and 4 both raise the question of relief for children. Amendment 3 is the wider amendment and will therefore be taken first. In regard to paragraph (b) of amendment 4, there is a point of order to be raised.

In regard to amendment 4, I take it from the Minister's statement in connection with amendment 2, that this is one of the things which he will include in his inquiry. I understood him to say that the question of giving greater relief in the case of children is to be included. If that is the case, I take it that the position in regard to this amendment is the same as that in regard to amendment 2. If I get a definite promise that the Minister will include in the inquiry the question of giving more substantial relief than is given in the case of lower incomes, I am satisfied.

I indicated that that and the question of earned income will be discussed by the inquiry.

When will we have an opportunity of discussing these proposals? I am not in entire sympathy with what the Minister said on the question of earned income. There is a good deal more behind this proposal than possibly appears on the surface. I am not going to discuss it now, but I would like to have an opportunity of doing so if any drastic action is proposed to be taken. I am in entire sympathy with the other suggestion, but on this one I would like to see more clearly before agreeing to it.

I do not know if it would be possible to find an opportunity of discussing it before the Budget. It probably would be, and, in any event, towards the end of the autumn, if the Deputy would inquire, I could have a scheme ready and could see whether there was any way of discussing it in advance.

The Minister sees the difficulty. If he bases his Budget on the altered proposal in regard to earned income tax and, if we discuss it later, we will be told that it will upset the basis of the Budget. Therefore, we will be precluded from discussing it, as Deputy de Valera was to-day.

A discussion without a decision could be arranged, as it was arranged yesterday evening in connection with the tariff on flour, whenever the Minister is prepared to say that his investigations have had some definite results.

Amendment 3.—Before sub-section (2) to insert a new section as follows:—

"Section 21 of the Finance Act, 1920, is hereby amended by the substitution of sixty pounds for thirty-six pounds and of fifty pounds for twenty-seven pounds as the deductions in respect of children."—(Not moved.)

I move:—

To insert before sub-section (2) a new sub-section as follows:—

Section 21 of the Finance Act, 1920, is hereby amended by the deletion of the words "in respect of one child to a deduction of £36, and in respect of each subsequent child to a deduction of £27," and the substitution therefor of the following:—

"(a) In respect of an income of not more than £400 to a deduction in respect of one child of £50, and in respect of each subsequent child to a deduction of £40, which deductions are referred to hereinafter as the basic allowances; and

(b) in respect of an income of more than £400, to proportionate deductions in respect of one child and each subsequent child, which proportionate deductions shall in each case be equal to the basic allowance or allowances, less a pro rata reduction or reductions therein of twenty per cent. of income in excess of £400."

This proposes a graduated scale of allowances. Where the income does not exceed £400 the allowance would be £50; where it does not exceed £500 it would be £40; where it does not exceed £600 the amount would be £30; where it does not exceed £700 the amount would be £20; and where it does not exceed £800 the amount would be £10. If that is the effect, then the amendment would mean that people in receipt of incomes of, say, £600 and upwards would get less relief than they are at present entitled to. Consequently, the amendment is a proposal to increase the charges so far as certain people are concerned and is, therefore, out of order.

That is the effect of paragraph (b).

Could it be held to contravene Standing Orders if it was intended to restrict allowances and not to impose a charge?

Is the Deputy prepared to agree with the Minister's interpretation as to the meaning of paragraph (b)?

Perhaps I would be permitted to explain the effect of the amendment before agreeing to the Minister's proposition. The amendment was devised to meet a well-founded objection to any flat rate relief in respect of children or earned income which undoubtedly benefits the richer income taxpayer as against the poorer. Under the amendment the effect would be as the Minister has stated, but we feel that it is a desirable principle to introduce into income tax law because, as it is at present, an income taxpayer with an income of £300 and with one child would receive a remission in respect of that child of £2 14s. If he were fortunate enough to enjoy an income of £900 he would receive in respect of one child a remission of £5 8s. That is not a just basis of taxation. Under the amendment an income taxpayer with an income of £310 would receive a remission of £4 in respect of one child. If his income were £500 the remission would be reduced to £3. If his income were £800 the remission will be reduced to £1 10s., and if his income were £900 he would receive no allowance. I need only submit, in answer to the Minister's point of order, as I said before, that this may be held to impose a charge, but it is rather a removal of a privilege or allowance. In view of that, I feel that the Dáil would be in order in considering the amendment now before it.

Is this to the point of order? I want to deal with the point of order.

After I have made my statement I will leave it for you to judge, sir. The principle that is sought to be established—as a matter of fact it is not a principle, because it is in every Act—seems to be that a greater amount should be allowed for the first child and a lesser amount for every additional child. I would like to point out to the Minister that it should be the other way round, that there should be a certain amount for the first child and an increasing amount for every other child.

The Deputy is giving a point of view, not a point of order.

I have got it in, anyway.

The amendment is really in two parts, part (a) and part (b). Part (a) is, in effect, the same as Deputy O'Connell's amendment, No. 3, except that instead of £60 it substitutes £50, and for £50 in respect of every child after the first it substitutes £40. In regard to the second part of the amendment, it is, I think, now admitted that it would have the effect of increasing the income tax which would be payable by certain persons. That, I think, is imposing a charge. The Deputy is quite in order in moving for any relief in taxation, but the part of the amendment which finds money for the Minister by increasing the charge on other taxpayers is out of order. The point is, perhaps, rather a fine point here, but if it were extended in any way I think it would be quite clear that it would strike at the root of the whole principle by which only the Minister can move for the imposition or increase of a charge. The Deputy's amendment, to be in order, should be to the effect that "Section 21 of the Finance Act of 1921 is hereby amended by substituting £50 for £36 and £40 for £37." I think that is the form in which it should be proposed, because to remove the distinction between people under £400 and over £400, as proposed, is out of order.

We may take it then that for the moment point (b) has to be withdrawn as out of order, and we find the Minister in the embarrassing position of possessing more money than he otherwise would have. We might be allowed to relieve any anxiety he has on his mind by suggesting that when he comes to consider an amendment, and when he decides to put down an amendment for the purpose of dealing with this matter, an amendment framed somewhat like the amendment that is now withdrawn might fulfil the point. When the Minister comes to consider something to substitute for the whole of Section 4 he might consider doing what Deputy MacEntee is not in order in proposing. Having envisaged that possibility, and now envisaging the whole of Section 4 as if he had proposed it, which would have been in order, he might be able to indicate that the principle of that amendment would be one which he would be prepared to consider—that is to say, increasing the reliefs to what I would call the hardship limits. Income tax on a man with a salary of up to £400 is rather different, say, to income tax on a man who has £10,000. It is rather a hardship in that it hits at necessities. What I am suggesting to the Minister is that it would be very little use our moving that first part of the resolution alone, and he might indicate whether he would be prepared to consider himself the principle of the whole amendment, (a) and (b) together, sympathetically.

I can express general agreement with the principle. In regard to the method of what I would call fixing layers of taxation, I would like to say that that presents difficulties.

I do not think the Minister is right in that description. It is a pro rata reduction of 20 per cent. It does not go in strata. It is gradual.

I just confine myself to saying that I accept the general principle that it would be a good thing to increase the allowances to people with small incomes and find the means of doing that by taking it off people whose incomes are substantial.

Could we not do it at this stage?

We cannot do any of these things at this stage, as it would mean interference with the principles on which assessments of tax on practically all taxpayers would be fixed. It is impossible to take on anything like that at this stage without, as I have said, taking the staff away from the straightforward collection of tax, and without involving our falling short substantially of the Estimate.

Would the Minister give any data with regard to the effect on revenue of this proposal?

No. I have not had time to have it examined.

Might I suggest to the Minister that this is a line along which we should move cautiously. In reply to a question of mine, the Minister stated to-day, on the question of super-tax, that in the years 1923-24 we had 1,361 payers of super-tax in the Free State. In the year 1924-25 the number was 1,344. In the year 1925-26, the number had fallen to 1,197. Last year, that is, 1926-27, the total number of super-tax payers in the Free State was 1,181, showing a falling-off of 180 in a period of five years. If we are going further to burden that particular section of the community with heavy taxation in the future, we will have an even larger diminution in the number of these taxpayers in the future than we have had during the five years I have mentioned.

I would rather like to express agreement with the caveat entered by Deputy Good. The idea that we are going to benefit the State permanently from a productive point of view by actually increasing the load upon the big taxpayers is unsound, in my opinion. I say that quite frankly, and I do not want that there should be any doubt about it. What we are dealing with here for the moment is a restricted area in which income taxation is a hardship taxation as distinct from taxation which is more directly inimical to production. I say quite deliberately that I believe this country wants people who are earning big incomes and getting them. I believe on that basis you will get more production and more enterprise in industry. This thing is not intended to deal with that general principle. We are dealing with a segregated area where you have actually hardship to income taxpayers.

I feel constrained to make one or two remarks. I agree with what has been said by the last two speakers. It is quite impossible to lay down hard and fast rules and to say that because the head of a family is earning £200 or £300 or even more per year, his family is necessarily in a state of hardship. There are many cases where the head of the family is earning an income and members of the family are also earning and it becomes really a matter that is quite difficult to deal with. I know many cases where the total income may be brought in by the head of the family and may amount to £500 or £600 and where it is more difficult for that man to bring up his family than in the case of other men where the total income amounts to considerably more, even though the head of the family is earning only £200 or £300.

Would I be in order in dealing with sub-section (b)?

The amendment which is properly before us in lieu of amendment 4 on the Paper is this:—

Before sub-section (2) to insert a new section as follows:—

Section 21 of the Finance Act, 1920, is hereby amended by the substitution of fifty pounds for thirty-six pounds and of forty pounds for twenty-seven pounds as the deductions in respect of children.

In view of the points raised by the Minister with regard to an investigation, on which I presume the amendment will be withdrawn in the end, the Deputy is in order in referring to the actual text of the amendment as on the Paper.

In that case, I must say that I have more sympathy with the latter portion of the amendment than with the first portion. The Finance Act here and the Finance Act in England follow out much the same principle as the amendment—the first child should deserve more consideration. The principle appears to be that the first child is more welcome than the second.

That is an arguable point.

One in family would be an ideal family, according to that. Well, that is not so. I would be inclined to leave the amount in respect of the first child as it was and increase it to £40 in the case of the second and subsequent children. It is a joke to have it otherwise. Where there are four, five, or six in family it is at that period that the cost of the family begins to increase and it is there you ought to mark your appreciation because it is there relief is needed. Relief is not so much needed in the case of the man with one child. It is the second and subsequent children that really should get consideration. We ought to depart from the old principle altogether and strike out on a new line. That is the right thing to do. There is no disputing the fact and when you examine the subject on its merits you will realise there can be no dispute about it. I recommend the Minister to adopt that line.

I look upon this matter from a very different point of view. I think the amendment would place a limit on the industrial capacity of a man, and I look upon it as more or less putting a premium on inefficiency. I do not think that the amendment ought to be accepted, or that it should go to form the basis of consideration by the Minister in the near future. If the amendment were introduced on a broad scale, giving equal rights to every citizen, no matter what his earning capacity or his income might be, then it could be reviewed from the broader aspect; but when it narrows down the position to persons earning only a limited amount of money and specifies that those persons only should get special relief, it more or less creates an anxiety to earn only that limited amount. If it were put upon the broad basis, say £50 for the first child, £40 for the second, and £40 down along, it would be more reasonable and possibly would be acceptable to the country in general. To ask the Minister to form a basis on the views as expressed would not be at all right. It does not lend itself to progress or universal expansion of any kind. It is more or less a premium on indolence, and I hope the Minister will not consider it.

It puts a premium on more than that.

I do not know whether it is necessary to reply to the points raised, but I should like to make a few remarks in regard to them. As regards Deputy Connolly's point, I do not see how an amendment of this description will at all tend to curb enterprise. If an income of £900 is not a greater inducement to a man than any allowance he might be able to secure under this amendment in respect of income tax I am afraid nothing will stimulate that man either to industry or enterprise. In connection with Deputy Gorey's criticism, I must say I have a great deal of sympathy with his point of view, but at the same time I think the idea that remissions of income tax in respect of children stimulate the production of large families is a very ill-founded one.

It is only a consolation prize.

As Deputy Flinn says, it is only a consolation prize. The fact that a man is going to secure a remission of £5 per year in respect of one child is certainly not going to induce him to incur the expense, if you like, of having to maintain the child.

What about providing for them if they are there?

If a man cannot provide for his family without depending on the income tax collector to help him the children are likely to go hungry before they die.

With reference to the point raised by Deputy Good, he quoted certain figures I gave to-day in answer to a question, but I do not think his deductions are justified. In respect of the latter years shown in the table there are assessments still to be made. These are super-tax matters in connection with which there is great difficulty and delay. I do not think there has been the decline in the number of persons liable to super-tax that Deputy Good fears.

Would not the same number be outstanding each year?

If the Deputy will look at the returns he will see that the numbers in the years 1923-24 and 1924-25 were practically the same. In respect of 1925-26 and 1926-27 there are still assessments to be made. With respect to the question of not imposing a heavy burden on the people with larger incomes there is a fact to be remembered that they have at present a substantial advantage in the 3/- rate as compared with the 4/- rate heretofore, and the loss of certain allowances would not be a very great factor in their cases.

There would be the higher cost of living.

Amendment, by leave, withdrawn.

I move amendment 5:—

Before sub-section (2) to insert a new section as follows:—

Section 21 of the Finance Act, 1920, is hereby amended by the substitution for the deduction specified in that section of a deduction of eighty pounds in respect of any child who is over the age of 16 years at the commencement of the year of assessment and who is receiving full-time instruction at any university, college, school or other educational establishment.

This is an amendment which I am satisfied is not of such a nature that it will impose a specially big drain on the Minister's resources, even this year, and for that reason I would urge him to accept it. Its purpose is to give greater allowances in respect of any child over the age of 16 who is being educated at a school, college or university. It seems perfectly ridiculous that the same allowance is given in the case of a baby six months old and a boy or girl, eighteen, nineteen or twenty years of age who may be maintained at a university. That is absolutely unsound in principle, and, from the point of view of encouraging people to keep their child for a year or two or longer at school, I think it would be well from the point of view of the community as a whole if this concession were given. At the present time the amount of actual relief to the general taxpayer, taking half the standard rate he would be allowed off the income tax, would be £2 14s. 0d. Under my amendment that would be increased to £6. Even that £6 relief is not a very big inducement to a man to keep his child at school for a year or two longer, but it is something. It would not, in any case, cover the cost of books or if it did it would not be very much more. I do not believe that this concession would cost a very great deal and I believe that it would be advisable from many points of view to have these allowances given in the case of this particular class of children. While we are prepared to give way on the others and leave them over for the next year, I think this is one which the Minister could very well give way on even in the present Budget.

With reference to this particular amendment, the best estimate that I could make as to the cost is about fifty thousand pounds. This amendment has this disadvantage —perhaps Deputy O'Connell might not think it a disadvantage, but it has this quality—that the amount that the smaller taxpayer is likely to get out of it is very much less than in the case of the larger taxpayer. If you take a man with £500 income who has one child receiving full time instruction whether at a university, college or other educational establishment, the amount of extra relief that he will get will be £3 6s. 0d. per annum. A better-off person would be likely to have more than one child obtaining this full time instruction at this age. You might have a person with four children receiving such instruction, and that person would get relief to the amount of £30 per annum so that most of the benefit of this relief would go in actual money, not to the people who are in the very low ranges of income but to the people who are fairly well up. I do not think that this could be adopted this year but I would just like to hear the opinion of the Dáil as to whether substantially greater relief should be given in respect of children who are, say, at universities or such institutions than in respect of other children.

That is not a matter that I remember hearing debated at any length in the Dáil, and, as we are considering the whole question of relief, I would be interested to hear what is the general opinion of the Dáil on this question. At present the highest relief for a child is £36. Would the Dáil be prepared to accept the principle that in respect of a child at a university or a training college or some such institution the total of the ordinary amount of relief would be doubled or more than doubled? Without being able to accept the amendment at this stage, but in view of the proposed overhauling of the whole system of reliefs in these cases, I would like to hear that principle discussed— as to whether if we are to give reliefs upon these lines, a good deal of the benefit in money will go to the comparatively well-off, and consequently there will be some curtailments of the reliefs that can be given to people whose incomes are much lower down the scale. This is a matter on the merits of which I have not personally made up my mind. As I say, while I could not accept it, I am satisfied that it would cost in the neighbourhood of £50,000 a year, a sum which we could not lose without making up in some other way, and that, I do not think, would be desirable. At the same time, as the matter has been proposed, I would certainly welcome some general expression of the opinion of the Dáil on the principle. I do not know whether Deputy O'Connell would state it as his principle that twice or more than twice the ordinary relief should go in respect of a child that is over the age of 16 years and that is receiving full-time instruction at a university or other educational establishment.

Before dealing with the point raised by the Minister, I would like to put it to him whether he would this year accept this amendment confining it to the lower range of income. He made the point that this amendment would give a greater amount of relief to the higher taxpayers. I would like to know from him whether he would be prepared to accept an extension, say, in the case of incomes up to £400, because, even as it is, I can hardly understand how this proposal will cost £50,000. Of course, the Minister has means for calculating these things, but I can hardly realise how it would cost £50,000. But if the Minister would agree to confine the amendment to the cases of lower incomes, say £400 or so, then it would cost the State very much less. I would ask him in the first place to re-consider between this and the Report Stage as to whether it would be possible to extend the relief and increase the allowances for children at school in the case of the smaller taxpayers up to, say, four hundred or five hundred pounds. On the general question, I have no hesitation in saying that the principle upon which the same allowance is given in respect of a baby of six or eight months as in the case of a young man or woman at a university is wrong. It is unsound in principle and undoubtedly the proposal that a much greater relief should be given in the case of children over the age of 16 who are being maintained at school or college, would have my very strong support. As to what the relief should be, that would be a matter for consideration. As a general principle, it is sound that the allowances for children who are being maintained at school over the age of sixteen should be greater than the allowances made in the case of children who are of more tender years, because it is only at sixteen years and after it that the expenses of children begin to mount up.

It would be a some what difficult matter to get statistics that would enable me to know what the cost would be if it were confined to lower incomes, but I know it would be a substantial sum, and the Budget proposals were drawn in such a way that any concession involving a substantial loss of revenue has to be countered by some other proposal. It is for that reason that I do not feel able to agree to any concession in this respect this year. Personally, I am inclined to the view that there is ground for some extra relief in respect of children, at any rate, of people with small incomes who are maintained in such institutions, but I think it is a matter that could and would be best dealt with in a general review of schemes of relief. I do not know that I need go into the bases on which we arrived at the estimate of £50,000, except to say that we have statistics showing that there are 18,000 children over the age of sixteen receiving whole-time instruction. Of course, a considerable number of these are the children of people who would be exempt from income tax, but there must be a balance of 9,000 who are the children of parents paying income tax. We have made a calculation on those lines, which I think is a reasonably accurate calculation, and it shows that there would be a loss of about £50,000 yearly. That might be five or six thousand pounds out one way or the other. It is only an estimate, but it has been gone over carefully, and I believe it is correct. There is one point which was not raised here but was raised by representations from people outside, with reference to children who are needlessly, and out of motives of snobbery, shall we say, sent out of the country for education. I have received many letters urging that these particular children's allowances, or any allowances even for those under sixteen, should not be paid in respect of such children. That is a matter that perhaps might also be considered.

Is it not rather a limitation to apply this only to children who are in educational establishments? I am in sympathy with the proposal, even in its narrow limits, but I would like to see the principle, if adopted, extended. An educational establishment is a training establishment for a future career. A great many parents are making sacrifices by having their children trained for future careers, but they are not in educational establishments. Are such parents to be cut out from the benefits in this proposal? I do not think that is the intention of Deputy O'Connell. If the amendment is to be considered by the Departmental Committee, I think it should be considered in its wider aspect, because, as I said, just as great sacrifices are being made by other parents in the training of young people for future careers. Those people ought to be taken into account in a question of this kind.

Does Deputy Good mean apprentices?

I would even go as far as apprentices. The term "apprentice" is a very wide one. I think apprentices should be included, as they are training for future careers, and their parents have to make sacrifices. The proposal Deputy O'Connell makes is that when parents have to make these sacrifices the State ought to give some assistance. I would be in favour of the term embracing apprentices, as Deputy Flinn suggests.

I would like Deputy Good to indicate the particular class he was referring to between educational establishments and apprentices. There is evidently some intermediate stage that the Deputy has in mind. Would it be those attending technical or secondary schools?

This is a matter that it is difficult to discuss here. A great many apprentices would not come within the scope of the proposal at all, because the parents would not be income tax payers.

The majority.

