Dáil Éireann debate -
Wednesday, 8 Jul 1931

Vol. 39 No. 13

Public Business. - Finance Bill, 1931.—Report Stage.

Minister for Finance (Mr. Blythe)

I move:

In page 8 before Section 13 to insert a new section as follows:—

13. The duty imposed by Section 11 of the Finance Act, 1928 (No. 11 of 1928), shall not be charged or levied on any casting, stamping, pressing or forging which has not undergone any process of machining and is not an assembly of motor car component parts (howsoever joined together), and is imported either separately or packed only with other articles which, if imported separately, would be exempted by this section from the said duty.

This amendment was discussed on the second reading and it is now introduced.

Mr. Flinn

In relation to that, will the Minister for Finance try and make arrangements to have this clause or a corresponding clause introduced on the other side? In Cork we export castings from this country for motor works and other purposes to Great Britain and on account of the facility which we here give to Great Britain to export castings I think the Minister should be able to arrange that we should export our motor castings free of duty to them also. I think he should take this into consideration as there is a definite possibility behind them. Possibly he is aware of the circumstances.

Mr. Moore

Would the Minister say whether he has consulted the engineering industry with regard to this amendment or whether they have expressed approval of it? There is considerable work in the way of preparation of castings and the other articles referred to in the amendment in Dublin.

Mr. Little

I am glad that the Minister saw his way to accept this suggestion which came from our benches and which I think will do a great deal to help some of the more enterprising people who have machinery which in the summer time is used for repair work and in the winter-time can be used for making spare parts. I think the attention of the general public should be drawn to the fact that there is this opportunity for enterprising firms. It cannot be forgotten that some motor works, now of very large size, started as bicycle shops 20 or 25 years ago. There is no reason in Ireland where we have so much ability and so many mechanics why we could not use this to help to build up the motor industry.

Mr. Blythe

Certain concessions similar to this have been sought from time to time. With regard to certain classes of cars for some time past the revenue have been able to admit them under the law as it stood without amending it. It was felt that this change might be made without endangering the revenue, and would convenience a certain number of people engaged in manufacture. I do not anticipate that it is going to lead to any substantial import, but it will, I think, certainly lead to some employment being given by a development in a particular type of assembly and manufacture here. With regard to reciprocity, I do not think that any negotiations can be based on a very small change such as this.

The whole question of the reciprocal free importation of motors and motor parts was discussed at great length with the British Government some years ago, and in fact a draft scheme was evolved, but finally we had to break off negotiations on the ground that the scheme—and it was the only scheme that the British would agree to—would be unfavourable to this country. I do not think there would be any hope of doing anything better with reference to a small thing like this.

Amendment put and agreed to.

Question proposed: "That the Bill as amended be received for final consideration."

Mr. MacEntee

This Bill now reported to the House differs in one important respect from the Bill which was submitted to the Dáil by the Minister, in so far as he has seen fit to accept an amendment which stood in the names of Deputy Shaw and Deputy Egan to insert before Section 20 a new section. The purpose and the intention of that new section was to pass on to the public a tax which the Minister, in the Bill as originally introduced, proposed to levy upon sound films. I have been reading the debate on that matter, and I am not satisfied that the Minister and those who proposed that amendment have justified it to the House. In that connection, I would like to refer the House to the Minister's original financial statement, in which he indicated that this new tax would be imposed and I would like to emphasise the words with which he defended it. The Minister stated

For some time past the silent film has been going out of use in picture houses in the Saorstát, as in picture houses elsewhere, and the long queues in the streets testify to the popularity of the sound film and to the large sums of money which are going to support it. It is supplanting not merely the silent picture but also the orchestra. It has been felt for some time that the rate of tax which was appropriate to silent films was an insufficient levy on talkies. They are not only a more complex product but their attractiveness to the public enables them to bear more tax. Further, they are also more effective agents for the reduction of our revenue in other directions than the old films. I propose, therefore, that the customs duties on sound films, whether they themselves bear the sound record or whether they are adapted for use with a separate sound record shall be increased from one penny to threepence per linear foot.