That question is a very debatable one and cannot be discussed now, but in the cases I have in mind the parents of apprentices are income tax payers, and I think ought to get assistance. That is the principle in Deputy O'Connell's mind as embodied in the amendment.

Possibly Deputy Good would formulate a memorandum for the benefit of the Committee which will inquire into it. Deputy Good evidently has some definite class of people in mind and I would like to know what that class is. I am not objecting in any way, but I want to know what is the ambit of his idea.

I only want to say that I trust the Minister will look into this proposal and the principle that underlies it. I urged it some years ago. The Minister for Education the other day pointed out that in this country, more than in any other country, the cost of education falls on the State and not on the locality nor on the parent. I think it is desirable that some concession should be made to these parents, who will face the self-sacrifice of giving their children a profession or skilled trade. Such a class is of extreme value to the State as craftsmen in every profession. They are needed, and the State does not contribute as much directly perhaps, in this case, as it does in the case of other branches of education. I think the parents who have to make sacrifices should be encouraged. I would certainly recommend the principle that underlies Deputy O'Connell's amendment to the Minister, and I would go further and suggest that none of the money spent on education should be subject to income tax. But perhaps that is going too far.

I agree that this would be a very good thing, especially in the case of people with incomes under £400. I think beyond that it might not be reasonable, but certainly up to £400 it would be. If you look at it in an actual kind of way, a parent has to consider whether it will be possible for him to allow his child to get a better education or be forced to let that child become a wage-earner at once. For that reason, the immediate effect would be to raise the standard of education.

Might I ask the Minister if he could tell me roughly what is the amount the State contributes now for University education. I think it is about £80,000. Would it be more beneficial on the average to the children of these parents if it were directly applied by the State to higher education or should it be distributed in this way indirectly to the parents? I am only suggesting that for consideration.

The Minister has invited the Dáil to express its opinion on the principle of this proposal of Deputy O'Connell. I want to say that I am entirely in favour of it, and I hope in another year the Minister will see his way to accept it in its entirety. I should like, as Deputy Alton has stated, to go considerably further. I think there is a real reason for discriminating in the way this amendment favours. That is the particular point which the Minister has asked us to direct attention to. He has asked whether there is ground for giving higher relief for children undergoing university education, or higher education of some form later than 16 years, than in respect of younger people. I think there is. I think one's experience as a parent is that the expense of children's education steadily increases from the time they are six or seven years of age until they have completed their university course. Therefore, I think there is really a substantial ground for this concession. I would like to see a greater allowance given in respect of children's education all-round from the start, certainly from twelve or fourteen years of age; but if you are to discriminate, I think there is ground for the discrimination that Deputy O'Connell has suggested.

I would rather deprecate the suggestion that a benefit of this sort should be confined to a particular range of income, for this reason: That would be a perfectly sound principle if our income-tax system was one under which an income of £400 a year was always divisable by the same factor—by one, by two or by three. We all know that that is not so; the head of the family is treated as the unit, and for income-tax purposes, apart from these very slight modifications, we are getting no discrimination, broadly speaking, between the man who has £500 a year who is a bachelor and the man who has £500 a year and who has a wife and four children, though in one case the income has to be divided by one and in the other case it has to be divided by six. That makes a very substantial difference. It may very well happen that in actual practice a man with £600 or £700 a year is in fact very much worse off and may find it very much more difficult to bring up his children than a man with £400 a year and with one child. That is a fact that I think ought to be borne in mind when this matter is under discussion.

I would feel better satisfied with this discussion if Deputies had indicated from whom they were to get these reliefs. No Deputy has so far suggested who is to bear the reliefs that it is proposed to give to the particular class we are discussing.

The bachelors.

I do not think that any Deputy would admit that the working classes should be more highly taxed than they are at present. If it be true that a man with £2 a week is paying such a high proportion of his income in taxation as was stated by Mr. Johnson in a recent contribution to a weekly paper, then I suggest that he is the man whose relief we ought to be considering and not the man with £500 or £600 a year. It is much more important, I think, that the man who is making a struggle for bread for his family should have his wants considered, rather than the man who is endeavouring to give a university education to his children. I would certainly be in favour of all these things if I thought that they could be done at the expense of people who could afford them, but nobody, so far, has given any hint as to where these reliefs are to come from. As a matter of fact, I think we have very little information, either in this House or anywhere within the country, as to the real incidence of taxation. I think that if this question is going to be considered it might be broadened into a really big review of the incidence of taxation, and as to whether the present principles are fair to the community, whether they mean equity as between class and class, or whether the aim of legislation should not be to relieve entirely those who are merely able to afford absolute requirements for themselves and their children.

I think it will be a bit of a shock to a number of people outside, if anybody is reading about these proceedings at all at present, to hear that we, as a body, almost without exception, are discussing proposals for the relief of taxation on incomes of £600 a year, and so on, in order that families with these incomes may have more or less free university education for their children. I have nothing in the way of scientific statement to go on, but I am satisfied in my own mind from my observations that the national income of the country is not big enough to afford any consideration for people with incomes of £600 a year. I am quite satisfied that the average earning is so low that the people with £600 a year would have to pay, if we endeavour to arrive at a really fair system, in full for the education of their children, and that the State cannot afford to give any relief to them.

In reply to the point raised by Deputy Flinn: The only figures on which I can lay my hands are those in the Estimates. We provide about £183,000 per annum in respect of university education. Ordinary grants to the Universities are £153,000; there is about £27,000 for the Agricultural Faculties in Dublin and Cork, and there is a grant of £3,000 a year to Trinity College. The expenditure on secondary education is £312,000. In addition, there is a contribution from local sources in the form of university scholarships, the total amount of which I have not at hand.

I support Deputy Good's contention in this matter with reference to apprenticeships and apprentices in general. These are a class of children that involve the greatest possible demand on the resources and or the income of the parent. He has no means of getting relief from the State; he has no grants from the State, and he does not ask for any grants from the State, but he asks to be relieved from the payment of income tax on the amount which it is necessary for him to expend on a child, and I think it is only reasonable and fair that he should get it. I should also like to call attention to the fact that Deputies on the opposite side are circling round the figure of £400. It would appear that the majority in this House have about reached that figure, and I do not think when we have reached that figure that we should be specially exempted people in the circumstances. If there is to be an allowance for apprentices, or for university students, it should be applicable to all, no matter what their incomes are, and I think the burdens that are in many cases inflicted upon people with large incomes are greater than what would be inflicted upon some of the Deputies on the other side.

As the Minister has asked the House to give a general indication of its attitude in this matter, I would point out that I think there is a considerable section of the House which feels that any great increase in the allowances by a reduction in income tax cannot be afforded until there has been, first of all, a very substantial reduction in expenditure and a very substantial remission of taxation in other respects. The difficulty I see in connection with this amendment is the one which the Minister himself expressed, the fact that people with larger incomes will undoubtedly benefit, people who hardly require a remission or concession. On the other hand, it is a very difficult matter to cut the relief off at a limit of £400, or anything like that, and if while a case can be made for relief in respect to the lower income, at the same time a transition from the absolute refusal of relief on any one limit would be a difficult matter, and would possibly be unjust, taking into consideration that a man with an income of £500 or £600 a year may have two or three members of his family at a university and may be able to establish a very good case for relief.

On the other hand, as the Minister himself said on a former occasion, it is not a very simple relief to grant. There are considerations in respect of children who are educated outside the country, in respect of children who are enjoying county council and university scholarships, which would have to be taken into consideration, and which might make the granting of the relief a very difficult matter. As well as that, we also have the fact that a considerable sum of public money is already expended on education. A point has been made, and I think we ought to devote some consideration to it, that people should be encouraged to educate their children. I agree. At the same time, those who are sending their children to universities, and who are making present sacrifices, are doing so possibly in the hope of reaping future rewards. There are considerations of that sort which can be set off against the fact that it is a burden on them at present to educate the children. They are also only discharging their duty as parents to the children, and when the children are educated in many cases they repay the cost of their education to the parents. Consequently, I think, while the principle is at first sight a good one, in many cases it is very difficult to apply.

In view of the attitude taken by the Minister there is nothing left but to withdraw the amendment.

There is one point I should like to make with regard to this proposal. This proposal to give a deduction in respect of income tax for children receiving education really amounts in fact to the provision of extra scholarships for education. It means that you are proposing to give scholarships all round without any differentiation between the children who are going to get the scholarships, whether they deserve them or not, or are likely to make full use of them or not. I believe that if the State wishes to make further provision in respect of cheaper education it should be done by giving an advantage to the poorer children, who are qualified and fit to receive a good education, and who show they are fit to receive it by giving proof of their capacity in primary or secondary schools; that we should not go in for universal free education for everybody, no matter whether fit to receive such an education or not, as is implied in this. We have a good deal of that already, and I think that giving it in the way implied in this would be going altogether too far. It would be far better, if the State is prepared to spend £50,000 extra on education, that it should be spent in such a way that the people who would get the value of it would be the people who will, in the first place, need the money and will, in the second place, be able to give a better return to the State for the money they are going to get.

Will Deputy Tierney, who is an educationist, explain whether he is purposely excluding technical students from the benefits of this proposal and whether he has in mind preserving this concession for university students?

I was rather opposing the proposal altogether and, therefore, inclined to oppose it both for university and technical education. It does seem to me, certainly, that if extra money is to be spent—because this does mean that the State should spend £50,000 a year extra on education—it would probably be better spent on technical education and by the definite and direct provision of methods for secondary education, rather than by giving universal all-round relief to everybody, whether the children are capable of making the best use of that education or not.

The parents ought to be the best judges of that.

I find myself in agreement with Deputy O'Connell's proposal and with most of the speakers, and in disagreement with Deputy Tierney. I do not know by what stretch of the imagination he can imagine that a sum, say, of £3 6s. relief in income tax should be regarded as a scholarship. That is what it amounts to. If it serves no other purpose, the fact that it is on the income tax return that such relief is to be got for education will remind parents that there is such a thing as giving better education to children, even though it is very small relief. With regard to the point raised by Deputy Good, I did not quite follow whom he had in mind or what type of occupation the child might be put at. Apprentices might come under the heading of this, and those apprenticed to solicitors and engineers and those going on to be doctors. They would also come under the heading of those who would be the subject of relief. With regard to the question of confining it to the lower incomes, I think we are rather beating the air in discussing that. I would suggest to the Minister, when he is considering this matter, that the income taxpayers should be graded in regard to families, so that when we are discussing this he will be able to know exactly what it would be for salaries of £400 up to £1,000, and then the Minister and the House would be able to come to a conclusion as to what the result would be on the revenue as a whole. I hope that this proposal will be broadened out, and I think Deputy O'Connell deserves credit for having brought it forward.

It seems to me that what Deputy O'Hanlon has said is in favour of what I was arguing. He said it will amount to about £3 6s. each. If that is the way you are going to spend £50,000, you can find many ways of spending it better. We are to dole out £50,000 in small sums simply to remind parents, apparently, that they ought to educate their children. We cannot afford that sum very easily at present. If we want to spend £50,000 on education, let us make up our minds to do it, and spend it in some way that will give a good return for the money —on children, for one thing, who are deserving of a good education, and on technical education—but let us not dole it out in this equalitarian fashion and spend it as a kind of inducement, by way of advertisement on income tax forms, to parents to get their children educated.


I am rather surprised to hear Deputy Tierney advance these views, because if there is one thing more than another that this country is noted for, it is this rather foolish worship at the shrine of scholarships—the idea of picking out one or two children in a district, getting them specially educated, and leaving the average child to paddle its own canoe. I would prefer to see a general average education rather than have one or two picked out and treated as something special above their fellows. This is neither the time nor the place to go into that. The amount of relief to be given may be small, but it may just make the difference to a parent when he is calculating whether he will keep his child another year at school; it may be just sufficient to throw the balance on the side of keeping the child at school for another year. I suppose there is no use in pressing the amendment on this occasion, but I hope the Minister will give serious consideration to the points put forward. Perhaps when this Departmental Committee is sitting, it might be possible to give an opportunity to people on various sides of the House, who may have various points of view, to put their views before the Committee.

We can arrange that.

Amendment, by leave, withdrawn.

Amendments 6, 7, 8 and 9 are all amendments for certain deductions and appear to be based on the same principle. I wonder whether it would not be possible to get a discussion on the whole principle involved in the four amendments on amendment No. 6. It would be difficult to discuss them separately, I think.

6 and 7 might be taken together, but in regard to 8 and 9 there might be difficulty.

For the purpose of discussion, not decision. Amendments 8 and 9 deal with distribution, but the principle is practically the same in all. The best way would be to take a decision on 6 as embodying the principle and not have any further general debate.

I move amendment 6:—

To insert before sub-section (3) a new sub-section as follows:—

"If any claimant proves that any portion of his income arose directly from stocks, shares or other investments in a manufacturing undertaking (or undertakings, as the case may be) established in Saorstát Eireann he shall, for the purpose of arriving at his assessible income, be entitled to a deduction of one-fifth of the income which thus arose."

The purpose of the amendment is to render Irish productive and manufacturing enterprises more attractive to Irish investors. It is also to a certain extent intended to counteract the tendency which the lower rate of income tax ruling here has to make foreign investments—British investments, for example—more attractive to the citizens of Saorstát Eireann than to the citizens of Great Britain itself I think one of the indirect effects, and I seldom advert to it, is that the tax on unearned incomes in the Free State is 25 per cent. lower than the tax on unearned incomes in Great Britain. The effect is, as I said, to make it easy for an Irish investor to pick up stock in Great Britain at what he thinks will be a remunerative price. If you had a British undertaking whose £1 shares stood in the market at 30/-, and you have an investor anxious to invest £750, and this particular concern was a long-established and well-managed one, as the price of the shares shows, there would be a prospect of some capital appreciation. Obviously the margin of price at which the British investor will purchase such shares in the existing circumstances will be 30/- per share, and if a British resident buys them he will receive in due course on £750 a nominal dividend of £35. From this dividend there will be a deduction of 4/- per £, or £7 in all, on account of income tax, and the net return he will receive will be only £28. The Irish investor, on the other hand, in that concern buying shares at the same price will receive a nominal dividend of £35, and in due course he will have returned to him £1 15s. in respect of unearned income here, and if you allow 5/- for the income tax recovery agent the actual return he will receive will be £29 10s.

The British investor receives an average of 3.73 per cent. The Irish investor in the same stock will get 3.92 per cent., and as the market is fixed, presumably, by the British investor, and Irish buying will not appreciably affect the price of the stock, there is always an inducement for the stockbroker here or in England taking an English valuation of the stock to say: "Look, here is a thing which is a very good thing; you get a little more than the ordinary return for it. You get 3.92 per cent. for this English stock, for which the Englishman is content to receive 3.73 per cent., and in addition you have the prospect that it is going to go further."

I feel the general effect of that is to make it more attractive for the Irish investor to go in for certain stock that can be picked up in the British market and to invest his money there. One effect of this amendment would be to offer to the Irish investor, at any rate, an inducement to put his money into Irish enterprise, if there were an Irish enterprise that would offer the same inducement and nominal return. If he were to put £750 in an Irish industry and to receive a nominal dividend of £35 the amount he would receive under present circumstances would be £29 15s. The actual net return, after deduction of income tax, would be £29 15s., as opposed to £29 10s. across the water. I do not think that in the present circumstances there is any definite inducement so far as the fiscal policy of the Government is concerned for the Irish investor to put his money into enterprise here. On the other hand, if this amendment is carried the net return he would receive in respect of £750 would be £30 16s., and that would be equivalent to 4.13 per cent. return. So that £750 invested in Irish industry will bring him the same return as if it were £785 invested in Great Britain. That is the chief recommendation which we have to make in respect of this amendment.

How does that benefit Irish industry?

In so far as it makes Irish industry more attractive to the Irish investor.

It is already attractive, by the reduction of 1/- in the £ in income tax.

Not exactly. It is only attractive to the extent of 5/- out of £30. An Irish investor, say, buying 500 one pound Cunard shares for £750 would at the present moment here in Dublin get an annual net return of £29 10s. If he put that £750 into Irish industry of equal status and was content with the same nominal dividend, the amount he would receive would be £29 15s., so the net advantage of the 1/- in the £ in the income tax to the Irish investor is only 5/- out of £29 15s., which is something less than 1 per cent. Under the circumstances, while we suggest a deduction of one-fifth we feel that that deduction might be increased. We put it there more or less as a token deduction rather than one to which we actually pin our faith. We are concerned with bringing this principle before the Dáil and the Government in the hope that they may see their way to accept it. It does offer to the Irish investor a tangible inducement, and a very appreciable inducement, to invest in Irish enterprise. That principle runs through amendments 6, 7 and 8. There may be some difficulty raised in regard to amendments 8 and 9 in so far as they deal with Irish distributive undertakings. We feel we are trying to do two things there. We offer, first of all, to the Irish investor in distributive undertakings an inducement to put his money into such an undertaking provided it does its duty and helps the Irish manufacturer and worker and the State as a whole. All of us at one time or another have tried to buy Irish manufactured goods and we know the extraordinary difficulty that we have experienced in getting the shopkeeper and salesman to show those goods or to try to sell them.

Under amendments 8 and 9 we are making it a sound proposition for the Irish distributor to push and sell Irish-manufactured goods. Certain machinery will have to be provided. The form in which the amendment has been drafted enables the Minister to provide that machinery if he accepts the amendment. I take it that will be a matter for departmental regulation rather than for actual enactment by statute, but my belief is that the machinery required could be very easily and inexpensively provided. Every Irish manufacturer can issue to the wholesalers, or where a distributor buys direct from him, a certificate stating that so-and-so bought a certain quantity of his goods at such and such a price on such and such a date. At the end of the year the distributor can collect these certificates and file them on his income tax return or, and perhaps the Minister for Finance would prefer this, deposit them with his books showing his turnover. If 50 per cent. of his turnover was represented by Irish manufactured commodities, then he would be entitled to the deduction mentioned here.

I think that the machinery suggested is simple. It will cost very little to the Minister. Manufacturers will be only too glad to print these forms and send them out with the goods, because they are an additional inducement to the shopkeeper and distributor who buys those goods to push them. They represent something which costs the manufacturer nothing and which, ultimately, I believe will cost the State nothing, because the general industrial development and the stimulus which would be consequent upon the acceptance of the principle here advanced would, I suggest, more than repay anything which the State loses. There is also the fact that before the distributor can recover anything, or receive any allowance under amendments 8 and 9, he will have to show all his books. The Minister for Finance may be certain that in that event this will prove an additional preventive of fraud. It will compel the ordinary distributors to make an honest return to the income tax collector, which in certain cases at any rate some of them do not do at the present time. I feel that the general effect of the principles embodied in the amendments will be good. I feel, too, their acceptance will be a stimulus and a help to Irish enterprise. I hope that if the Government cannot see its way immediately to adopt the amendments, it will at all events consider favourably the principle underlying them.

I understand that Deputies will be able to speak several times on this particular question. Deputy MacEntee, as I understand it, has put down this amendment for the purpose of discussion. As that is so, I need not use some of the arguments that I was going to use, because it would be impossible in the short time that has been available to estimate the financial effect of the acceptance of the amendment. There are various defects in the drafting of it that I could point to, but as the Deputy has stated that he has merely put down the amendment for the purpose of having a discussion on it, I will not go into that.

It seems to me that the real difficulty as regards getting money invested in Irish industries is the uncertainty as to profit. It is the fear investors have that, owing to the conditions operating here, they would not obtain any profit. There are certain industries which are well established and which make good profits. In regard to these, there is no difficulty in obtaining further capital if it should be needed for the purposes of extension. These industries do not suffer from the difficulties which this amendment sets out to cure. By this amendment you do nothing for these industries. You simply, perhaps, bid up their shares and bring about an appreciation of them because they gave certain advantages to the people who have investments in them. That does not seem to me to be desirable. Besides the amount of income that would be lost in this way, unless we actually could bring about a great extension of industry, it would mean that non-income taxpayers would somehow or another have to be burdened in order that we might obtain it.

There are many arguments that could be made for the encouragement of industry. There is one type of proposal which has a good deal of support from writers on economics, and that is that where a firm or a concern invests money in extending premises or in installing new plant, it might do that out of revenue and the particular revenue expended on that might be exempted from tax. That is one of the matters which, for some time I have thought that we could explore. I do feel with Deputies on the other side that it is desirable for us, in our particular circumstances, to consider whether in respect to our scheme of income tax we cannot do something to encourage manufacture. It may be that there will be a case for such a thing. I think that to encourage firms to put a part of their earnings or the greater part of their earnings into extensions, if we agreed on a scheme like that, it would not mean a great loss of revenue. I have not had the proposal fully examined, but even without having given it careful consideration, I do not think it would mean a great loss of revenue. There might be some case for doing that.