The original intention of the Minister is quite clear from his statement and that was, not to increase the amusements tax, but to put such a duty upon sound films as would compensate for the loss to the public and the public particularly of the Free State and to those who have earned their living by following music as a profession. He proposed to compensate for those losses by imposing a tax upon sound films. I think that that is a tax which in all the circumstances was justifiable because the introduction of the sound film has enabled every picture house in the Saorstát to dispense with its orchestra. We know that in the largest picture-houses in Dublin the orchestra has been entirely dispensed with and these Dublin citizens who formerly earned their living as members of these orchestras are, many of them, now facing destitution. I believe that some of them ultimately will either be compelled to emigrate or will be supported out of public funds. Merely as compensation for the public moneys which would be spent in supporting those disemployed members of the orchestras, the tax on the sound film would be justifiable. The people who are reaping the profits—and there is a considerable amount of profit out of the talkie films, firstly because of their popularity and secondly, because of the economies which the proprietors of picture-houses are enabled to make by using them—are the renters and the exhibitors. The public only benefit to the extent that their taste is gratified and it is to my mind unfair and unjust that the Minister who designed this tax as a tax on renters and exhibitors should now, owing to political pressure within his own Party, pass that tax on to the public.

In proposing his amendment, Deputy Shaw endeavoured to justify it by asking the Dáil to behold the piteous spectacle of the poor film exhibitor. He said that the renters intended to pass this tax on to the exhibitor. Well and good, if the renters do, the film exhibitors have had ample compensation, and still will have ample compensation, for that tax if it is passed on to them, in the increased audiences which these films are bringing to their picture-houses. But, as I pointed out in the debate on the Committee Stage of the amendment, so far as Dublin is concerned, the film exhibitors and the film renters in the case of two and, to a certain extent in the case of a third, of the largest picture-houses in Dublin, are one and the same interest. I think the biggest, or the second biggest house in Dublin is owned by a film-producing corporation in America. A picture-house which is either the biggest or the second biggest, either of these alternatives, is in close association with a British film-producing corporation, and a third one has also certain contracts and affiliations with a British film corporation. If Deputy Shaw's amendment had not been accepted by the Minister those picture-houses would not be able to pass on the tax to the public.

Those picture-houses, I believe, represent a seating capacity which is equal to more than 60 per cent. of the total seating capacity of the cinemas in Dublin. They will be unable to pass this tax on to the public as they would have been if the Minister had not accepted this amendment. We say that the film renters ought to be compelled to bear this tax, but now on account of the flexibility, as it has been euphoniously described, of this amendment, a flexibility which Deputy Shaw states is necessary, these picture-houses will be able, as I have said, to pass on the tax. What the Minister originally intended, I believe, was to put the tax upon the external monopolies which control the film business in this country, but now they will be able to make it a tax upon the Irish public. That was not the original intention, I believe, of the Minister or of this House when it accepted the principle of this increased tax on films.

We on this side of the House, I believe, would be prepared, to a certain extent, to meet the point of view of the smaller cinemas and of the provincial cinemas, but I do not think we are entitled to meet it to the extent which Deputy Shaw asks us to do, or the Minister in the amendment he has accepted. I believe we could meet Deputy Shaw and the provincial exhibitors if we only permitted the alteration in the rates of the entertainment duty to apply to houses of a certain limited capacity. Very few of the provincial cinemas have a seating capacity of more than 800 or 1,000 at the outside. If we limited the alteration only to those houses which have a seating capacity not exceeding 1,000 or 1,200 we would be excluding those houses in which the film producers, renters and exhibitors represent one and the same interest. We would be compelling them to refrain from passing the tax on to the public and would enable the smaller houses in certain of the provincial towns where, in the majority of cases, competition does not exist, to meet any extra charge which the film renters might pass on to them.

Even though we would be prepared to meet Deputy Shaw to that extent we would like to make it clear that no figures and no data have been put before the House to justify the statement the Deputy has made, that the provincial cinemas are at the mercy of the film renters, and that if this amendment is not accepted they will be compelled to pay exorbitant rates for their films. For myself I do not believe that, because while I believe it is true that there is a shortage of suitable films in Dublin, where you have a considerable number of picture houses, and therefore competition for the films available, there is no shortage of suitable films for exhibition in the provincial towns. I suppose it is correct to say that you have nineteen or twenty picture houses in Dublin competing for the limited number of films released by the film censor each week. They are willing and anxious to pay a great deal in order to get a programme. In the case of the provincial towns you have at most one or two picture houses in each town. These picture houses have a choice of the films that are released for the use of the Dublin houses week after week. I believe that the film renters have to deal with the provincial exhibitors on competitive terms. Because of that I do not believe that the provincial exhibitors would be able to pass on this tax to the film exhibitors in the way that Deputy Shaw fears. For that reason I do not think that the amendment has been justified to the House either by Deputy Shaw or the Minister.

The only good argument from the financial point of view of which the Minister could justify his acceptance of the amendment was that it was going to mean no loss of revenue. He is going to get exactly the same revenue from the tax under Deputy Shaw's amendment as he would have got if it were not accepted. The important thing for the House to bear in mind is that the original intention of the Minister was to tax the film renters and the film producers in order to compensate for the dislocation in the economic life of the State which the introduction of the films has produced. That was his point of view, and certainly I believe it was not his original intention to seek that compensation at the cost of the Irish public. The effect of the amendment will be to pass the tax from the foreign film producer to the native Irish public. Unless the Minister is able to defend the amendment on its merits, and unless Deputy Shaw is able to produce more cogent reasons in support of his amendment than he has given hitherto we will be compelled to oppose it.

Mr. Shaw

It is very strange, after the very full and free discussion that we had on this matter on the Committee Stage, that Deputy MacEntee is now so loud in calling for a division. If the Deputy wanted to discuss this matter then he should have given notice to members of the House by putting down an amendment. In view of the fact that his Party unanimously agreed to the amendment and that no notice was given that it was intended to raise this on this stage of the Bill, I am not prepared to discuss it now. I agree that it is a most difficult thing to talk about a subject that one knows nothing about. Deputy MacEntee knows nothing whatever about this, but his friend Deputy Flinn does. He made a speech on the last evening which stated the position exactly. Deputy Flinn knows more about it than I do, and I wish I knew even less than I do. Deputy MacEntee talked about the renters passing the tax on. He does not say how we are to get over that. If he can make any suggestion to get over that I will welcome it but the present position is that the renters can dictate their terms. The tax will cost the exhibitors £30,000. Those in country towns would not be able to meet the extra charge that would fall on them. I would like to have got better terms than even those set out in the amendment. I would like to have seen all seats up to sixpence exempt from tax. The terms in my amendment represented the maximum that there was any possibility of getting accepted. I again protest against Deputy MacEntee's method of springing this question on the House without putting down an amendment. I think it is unfair to me, the Minister and the House. I ask Deputy Flinn to contradict what Deputy MacEntee has said.

Mr. J.X. Murphy

There is only one question that I wish to ask the Minister. It is in relation to Section 2. Arising out of the point that was made by Deputy Thrift the Minister said he would consider whether anything could be done to clarify the position, and made a reference to two cases which are still more or less sub judice. In another part of his speech the Minister said that there were cases where writs had been issued and where no costs would be incurred. I do not think that would be possible. There are several cases in which considerable costs have been incurred. If the Minister would let the House know his intentions with regard to these cases I would be very glad. What he said on the previous occasion was not very clear.

Mr. Briscoe

I was interested in Deputy Shaw's speech to hear what arguments he would put up against the point raised by Deputy MacEntee, as I understand representations were made to the Minister through Deputy Shaw on behalf of the cinema proprietors.