It seems to me that under the proposal that is set down by Deputy MacEntee in quite a considerable number of cases revenue would be lost, and there would be no return in increased manufacturing activity. Where I join issue with Deputy MacEntee is that any difficulty that may exist in regard to the obtaining of capital for manufacturing industry in Ireland arises not directly out of the attractiveness of foreign investment, but really out of the fears, which are not altogether unjustifiable fears in view of the industrial history of the country, that profits will not be earned.

Without going into a tariff debate, something has been done towards encouraging the investment of money in industries by means of tariffs. It may be the argument is that more should be done, but it seems to me the Deputy has not made a case that is convincing for this particular scheme. In regard to the two amendments, of course there is a very great difficulty where you fix on a particular part of the trading turn-over as qualifying the trader for the concession. It might be very easy for a particular concern to do 50 per cent. in turnover in Irish manufacture and really be entitled to no consideration. It is possible to conceive of an establishment that would trade in Irish meat, bacon, and such like, and 50 per cent. of whose turn-over would be in Irish goods, and yet not really be putting itself out in any particular way. The difficulties of administration in regard to distribution would be very much greater than in respect of manufacture, though I do not think it would be an easy matter to arrange even in respect of manufacture, but in regard to distribution it would, I believe, so far as it has been possible to examine it in the time, be very troublesome and would involve a great deal of staff work. As to the extent to which it would actually encourage people to sell and push Irish manufactures, I do not know, but I would like to say I place more reliance on the tariff weapon, as I think we get direct results there. It is very uncertain as to what you will get in the other respect.

You can never know whether a particular firm is really doing anything to earn a concession. Then there is the other question: if you have people earning large incomes, and if you cannot see a direct result from a concession to them in increased economic activity it is extremely difficult to justify a very substantial concession. There is no doubt that if you do not get increased economic activity immediately, or soon, you have to cast a heavier burden on the people who are less able to bear it. I am glad the Deputy brought forward these particular amendments, because, while it cannot take place for a year or two, we must overhaul our income tax code in general. We can do the particular matter I referred to earlier in regard to allowances. We can do that even within a few months. Regarding the matter of income tax, it has been impossible, owing to shortage of trained staff and the strain put on the office with respect to outstanding arrears, and the work involved in that. But it has been recognised that we must overhaul our income tax code, and substantially. In that process we might incorporate new principles. One principle that has so far recommended itself to me is that which I have already mentioned, the encouraging of firms by exemption from income tax to extend and put in new and improved machinery. I am not convinced you would get results commensurate with the loss of revenue from the particular proposals put forward by the Deputy. I think it is a good thing these proposals have been brought forward, and that attention should be directed to possible changes.

The Minister for Finance may be familiar with a formula somewhat as follows: That on and from a certain date in Saorstát Eireann all incomes derived from investments in productive industries in Ireland shall be abolished. Behind that particular formula is the very eminent Irish economist whose pupil I am—John Punch, of Cork. One word I want the Minister to get hold of is—discrimination. He has raised a good many points, and raised them sympathetically, in relation to the details of these amendments. We have put down four amendments which deal with the principle of discrimination. If we had put down all the amendments which would have covered all the points the Minister desires we would have had exactly the same discussion we are going to have on these. First, let me say I unhesitatingly agree with the suggestion made by the Minister that the first thing to be dealt with is capital which is not taken out in profits, but is put back into the development of business, and in every form in gradation as we find it immediately affecting it. The natural thing you would say would be: "Well, let us encourage new money which goes into Irish industry." By that I mean putting it into an industry which is engaged in employing labour in Ireland, producing wealth in and for Ireland. The difficulty is if you give discrimination in favour of such capital you are discriminating against old capital which has already been doing its work. In the same way, broadly speaking, every proposal that you tackle has its disadvantages.

The Minister may find fault with one particular clause or another, but so long as the principle is accepted that in relation to taxation and taxation reliefs we will give preferential treatment to those who are prepared to engage their money and energy in the development of Irish industry, the particular form in which it comes at once does not matter. I have looked up a whole series of figures relating to different companies and enterprises. A chartered accountant was good enough to give them to me. I said: "I simply want a series of typical cases. I do not want to know the names of the firms or anything of that kind." We took out the benefit which the State got in income tax and we put that against the amount which was distributed in this country in wages, rates, rents and taxes, and other moneys which were distributed in this country, and went into consumption in this country, and the relation between the income tax got from them, and the benefit given really means that in many cases the collection of that income tax was a ridiculously small proportion compared to the total amount of benefit that was given. There is one other point which, in my opinion, is very important in this matter, and especially in relation to the income tax, and that is that only legislation of a compulsory or a restrictive character can counter the tendency to the transfer of ownership in Irish industrial and distributive processes to outside. If you take the case of income derived in this country and taxed, say, at 4/- in the £—it does not matter what the figure is at this moment—you will see that out of £100 a man gets £80—that is, £20 is deducted at the source. If he is an Irish resident owning that Irish capital he gets it back.

If it is some outsider who gets it, his State naturally takes it. That is no business of ours but the result is that the shares of a firm which is functioning in this country are more value on the market to an Irish shareholder than to a foreign shareholder and the tendency is to transfer the ownership—I mean to retain the ownership of the Irish-owned firm in this country and transfer the ownership of a foreign enterprise which is not producing or distributing in this country to the native inhabitants. The difficulty is put quite fairly by the Minister when he says that profit is not the only thing. Capital gets its mixed wage. It gets its profit, convertibility and security. Our difficulty is to give him that. I am out to see that he gets the inducement of that proht, and let me say quite frankly that the profit will not be earned unless there is enterprise behind it. That is the object of it. The idea that you are going to make an artificial permanent present to anybody by doing this is nonsense. If it works at all, capital flows into that enterprise and there is more competition. There has to be more effective machinery of production and, broadly speaking, the pressure of inflowing capital tends again to reduce the rate, so that eventually the man who works hardest, who is the most enterprising, and who puts his heart and brains into the job is the man who will survive.

This will not permanently benefit the slothful and the sluggard. We do not want to discuss in detail these particular provisions. If the Minister will accept, as I think he has accepted, the principle that to whatever extent taxation relief would be effective for the purpose of stimulating Irish industry, to that extent preference and discrimination will be made in favour of Irish enterprise holding Irish capital, that is satisfactory. If the Minister goes so far as to say that he will consider that intention and give so far as possible effect to his own suggestion that capital which is left in a business, for the purpose of expanding it, will have the first preference in the direction of discrimination, that will also be perfectly satisfactory. We simply want to get to-day the principle of taxation discrimination in favour of enterprise employing Irish labour accepted by the Dáil. The detail does not matter. We want the principle of discrimination accepted. I suggest that the Minister could best do that by saying that he will suggest to this Committee, which is to revise the income-tax proposals with more sympathetic consideration, that arrangements should be made for the relief of money which is left in for the purpose of developing plant. I think that is the most effective way it could be done.

In reply to Deputy Flinn, I can only say that I have given some examination to that one aspect of it which I mentioned, and so far as that examination has gone I see no objection to the principle. While I do not want to pledge myself in advance, I promise further sympathetic consideration with a view to early action. I do not want to put it further than that because it has not yet been fully examined.

That assurance is fully satisfactory and with the leave of the House I withdraw the amendment.

Amendment, by leave, withdrawn.
Amendments Nos. 7, 8 and 9 not moved.
Question: "That Section 1 to 4 stand part of the Bill," put and agreed to.

I move:—

Before Section 5 to insert a new section as follows:—

Notwithstanding anything to the contrary that may be contained in the Income Tax Act, 1918, as amended by any subsequent Act:—

(a) An Inspector of Taxes shall at the request, in a form to be prescribed by the Revenue Commissioners, of any person assessed or liable to pay Income Tax under Schedule A or Schedule B of the Income Tax Act, 1918, and on payment of a fee prescribed by the Revenue Commissioners issue a certificate showing the amount for the time being due and payable under the said Schedules A and B, or either of them, out of the premises in respect of which the certificate is required.

(b) The Minister for Finance and the Revenue Commissioners shall be bound by such certificate as aforesaid to the extent necessary to release the premises contained therein from any liability to such tax as aforesaid on payment of the amount of tax therein specified and on the bona fide conveyance, assignment or demise for value of the said premises, but without prejudice to the liability of any person other than the purchaser or lessee thereof.

This amendment is put down for the purpose of trying to get rid of an existing anomaly. At present it is very difficult to get property cleared of charges for income tax. Take a case in point, in which property—let us suppose it is called "Ashville"—was involved. When application was made to the income tax people to state exactly how much was due they replied saying that it was, let us say, £100. On the transfer of the property that money was paid, and a year afterwards another application was made in respect of the same property, but it was called another name. That was possibly because the source of information of the income tax people was different from the actual title, or, perhaps, because for convenience they had it described under another name. If a certificate could be given, such as is given in the case of death duties, in this connection it would clear the whole matter up and would make it possible for any portion of the property to be transferred after the payment of duty and the title of the property would be cleared from any further charges. The certificate of discharge from death duties was introduced some years ago and, if a similar certificate were given in this instance, it would be very useful. The amendment suggests that the Revenue Commissioners would draft their own form. If that were done it would simply state that there was no outstanding income tax due in respect of the property hereinafter described. You would have set out in columns the exact extent of the land and a full description of the property, so that no question of confusion could arise and it would mean the saving of a considerable amount of annoyance and difficulty in selling or transferring property.

It should be noticed that this certificate would be very limited. At present the receipt given by the Commissioners is not binding. When an inspector gives a receipt it may, on the face of it, appear to cover the whole situation, but it is not binding or final. This amendment would make it binding and final, and would apply to Government offices the ordinary law which applies to everybody. If a man is asked how much is due to him he sends in his bill and says so much is due. He is bound by that, and if he is paid he is bound by the payment. We can give ample opportunity to the inspector to make full inquiries to find what taxes are due and to supply full details so that the property may be cleared of any further charges. The amendment even does not go so far as to clear all individuals. It only clears the specific property under sub-section (d). If he has any other claims he can make them against other parties.

It is true that difficulties arise in this connection. I have had brought to my notice instances in which purchasers were very seriously mulcted because of taxes being due on property which they were not aware of. In the most serious case that came to my notice it was due to the negligence of the purchaser's solicitor, but there may occur cases where no care on the part of the solicitor would make them safe, or cases in which if the solicitor took care to make them safe, it might hold up the purchase of the property very seriously. The Deputy's amendment does go a little further than the existing provisions in respect of death duties. However, I am impressed by this case. I think that from the drafting point of view I would make certain objections to the Deputy's amendment, but if he would agree to let the matter stand over to the Report Stage, I would consider whether it would not be possible to put down an amendment, perhaps not going exactly as far as the Deputy's but at any rate meeting his point substantially. If there is no agreement on that amendment, we can discuss the Deputy's amendment, but I think I will be able to meet him.

I think that is quite satisfactory.

Amendment, by leave, withdrawn.
Section 5 put and agreed to.
Sections 6, 7 and 8 put and agreed to.

Section 9 proposes to do away with the posting of notices on church gates and to substitute publication in newspapers and in "Irish Oifigiúil."

Section 9 put and agreed to.
(1) A customs duty of an amount equal to thirty-three and one-third per cent. of the value of the article shall be charged, levied and paid on all motor cars and component parts and accessories of motor cars imported into Saorstát Eireann on or after the 26th day of April, 1928.
(2) The value of any article for the purposes of this section shall be taken to be the price which an importer would give for the article if the article were delivered, freight and insurance paid, in bond at the place of importation, and duty shall be paid on that value as fixed by the Revenue Commissioners.

Amendment 11 to this section, in the name of Deputy Lemass, is out of order because it introduces a new principle into the Bill, the principle of the prohibition of imports.

The section which it is proposed to amend provides for the imposition of a customs tariff on motor cars and motor parts. The intention of the amendment is to effect the same purpose, only to a greater degree, that is the purpose of protecting one particular motor car. The Bill proposes to impose a duty of 33? per cent. on cars and component parts, that is, to impose the amount of protection allowed by an ad valorem duty of 33? per cent. The amendment proposes to extend protection in the case of a particular class of motor bodies, and it can hardly be maintained that it is outside the principle of the Bill. Whether or not the prohibition of the import of any particular article is a matter that can be introduced into a Bill of this nature is another question. I would submit that the principle of restricting the importation of motor cars was contained in the Bill when it passed its Second Reading and that an amendment having a direct relation to that matter would be in order at this stage.

This introduces a principle of far-reaching importance with which the Bill has nothing to do—that is, the prohibition of imports. I suggest to the Deputy that even if the Minister wanted to introduce this principle he could not get it into this Bill.

Is not the principle of the Bill the restriction of imports of motor cars and component parts? If that is the principle, the question of the degree of the restriction to be imposed is, I suggest, in order.

The Bill is to get money.

The amendment is not in order.

On the section itself, during the debate on the Report Stage of the resolution, some matters concerning this duty were considered and the Minister gave a couple of conditional promises in respect to the matter, one of which he has fulfilled by extending the period of credit for the payment of the duty on motor bodies. The other matter, of course, would be dealt with by an order issued by the Department of Industry and Commerce as successors to the Board of Trade. I would be glad to know if he has discussed the matter with that Department, as promised, and if an order increasing the percentage of the imported article which must be manufactured in England will be issued.

The matter is not finally settled. We have been in correspondence and officials of the two Departments have been meeting to ascertain what increase should be made in the percentage. We have not fixed the point at which it will be raised, but a statement will be issued shortly.

The Minister will notice that Canada has increased the percentage to 50 per cent.

We will increase it. That is accepted, but we have not fixed the percentage yet.

I hope the Minister appreciates the importance of this preferential tariff, because in effect it defeats the original preference given. I have had a case brought before me where a chassis and body in England cost £1,100. If, on the other hand, a foreign chassis is imported into England and has a body put on it costing £400 the actual import duty is only charged at the rate of 22½ per cent on the whole £1,100.

I recognise that a substantial increase is required.

Question—"That Section 10 stand part of the Bill"—put and agreed to.
Section 11 put and agreed to.
(1) Where it is proved to the satisfaction of the Revenue Commissioners that a motor car is constructed and adapted for propulsion or traction along rail tracks and is intended to be or has been and is being used exclusively for such propulsion or traction or that a motor tractor is constructed and adapted for agricultural purposes not involving use on a public road and is intended to be or has been and is being used exclusively for such agricultural purposes or that an article is a component part or accessory or is intended to be or has been and is being exclusively used as a component part or accessory of any such motor car or motor tractor as aforesaid, or that an article is of a kind mainly used as a component part or accessory of a motor car but is imported for use for some other purpose, the Revenue Commissioners shall, subject to such conditions (if any) as to labelling, marking, stamping, proof, security or otherwise as they think fit to impose, allow such article to be imported without payment of motor car duty, or, where such duty has been paid on importation shall repay such duty.
(2) On any transfer of ownership of a motor car or of a component part or accessory which has been admitted under this section without payment of motor car duty, or in respect of which motor car duty has been repaid under this section, the transferer shall, where the Revenue Commissioners so require, forthwith give to the Revenue Commissioners notice of such transfer and of the name and address of the transferee.
(3) If, while motor car duty continues to be payable, any person obliterates or removes a label, stamp, or mark affixed to a motor car or a component part or accessory of a motor car pursuant to conditions imposed by the Revenue Commissioners under this section or uses a motor car or a component part or accessory which has been admitted under this section without payment of motor car duty or in respect of which motor car duty has been repaid under this section for any purpose other than the purpose on account of which such admission or repayment was made, or fails to give notice in pursuance of a requirement of the Revenue Commissioners under this section of a transfer of a motor car or a component part or accessory of a motor car or of the name or address of the transferee thereof, such person shall be guilty of an offence under the Customs Acts and shall be liable on summary conviction thereof to a fine equal to treble the value of such motor car, component part or accessory, including the motor car duty payable thereon, or, at the election of the Revenue Commissioners, to a fine of one hundred pounds and, in any case, the motor car, component part or accessory in respect of which the offence is committed shall be forfeited.

I move:—

In sub-section (1), line 34, to add after the words "Public Road" the words "except for journeys from place to place for such agricultural purposes."

Section 12 exempts tractors for agricultural purposes from the motor duty. A tractor, as Deputies know, is used for a great many purposes in agriculture.

It is used for the purpose of threshing on different farms, and in discharging that particular work it has to be taken from farm to farm. In other cases a tractor is used by a group of farmers for different purposes in a particular district. To discharge those uses it has to be taken from one farm to another. This entails the tractor travelling over public roads. The Bill states that the tractor is only exempt from motor car duty provided it is not used on a public road. That means, of course, the uses of the tractors would be very few if they cannot pass over a public road. The suggestion I have to put forward on behalf of those who have drawn my attention to the matter is that the words embodied in the amendment should be added after the words "public road" in line 34. The words are as follow: "except for journeys from place to place for such agricultural purposes." That would make the section in the Act quite clear and would enable the section to help agriculturists. I am sure the Minister will meet those who desire that this section should be amended in that way so as to enable those tractors to discharge the uses for which they are imported. I move accordingly.

The Revenue Commissioners are satisfied that they have powers to effect this administratively because, as a matter of fact, if the Act were read in the strict way that the people who have been speaking to Deputy Good read it, it would mean that the tractor would be exempt so long as it stayed at home and by taking longer routes to the farmer's land it would lose the exemption.

Quite so.

That would be ridiculous and the Revenue Commissioners are satisfied that they can do all the Deputy wants done administratively. However, if the Deputy will let this matter stand over I will have it further considered, and if there is any doubt about their power to meet all cases administratively, I will bring in an amendment on the Report Stage. I agree entirely with the purpose.

There is just one point that I would like consideration given to. That is the position of farmers who use light lorries for carrying agricultural produce to the market. I have particularly in mind the district of Rush, Co. Dublin. Lorries are very extensively in use by the farmers there for bringing products to the Dublin markets early in the morning. At the present moment they feel that the tax on the lorry is an excessive burden on them. Owing to the improvement in the roads that made them more suitable for motor transport, the farmers complain that they are restricted to the use of motor transport. Formerly all their produce was brought in on horse-drawn vehicles and a good deal of it comes in very early in the morning. The difficulty now is that they cannot use horses because in the early morning, particularly in winter and spring, the roads are so slippery that they cannot get the horses to travel. They are restricted, therefore, to the use of the motor lorry. The horses, of course, are not taxed. By the deliberate policy of the Government in improving the roads, those men have been compelled to use the light lorries much against their will and they feel that in view of the particular circumstances in that district they ought to be exempt from this particular tax.

That refers to Rush only, but I am sure there are other districts in the country equally affected. I feel the Minister ought to give some consideration to the question whether it would not be possible for him to exempt these light lorries.

In Deputy MacEntee's constituency?

Exactly, if you like; but if there is any other Deputy who wishes to reap the advantage of my initiative in the matter, I am perfectly prepared to let him have it free of cost, and let him reap whatever advantages there may be. It is, however, a matter that should be considered.

That is a very much bigger matter than the Deputy thinks.

In my capacity as an agriculturist I have been engaged recently in experiments which involved the use of motor lorries in combination with threshing machines. The idea was to combine the two. It seems to me in this case the threshing machine would be an agricultural implement, but in so far as some of it is raw material, it would be liable to this tax. The point I am making is that there may be similar cases of that kind in which lorries and lorry chassis are used for the purpose of part of an agricultural implement. I suggest the Minister should study the question of exempting them.

I will see if there are any other further cases to be considered. I am afraid the particular plea made by Deputy MacEntee would carry us very far. It would be impossible to confine it to his constituency. He will see that, and he will also see that it would be very difficult to confine it to farmers' lorries. Generally, I am afraid it would be a question of abandoning the tax on lorries altogether. If there are any chassis imported for use otherwise than simply as part of road vehicles, they are in a different category, and I would consider whether there were any other vehicles that ought to be treated somewhat as the tractors are treated. I am afraid the ordinary road vehicles cannot be considered.

Amendment, by leave, withdrawn.

I move amendment 13:

In sub-section (1), line 37, to delete the word "or" and substitute therefor the word "and."

This is purely a drafting amendment to make the wording of the section more clear. It is at the moment slightly obscure.

Amendment agreed to.

I beg to move amendment 14:

In sub-section (3), line 56, to insert immediately before the words "a component" the word "to."

This is also a drafting amendment to remove a possible ambiguity.

Amendment agreed to.
Section 12, as amended, agreed to.

Section 13 re-enacts existing legislation with regard to motors.

Sections 13 and 14 agreed to.