Mr. Shaw

I do not wish to interrupt the Deputy, but I would like to point out that Deputy Shaw only introduced the deputation to the Minister.

Mr. Briscoe

According to the information given to me the cinema proprietors were introduced to the Minister by Deputy Shaw, and their case was heard and dealt with. I was interested in hearing what the Deputy would say contra to Deputy MacEntee's arguments, because if Deputy Shaw is right in the views he holds with regard to larger cinemas, which are the only ones that will benefit, and which, as Deputy MacEntee pointed out, are not, in a sense, domestic cinemas at all, the smaller cinemas throughout the country, and twenty in the City of Dublin, will get practically no benefit. The benefits proposed in the amendment only deal with the higher-priced seats in the bigger institutions. Deputy MacEntee alluded to these. I desire to support what he said. I believe Deputy MacEntee would have a different point of view, and possibly would have expressed it, if the case was made by Deputy Shaw that the persons who were to be given some benefit were the smaller people. Deputy Shaw pointed out that it was impossible to put a tax on the renters that they will not pass on. It is the practice of renters to rent pictures to the smaller cinema proprietors in Dublin, and they pass on the tax, so that the smaller people will get no benefit. I feel that Deputy Shaw has made a bad case for his amendment. It is only the very poor in the congested areas, where there are small cinemas, are being asked to pay the full amount. They will get no remission, while foreign-controlled houses will get a remission. I do not know why Deputy Shaw did not allude to that, because I understand that representations have been made to him and to his Party. I received particulars about the matter. I think that a gross injustice has been done to the smaller people. There was no necessity of introducing an amendment under which remission will be given to the wrong people.

Mr. Shaw rose.

An Ceann Comhairle

The Deputy has made his speech.

Mr. Shaw

On a point of explanation. Deputy Briscoe stated that I made a bad case. I made some case, but Deputy Briscoe did not speak on the subject, and has not brought in an amendment.

An Ceann Comhairle

That is not a point of explanation.

Mr. Little

Now that we have done our best with reference to the income tax proposal this year I would suggest that in the next stage of the Bill in another place the Minister would introduce the same facility for executors that he introduced on a suggestion from this side with reference to property, namely, that it would be possible for an executor to get a certificate stating that income tax had been paid, so that the executor's position would not become an impossible one. Otherwise an executor would not, for a considerable time, know whether he could distribute an estate or not. He would have to wait at least three years before he could do so. If that happened it would be a cruel thing on a number of people who would be beneficiaries under the administration. I would suggest to the Minister that he should consider carefully the application of the principle, so that an executor could get a certificate showing that all tax had been paid and that no further claims would be made.

Mr. Flinn

All that I am concerned with is that I regard entertainment tax as a perfectly legitimate tax. It is fair game for the Minister as a method of gaining revenue so long as, in the method of taking it, he does not do damage which he does not intend to do. As far as dealing with entertainment tax which is paid upon the income of people to whom amusement is simply amusement, as distinct from a psychological necessity, then the Minister is entitled to it. My difficulty in all these cases in relation to this and every other schedule put forward is that I have not been able to find any logic in the schedule.

I have had experience of this thing, and I have given information to the Minister that was in my possession at one time or another. That on the same revenue from entertainments the lower prices you charge the public the more tax you have to pay. That is wrong. That is my fundamental objection. Entertainment of a cheap and wholesome character, whether indoor or outdoor, is a national necessity in this country.