I beg to move:—

To insert before Section 15 a new section as follows:—

"(1) There shall be allowed in respect of beer brewed in Saorstát Eireann on or after the 1st day of June, 1928, the following rebate from the Excise duty now payable in respect thereof, that is to say:—

In the case of beer brewed by a brewer for sale, for every thirty-six gallons of beer of whatever original gravity charged with duty and delivered from the brewery, a rebate of one pound, or where the duty now payable in respect of thirty-six gallons of any beer so charged and delivered is less than two pounds four shillings, a rebate equal to the amount by which that duty exceeds the sum of one pound four shillings; and so in proportion for any less quantity.

(2) The Excise drawback now payable on the exportation of any beer or on the deposit thereof in a warehouse for exportation from Saorstát Eireann as merchandise or for ship's stores shall unless it is shown to the satisfaction of the Revenue Commissioners that no rebate has been allowed in respect of that beer under this section be reduced by an amount equal to the amount of the rebate allowable under this section in respect thereof.

This sub-section shall be deemed to have had effect as from the 1st day of June, 1928.

(3) The Revenue Commissioners may make such regulations as they consider necessary for the purpose of carrying this section into effect, and in particular for the purpose of facilitating and controlling the calculation of the amount of the rebate to be allowed under this section and with respect to the method of computing the quantity of the beer in respect of which rebate is to be allowed."

In moving the amendment I do so with a full sense of my responsibility and a full regard of the position of the Government from the point of view of national revenue. I am convinced that in the best interests of the country the time has arrived when even possibly with a certain element of risk of revenue that some relief should be given to the two great industries which the Free State has. I have no interest in the licensed trade—good, bad or indifferent—and my sole reason for coming along with this amendment is to do what I think is right. Two years ago a similar amendment was moved, and while it got a good deal of support from all parts of the House, some who spoke in favour of it afterwards voted against it, and it was defeated by 33 votes to 17. The situation in regard to these industries and all connected with them has advanced very considerably since then, and not, I regret to say, in a direction favourable to either of the industries. I believe the stage has now been reached when something must be done to check the destruction which is taking place.

In his Budget statement the Minister stated there is a falling-off of over £100,000 in the duty compared with beer duty for the previous year. But as he was only dealing with revenueraising his reference only came up to the end of December last, owing to the three months brewer's credit which has now lasted for some years. But what are the facts? If we compare the six months ending 31st March last with the six months ending 31st March, 1927, we find a falling-off of 104,292 barrels in the quantity of beer retained for home consumption, or a reduction in revenue of £521,460. The decline has been taking place each year since 1923, but the most significant drop has been in the six months referred to. I take it, as an indication of the future and a warning to the Minister, that if he persists in keeping the beer duty on at the present level, this source of revenue to the State will be very largely dried up in the near future.

I know I will be told that revenue must be got, but I do submit that in my considered judgment it is an unwise course to pursue that. Because a certain amount of money must be obtained by a certain time, in order to get money you will be putting upon one particular industry such a strain as to endanger its very existence. But there is another argument in favour of relief, and it is that a reduction in duty will naturally be followed by a reduction in price to the consumer. In view of certain remarks made by a Deputy two years ago to the effect that he would oppose relief in duty because the public would not get the benefit of it, I have made it my business to find out if this would be the case, and I am in a position to state that if there is relief, the public will get the benefit of it. It is reasonable to assume also that there will be a corresponding increase in the output also, and the loss of revenue would not be anything like that anticipated, for you would be helping industry and employment. I am also inclined to the view, bearing in mind the alarming drop in the six months up to the end of March last, that there will possibly be a bigger falling-off in revenue by keeping the duty at its present rate than there would be by having the rate of duty brought down to that which obtains in Great Britain and Northern Ireland. I am only asking for the same duties as in Great Britain and Northern Ireland.

During the past few years several of the smaller breweries have been closed down. We all know what a blow it was to employment when D'Arcy's, the oldest brewery in Dublin, was forced to close its doors a little over a year ago. It may be stated that these concerns would go to the wall in any case, and that mass capital and mass production would squeeze them out. I do not hold with this view at all, and I am convinced if the beer duty were reduced in the Saorstát when the concession of 24/- a barrel was made in Great Britain and Northern Ireland in 1923, that Murphy's in Clonmel, the Castlebellingham Brewery in Louth, Egan's of Tullamore, D'Arcy's in Dublin, Cassidy's at Monasterevan, and others which were great sources of wealth and employment, would still be working. When one bears in mind that before the European War the duty on a barrel of beer stood at 7/9 and that this duty now stands at £5, it is easy, to me at all events, to understand the great falling off in revenue which has taken place and the alarming collapse which has taken place in the last six months of the financial year. I do not know why some Deputies in the House have just sneered at this matter. I wonder why they sneer, because I can assure these Deputies that those engaged in the trade are engaged in a legitimate trade. They are all men of the highest character. If they were not men of the highest character they would not get a licence. It is not an occasion to sneer at men whose means of livelihood are threatened, men who have put their all into the business believing that they would get the protection that all other trades are entitled to get, and now when there are efforts made to squeeze them out, not by the Government but by the banking system of to-day, I think it is unfair for any Deputy in this House to sneer at the proposal which I have suggested.

Would the Deputy explain why these gentlemen reduced the bottle of stout from 8d. to 6d. within the last month?

I have nothing to explain. I say that they are engaged in a trade in which they pay licence duty and that before they got that licence their character had to be investigated. The character of the men in the licensed trade can compare with the character of any men in this House. I say that these men and their families are not people who should be sneered at by any section in this House. In moving this amendment, I am merely asking that those traders in the Saorstát should be put in the same position as are the traders in Great Britain and Northern Ireland. I move the amendment, and I hope the Minister will be a little more sympathetic towards it than some of the Deputies in the House at present appear to be.

As the mover of this amendment has stated, a motion in similar terms was brought before the House two years ago. It was practically in identical terms. The matter was then discussed at some length. I find that on that occasion the Minister for Finance stated: "The production of beer in this country is not falling to pieces; the brewing industry is a prosperous industry. There may have been some decline, but at present it is a prosperous industry." I suggest that the Minister is not in a position to-day to repeat the statement he made in 1926. Deputy Byrne has quoted figures showing the immence decline in revenue derived from this source since 1926. On that occasion one of the speakers in favour of the amendment stated that if the existing duties were to continue there was no reason why the revenue should not continue to decrease. We know now from the figures before us that the revenue has immensely decreased from that time. I should like to know on what ground the reduction is refused. Is it on the grounds that it is necessary to keep up the present duty in order to raise revenue, or is it on the ground—which I think some Deputies are in favour of—that it is in aid of the advance of temperance? Some Deputies are not old enough to remember it, but others of us may remember that there was an immense change in the habits of the people as regards temperance long before the duties on beer and spirits were increased. I can remember distinctly the nineties, when there was a considerable amount of drunkenness in the country, a degree of drunkenness which perhaps any thinking person would have to feel rather ashamed of. But that has changed very considerably. I saw some places in the years before the duties were increased, prior to the war, where there was an immense change. That was not owing to any increase in price, but not owing to an improvement in the habits of the people, a change as regards education and a change amongst them in their feelings of self-respect.

I do suggest to those who advocate the keeping up of these duties as an aid to temperance that they are wholly unnecessary as an aid to temperance. Even if the decrease that is now asked for is given there will be very little temptation to any person, except to people who are very rich, to drink more than is good for them. Deputy Byrne has referred to one aspect of this question, namely, to the closing down of numbers of breweries and distilleries. That is an aspect of the question which I do commend to the serious consideration of Deputies. This is an industry which did give an enormous amount of employment, and a great deal of that employment has now disappeared. It has been going steadily year after year, and as has been stated, in the last five years, five breweries have been closed down. Ten years ago there were in the whole of Ireland twenty-two distilleries carrying on, twelve of which were in the Saorstát and ten in Northern Ireland. What is the position to-day? No doubt it will be pointed out that, despite the decrease of duties in Northern Ireland, the number of distilleries there has decreased. That is true. As we know, the duties in Northern Ireland have been reduced in the same way as they were reduced in England. That is to say, a reduction has been made on the peak war duties; but no reduction has been made here. What is the result? I think it is a fair inference that this is the result: While in Northern Ireland 50 per cent. of these distilleries are going, three-fourths of those in the Saorstát have closed down under that policy. I do suggest to the House that a fair inference to be drawn from that is that these enormous duties that are kept on in this State are causing the closing down of the distilleries and breweries at a rate altogether out of proportion to what is happening elsewhere. I submit that for these reasons, and having regard to the existing amount of unemployment in this country, it is not for this House, in pursuing the shadowy cause of increased temperance—which I think is an unsound argument—to cause increased unemployment, and for that reason I would suggest that this reduction should be given so as to keep alive the industries that we have.

I rise to support the appeal of Deputy Byrne and Deputy Rice. I am a licensed vintner of fifty years standing, and I proclaim, on behalf of the members of that profession, that we are as honourable, as straightforward and as good citizens of the Saorstát as any other section in the community. We do not come here for charity; we come here for justice and for fair play. In the year 1915 Mr. Lloyd George, in the zenith of his power and in his anxiety to build up in Great Britain industries like Bass's ale and Scotch whiskey, closed down and dismantled our breweries and distilleries and sent 17,000 families into the workhouses of Ireland. What did he do that for? He did it simply to wipe out an industry that was forging its way ahead and holding its own all over, the world. At the Golden Gate of San Francisco and down on the other side of Hong Kong a bottle of Irish whiskey or a bottle of Irish stout is appreciated and looked for, and if the Government had the courage to sustain these two great industries they might rest assured that the export trade would pull up the leeway for them. No alcohol manufactured all over the world has a greater fame or name than Irish whiskey and stout. Are we here, in cold blood, going to wipe that out, simply because there are extreme temperance men here and there all over the country crying: "Away with the publican; away with the distilleries; away with the breweries"? Well, then, I say, as an honest proposition to them, that if they are satisfied in their hearts that the Saorstát will be saved by having prohibition let them, in God's name, advocate that. We in the trade will have no objection to it. We will proclaim that we are as good Irishmen and as ready to come to the assistance of the country as anyone else. But we demand justice, and we look on our interests in our licensed houses in the same way as the farmer looks on his land.

I was put into a public-house in my twenty-first year by my father, who believed that he was giving me a property with which I would earn an honest living, and I have earned it. Never from the day that I took up the key of my public-house did I get a summons for a breach of the Licensing Acts. My story is the story of thousands of vintners all over the country. I am not speaking now of the vintners in Dublin, who are well able to speak for themselves. I say that the vintners are honest and honourable men, that they are conscientious men, and that they are men who will serve nobody who comes into their houses under the influence of drink. There may be a few black sheep. Is there any flock without black sheep? Why, then, should an honourable and an honest trade be victimised because a few men break the law? I appeal to the Minister for Finance to rise to the situation, to have courage, to make a bold stroke and grant a reduction in the prices of beer and spirits. If he does, the farmer, the artisan, the fisherman and the labourer will appreciate it. He will be coming to the rescue of men who cannot have seven-course dinners. What they want is a legitimate bottle of stout at their tables. They are satisfied with that, and if the Minister lessens the price and gives them that he need not be a bit afraid in his conscience that he will be promoting intemperance.

Like my friend Deputy Sheehy, I am a publican too. I was called to the bar when I was 26. Not very long ago, in another place, I pressed the Minister very hard, but it was put to me by the Minister for Finance, whether I would rather see a poor child suffering 1½d. in the £ on tea and sugar for a reduction in the duty on stout. The Minister beat me. I can see by the attitude of the House that there is no hope. I could see by the attitude in another place that there was no hope of a reduction this year. But I think, after all, that we are not getting fair play. Mr. Lloyd George, bad as he was when he slaughtered the trade——


He failed.

—reduced the licence duty during those years, but our friend, the Minister for Finance, did not do any such thing. He is like a lion looking for money everywhere he can get it. I suppose he wants it. What I would like to see—but there is no hope of getting it, I fear, when I see the humorous mood in which the Dáil treated Deputy Byrne's amendment— would be a change in the licensing law. I did not ask for a reduction in the duty on whiskey. I pointed out that stout was the food of the working man, but I found that even then I had not the killing fly. In a short time—a few months hence—some of the publicans will be eliminated and the remainder will have to pay for their passage out of public life. In every other grade of society in this country if such a thing occurred, for instance, in the case of the farmers, would payment of the compensation be confined to the remainder? What is the cause of the publicans being bought out at all? It is said that it is for the betterment of the nation. Perhaps it is. If it is let the nation pay for it.

The Deputy is going a long way from the amendment. If he is going to discuss the compensation clauses of the Intoxicating Liquor Act he is going a long way from the amendment.

I am sorry if I went outside the amendment, but this concerns compensation. I must come back to the poor child again. We are face to face with it, and I am sure the Minister for Finance will not forget it when winding up. At least he will give no reduction. As I pointed out a few moments ago, I stressed the case very hard, not on behalf of the man who would take a glass of whiskey, but on the part of the workman who would want a pint of porter. After all, he is only passing through this life and is entitled to some luxuries while here, as well as the rich man. That is not considered, however. He has plenty of water to drink, but the stout and the whiskey can remain to be drunk by the men with money. I do not think there is any use continuing. I will stress the case no further, but I will express my deep sympathy with the object which moved Deputy Byrne to come along with his amendment. At the same time, I think if it is at all possible, now or in the near future, the Minister for Finance should not forget to reduce the duty on stout. I will not go any further as far as drink is concerned, because I consider whiskey is a luxury.

I wish to support the amendment moved by Deputy Byrne. We have two main industries, distilling and brewing, and as we all know very well, they are decaying. As a result great unemployment exists. We have heard Deputies in all parties discussing unemployment and how to relieve it. The two industries, distilling and brewing, employed a large number of men. To-day there are not half the number employed in these industries that were formerly employed. The taxation that was put on beer was war taxation, I think it is £5 a barrel. It still continues, and I think there is no hope of getting a reduction in this year's Finance Bill from the Minister, because he stated that if he took the tax off beer he must put it on the necessaries of life. Well, if the Minister takes the tax off beer he has a staff of able civil servants who, I am sure, could find other articles that come into this country to tax, so as to give relief to the workingman who always drinks stout. Instead of trying to do something for the poor man the whole burden of taxation is being placed on his shoulders. Sugar is costing 1/4d. per lb. more than it cost formerly, and the price of stout remains the same. Stout is food for the workingman. I think if the Minister could see his way he should give a reduction in the duty on stout, and get revenue from articles coming into the country which, if made here, would give employment.

I would like to support the amendment. I think the House realises that the Minister is not in a position to do anything this year, and that the amendment is moved more with a view to urging him to look into the matter next year, and to try to give some relief to the distilleries and the breweries. Deputy Daly and another Deputy urged a reduction in the price of stout. I think the case of whiskey is just as important. I do not think that anyone wants to encourage too much drinking, but a slight reduction in the duty on whiskey would enable people to have an occasional glass of whiskey. As I said, I do not think the Minister can do anything this year, but the President, when addressing the Chamber of Commerce last week, indicated that something might be done in the future.

Deputy Murphy and Deputy Daly have made it plain that this is a sham fight. Although I am sorry to disagree with Deputy Byrne and the other Deputies there is one fact worth looking into. If we take off this tax we must put on some other tax to make up for the loss of revenue. Will not the putting on of almost any tax lead to unemployment? Because it will do one of two things, either tax an existing industry or it will increase the cost of living. Would Deputy Byrne be willing to re-impose the duty on tea in order to allow for the removal of the duty on beer and stout? Is that a tenable proposition?

Other articles could be taxed.

What other articles would bring in revenue amounting to hundreds of thousands of pounds?

Ladies' handbags.

Ladies handbags! I think the sacrifice in revenue effected by the amendment would come to £150,000. Deputy Vaughan will have to qualify as a pickpocket in order to get £150,000 from ladies' handbags. There would have to be an increase in taxation and I do not know what luxuries that could be taxed would make up for the loss of revenue involved here.

In other words industry will suffer. To relieve unemployment in the brewing and distilling industry you are to create unemployment in other industries. It has often been said, and I believe with accuracy, that in proportion to the capital invested, and the output of the industry, the amount of labour employed in the brewing and distilling industry shows the lowest percentage of any industry in the State. I should like to say that this is a most respectable industry. I am not a prohibitionist, and I agree with Deputy Daly in what he said about the publicans. They are the licensed trade. They are honourable, fair-dealing, conscientious men. They are also wise men. Most of them are teetotallers; they know too much about what they sell. But it comes to this: that you are to relieve unemployment and to assist an industry that gives the least employment proportionately and put the burden on another industry that gives more employment—the farming industry. I do not often hear Deputy Vaughan speaking, but I have heard other farmers saying that all the taxation was levied off the farmer. There is an element of truth in it. I suppose some farmer's wives even use handbags. But I am quite sure that there is no means of raising the substantial amount of revenue that would be required by this amendment without imposing some new tax. If it were possible to do it without imposing fresh taxation, I should be in favour of it. I agree that the existing scale of duties on liquor is high and was imposed as a war measure, but it cannot be done this year. I do not believe it can be done next year, and there is no use in raising false hopes that can never be realised.

I wish to support this amendment. I quite understand that it is only to get an expression of opinion from the House as to whether it should be put into effect this year or not. Those of us in the trade realise the position we are in. While the Minister for Finance may find it very difficult to raise the money that he would lose by reducing the taxes on beer and spirits, the time will come next year when he will find himself in a predicament, as the decrease in revenue from this source will be double what it is this year. Even if it is not possible to reduce the taxes on beer and spirits this year, I suggest to the Minister the advisability of looking into the question of the hours of opening of public houses. Traders in the seaside resorts, for instance, find themselves at present at a great disadvantage owing to the hours of opening, and the people visiting these resorts also are not speaking in very high terms of the restrictions imposed. These people after travelling long distances arrive in these places at 11 or 12 o'clock on a Sunday and find they cannot get any refreshment until after 1 o'clock. Then in the evening the licensed houses are closed at 8 o'clock and the people cannot get any refreshments after that hour. If the Minister cannot see his way to do anything by way of reducing the taxes on beer and spirits, he can come to the aid of the vintners by regulating the hours to suit the people. If he did that, it would alleviate to some extent the grievances of those who are trying to make a living by the trade.

People talk about the employment given by the trade. Do they realise the employment that is given to porters, shop assistants and others? After all, licensed traders are not the worst people in the country. When subscriptions are needed for charities, or for public amusements, such as racing, the men they look to for the big subscriptions are the vintners. People may laugh at what I say, but you will find some of these people when they come for a subscription to a publican saying: "We will look after your interests next year; we will see that the Executive will give you better hours, and that the pint can be sold for sixpence." That is the sort of camouflage that is used when the publican is asked for a subscription of £20 or £50. Even though the grievance we have at present cannot be taken into account on the Finance Bill, I think the Minister for Justice will be doing the right thing if he could see his way to give some concession in regard to the trading hours.

I think everybody will agree with Deputy Cooper that there is nothing in this but a sham fight, that if the Whips are put on the Deputies on the other side are going to go into the Lobby very definitely against the amendment. As far as we on this side are concerned, we are quite straightforward. We have decided, as a Party, that we, at any rate, will go into the Lobby against it, and we will go as a solid body. We have very carefully considered the whole question. The first argument that naturally occurs to us in connection with it is, if this reduction is granted, how are we to make up the alternative taxation? Can anybody suggest any alternative that is not very much less desirable than the present taxation? If reliefs were to be given, is there anyone who would not say that it would be better to give these reliefs, for example, in increasing the old age pension, as we were unable to do to the extent we required recently, or give relief even in tobacco? I mention these as just the first things that occur to me. But to speak of the reduction of the liquor taxes at the same time that there is a question of increasing the tax on sugar is surely ridiculous. There is nobody who really considers the national interest who will think of agreeing to this amendment.

You must get an alternative, as I said. The only way in which an alternative would be avoided would be if there was an increase in consumption to make up for the deficiency created by the diminution of the tax. I think it is most unlikely that there would be such an increase in consumption as would make up the difference. But are we prepared to face an increase in consumption? Do we want an increase in consumption? Would it be wise for us to take steps that would lead to an increase in the consumption of liquor, either from a social or national standpoint? I do not think there is anybody who seriously examines this who will, apart from making speeches about it, vote for this particular amendment.

As to the question of relief, the argument put up is that it would benefit the workingman. It is very questionable whether these reliefs, if granted, will be passed on to the workingman. We know from past experience that, in fact, in the case of relief of that kind it has not been passed on to the workingman. Recently beer is not as cheap as it could be made if there was not the amount of profiteering that was going on. That is revealed by a circular which, I believe, every Deputy has got showing that this diminution of 24/- in the barrel would amount to a penny on the pint of stout, and would be passed on and something more. That does not seem as if they were very hard pressed at the present moment. Regarding the industry from the national standpoint, as Deputy Cooper remarked already, there is scarcely any industry which employs less labour comparatively, that there is per unit of labour less capital in, and that gives less aid to the fundamental agricultural industry in the country. I think there is no real case made out for the decrease of the duties on that basis.

We also think it is an industry which ultimately is going to go down, and it would be most unwise—and that is why I felt from the beginning that at this moment it would be unwise—to give any encouragement to people by holding out hopes to them that there is going to be any improvement in the future. So far as our Party is concerned, I am perfectly certain that neither are we going to support an amendment of this kind now nor so long as there are social services requiring expenditure which must be met, and met as far as possible without putting a further burden on the indirect taxpayer, such as a sugar tax upon the portion of the community least able to bear it. As to the falling off in trade, is not that due mostly to the falling off in exports? We have had this thing examined, and examined as impartially as we could. We had a Committee that was not by any means a temperance committee. They got circulars, and they made inquiries both from those who are temperance advocates and, also, from the trade interests, and we got a report, the main terms of which I am explaining now. One of the items in the report was that this falling off was due mainly to the falling off in export. Consequently it would not be made up, and it is most unlikely that it can be made up, by an increase in home consumption. As for the falling off of the small breweries throughout the country, is it not a fact that what is happening is that the big breweries and distilleries are capturing all the trade of the smaller breweries and distilleries by the centralisation process and superior equipment and so on? They are just doing that in a way that was held out yesterday as if it were an admirable thing. I myself regret it. I, for one, think we could very well lose by this over centralisation, and lose in ways on which it is hard to put one's finger, but there are really ultimate losses to the community by centralising in ways of that particular kind. We can pay too big a price for this so-called efficiency in mass production and standardisation which are associated with big businesses in America and elsewhere. I thought, perhaps, there might be some amendments coming forward that would put a graded tax on beer, particularly in favour, perhaps, of the lighter beer and in favour, if it could be managed, of the local breweries and consumers of home barley.

I am not going to express the opinion, because generally I try to speak only when I am expressing the Party's view on matters of this kind. I am not going to express what would be the Party's attitude, but there would be some consideration at any rate given to a proposal of that particular kind, but this proposal seems to us to be altogether unreasonable under present conditions.

There is another thing which I wish to say before I sit down. The spirit and beer interest and the liquor interests generally are strongly organised in this country; they are a menace politically to political parties in this country and I want to say on behalf of those on these Benches, that we will support anybody, no matter what Party or Government, that will stand up against things of that particular kind. We are prepared to stand up against it ourselves and we are prepared to assist anybody to prevent interests of that kind having it in their power to make and unmake Governments. We think nothing could be worse for the country than that that should happen. We have considered this matter very carefully and we believe it would be altogether wrong and unjustifiable from any standpoint and that it would be from the point of view of the national interests the worst possible thing that could happen. Thinking of it at the same time as a tax on sugar continues in effect, it is almost unthinkable.

This motion or motions like it have been before the House on many occasions. They have always been supported by two different sets of arguments. We have been told on certain occasions that there would be no loss of revenue, that the consumption would increase, and that the Exchequer would lose nothing. That particular argument is not correct. There was a reduction of the beer duty in England in 1923-24 and the result of that was, roughly, this: That there was an increase of slightly over 10 per cent. in consumption, but there was a decreased duty yielding about 18 per cent. I believe, if this amendment were passed, there might be an increase of 10 per cent. in the consumption, and if there was that increase of 10 per cent in the consumption the amount the Exchequer would lose would be £450,000. As far as I can come to a conclusion, I believe that the passage of this amendment would mean to the Exchequer a loss of £450,000 which would have to be made up in taxation on articles of necessity, because you cannot get a sum as large as £450,000 by the taxation of handbags or any sort of luxury. You must go to some articles of common and general use in order to get it.

There were people when the amendment was previously put forward who accepted the fact that it would mean a loss of revenue, but said that for social reasons we ought to face up to the loss of revenue and impose fresh taxation. It seems to me that there is really only one difficulty in this matter, and that is that the consumption of alcoholic liquor has declined at an exceedingly rapid rate. As far as I am concerned, I am glad to see that decline in the consumption of alcoholic liquor. I think the country has benefited by it, and will benefit by it. I think a great change for the better has taken place in comparatively recent years, but the continuance of this decline does undoubtedly cause a great deal of dislocation. It means that people who have made a respectable and legitimate livelihood in business are finding, after spending many years at this business, that it is difficult if not impossible to continue to make a livelihood at it.

There is also this factor about it, that while a year or two ago we thought that the consumption of alcoholic liquor had been almost stabilised and that the decline, if it continued, would be very slow, I must say that in such circumstances I could see no necessity for giving very serious consideration to this whole matter. As it stands, I do think it merits very serious consideration. I would go this far with Deputy de Valera at least, that there is no chance that I can see this year, or the year after, of any such amendment as this being passed. If it were possible to do something, it could only be done on a much more moderate scale than is suggested. While I think that there is very little drunkenness in the country, and that a small increase in the consumption of alcoholic liquor would do little or no harm, I would not like to see any substantial increase in consumption. I would not like to see an increase of 25 per cent. or less. I would rather see no increase, but I think it would be a good thing if it were possible by any adjustment of taxation—I do not know whether it would be possible or not—but if it were possible, I think it would be a good thing to reduce the comparatively great rapidity of the decline, so that the people in the various businesses might adjust themselves to the new conditions, and so that there might not be the losses, the heart-breakings and the upset that are involved where any big trade or industry suddenly loses its prosperity.

I am giving my own view on that matter to the House quite frankly. I do not deplore the decline in the consumption. I am not anxious to see an increase in consumption, but I do think that the great rapidity with which the change has taken place has involved very great hardships on individuals which they could not foresee, and I think that a continuance of that decline will involve very great and very serious hardships to many more individuals. Whatever we may think of the particular change that is taking place in the country and in the habits of the people, we must, I think, have regard to such factors as I have indicated. It is our duty to try and see that any dislocation that takes place will do the least possible injury to any respectable class of people who have been carrying on a legitimate and proper business.

So far as the beer duty is concerned, I would be inclined to agree with Deputy de Valera, that if we were giving relief it would probably be desirable to try and give some discrimination in favour of the lighter beers, although that is not what the people interested in the trade here have demanded at all. I think there would be a good deal to be said for that, but the present position in regard to brewing is this: That a great deal more beer is brewed here than is required for the consumption of the people. It is possible, in one sense, to say that the brewing industry is comparatively prosperous. Undoubtedly, a number of small breweries have ceased to operate. That has been largely due to the fact that they have been unable to compete with the big industry which exists here in Dublin. The decline in consumption has affected them, but if there had been no decline in consumption at all, I think that many of the small breweries would have found themselves in great difficulties.

So far as distilleries are concerned, what has happened there is that for one reason and another the distilleries here have very largely lost their export market. In some ways they have great difficulties to contend with. They manufacture a special article by a special process. Their competitors produce the other article by a much cheaper process, and have a margin for advertising and pushing and popularising their wares, that the Irish distilleries have not. During the war certain circumstances also, I think, gave an advantage to the distilleries using the patent still process, but before that, as a matter of fact, Irish whiskey had very largely lost its export market. I think that they can recover it only in one way and that is by trying to make an article of superlative excellence and to cater for a special trade. It will not be able to compete with the article made by the cheaper process for exactly the same market. No concession that we could give would restore the prosperity of the distilling industry here. That can only come about by a very substantial recovery of the export market. If the consumption of whiskey here was increased by 33? per cent., it would not make the distilling industry prosperous or even comparatively prosperous. It would, of course, be an advantage to the distilleries, but it would not put them as it were on their feet at all. They must look for their salvation to regaining the export market.

I do not agree with Deputy de Valera as to the publicans and the people who are engaged in the manufacture of beer and whiskey constituting a danger to the political life of the country. Undoubtedly the people who are engaged in that trade do desire and press for remissions of taxation that would be advantageous to them in their business. That is done by all sorts of interests, but anybody who has observed both the fact that the liquor taxes have been maintained here at their pre-war level, and the fact that licensing legislation has been introduced here which very substantially tightened up the code—when they see that happening on the one hand, and when they see the other political party in the State taking the line of action that Deputy de Valera indicated himself to-day, I do not think it can be contended that there is any danger that the political life of the country or the public affairs of the country are going to be dominated by this trade. I cannot speak very well from personal experience myself, but I believe there was a time when the liquor trade had, perhaps, too much influence in the political life of the country. Changed times have done away with all that, and therefore I do not think there is any need for us, in considering this matter, to consider it with any animus in our minds against that trade, or any feeling that we must defeat it lest we increase the power of that trade. I do not think that the passing of these amendments or any changes would have the effect of increasing the power of that trade so as to make it dangerous. It has undoubtedly fallen on very evil times. I do not think that there is the slightest chance that it will dominate the political life of the country and bend the institutions of the State to its will.

I think that we can face this whole matter of liquor duties simply as an economic and financial problem. It is first a financial problem in the narrower sense because we must get revenue. If we reduce these liquor duties, we lose substantially in our taxation. I have always argued in this House that it is not possible to reduce the liquor duties and put, say, fresh taxation on tea or sugar. That is the financial problem. It is extremely difficult to do anything, and as a matter of fact if anything were to be done it could only be by way of something that would prevent a rapid decline in this trade. I think it would be fair and reasonable to aim at that, something that would induce an element of stability, but I admit that is difficult.

That is one aspect of the matter. If we look at the economic situation the question is, what is the importance of this industry? It has capital that has linked up in it employment. So far as its prospects are concerned, these depend on the recovery and extension of its export trade. I think there is every hope these two industries will continue to bring very substantial sums into the country. We should not lightly turn down any possibilities of giving them some assistance or relief. I say that because I think there is a slight tendency, as I think Deputy Byrne or Deputy Daly said, to treat this matter with levity. There is a certain tendency to think that the matter does not merit consideration. I think it does, but it is full of difficulties. It is sometimes supported with arguments that make it difficult for one to treat it quite fairly. If a man asks for the imposition of fresh duties on necessities and at the same time speaks pathetically about the fact that the workingman cannot get a glass of whiskey it is rather hard to take that quite seriously. We must admit it is not as necessary that whiskey should be cheap as that tea or sugar or other articles of common necessity should be cheap. From the public point of view a tax on liquor is preferable to a tax on any of those necessities. If we are to find support for the liquor trade we must find it on other grounds, such as the grounds of mitigating the dislocation that occurs through the sudden collapse of trade or industry, and the unemployment dislocation that might occur if there were a further serious decline. As to the policy of looking forward from the point of view of revenue, we have to realise that while some concession to the liquor trade would mean an immediate drop in revenue, the effect of that immediate drop might be rather to fix the revenue at a specified point, whereas if we decline to make any concession the revenue might continue to decline year after year, and might fall very substantially below that specified point. That is a matter we have to consider.

The concession given in England seems to have had this effect so far as beer is concerned, that it practically stabilises consumption. While the figures for the last couple of years have not been comparable, as credit was shortened and introduced a disturbing factor, the position seems to be that the reduction of one pound per barrel stabilised consumption and left it practically where it was. Suppose this was worthy of consideration, we cannot attempt it. I do not see any way at the moment of giving a concession to liquor people, but leaving that out of account, I think there would be a great deal to be said, with the consumption of liquors so low comparatively, and having regard to the fact that there is no drunkenness worth talking about at present, for stabilising revenue at the existing point. By stabilisation I do not mean fixing it permanently at that point, but fixing it so as to check the comparatively rapid decline that has been going on. There is no possibility of accepting the amendment. If the Dáil were to pass the amendment the position would be very serious, and would, I think, involve very great hardships because of the methods that would have to be adopted to meet it. I cannot hold out any definite hope to Deputy Byrne, except to this extent, that up to this year I thought the consumption was somewhat stabilised, and that any decline that might take place would be a gradual one to which we need pay no particular attention. Last year's figures seemed to indicate that that hope was not justified. I admit that the matter has now reached a point where it merits careful consideration, but, frankly, I do not see at the moment where the means are to be found of giving it.

Would the Minister take into consideration the advisability of extending the hours during the summer time for the tourists?

I do not know anything about that.

Might I ask the Minister whether he or his Department has considered the question of protecting, as far as home consumption is concerned, Irish spirits? We do not wish anybody to encourage the drinking of either beer or stout, but we think that if beer and stout are being drunk, it should be either Irish beer or stout.

We had that under consideration. Certain people proposed to us that we should have a differentiating duty. That is, Excise duty and Customs duty apart from certain allowances are the same, and it was suggested that the Customs duty should be increased above the Excise duty. On the other hand, others interested in the trade pointed out to us, what we believe to be the fact, that the only hope of any recovery in distilling was in the recovery of the export market. They said that even if there was no retaliation tax in Great Britain, the fact that it was published abroad that Scotch whiskey was penalised here would result in the creation of a certain feeling there which would make it more difficult to recover the market. There is a view abroad that the law gives preference to Scotch whiskey. That is not so. Irish whiskey can be sold at the same strength as Scotch whiskey, but the distillers for reasons of their own prefer it being sold at the present strength.

The reason for doing that is that they manufacture spirit at a certain strength which is typical of the spirit. They would change its whole quality by reducing it to the level of the Scotch and imported whiskey; in fact there is on that very account a preference being given to the Scotch whiskey. It works out at a preference in favour of the Scotch whiskey.

It does not. Both spirits are manufactured at a greater strength than they are sold, and are actually bonded at very much greater strength. When they are ready for sale they reduce the Irish to 25 underproof, and the Scotch to 30 underproof. It may be that the character of the Irish spirit would be destroyed or altered if they were to reduce it to the Scotch level. I do not know, but I believe there is a certain difference of opinion in regard to that. We have several times been in conference with the distilling trade, and it has not been put to us, for instance, that we should prohibit the selling of any whiskey at any weaker strength than 25 underproof.

That would be a possible thing, but it has not been put up to us. What we have done heretofore is that we increased the maturing period from three to five years. As a matter of fact, that had a certain effect on checking the importation of Scotch whiskey. which normally would not be kept beyond three years. Owing to the process of its manufacture it does not benefit by being kept beyond that time. On the other hand, Irish whiskey has to be kept longer. It ought to be kept seven years, and we would propose, probably later on, an increase in the maturing period of Irish whiskey from five to seven and, perhaps, nine years. That is a matter that has been under consideration. That destroys a certain advantage which Scotch whiskey has had up to the present. Many brands of Irish whiskey are kept for nine years. There is an actual loss of spirits and there are costs involved through keeping whiskey in bond for nine years. Up to the time we made the change Scotch whiskey had to be kept three years, but now it has to be kept five years. That is a matter with which we may proceed further, and we have been in conference with the distillers in regard to it. In this matter I would not like to proceed in any direction without, at any rate, having consulted the trade and having their views. As I pointed out, the big problem which they are up against is the recovery of an export market, and all sorts of factors have to be taken into account when a trade is trying to recover its export market. We might do something here which would nullify a good deal of the expenditure which they incurred by way of propaganda and in advertising their wares. The whole matter is one of some difficulty.

I see that matter all right but what I see in the Minister's answer is that he will defer taking action until it will probably be too late. Already Scotch whiskey has got into a substantial preferential position in the country—that, at least, is my information.

It is small, it is only about one-fifth.

That is due to the specially privileged position in which it is.

In view of the sympathetic tone of the Minister's speech, all I can do at the moment is to ask the permission of the House to withdraw this amendment and the next one in my name. They have practically been discussed as if they were one amendment, and I may say that I am glad that the Minister changed the whole tone of the House and showed Deputies that the subject was not as flippant as they thought.

Amendment by leave withdrawn.
Question "That Sections 15 to 17 stand part of the Bill," put and agreed to.

In regard to Section 18, perhaps the Minister would tell us what benefit we derive by maintaining imperial preference on imported dry fruits. I think it applies to South Africa and Australia, and, so far as I know, they do not give us the same imperial preference which we give them.. I doubt, in fact, if they give us any preference at all.

I am not sure that we should not consider the withdrawal of the imperial preference so far as this particular commodity is concerned. It simply has remained because it was there when we took over the duty and we did not make any change in regard to it. I am not sure that there is any particular advantage in it. I will look into the matter and perhaps discuss it on Report. It may be there are cases where if we abolish imperial preference what we would be actually doing would be increasing the rates. Take the case of confectionery. We have a certain rate and an imperial preference rate, and the latter is really the effective rate. If we abolish imperial preference we would really be increasing the rate. I cannot say what the position is in regard to dry fruits, but I will look into it.

Question, "That Section 18 stand part of the Bill," put and agreed to.

In regard to Section 19, our attitude has been expressed so often that there is no use in talking about it further. We are opposed in principle to the imposition of this extra duty on sugar. We think that the Minister just took the easy road, as he did when he cut off the shilling from the old age pensioners. He saw a big sum coming to him and did not go to the trouble of considering it further. We believe that the ground has not been investigated by him sufficiently in his search for alternative taxes. Besides, we have expressed already our view that reductions were possible which would have enabled him to avoid this extra tax altogether. As I say, we have spoken about it so often there is no use in repeating the arguments against it. We intend to put the matter to a division and vote against it.

I have nothing to add to what Deputy de Valera has said. We also have expressed our views on the matter, and we propose to vote against this section which increases the sugar duty.

There is one matter on which I would like the Minister to give us some information, and that is in regard to the present Customs duty on sugar, confectionery and chocolate confectionery. I think that the decrease which took place in the duty in England and the increase which took place here, and also as a result of the drawback, the preference given to sugar confectionery here means only 1½d a lb., and in the case of chocolate 2½d. That represents a substantial reduction—in one case 25 per cent. and in the other 16 per cent. In consequence of the changes that took place here and in England in the sugar duty, does the Minister propose to take any steps to restore the former preference?

As well as that, I think there is the question of certain confectionery which, while purporting to be chocolate or having the appearance of chocolate, is in actual fact not chocolate. There is a very cheap quality of confectionery sold in the Saorstát which purports to be chocolate. It is called chocolate; but it is really coated with a chocolate shell. That comes in here as sugar confectionery at the rate of 1½d. per lb., as contrasted with 2½d. per lb., which. I presume, was intended to be charged when this duty was imposed by the original section. I think the Minister might look into that to see if, on the Report Stage, he could not introduce an amendment which would cover goods purporting to be chocolate goods or some imitation of chocolate.

As far as the latter is concerned at present it is charged at the lower rate. To charge it at the higher rate it would be necessary to have a resolution and machinery to deal with it. If the position is as stated, it can be rectified later on. In regard to the first question, the change in the sugar duty in England does not affect the chocolate trade here. What has happened is that they are paying a farthing more for their sugar here. Of course, in many classes of confectionery only about 50 per cent. of sugar is used. Theer are other ingredients, In no case has the cost of the article been increased entirely by the farthing per lb., so that while there may be some little decrease in the amount of protection there was afforded when the confectionery duty was imposed and when the sugar duty was at 2¾d. per lb., they have a substantial protection even yet. As a matter of fact, when imposing confectionery duty we changed the sugar duty in such a way as to increase very greatly the protection we gave to confectionery, and I think even with the increase of one farthing per lb. in the duty, they have a protection which is quite sufficient. As a matter of fact the rapid strides made by the confectionery industry and the jam industry indicate that the amount of protection they got was quite sufficient, and I do not think any change is required when so small an increase as a farthing is made in the sugar duty.

Admittedly, while there has been an extension in the sugar confectionery industry here, it has been confined to the cheaper grades only. As a matter of fact the present tariff does not seem to be effective as far as the better quality of chocolates is concerned. The flat rate means, of course, that the percentage of protection on the better quality of chocolate is very much less than on the cheaper quality. The consequence has been to compel the Irish chocolate factories to devote their attion almost entirely to the cheaper grades. That is not a desirable thing, I think, because if the Irish chocolate manufacturers are associated with the cheaper quality of goods, that undoubtedly will create a prejudice in the mind of the buying public against them. I do not believe you will ever get that industry on a strong, sound foundation unless the factories are able to hold their own in the better-class lines. As well as that, if they develop the manufacture of the better-class lines there is a possibility of developing an export trade in chocolate. Any person who has taken the trouble to go into a place where confectionery is sold in Dublin will know the extraordinary number of varieties and the different qualities not only of English but of Continental chocolates which are sold. Of course, they are all of the highest price. It seems to me that there is a possibility, if the Irish manufacturer provides the necessary quality and meets public requirements in regard to tastes, that you can develop an export trade in chocolates, and provided the manufacturer by a preference of some sort is able to secure a place in the home market for his own superior quality of chocolate. At the present moment it would not pay to produce that better quality of chocolate in competition with foreign factories.