If I might take a one side line in order to illustrate what I mean, in my opinion the biggest value in the Shannon scheme was the brightening of the little towns. In exactly the same way there is a definite social, financial, economic and national value in being able to provide for poor people in Ireland something which will take their minds away from the drabness of a good deal of their lives. I would be prepared to accept the schedule which raised steeply on the higher prices if I could see that people who really did require amusement as a necessity were not taxed. That is the only line on which I am prepared to press the Minister now or at any other time. The fundamental badness in the Bill, apart from the sugar tax which it enshrines, is Section 2. I notice that all the people who asked for another opportunity to review this matter on the Report Stage are unanimously absent. Deputy Myles said: "I think the Minister ought to give us a further opportunity on the next stage to discuss this matter." Apparently he has thrown in his hand, and so have Deputy Thrift, Deputy Murphy and the rest. What was wrong a week ago is wrong now, and the fact that they could get a division and go safely into it on this specific issue, does not excuse them from being here when they have to speak and vote on the Bill as a whole. We had very high morality in relation to finance, spoken from these benches, playing the game, playing all the rules, honesty and decency in legislation.

That was all right when it was possible to go into the Division Lobby, knowing that Cumann na nGaedheal had with them the Labour Party to make it perfectly safe to be independent. This is the sort of conduct which makes the name of Independent stink in the nostrils of honest men. That is what gives a definite meaning, a cruel meaning, because a true meaning, to the statement of their own organ that every man has his price. I certainly think that their absence to-day ought not to have been introduced by the high moral tone, the hauteur of the speeches of a week ago. In this Bill, and in this clause in relation to this Bill, the Minister has frankly claimed the right, not merely as constitutional, but as a thing right in itself, not a legal right, but the right of decency and the right in morals, of an Assembly of this kind, not merely to interpret the law, but to interpret the law retrospectively in every case which suits them. We have had the mad-dog theory in relation to the law that extraordinary results would follow if the courts were allowed to interpret the law in a way different from what the Minister or the Executive have been practising. It would be an extraordinary thing that people who were doing what they were legally entitled to do should not be expected to be subjected to penalties for doing that by the Executive. It would be an extraordinary thing that, at their own initiative, or whenever the idea struck them, they would not be able to manufacture a crime that a man had committed previously. It would be an extraordinary thing if the courts were prevented from making a man liable to-day for penalties for doing a thing for which he was not liable for penalties when he did do it. If that is not a subversion of all law as we know it, as conventional people regard it, I do not know what law is.

As I have said, this is not the first case. We have had it in every single area, and if we pass this precedent, if we allow people to be penalised now through the State, penalised through their successors, penalised through the people who are occupying fiduciary positions and serving them, then anything is liable.

Apply the law to any other thing, apply the law to other cases in which Ministers have been found to be wrong, and in which they have put people in jail and then found that they had no right to have them in jail; in which men have damaged their property and the Free State Courts have said that though the Minister did intend it, though he thought that was the law, it was not in fact the law when he had those people under arrest. You cannot make water-tight compartments in these matters. The principle which the House is going to vote for when it votes for this clause is one which may rest like a whip across the shoulders of the men who have contriyed it and they thoroughly deserve it. There is no man who consents to this Bill in this form, who consents to the principle of clause 2, who will have any complaint if any future government in this country, in relation to his interests in any matter which the Executive thinks right, shall declare that what was right when he did it is wrong now when it no longer suits that Executive. I am giving that warning definitely. It will come home to roost. This evil counsel which they are giving may be improved upon and let the consequences rest upon those who have created the cause.

Mr. J.T. Wolfe

When this Bill was before the House on Second Reading I opposed Section 2. I did so on the grounds that it was legally, constitutionally, and morally insupportable. I have heard and read the debates which have since taken place and I am more than ever convinced that the view which I took then, and which reluctantly compelled me in honour to refuse to vote for this Bill, more than ever prevails. We have been told by the Minister for Finance that he has got somebody in Somerset House, where he evidently received his inspiration, to send him a letter telling him that what they are doing to-day is in accordance with English precedent. There will be very little difficulty for the Minister if that statement is accurate to give us the English precedent which he quotes. There need not be anything mysterious about it.