I admit that the chocolate trade has not gone ahead in the same way as the sugar confectionery trade. It may be that the effective rate of fivepence is not sufficient, but I would not like to conclude that at present, because I understand it is one of the trades in which a great deal of special skill, almost scientific skill, is required. It is one of the trades in which there might be some delay before the tariff becomes effective. I have been struck, as the Deputy has been struck, by the fact that the chocolate trade has not made the progress that the sugar confectionery trade has, but, at the same time, I am not yet satisfied that the tariff will not operate sufficiently, really to put the industry on its feet. As the Deputy knows, so far as confectionery is concerned, not only has progress been made at home, but there are firms which are doing a substantial export trade. The sugar confectionery trade has gone on as well as could be expected and has certainly made remarkable progress. The Deputy must remember, however, that for a long time there had not been any phenomenal progress even in the sugar confectionery trade, and it may be that the other trade has not had time to develop yet. I feel that this is the sort of tariff which affects a luxury and which there need be no great compunction about increasing. It is different to very many tariffs which would be given consideration. I would be prepared to consider it later if the facts merit consideration, but I think, on the other hand, we ought not too hastily to come to the conclusion that the tariff is insufficient.

That is satisfactory.

Question: "That Section 19 stand part of the Bill," put.
The Committee divided:—Tá, 70; Níl, 57.

  • William P. Aird.
  • Ernest Henry Alton.
  • James Walter Beckett.
  • George Cecil Bennett.
  • Ernest Blythe.
  • Séamus A. Bourke.
  • Michael Brennan.
  • Seán Brodrick.
  • John Joseph Byrne.
  • Edmund Carey.
  • John James Cole.
  • Mrs. Margaret Collins-O'Driscoll.
  • Martin Conlon.
  • Michael P. Connolly.
  • Bryan Ricco Cooper.
  • William T. Cosgrave.
  • Sir James Craig.
  • John Daly.
  • Michael Davis.
  • Peter de Loughrey.
  • Eugene Doherty.
  • James N. Dolan.
  • Peadar Seán Doyle.
  • Edmund John Duggan.
  • James Dwyer.
  • Barry M. Egan.
  • Osmond Thomas Grattan Esmonde.
  • Desmond Fitzgerald.
  • Daniel O'Leary.
  • Dermot Gun O'Mahony.
  • John Marcus O'Sullivan.
  • Patrick Reynolds.
  • Vincent Rice.
  • Martin Roddy.
  • Patrick W. Shaw.
  • James Fitzgerald-Kenney.
  • John Good.
  • Denis J. Gorey.
  • Alexander Haslett.
  • John J. Hassett.
  • Michael R. Heffernan.
  • Michael Joseph Hennessy.
  • Thomas Hennessy.
  • John Hennigan.
  • Mark Henry.
  • Richard Holohan.
  • Michael Jordan.
  • Hugh Alexander Law.
  • Finian Lynch.
  • Arthur Patrick Mathews.
  • Martin McDonogh.
  • Michael Og McFadden.
  • Patrick McGilligan.
  • Joseph W. Mongan.
  • Richard Mulcahy.
  • James E. Murphy.
  • Joseph Xavier Murphy.
  • James Sproule Myles.
  • Martin Michael Nally.
  • John Thomas Nolan.
  • Bartholomew O'Connor.
  • Timothy Joseph O'Donovan.
  • John F. O'Hanlon.
  • Timothy Sheehy (West Cork).
  • William Edward Thrift.
  • Michael Tierney.
  • Daniel Vaughan.
  • Vincent Joseph White.
  • George Wolfe.
  • Jasper Travers Wolfe.


  • Frank Aiken.
  • Denis Allen.
  • Richard Anthony.
  • Neil Blaney.
  • Gerald Boland.
  • Patrick Boland.
  • Seán Brady.
  • Robert Briscoe.
  • Henry Broderick.
  • Daniel Buckley.
  • Alfred Byrne.
  • Frank Carty.
  • Archie J. Cassidy.
  • Michael Clery.
  • James Coburn.
  • Hugh Colohan.
  • Eamon Cooney.
  • Richard Corish.
  • Fred. Hugh Crowley.
  • Tadhg Crowley.
  • Thomas Derrig.
  • Eamon de Valera.
  • James Everett.
  • Frank Fahy.
  • Hugo Flinn.
  • Andrew Fogarty.
  • Seán French.
  • Patrick J. Gorry.
  • John Goulding.
  • Seán Hayes.
  • Patrick Hogan (Clare).
  • Samuel Holt.
  • Patrick Houlihan.
  • Stephen Jordan.
  • Michael Joseph Kennedy.
  • William R. Kent.
  • James Joseph Killane.
  • Mark Killilea.
  • Michael Kilroy.
  • Seán F. Lemass.
  • Patrick John Little.
  • Ben Maguire.
  • Seán MacEntee.
  • Séamus Moore.
  • Daniel Morrissey.
  • Thomas Mullins.
  • Timothy Joseph Murphy.
  • Thomas J. O'Connell.
  • Seán T. O'Kelly.
  • Matthew O'Reilly.
  • Thomas O'Reilly.
  • James Ryan.
  • Martin Sexton.
  • Timothy Sheehy (Tipp.).
  • Patrick Smith.
  • Richard Walsh.
  • Francis C. Ward.
Tellers—Tá: Deputies Duggan and P. Doyle. Níl: Deputies G Boland and Cassidy.
Motion declared carried.

I want to ask the Minister whether, on Section 20, he is prepared to consider the admission of ginger preserved in syrup imported in casks of a capacity of not less than 1 cwt. at the lower rating—viz., 1¼d. per lb.? It is a small concession that the trade want, and I think the Minister might consider the matter on the Report Stage.

Perhaps the Deputy will give me some notice of the question. I think ginger imported as he suggests is raw material connected with the confectionery trade, and I would be prepared to admit it at the lower rate. I am prepared to bring forward an amendment on the Report Stage.

Section 20 agreed to.

On Section 21, may I ask the Minister whether it would be possible to get the State Chemist to hurry up the manufacture of spirit varnish in this country? Surely it is not beyond the power of the State Chemist to get a spirit varnish that would be suitable?

That is a new matter. I will consider whether there is a possibility of getting the State Chemist to deal with that matter. I know that big efforts were made by the firm of Jacobs to get it. It is really a question of a very quick-drying varnish. There are spirit varnishes made in the country for ordinary uses, but owing to the system of manufacture it was necessary to get a varnish that dried practically immediately. Various firms which make spirit varnish here have tried to supply Jacobs' with one suitable, and they were not able. I understand the firm that supplies has some sort of a trade secret. After all, the State Chemist is largely engaged in a supervising capacity, and the members of the staff in the State Chemist's Department are very busily engaged on routine analyses, and whether it would be proper to detach any of them for a sort of research experiment which might or might not produce results is a matter I have not considered.

Will the Minister bear the matter in mind?

I will give it consideration.

I have knowledge of an industrial chemist of very great eminence in matters of that kind who has done very remarkable work, and I think possibly if the inquiry were transmitted to the intellectual and spiritual centre of Ireland, better results might be achieved.

Sections 21 and 22 agreed to.
On and after the 1st day of May, 1928, entertainments duty within the meaning of Section 1 of the Finance (New Duties) Act, 1916, shall not be charged or levied on payments for admission to any entertainment as respects which it is proved to the satisfaction of the Revenue Commissioners that the entertainment consists solely of one or more horse races and that the holding of the entertainment has been authorised either by the Turf Club of Ireland or by the Irish National Hunt Steeplechase Committee or by both the said Turf Club of Ireland and the said Irish National Hunt Steeplechase Committee.

I move:—

"To insert after the word ‘payments,' in line 44, the words ‘not exceeding ten shillings.'"

This is intended to insure that the remission of the entertainments tax will be confined to the cheaper kinds of admission. It is generally agreed that people who pay more than ten shillings into a race meeting would not be deterred from going by being charged the entertainments duty on prices above that. At the same time, we feel if the remission of the tax goes through in its present form that the racecourse executives, instead of passing the remission on to the public and reducing their charges proportionately, will be inclined to profiteer and put the remission, so to speak, into their own pockets. For that reason I propose that amendment in my my name.

Since the entertainments tax has been remitted, various racecourse committees have already made announcements of substantial reductions, and many of the race companies who were awaiting the Minister's announcement before they would decide whether they would apply for a fixture have now considerably reduced their charges of admission. Mullingar and Naas meetings are two places that had been awaiting the Minister's announcements, and they have reduced their charges. They made very substantial reductions, and prior to the announcement of the remission they had not decided as to whether they would apply for fixtures. I do not see that there is any necessity for this amendment.

I do not profess to be extremely interested in this particular matter, but a good deal of consideration was given to it by officials of my Department and the Department of Agriculture, who considered the present position of racing. As a result of their consideration they came to the conclusion that racing in this country was in such a state that the entertainment tax would have to be abandoned if there was not to be a collapse of racing. On the Committee there were really two finance officials, a representative of the Revenue Commissioners and a representative of the Department of Finance. The third was a representative of the Department of Agriculture, and they agreed that in the interests of horse-breeding—and we have a considerable export of horses from Ireland—it was necessary to maintain racing. That Committee, after considerable consideration and after hearing an enormous number of witnesses, came to the conclusion that it was necessary that the tax should be remitted. I feel that, as a good deal of money is made at race meetings by people who would buy tickets at ten shilling or more, we would be destroying a good deal of the effect of the concession by adopting Deputy McEntee's amendment. And I feel, on the whole that, racing having fallen to such a parlous condition, when giving the concession we should give it on the whole.

The main purpose of the amendment was to insure that, first of all, prices would be reduced so as to popularise race meetings and to take away the people from the betting saloons to the race meeting—to take the people who wish to bet in the city to the race meeting. The question is whether, if you will allow the remission to go without any condition, the race-course people will not put the tax they save into their own pockets and so leave the position exactly as it was before, thus taking so much easy money and making no attempt by reducing prices to attract the public to their meetings. Deputy Shaw mentions that in one or two particular instances reductions have been made.

I might have mentioned that the Curragh and other places as well have also reduced the charges of admission.

Even if they have done so, I do not see that there is any strong case made against the amendment, even granting that in some cases the prices had been reduced, so that the race meetings are now more popular. At the same time, I feel, as I said before, that any person who is prepared to pay ten shillings for admission to a racecourse will not be deterred from going to that racecourse if he has to pay the entertainments tax as well. There are other people—the poorer class of people—who pay their shilling or their two-and-six for admission to the popular enclosure. They may possibly be deterred if the tax remains, and it is possibly due to the fact that the public as a whole have forsaken race meetings, that race meetings have gone down. But I do not think that any person who is willing to pay a substantial sum for admission will object to pay the entertainments tax. After all, the admission money is a very small proportion of what a day at the races is going to cost. There is the entrances to the various enclosures, apart altogether from the tax which he will pay to the bookmaker, and the amount he will have to pay in respect of luncheon and the libations which accompany it. On the whole I think the admission portion of the money represents a very small proportion of the cost of going to the races, and if we add to that very small proportion the amount of the entertainment duty which could be collected in respect thereof, I think the Exchequer will gain, and that race-courses and racing as a whole will not be the losers.

Really, I feel that I cannot accept the amendment. As I say, I do not want to say that I have very strong views on it, but I think that even people who can afford to pay 10/- or 10/6 for entrance to the meeting will feel the cost of an extra shilling or two, as they often go in family parties to the races, and one individual might be paying the tax three or four times. It will, I think, serve to some extent as a deterrent.

You ought not to inculcate bad habits in this country.

Amendment, by leave, withdrawn.

I move:—

To add at the end of the section, line 51, the words "or by the Irish Racing Association."

This point was raised by me on the Second Reading of the Bill. I think something the Minister has said in connection with the last amendment gives me a certain amount of encouragement. He says that if we are going to give the concession at all we should make a clean sweep or something to that effect. I believe that is what should be done. I have no particular views on the question as to whether this tax should be remitted or not, but I say that if you are going to remit it on the races run under one particular code of rules, then you ought to remit it in races run under another code of rules. I can see no argument at all for the remission in one case, and for the continuance of the tax in another case. Personally I do not believe, as far as the smaller classes of race meetings are concerned, that it is worth while, or that it will pay for the collection and for the trouble. As I pointed out before, many of the smaller race meetings are got up in the interests of local funds of some kind or another, and I think it will seem peculiar if one town runs races under the National Hunt Rules, or the Turf Club Rules, and the next town runs them under another set of rules, that in one case the tax will be collected and in the other they will be tax free. No one has demonstrated what Deputy Flinn asked for—the connection between racing and horse breeding—to our complete satisfaction, but Deputy Flinn and myself think there is a connection, and that if it is demonstrated it will either have to be demonstrated as a connection between horse breeding and the horse industry and the particular races run under the rules I am speaking of. I think it will be very difficult indeed to point out where the difference lies, and I press the Minister to wipe out the entertainments tax on all horse races. I do not see where the distinction comes in. He pointed out before that the other races had some sort of particular advantage, that they are commercial concerns. I do not know why that fact should entitle them to special consideration over and above those got up for some laudable object like the improvement of the local town hall. There are quite a number of races run under these rules. Most of the smaller towns and villages hold races under these rules. The only reason is because the fees are smaller. I do not profess to be an expert in this matter, but I can see no case for keeping the tax on this particular class of races and removing it from the other class. I would be prepared even to support keeping it on all classes of racing, but, if you make an exemption in one, it should not be kept on the other. People have urged me and others to bring this matter before the House and they pointed out that dog racing at Shelbourne Park and Harold's Cross is free of entertainments tax. I do not know if that is the case, and I speak subject to correction, but certainly I cannot understand the principle by which the entertainments tax is enacted, if these races are free, while the tax is kept on small race meetings in villages and towns in the rural districts.

With regard to the last matter raised by the Deputy, the question of a tax on dog racing, there was no intention of exempting dog racing. What happened was that coursing was exempted from the entertainments tax, and there was no dog racing at that time. The section was so drawn that probably it makes it impossible to collect the tax on dog racing, though, as a matter of fact, we are at present receiving legal advice in regard to dog racing, and may bring a test prosecution, because if it turns out to be free of tax it is only by accident. I want to put that aside in considering this question.

With regard to the exemption of horse races, racing under this so-called Irish Racing Association, if there is any such thing, there is no money involved. From the flapper meetings very little money will be collected. It does not matter in the slightest from the money point of view. Of course if the amendment were going to be accepted, I would not like to give statutory recognition to the Irish Racing Association. I do not know if there is any such body. There are one or two self-constituted individuals who perhaps make some money by calling themselves the Irish Racing Association, but the races carried on under the Irish Racing Association are really not carried on under any association. If the Dáil were of the opinion that we should exempt all racing, I would move at a later stage to delete everything after the word "races" in line 47. I would not think of adding the name of the Irish Racing Association to the list. That is rather a detail. We are exempting racing, not because we regard it as an entertainment specially worthy of being exempted and specially worthy of encouragement— we do not put it in the same line with athletic meetings, football, or other games, which a year or two ago were exempted from tax—we are not exempting racing from the entertainments tax along these lines, we are exempting it simply because we believe —I do not speak with any deep personal conviction—and everybody who has anything to do with horse-racing seems to be in agreement, that racing is necessary for the maintenance of horse-breeding. Horses can only be sold if either they or their relatives have own races. In order that they may win races and be sold at a good price, we must have a certain number of race meetings, and for that purpose only recognised race meetings under the Irish Turf Club or the Irish National Hunt Club are of any use. As a matter of fact, if a horse is raced at one of these flapper meetings it is not allowed to be raced at any other meeting either here or in Great Britain, so that instead of gaining in value and becoming more saleable by winning a race at a flapper meeting it loses.

It loses its moral character.

What are horses bought for but racing?

Flapper races are got up for one or two purposes. Sometimes you have a conspiracy, such as that depicted in Brinsley McNamara's "Glorious Uncertainty." In other cases the local licensed trader may wish to serve liquid refreshments to the assembled multitude. In other cases a man gets up a race meeting and says it is in the interests of the town hall, or something like that. It seems to me that the flapper meetings are not deserving of any encouragement or assistance. If you have a meeting genuinely got up for charity it can be exempted from tax in the ordinary way, the same as a concert got up for charity or anything of that sort can be exempted. Leaving the tax on will not prevent special exemptions where the meeting is for a charitable purpose.

There is just one other point in connection with this. The Inter-Departmental Committee which considered the matter was of opinion that there are too many of the recognised race meetings, that the wealth and population of the country do not enable as many fixtures to be held as have been held, and they recommend that steps should be taken by the Turf Club and by other people interested to reduce the number of fixtures so that there may be better support for and better racing at those that continue. I accept that view as correct. I think it is, and it has certainly been agreed with by people outside, and that being so, we should not encourage these flapper meetings, which are of no value to horse racing, by specifically exempting them from the tax. I do not say that the maintenance of the entertainments tax will be a serious discouragement to them, because a great many of them are organised on such a basis that there is not an admission fee; there is, perhaps, a parking fee for cars, on which tax is not chargeable, and in respect of the great majority of them no tax would be collected. As I say, this is a matter of very trivial importance, but it has been raised and these people have been sending circulars round, I suppose to all sorts of Deputies. I did not get one myself, but I suppose I was regarded as hopeless.


To all sorts of Deputies!

To a representative selection of Deputies, and they have written to the newspapers. But I do not think that this is worth much talk, one way or the other. I certainly would not resign if I were beaten on this.

I want to support Deputy O'Connell. I think somebody said that the liquor question was treated with levity, but this is also treated with a great deal of levity. It is really a trivial matter and as the Minister has stated that the revenue derived by the State from this racing is so small, I think he might give way to Deputy O'Connell. These race meetings do not do any harm. They may not do any good to horse-racing, but, after all, greyhound racing does not do any good either.

It is very seldom that the Minister for Finance and I agree on anything in connection with racing, but I am in agreement with his remarks on this. The matter is a very small one. I do not think that the revenue that will be collected at any of these meetings will pay for the stamps to go on the cards, so that that aspect of it does not arise. I would not like to see these meetings encouraged, because they are handicapping legitimate meetings, and the legitimate meetings are handicapped enough at present. The flapper meetings encourage dishonesty, because it is often the worst horse that wins, and not the best.

That happens at the Curragh too.

I believe that the country would be better off without them. Donkey races are popular, and they are sporting events, but the flapper meetings are in most cases held because they make money for sharps who go to them from Dublin and other places and who obtain whatever little money the mugs have got who are fools enough to bet. So that whilst I think it may be said that I am in agreement with the Minister possibly the acceptance of the amendment would make no difference, at the same time I would not like to see any encouragement whatever given to the development of these flapper meetings.

Is it not an amazing statement for a responsible Deputy to make that taxation should be inflicted which was producing less than the cost of collection? That seems an amazing statement for a responsible man to make.

That is not so, of course. If I were advised by the Revenue authorities that it would cost more to collect than is obtained, I would certainly say that the tax should be abolished, but that is not so. On the other hand, the amount that would come into the Revenue is of no real consequence. I do not want to mention the figure, but perhaps I might say £100 or so.

I think the Minister might celebrate the agreement between Deputy O'Connell and myself by removing this tax. The situation is that it is a sort of trade union regulation for discouraging these meetings, and if the amount is so small, there does not seem to be much occasion for keeping it on.

In justice to some of the promoters of the flapper meetings, as they are called, I do not think it is right that Deputy Shaw should be let get away with the statement that all the rogues are on the one side. I have been at race meetings, both flapper and legalised, as they call them, and often the best horse did not win at the class meeting either, because it would not suit the owner to let him win; he was waiting until he got a long price. If the people who promote flapper meetings want to do a little squaring too, it ought not to be thrown in their faces in this House.

I do not wish to have this amendment put in its present form. The Minister does not seem to have turned it down definitely. There is really a great deal of interest in this matter in the country. I have a list of over 140 centres where these meetings were organised last year. The Minister referred to the necessity for reducing the number of fixtures in order to get a bigger attendance at the fixtures that are held. I think this would not help very much, because the people who go to this class of meeting are the people who will not travel far to them; they come from a radius of three or four miles, and they are not able to make a habit of going to races. They are just out for one day in the year, and it will not affect the question of what is called legitimate racing one way or the other. The people who go are not regular racegoers. They go to the local meeting, and that is perhaps all they will go to in the year. As the amount of money is negligible, as a great many people are interested in the matter, and nothing will be gained, comparatively speaking, by keeping the tax on, I think the Minister might very well give way on the matter.

If the Deputy would put down the amendment in the other form, this is, by deleting all the words after "races," for the Report Stage, I would at least agree to leave it to a free vote of the House.

Why not remove the specific mention of the other organisations?

That is what I am proposing.

That is the effect of it—to leave out the words "and that the holding of the entertainment has been authorised either by the Turf Club of Ireland or by the Irish National Hunt Steeplechase Committee or by both the said Turf Club of Ireland and the said Irish National Hunt Steeplechase Committee."


To stop after the words "one or more horse races."

The Deputy withdraws the amendment and will put down an amendment for the Report Stage.

Amendment, by leave, withdrawn.
Section 23 agreed to.
Section 6 of the Customs and Inland Revenue Act, 1879, shall, on and after the 26th day of April, 1928, have effect in relation to plain spirits distilled in the Irish Free State reimported from Great Britain or Northern Ireland as if the words "the same shall be brought back within five years from the time of the exportation thereof, and" were omitted therefrom.

I move amendment 19:—

To insert before section 24 a new section as follows:—

"On and after the first day of May, 1928, entertainments duty within the meaning of section 1 of the Finance (New Duties) Act, 1916, shall not be charged or levied on payments for admission to any entertainment as respects which it is proved to the satisfaction of the Revenue Commissioners that the entertainment is merely subsidiary to an agricultural show, exhibition or competition."

I received a certain amount of encouragement in putting down this amendment when I discovered the attitude taken by the Minister in regard to the demands made upon him by Deputy Shaw and those associated with him. Deputy Shaw, as a result of his persuasive methods and the eloquence of those behind him, persuaded the Minister to remove the entertainments tax so far as it affected races under the rules of the Turf Club. The main argument put forward in support of that, and which was accepted by the Minister, was that the amount was so small—it was in or about £10,000—that the removal of the tax was in indication of the measure of support which the Government were prepared to give the horse-breeding industry. Racing is only carried on in this country under the rules of the Turf Club by reason of the fact that a certain number of wealthy gentlemen, whether trainers, owners or other people, can come together and form a company. Obviously the object of the formation of that company is to enable these people to run races under the Turf Club rules for what most people regard as profit-making purposes. I take it from what Deputy Shaw says that certain race companies have been carrying on under great difficulties and at a loss. The Deputy will admit that the members of the Labour Party supported him in the attitude which he adopted in regard to the demand which eventually resulted in the concession being given. On the other hand, agricultural shows are only carried on by a collection of individuals who come together to carry out the work on voluntary lines. Not only do they do the work necessary in connection with the organisation of the show, but in most cases they actually help to finance it. Many shows, including some in my own constituency, have been carried on at a loss. That can be proved to the satisfaction of the Minister by the production of the balance sheet of those shows. I think it cannot be disputed that the shows were carried on for the purpose of encouraging the breeding of live stock. There may be side-shows, but, as far as one can see from attending the agricultural shows, these side-shows as well are closely related to the encouragement and development of the breeding of live stock.

The amount represented by the concession given to the race-course companies and the racehorse owners, trainers and other wealthy people associated with the carrying on of racing is about ten thousand pounds. I have no idea, I admit, as to what the amount of the concessions asked for in this amendment would be. It would be a very small amount compared with that involved in the concession to race meetings. I hope the Minister will realise that if he agrees to this amendment he will be giving a concession to the people who organise these shows and who do all the work on a voluntary basis, and in many cases support the shows from their own private resources. The concession would only mean a small amount to the Government. I hope the Minister will agree that in removing the entertainments tax in this case he will help to reduce the losses of some of the people responsible for the carrying on of these shows. I cannot give any accurate idea as to the amount involved, but I hope the Minister will take into consideration the fact that this is a very important part of the work that is being done, and that I hope will be carried on, to develop the live stock industry, and that for the same reason as he gave the concession to the race-course companies he will give this small concession to the people who do this voluntary work, which is of a very useful kind.

Has the Minister any idea of what the actual amount involved will be?

If it were not abused it would be very small. I would be quite prepared to accept the principle of the amendment, but I think it ought to be drafted rather differently. It ought to be drafted in such a way as to give the Revenue Commissioners power to exempt. As it is drafted, it would be difficult to administer. I am prepared to accept the principle of it, and if the Deputy withdraws it I shall bring up an amendment on the Report Stage that will have the same effect. We must take care to see that we do not give exemption to something where the other entertainments are the main feature and the agricultural show is subsidiary. In order to make sure of that in practice we must draft the amendments separately. At present the position is that a cattle show is exempted, even if it has a band. Some thing like a small Féis in connection with a show does not render it liable to tax. By agreeing to the principle of the amendment, I do not think any appreciable revenue is going to be lost. As a matter of fact, only a comparatively small number of shows are liable to tax.

In drafting the amendment I tried to give whatever power the Revenue Commissioners required to decide as to whether it was possible to remove the entertainments tax in certain cases where application might be made. I thank the Minister for agreeing to accept the principle and I shall leave it to him to bring in an amendment which will cover the matter.

I should like to put a point to the Minister in connection with the entertainments tax with which I think he is familiar. It is a case which I raised with him as to exemption from entertainment duty of a particular body which was giving entertainments which were, in our opinion, absolutely essential to the educative purposes of the Association. The difficulty is that, as far as we can see, education is defined to exclude cultural matters. I do not want to go elaborately into the case, because the Minister has full particulars.

What I am suggesting to the Minister is that between now and the Report Stage he might find some other and wider definition of that term. I wish to say, quite frankly, that I accept, without any hesitation, the idea that the entertainments tax should be levied upon a whole lot of bodies of an amateur character engaged in entertainment. But there are some whose claim to be educational is so clear and definite and whose actual educative functions and results on the lives of individual people engaged in them are so marked that the mere fact that the machinery which they use for education is cultural ought not to rule them out. I would be inclined to say that we should in this case have to apply and satisfy the Minister for Education that the purposes are educative and that the effect is educational.

I am asking the Minister if he can to consider and find between now and the Report Stage some terms by which we could bring this matter to a test. The one I have in mind happens to be the Cork Shakespearean Society, a body made up of very ordinary people, apprentices, shopkeepers, assistants and people of that kind. Yet they actually rehearsed concurrently in a loft—and this is an amazing statement —seven uncut Shakespearean plays, and produced these in public at a very high standard of professional ability, without a single previous public performance. That is an achievement which, from a cultural and an educational point of view, ranks with the achievement of the Abbey Theatre in acting. They have taken a man with an absolutely fatal impediment in his speech to perform an important part. There was one case I knew of a man who could not speak at all practically. That man produced and acted in my presence the part of Hamlet better than I have ever seen it done. There was a cripple in another case, and it is a rather extraordinary psychological reaction of the training given there that this man was capable of allowing his deformity to be used for artistic purposes. This deformed man took the part of Richard III., and performed that part with amazing skill. There are certain numbers of associations and bodies which are apparently excluded from the concession the Minister would like to give, and I am suggesting that he should try to find some definition by which we could ascertain whether or not, within a reasonable meaning, the function of these bodies is educative, and educative up to a standard at which the State ought not to tax it.

I would like to associate myself with Deputy Flinn's appeal on behalf of a similar society in the city of Waterford.

The difficulty in this case, of course, is to draft a section which will exempt bodies whom most people would agree have a certain claim, at any rate, to be exempted, without exempting others. It is very difficult to draft a section that might not mean our losing a good deal of our entertainment tax. I have had representations from the Deputy and from a good number of other people in this matter, and I have given it some consideration. I shall have it looked into as sympathetically as possible, but I do not know if it would be possible for me, between this and the Report Stage, to come to any conclusion upon it. It really is quite a delicate case. There are always borderline cases, and they cause great difficulty. You finally might be driven by a carelessly or hastily drafted section actually to repeal it because its scope was much greater than was intended. I can only repeat that, in view of the very strong representations made, of which I frankly recognise the force, the matter is under consideration, but I do not think I could give a definite promise.

That is perfectly satisfactory.

Amendment 19, by leave, withdrawn.

I beg to move amendment 20.

Before Section 24 to insert a new section as follows:—

"Entertainments duty within the meaning of Section 1 of the Finance (New Duties) Act, 1916, shall not be charged or levied on payments for admission to any entertainment held under the Council of Aonach Tailteann, and this section shall have effect from the first day of August, nineteen hundred and twenty-four."

I have hopes that the Minister will feel favourably disposed towards this amendment, because the primary object is in line with the policy he referred to a few minutes ago, and of which the Dáil has already approved, and that is that it is a good thing as far as we can to encourage healthy outdoor athletics. The second reason is that the effect of the amendment is to endeavour to help, in a rather effective way, without possibly much expense, national games. I confine myself in the first place to the amendment without the last two lines, because An Ceann Comhairle has pointed out to me that there is at least a doubt as to whether it would be allowable for me to move these two lines in my amendment. Without trying to argue that as a point of order, I should be quite satisfied if I could bring forward certain facts in connection with the 1924 Tailteann Games, and ask the Minister to consider these facts with a view, if he feels favourably disposed to the whole idea, of seeing whether they could be extended so far as the 1924 games are concerned.

The actual entertainment tax in 1924 which these games would have produced would be something like £1,200, but I do not think that the corresponding sum in this year's games will be anything like that, because owing to that provision which the Minister mentioned a few minutes ago definite athletic games would be free from entertainments tax. So I do not think that there is that amount of money involved in any case. Further it is questionable whether money is involved in the matter at all, because one can certainly put it this way: If the entertainment tax is levied it will postpone to a longer date and, possibly a very considerably longer date, the repayment of the loan which was made by the Dáil to the Tailteann Games in 1924. It certainly is hoped this year, and in future years, that the Tailteann Games will pay their way, and very probably, more than pay their way. The length of time that would be taken up making such profit as would enable that loan to be repaid will be very perceptibly increased by the enforcement of this tax and, therefore, I say it is not so much a matter of money really at all. My point is that on principle we ought rather to encourage the games than to make a profit out of them.

Now with regard to the 1924 games and the enforcement of the tax for them, I do not like to do anything of a retrospective kind, but, nevertheless, there are these facts that the Dáil granted to the Tailteann Games in 1924 a loan of £7,500. There was difficulty about the levying and the collection of the entertainment tax of which I think the Minister is aware, and which, if attention had not been paid to, might have endangered the success of the games. Therefore, the tax was not collected when the entrance money was being taken, but the effect of that was that the Revenue Commissioners, I suppose—I do not know whom, but somebody at any rate —held that a greater sum than £1,200 was really due by the games. And as a consequence, a sum of £3,000 was deducted from the £7,500 loan which was made by the Dáil and only £4,500 paid over. Therefore, the effect of making this retrospective would be simply that the loan of £7,500 was made and the Tailteann Games would owe more. But, in order to get them to owe more, the Government would have to pay back £3,000. That is to say, it is practically in that respect very largely a book transaction. But it has this vital point for the Tailteann Games themselves, that the profit that was made in reference to the games was only a few hundred pounds, and that profit—I use the term perhaps wrongly—because it was a profit on the £4,000 that was handed over by the Government as a loan and not paid back. It really was a loss, and if that were attempted to be repaid all that could be brought forward to enable the present year's games to be set going was this sum of £500. Now it is obvious that a considerable sum of money is required to start and keep the organisation going, in order to make the games a success before any revenue can be received, so that having in hand that sum of £3,000, as well as the £500, would have made all the difference between the starting of and the running of these games as compared with the difficulties which they actually have had. I would ask the Minister when he is considering the general principle for the future, to see if he cannot reconsider the decision that was come to with reference to 1924.

I would like to say that the Deputy's amendment, as it stands, is thoroughly vicious. If this amendment were accepted by the Chair and passed, I can see no reason why some other Deputy—Deputy Flinn for instance—should not bring forward an amendment saying that the income tax should only be a shilling in the pound, with effect as from the 1st April, 1922. I really do not think the amendment should be passed in this form.

I did not suggest that it should.

In any case, it would not take effect. If Deputy Thrift's suggestion were adopted what would happen is this: the Revenue Commissioners would pay back £3,000 to the Exchequer, and Aonach Tailteann would be no better off. If they want money immediately, we have provision made in this year's Estimates for giving them a certain sum. If that is not sufficient, and if a suitable case can be made, and it might be possible to do so—I do not say that I would like to hear the case— but in such an event it would be possible to introduce a Supplementary Estimate giving them more, if we thought it would have support in the Dáil. If anything is to be done for them so as to give them more money it must be done by means of a Supplementary Estimate in the House. That is really the only way of effecting that.

What about levying on them?

For the future?

As a matter of fact, I think we might agree to the matter. I doubt whether there will be a liability to pay tax on it, but I would like to examine that with the Deputy, who probably is in touch with Aonach Tailteann. If it were necessary, I would be prepared to introduce an amendment exempting them for the future, but not just in this way. I would allow the Revenue Commissioners to exempt them, but if exemption were given in the words of the Deputy's amendment, I think the council of Aonach Tailteann, over which we have really no control—I do not know who has control over it— might go and organise any sort of entertainment for any object. We would have to tie them down somewhat. As to the principle of exempting the actual funds of Aonach Tailteann, I think I could agree to that.

Of course, I never anticipated that the amendment, in its present form, would be accepted, but I just merely wanted to bring the matter up.

On the point of order, having listened to Deputy Thrift and the Minister, I am not yet clear as to what the effect of the last part of the amendment would actually be, that is the retrospective part of it, which reads:—"This section shall have effect from the first day of August, nineteen hundred and twenty-four." From the point of view of the Chair, that part of the amendment is clearly out of order, because presumably a tax was chargeable and leviable, and either it means that money which has been paid into the Exchequer would be paid out again, which is imposing a charge, or that a debt due to the Exchequer would be remitted. In either case a Deputy other than a Minister could not move a proposal to that effect. The amendment actually before the House is in this form:—"Entertainments duty within the meaning of Section 1 of the Finance (New Duties) Act, 1916, shall not be charged or levied on payments for admission to any entertainment held under the Council of Aonach Tailteann."

Ba mhaith liom cuidiú leis an leas-rún so mar is dó liom go mba cheart don Dáil congnamh do thabhairt d'Aonach Tailteann. Is fiú dhúinn an tAonach a bheith againn. I dtíortha eile ar Roinn na hEurópa—níl fhios agam i dtaobh Sasana—nuair a bhíonn cluichí ar siúl cuidíonn an Rialtas leo. Ba chóir do Rialtas an Stáit seo cuidiú le hAonach Tailteann. Níl fhios agam an bhfuil cead agam tagairt do dhéanamh don líne deiridh san leas-rún.

Isé an brí atá leis ná na trí míle púint d'fháil ar ais no an tsuim sin do scrios amach mar dhroch-fhiach. Sin é an brí atá leis. Ba mhaith liom a iar- ar an Aire, má tá cead agam, a mhíniú dhúinn conus is féidir sin do dhéanamh.

Ní féidir le h-aon teachta acht leis an aire é sin do dhéanamh.

Bhal, d'iarrfainn ar an Aire an rud san do dhéanamh.

Is the Deputy withdrawing the amendment?

Yes. The Minister has undertaken practically to bring forward an amendment which will meet the case. He has stated that he will reconsider the matter or see what can be done in order to put the games in funds from one period to the next. That is the one point that I wanted to urge, that there should be the possibility of carrying forward enough money so that the Council would be able to restart proceedings for the games that are to come on after the period of four years.

I think representatives who are familiar with the whole matter should come and consider the financial aspect of it.

Do I understand the Minister to say that he is prepared to receive them?

Amendment, by leave, withdrawn.

I move amendment 21:—

Before section 24 to insert a new section as follows:—

"On and after the first day of July, nineteen hundred and twenty-eight, section 1 of the Finance (New Duties) Act, 1916, as amended by section 3 of the Finance Act, 1917, by section 11 of the Finance Act, 1918, and by section 7 of the Finance Act, 1919, shall have effect as if the following scale of rates of entertainment duty were substituted for the scale set forth in the section:—

Where the payment, excluding the amount of duty, does not exceed 6d.—nil.


6d. and does not exceed


0d.—one penny.


1s. 0d.,,,,,,,,




2s. 0d.,,,,,,,,




2s. 6d.,,,,,,,,




3s. 6d.,,,,,,,,




5s. 0d.,,,,,,,,


6d.—one shilling.


7s. 6d.,,,,,,,,


6d.—one shilling and sixpence.


10s. 6d.,,,,,,,,


0d.—two shillings.

15s.—Two shillings for the first 15s. and sixpence for every 5s. or part of 5s. over fifteen shillings.

During the debates this afternoon there has been a great deal of consideration given to what one might call physical entertainments. Now, I should like to turn to something more or less in the nature of intellectual entertainments. I should like, in the first instance, to refer to what Deputy Flinn described a few moments ago as the services of individuals. I refer to services—he referred to individuals, I think—which have active educational functions in the lives of individuals in the country. In the first place, I would like to refer to the incidence of the present taxation. Where the price of admission is 3d. there is a tax of 1d., or thirty-three and one-third per cent.; where it is 4d. the tax is 1d., or 25 per cent.; where it is 4½d. the tax is 1½d., or 33? per cent.; where it is 5d. the tax is 2d., or 40 per cent.; where it is 7d. the tax is 2d., or 28 4-7 per cent.; where it is 9d. the tax is 3d., or 33? per cent.; Where it is 1s. the tax is 3d. or 25 per cent.; where it is 1s. 2d. the tax is 4d., or 28 4-7 per cent.; where it is 1s. 6d. the tax is 4d., or 22 2-9 per cent.; where it is 2s. the tax is 4d., or 16? per cent.; where it is 3s. the tax is 6d., or 16? per cent.; and where it is 5s. the tax is 9d., or 15 per cent.

It will be noted from the way the percentages run that the incidence of the taxation is clearly unfair. The percentage is heaviest on the small amounts for admission, that is to say, on the people who can only afford to pay 3d. for entertainment, and who possibly can only go to that entertainment once a week or so. They have to pay the highest amount of tax. The incidence of that is clearly unfair. It might be just as well that the history attached to this tax would be recounted.

This entertainment tax was originally introduced by the British Government as a war measure in 1915. The war has no effect upon us at present, and as a war measure it ought to be dropped. Some years ago the British Chancellor of the Exchequer abolished the tax in Great Britain in connection with the lower prices and gave a considerable concession in favour of the higher prices. We ought to have at least a similar concession here. No relief has been given to the cinema trade on this side, whilst extra burdens have been put on the trade in the way of film censorship. Other forms of entertainment were referred to a few moments ago, such as greyhound racing, that are free from tax. I know the Minister made certain qualifications with regard to that, though these entertainments are at hours when the cinemas are in operation. A competition is allowed between these two forms of amusement which is not fair, and which seems to work against what is at least the more intellectual of these two entertainments, for the cinema affords intellectual amusement and gives people an opportunity of seeing things as they really are throughout the world, and if some of these things are not true to life, surely the scenery and surroundings are. I think the Minister might easily allow the incidence of this taxation to work out more favourably, and I hope he will be in the same sympathetic mood with regard to this as he has been when deal ing with the other amendments.

We would be inclined to support the amendment on the general ground that the more popular amusements, provided they are not detrimental to the people, ought to be interfered with only as little as can possibly be avoided. We feel that a remission could possibly be made in the tax in respect of the lower rates of admission, and possibly the Minister might find compensation for that by making a slight increase in respect of the higher rates. We think, in general, that no remission of taxes for anything in the nature of a luxury could very well be granted when you have to put a tax on the necessaries of life. We believe this is one of the taxes where some alteration might be made in the incidence. The particular form of tax in this case affects very seriously the cinemas throughout the country. Reference was made during the discussion of the amendment to Section 15, to the decline which has taken place in the consumption of alcoholic liquor. I think that decline to a great extent is due to the change which has taken place in the habits of the people, and to the fact that they have some other alternative place to resort than to the publichouse. In the present instance I do not want to make any political point about it, but the times are so hard people really require some little amusement and relaxation in which they can forget their ordinary daily worries. If you do not allow them to enjoy relaxation in a place like a cinema they might seek an alternative in the publichouse. For that reason I think the amendment should receive the very serious consideration of the Minister. Although the cinemas, and places of entertainment of that sort, are taxed in respect of admission, I do not think that the dancing halls are taxed. If it is necessary that the Minister should find some compensation, possibly he would take into consideration the question of imposing a tax upon the dancing places of amusement, and, as my friend Deputy Little reminds me, you have also the dogs.