Where in the course of the history of England, where they have not the advantage of our Constitution which in my submission to the House puts the matter beyond all doubt, has there ever been a case in which while an appeal is still pending a British Government took it on themselves to bring into the House of Commons a Bill to reverse the decision of a competent court which the Revenue Commissioners found out or had come to the conclusion they could not challenge on appeal? I say it is an unfortunate thing for this country if it is to go forth that the power which the Revenue Commissioners are now seeking, and which apparently they have got from the Government through the Minister for Finance, is to prevail. It means one thing and one thing only, that nobody can go to law with the Revenue Commissioners no matter how wrong or unjust their decision may be, as the decision will be reversed and their decision will stand. They care not one damn about the law. That is the position they take up. That is the position even which some officials are good enough to tell you, if you call on them and receive the courtesy which we have been told here by some Deputies they get from them. If they had as much experience as I have, they would not be complaining of over-courtesy. One thing they are consistent about and that is, that they make it clear to you that they care nothing about the law, that they make the law conform to them and that they will not conform to the law. It is because of that principle that we have the Minister for Finance here to-day introducing a section which I respectfully submit to the House is contrary to all precedent, contrary to the principles of natural justice and contrary to the principles of the Constitution, which we have come here sworn to maintain. By all means alter the Constitution and then re-consider the matter, but the idea of turning into a penal offence—because that is what it is, no matter how they try to wriggle out of it—something that a man had done yesterday quite lawfully is quite immoral. What he did yesterday quite lawfully he may be sent to jail for to-morrow.

That is the principle the Revenue Commissioners have shoved down the throat of the Minister for Finance. I am opposed to that. It is almost said that there is no pending appeal. There is a pending appeal. Certain steps are taken, and a case is stated, and it was only when the Revenue Commissioners found out that they could not stand over that, and that the decision of the learned Circuit Court judge would be upheld they said: "We don't care a damn about the law, and we will square the Minister for Finance."

We are told that the Minister has given a very valuable assurance in that the decisions in the cases of people where litigation is pending will not be interfered with. I would like to know how many cases are referred to there. If the Minister was only referring to one, and if there is only one, I think it is hardly fair to mislead the House with the idea that he was referring to a number of cases. I do not think it was candid or quite fair to the House. I would like to know now how many cases are pending in which he will not enforce Section 2 when it becomes law.

It is said that this can only affect people who have fraudulently evaded the law. It is said that it can only affect estates where the testator made a false return. There is not a word of truth in that. Take the case of an executor when he got an assessment which was void on its face, made in excess of jurisdiction, and said: "I will ignore it. I will close, as the law permits me, my account with my beneficiaries," and he does close it. What is the position that the Minister for Finance and the Revenue Commissioners are going to take up in regard to that case? They say, "we made an assessment void upon its face, in excess of jurisdiction. Every citizen is presumed to know the law. You know the law, and you ignore this assessment, as you are bound to do. You close your estate, distribute your assets to your beneficiaries, but, to show our utter contempt of the law, say we are going to get a Bill passed into law and we will make you pay out of your own pocket, and if you do not do that you know where we will put you." That is the attitude of the Revenue Commissioners. I would like to know from the Minister for Finance when he promised to look into the matter if he looked into it, and what did he find as regards the position of the executor who has closed his account on the face of the existing law? Is he going to make him pay again? Is he going to make him pay for carrying out the duty which the law, as it existed then, cast upon him? If he is not, then this Section 2 must be remodelled.