I should like to join with Deputy Hogan and Deputy MacEntee in urging the Minister to consider this proposal as sympathetically as possible, and to give some remission in the taxation at present imposed on the cinema trade. I think the case for doing so was very cogently put by Deputy MacEntee, and I can add very little to what he has urged upon the Minister. I am of the opinion of Deputy MacEntee that a great deal of the sobriety at present is due to the effect of the cinema on the people, and that a great deal of the money which was formerly spent on alcoholic drink is now being spent in necessary amusement. Deputy Hogan stressed the part the cinemas were playing educationally and from the point of view of amusement. I am in complete agreement with his argument in that respect. I would point out that the cinemas give employment to something like 10,000 persons, according to my information. I am further informed that unless some relief is given to them in the way of taxation, which the Minister is now asked to consider, they will be forced to close during the months of July, August and September. That would be exceedingly regrettable, not only as regards the owners, but also the general public. There can be no doubt that in these times of economic stress the people require some relaxation. I ask the Minister to consider if the cinemas were closed during these three months what effect and reactions that would have on the people, especially from the point of view of sobriety. Nobody will deny that the cinemas are playing a very useful and creditable part, and I think they are entitled to sympathetic consideration from the Minister. Looking at cinemas from the municipal point of view, they are bearing a very great burden in the way of rates in the cities and towns. I have in mind one cinema in O'Connell Street, which is not by any means gigantic, and which pays the enormous sum by way of rates of £834. Now those are things that I feel sure any Minister for Finance will certainly consider sympathetically, and we urge upon him to take action. It has been suggested by those who have already spoken that some other method of taxation to replace the remitted taxes could be introduced. It has been pointed out here that greyhound racing is not at the moment taxed, and from what fell from the Minister I gather he did not view that with any particular equanimity or satisfaction, and that he would be inclined to redress that if it were possible. I gathered from him that it was not only possible but probable.

I would point out to the Minister that in the case of people going to a cinema and paying 1/6 admission that is the beginning and end of their expenditure, but in the case of people going to a race meeting or greyhound races the admission fee is the smallest item in their expenditure. I think it is common knowledge in this city anyhow that a great deal more money is spent by gambling upon these particular dog racing courses than really the people of this city can afford. If such racing is free from tax, as I gather it is at present, I suggest that a considerable portion of the revenue which would be lost by giving the relief the cinema people are asking can be recouped easily by putting a tax on dog racing. I have been informed that something like 10,000 people have frequented, in one week, Harold's Cross and Shelbourne Park. That information should afford the Minister for Finance means to recoup the taxes which the cinema people now ask him to remit. I have also been informed that there was a certain venue of greyhound racing with a capital of £5,000 that made a profit of £15,000 in a single year.


Because the best dogs did not always win.

I am not suggesting that, Deputy Jordan. I am endeavouring to arrive at an even balance between dogs and pictures if I can. If £15,000 can be made on a capital of £5,000 in one year by a form of amusement entirely free from tax I suggest to the Minister that some alteration is not only necessary but equitable. Deputy MacEntee, I think, referred to the fact that the dancing halls in the city were entirely free from amusement tax. Possibly that is correct, and if that is so the revenue these people are drawing from this particular form of amusement is much greater than the ordinary Deputy can realise. Moreover, those people are actually infringing at present upon the rights of variety theatres which are already taxed. I have in mind one particular dance hall in the city which I have been told has brought over a turn which cost the sum of £200. No tax whatever is imposed upon that form of amusement. Here we have this particular dance hall, with no imposition by way of taxation whatever, infringing upon the rights of other modes of entertainment which have to pay tax. There can be little doubt about it that if, as I have already stated, it should come about that the cinemas should be closed for a period of three months very great hardship would result both to the owners of the cinemas and to the public. I would also point out that not alone is very considerable employment given by means of the cinema trade but they are also a source of revenue to local authorities. I have already referred to the question of local taxation and then there are huge electrical charges in addition to the entertainment tax we now ask the Minister to remit. The Minister, I feel sure, will consider the request sympathetically. I would urge him from these Benches in common with my colleagues on the Labour and official Opposition Benches to deal with the matter as sympathetically as he can, and give the relief sought equitably and from the point of view of necessity as far as the cinema trade is concerned.

I view this particular matter from a slightly different angle from that referred to by the previous Deputies. I am certainly in sympathy with the sense of the amendment itself, but I wonder would the Minister try to realise how many children are affected by this tax, particularly in connection with the lower-priced seats. He may judge it purely and simply from the point of view of revenue, from the point of view of how many tickets are sold. He may not care to try and differentiate between where the tax will come from, whether it will come from adults or children. It may have a serious effect from the point of view of revenue if alterations were made, but, nevertheless. I do not believe for a moment that this House would desire the children to contribute to the upkeep of the State, as they do chiefly in the case of those low-priced seats. I am not at all anxious with reference to luxuries that any tax on a luxury should be remitted. In fact, from a table which I have had submitted to me, it appears that some of these prices could stand a little extra tax, but certainly from seats ranging from prices up to 6d. that tax should be remitted and should not be collected. The percentage of tax collected is 33?, and I am sure that if the people who run those cinemas could get a revenue of 33? per cent. they would be very happy. The point I want to urge on the Minister is that there are many cinemas in the city of Dublin and throughout the country which cater specially for children's performances on certain afternoons and evenings, and I think that where it can be shown that a great many of those present in the lowest-priced seats are children, the tax should not be collected. I would ask the Minister to consider the low-priced seats, and to hold out some hope that there will be some alteration made in the amount of tax to be charged.

The amendment, as it stands, would cost £40,000. It might be possible to gain something by increasing the tax on the higher-priced seats, but not so very much. The difficulty is that if you make the price of a seat which is 3/6 now 4/-, the person who has been going to that 3/6 seat will go down to the 2/4 seat rather than pay 4/-. An increase in the prices of the dearer seats tends to drive people down to the cheaper seats. Only a limited amount can be gained by increasing the tax on the higher seats. I would not entirely agree with the Deputy who said that it is obviously unfair that the tax should be proportionately high in the case of the lower-priced seats. I think that must be. As long as the tax is to be reasonably remunerative, that must be so. The person going to the higher-priced seats is paying on the double. He is paying more to keep the cinema open than the person going to the lower seats, and he is paying more to the Exchequer directly. The whole matter is somewhat difficult. I believe that only a portion of the £40,000 that the Exchequer would lose would go to the public. A great deal more of it would go into the pockets of the cinema owners, and the prices would remain as at present.

May I interrupt the Minister to say that I have been given to understand that any remission of taxation given to the cinema owners will be passed on in full to the public?

I do not really accept that. At one time, the cinema people stated frankly that they would not pass on any remission. When they found, as a result of a discussion in the Dáil, that that was not a very good line of argument to take, they turned round and said, "We will pass it on." Possibly some of them would, but possibly some of them would not. In order to make up the deficit, it has been suggested that dance halls should be taxed. There is one type of dance hall which obviously seems the sort of place entrance to which should be taxed. It is a case, too, in which tax could be easily collected. In the case of some other dance halls, there would be certain difficulties in effectively and easily collecting the tax. It may be that we can find means of giving some remission to the cheaper seats in the cinemas by some increase in the dearer seats—though that would give us very little—and by some system of taxing dancing in the dance halls. We have given a certain amount of consideration to that, because it always that before a Budget members of the public in large numbers write in, making suggestions. Most of the suggestions have to do with remissions of taxation, but many people write in making suggestions for the imposition of taxation. We had the suggestion before us that dance halls should be taxed. We were not able, in time for this Budget, to work out a scheme which we could regard as satisfactory for taxing dance halls. I do not know whether or not, if the matter had been further considered and a scheme evolved, it would be one which could be approved of. The matter had not advanced to that stage.

As things stand at present we could not give any concession like this to the lower-priced seats. The actual deficit that would be occasioned would be too great. I should be prepared to look further into the matter before the Report Stage and to see whether, within the entertainments tax itself, without losing money, anything could be done We have budgeted without a margin We cannot really afford to give away taxation at the present stage. It may not turn out to be possible to do anything in this connection in this Finance Bill. I am inclined to think that it would be possible, if further consideration were given to the question of dancing, and careful consideration were given to getting more out of certain seats, to give some concession without loss. But as I see the matter at present, we could not give as much as Deputy Hogan asks. As a matter of fact, dog-racing would not give a very big contribution towards this loss. It is estimated that if we were to succeed in collecting tax in respect of entrance to dog races we would get from £5,000 to £6,000. The loss here is £40,000. I do not see that it would be possible by any adjustment of the tax on the higher-priced seats to make more than another £5,000 or £6,000. I have not gone fully into that. It would be difficult to make up, on entertainment tax, a sum as large as £40,000, or even half of it. At the moment I do not see that the amendment can be accepted, and I do not see how a substantial concession along the lines asked for by Deputy Hogan could be given.

It is true, I think, that the cinemas are labouring under certain difficulties. That is due to a number of reasons as well as the tax. It is due in part to the difficult conditions in the country. The tendency is, as in everything else, for the custom or trade to drift towards the larger picture theatres— that is so, at any rate, in Dublin. People in the trade have told me that no matter what concessions with regard to entertainment tax are given, we are not going to do any good to quite a number of the smaller cinemas, that the people are simply going to go to the big houses which are able to afford more attractive, fresher and more widely-advertised pictures. I believe it is the owners of the smaller picture houses who are mostly clamouring for this concession. They are clamouring for a thing that I am told—and I believe it is in line with what happened elsewhere—will not substantially help them. I do not know whether I shall have anything more to say on the matter on Report Stage or not, but I must oppose the amendment as it stands.

I can speak with a certain amount of personal experience on this matter, because I have some financial interest in it. The point I am making is that, due to these watertight compartments you have, it is very difficult even to regulate the prices in the way you want. In many cases you are driven to put the lower prices on an uneconomic level, because if you do not you drop into a stage in which your taxation proportion runs right up. I have a graph here showing the rates, and if you take a case here at one shilling your taxation percentage is 25. By the time you have gone down to ninepence, your taxation percentage has gone up to about 40. You are not able to vary it in little stages. You come to a place and you say, "I should like to take a penny off here." You cannot do that without sacrificing two or three times the amount of revenue. The broad tendency, undoubtedly, is that as the people become poorer entertainment becomes more of as necessity. The necessity comes in certain classes of lives for a certain amount of amusement in one place or another. That becomes an actual psychological necessity. If the Minister cannot start to make a concession along the whole of the scale, I would suggest to him that he concentrate very severely upon the lower side of the scale—that is, from one shilling down. He took the case of the little cinemas which, he said, were being pressed. I cannot say that I speak with any particular knowledge of this, but the particular case he put rather suggested that in those cases they would pass on the advantage. Those places are hard-driven, and, probably due to the watertight compartments into which they are forced by the present gradation of the tax, they are forced to put up a price very often which they would rather not, because if they came down at all they would lose very much more than they would gain.

It is along those lines he should proceed and, simply and solely, concentrate on the lower side. I think the Minister is entitled to the revenue he is now getting from the entertainment tax, but it ought to be done down on the other side. Another point I wish to put—it is quite easy to do it in relation to big places and places where the tax is collected by revenue officials and where payment is made by cheque—is that the Minister might perhaps fix 25 or 20 per cent. of the total receipts and leave the people who arranged the entertainment to vary their allocations as they liked without being tied in watertight compartments. I am sure that the people would get considerably more value for their money. I have known cases where the receipts have been reduced and the taxes increased. You are often between the devil and the deep sea. You may want to do a thing which may be right commercially but which, owing to the present allocation of water-tight compartments, it is impossible to do. I suggest that the Minister goes into that and, if he cannot meet the case over a considerable area, he should concentrate on the lower end of the scale. There you get down to pence and halfpence and you cannot make a lower concession. In the lower scale people are paying large amounts and you are driving them, if not into injustice, into hardship. I think the Minister might consider coming to a certain point where he would stop taxing altogether. He might, for instance, say that he would not tax under sixpence. Whatever way he works it out he will find that his best plan will be to concentrate on the lower rates.

I want to say a word against Deputy J.J. Byrne's suggestion to put a tax on greyhound racing. A case was made for the abolition of the entertainment tax on horse-racing on the ground that it is an industry but, if it is, the same applies in the case of greyhound racing.

There is no suggestion in the amendment about any such tax.

No; but Deputy Byrne advocated a tax.

That does not put it into order.

Am I in order in speaking?

Yes, to the amendment, but not in reference to a tax on greyhound racing.

It is suggested as an alternative tax.

I understand that the objection is to the suggestion that a tax should be put on greyhound racing.

Yes, and I am entitled to give my reasons.

I would like to join the Deputies who have made an appeal for a lower rate of tax in the case of smaller theatres with low prices seats such as 5d., 6d., and 9d. The Minister in his reply made the case that people were inclined to drift to the bigger houses. That may be so with a certain class, but there is a class who visit the picture houses I have in mind where there are cheap seats from 5d. to 9d.— seats which you have not in the bigger houses. Such people will not drift to the bigger houses. I suggest that these small houses, to which I refer, should not have a tax of twopence on a five-penny admission ticket. That is really asking people in low priced seats to pay 40 per cent. amusement tax as against the 20 per cent. paid by people in higher priced seats. I maintain that these smaller houses should not be crushed out, and that the tax as applied to them should be reduced. A few theatres which were started in Dublin in the early days of the pictures have seating capacity for not more than three or four hundred people. Such a tax is unfair to them and they will be crushed out if it remains as it is. Some of the houses which I have in mind employ staffs of, at least, a dozen. In one case the theatre has a staff of eight, but even a staff of eight employees ought to be considered and such theatres should not be crushed out of existence if it is in the Minister's power to avoid it.

I think the case has been very well made. The Minister said that he could not realise much out of dog racing. If I were in a position to introduce an amendment for the increase of taxation in certain quarters I could probably show him where an amount of money could be got, but as I am not entitled to do that I must refrain from doing so. I would like to get something more definite from the Minister as to what he is prepared to do between this and the Report Stage, as I am anxious that whatever benefits may be derived from this will pass to the public. That is mainly why I moved in the matter. Before we decide what shall be the fate of the amendment I would like the Minister to state more definitely what help he is prepared to give in the matter.

I could not accept this. In view of the general Budget position I could not accept an amendment that would really lose revenue on entertainment tax. It may be possible to lose perhaps a thousand pounds, but, generally speaking, it is impossible to accept an amendment that will mean a loss of revenue. I am prepared to examine the scale and see whether it is possible by readjustment to relieve the lower priced seats or, rather, some of them, but I would not promise to consider any proposal that would mean a loss of revenue.

In view of that statement I withdraw the amendment.

Amendment, by leave, withdrawn.
Question—"That Section 24 stand part of the Bill"—put and agreed to.

I move:—

To insert before Section 25 a new section as follows: "Section 36 of the Finance Act, 1926, is hereby repealed."

Section 36 of the Finance Act of 1926 is the last remnant of the excess profits tax. That tax was amongst the taxes put on during the war. It has gone for all practical purposes except in this case where, when it is decided by the Revenue Commissioners that there is a case of fraud or wilful neglect "on the part of any person who has been owner of a trade or business liable to excess profits duty, and on which such duty has not been assessed, the Commissioners may make an assessment, etc." It gives the Commissioners power to act as judge and jury in deciding the question as to whether there was fraud or neglect, and then to impose the excess profits tax which they consider should have been paid previously. The actual effect of that in a considerable number of cases is to prevent people paying arrears of income tax. Anyone who has committed deliberate fraud or wilful neglect, and who has done it on a large scale, is not going to pay arrears of income tax if they can avoid it. Such people have taken up the attitude, more or less, of clearing out of this country. They have probably put the money into some investment in England and the dividends are paid into an English bank. If these people are in a position to reside elsewhere, and if they think they are going to be followed up closely, they will go elsewhere, and then of course they cannot be followed at all, so that really the only people who might be caught under this clause are people who conscientiously think they have not committed fraud or wilful neglect. You have people who may have committed a kind of technical fraud or neglect, but they are not criminals in any sense of the word. They now find themselves placed in the position—and I know cases of the kind—where they say, "If I could get rid of my liabilities by paying the arrears of income tax I would do so, but when I am also faced with the prospect of having extra profits charged against me I cannot do it, or I am not going to do it, because it would mean such an enormous sum."

Take, for instance, the case of a man who would be willing to pay £4,000 arrears of income tax. Such a man might have to pay £15,000 if excess profits were charged against him. It is a principle of equity and a principle which should be observed in making law, that you should not make the law so difficult that people will do their best to break that law and evade it. It is rather to get rid of this imposition and to get rid of something which is wrong from the point of view of the principle of law-making that I move this amendment. It may probably affect the Government in that they will get in more tax. People will be glad to get rid of this threat which overshadows them. They are anxious to live in the country and to invest money in the country if they can do it, and if the excess profits threat is removed they might very likely come along and make it easier for the Inland Revenue authorities to collect arrears of income tax. If in any shape the Minister for Finance could recognise this principle and consider it. I think it would have a good effect, because although there may be cases of abuse or fraud, possibly the amount of money which the Revenue authorities are going to get in cases where there is obvious fraud may very well be counter-balanced and exceeded considerably by the amount of money which will be brought in if the clause were got rid of altogether.

Since the Deputy mentioned this matter on the Second Reading of the Bill I have had consideration given to it. At that time I was not quite sure whether I might not be able to go some way to meet the Deputy, but on examination of the position I find it will not be possible to do so. So far as I could find the adoption of the amendment would probably lose us a very large sum of money. We would remain liable to make repayments, and we would lose revenue that is coming in. The matter has been examined by officials who are familiar with the whole income tax position and the excess profits tax position, and who know something about the evasions that have to be contended with. The view taken is that a very large sum of money would actually be lost. We are very near the end of this task, but we cannot drop off our repayments, and we could not drop off the recovery of tax, on which a great deal of work has already been expended, because the investigations have brought matters up to the point where the Revenue Commis- sioners can certify that there was certain or wilful neglect. There are not so many other cases on which work will have to be undertaken. In a year or two this thing will pass away, but at the present stage a great deal of that work has been done. A number of cases have ripened, or almost ripened, for action, and the passage of the amendment would mean that these people who are going to be brought to book would escape and the tax would be lost.

The Revenue Commissioners' position, as the Deputy knows, is that they have to give a decision as to whether or not there was fraud or wilful neglect. Once they have decided that, it only enables them to proceed for the recovery of the tax. No tax can be recovered that is not due, and the taxpayer has all the ordinary avenues of appeal open to him if he challenges the assessment or if he challenges them on a point of law. The only point he cannot challenge is as to whether they will or will not proceed. I have not any sympathy with these people, and I have no sympathy with the patriot who will stick to the country if he is allowed to put £15,000 of the Exchequer's money into his pocket. That is really the patriotism of the people who would stay here if they are not asked to pay arrears of income tax. I fear that if we let these people off some other people who owe income tax arrears would hold off and would create an agitation in the belief that they would be relieved of their liabilities. In any case I am not satisfied, as Deputy Little thinks, that the Exchequer might gain such a large sum by letting these people off. It would lose a lot. Taking such cases as there are of frauds or abuse, I think it is true that where their neighbours, perhaps a next door neighbour, has just been brought to book, there is an element of unfairness to people who have already been made to pay if we allowed other defaulters to escape. It would be unfair if by the adoption of Deputy Little's amendment such people could say they had been mulcted because their cases were handled a little more rapidly than those of their neighbours. Undoubtedly they would have some grounds for a sense of grievance, and, taking all the factors into consideration, and taking into account that a substantial sum of money would be lost, I feel that the amendment of the Deputy is one that I cannot accept.

We, on this side of the House, have no sympathy with any person who attempts to evade the payment of income tax. That person is in the position of trying to make his less fortunate fellow-citizen pay by indirect taxation some portion of the burdens that the man who is evading his income tax should bear. I think this is a question that we can consider on the grounds of expediency. Neither have we any sympathy with the patriot who, as the Minister for Finance says, would like to invest £15,000 of ill-gotten money in this country, provided he would be free from retrospective proceedings from abroad. I think the point we have to consider is whether it would be to the advantage of the community as a whole that certain sums of money which are at present locked up and, therefore, unproductive, should, by some sort of widening-out of these arrears and past malpractices, be made available for the benefit of the community or whether on the whole that would not be a good thing to do. That is the sort of problem we have to consider quantitatively.

I should like if the Minister could give us some indication as to the amount of money he anticipates he will be able to recover under this particular section, and, on the other hand, the amount of repayment of the excess profits duty which he expects to get. If he could give some information like that to the Dáil we would not be inclined to press the amendment. It may be that the time is not ripe to wipe out everything that occurred up to the present, but it is a question whether some of these are sums of money which would not probably be paid at any time. I feel that at some time he will have to make such a final balance and wipe out these accounts.

It is difficult, of course, to make an estimate of these matters, but the estimate that the Revenue Commissioners have made as to the effect of the passage of this amendment is that it would be a loss to the Exchequer of £100,000, not necessarily this year, but this year and next year and the year after, perhaps.

Amendment, by leave, withdrawn.
Sections 25 to 31, inclusive, and the First Schedule put and agreed to.

I move an amendment to the Second Schedule:—

In the title to the Schedule on page 15, after the word "rates" to insert the word "of" and delete the word "allowance" and substitute therefor the word "allowances."

This is a drafting amendment for the purpose of making the matter clear.

Second Schedule, as amended, put and agreed to.

Third Schedule and the Title put and agreed to.

Report Stage ordered for Thursday, 7th June.