Now let us take the other case of an executor knowing the law upon whom the assessment was made void. When he got the notice he may have, as I know has occurred in many cases, taken no notice of the void assessment. He has allowed the time of appeal from the void assessment to go by. That does not alter the fact that the assessment, when notice of it was served upon him, was so much waste paper. Does the Minister suggest that the Revenue Commissioners will not come down on that man again and that they will not contend that Section 2 has put new life into that void assessment? Does the Minister suggest that the Revenue Commissioners will not contend that Section 2 makes, what was just waste paper, an instrument of live torture? Does he suggest for a moment that the Revenue Commissioners will not make the case that the time for appealing has gone by and that the effect of Section 2 will be to take away from this man the right of appeal? They have done that in many instances. I have seen them more than once make the point the time for appealing had gone by because the notice of assessment had been delayed owing to troubles that existed in this country. It had been delayed in that way in some instances, and I have seen them make the case that in consequence the right of appeal had gone by. There are some of the Commissioners who made that point. I have heard them myself make the point when a man got notice of the fact that he had been assessed that the right of appeal dated not from the date on which he got notice, but from the date on which the document was sent out in Dublin, Cork or elsewhere. That is nonsense. It is not the law and never was the law, but it does not prevent the Revenue Commissioners holding that it was so and that the precedent for it is there. And it is to these same Commissioners that we are asked to hand this fresh instrument of torture. I would like an assurance from the Minister for Finance if he suggests that I have wrongly interpreted the position that in the case of void assessments—that is, assessments that are to-day void in accordance with the decision of the Circuit Court judge—that these void assessments would not be operative. At all events it would be some measure of relief to those unhappy people that they should have an assurance in trying to meet the demands of the Revenue Commissioners with the one mouth that would enable them to meet these demands closed in death, that the assessment void on the date of the passing of this Act would not be operative and that the executors would get an opportunity of getting a fresh assessment. That is only a trivial concession and does not at all meet the injustice that is really done by this section. But if the Revenue Commissioners are not inexorable in their desire to hunt to death the taxpayers certainly that concession is not too much to ask. It will not get rid of the difficulty, but the idea of this retrospective legislation trying to turn void documents into living forces is immoral, unconstitutional, and no good will follow from it either to the Revenue Commissioners or to the Government. I shall vote against this Bill.

Minister for Finance (Mr. Blythe)

With reference to the question of the entertainment tax I have been pressed many times in the House to make the scale of duties more flexible and I have also been pressed to adopt a percentage basis and on more than one occasion I have been very much inclined to adopt that percentage basis, because of the flexibility that it would give to owners of picture-houses. I have only refrained from adopting it simply because in practice it would not be possible to apply it to all picture-houses. It would not be possible to apply it to a certain number of picture-houses from which the Revenue Commissioners declined to take certain returns. When I was asked by Deputy Shaw and others, whether I would agree to accept proposals for modification in the scale of flexibility on this occasion if they did not involve a loss of duty, I was willing to agree to that. I am satisfied that whatever may happen immediately it is not possible permanently for the renters of picture-houses and producers to escape some share of this duty. What share they will have to meet, it is difficult to say. The question of attendance at these picture-houses, the question of the price of seats and all that is governed to a very considerable degree by competition.

We are dealing in this matter with a luxury thing, something in which the public demand can fall off very substantially without any great damage to the community. Consequently, when there is an increased burden to be borne, the ultimate fact will be that burden will have to be shared in some way. If it were all pushed on to the public I think the result would be some decline in the attendance at picture-houses or else a tendency on the part of the public to go towards the cheaper seats—something that would be, from the point of view of the picture-houses, practically equivalent to a decline in revenue. Therefore, there will be an incentive remaining whatever may happen to the scale of taxes on the picture-houses, to fight the battle as well as they can with the renters and producers. I am quite satisfied that that will continue to be done and while it is difficult to get at the fact there does seem, temporarily at any rate, from the point of view of the picture-house owners, a shortage of pictures.

It might be that they have not explored sufficiently all the sources from which they might possibly get supplies. But there does seem a shortage at the present time and it seems to be possible for renters or producers to make their own terms with the picture-houses than would be the case if there was a plentiful supply.

I believe that that shortage of supply is only temporary and that when it ceases the picture-houses again will have an opportunity of picking and choosing which perhaps they have not at the present time, and that they will be able to cause those who undoubtedly wish to sell this luxury article to meet some share of the cost. I do not think it would be a good thing to limit the concession to larger picture-houses. Perhaps the smaller picture-houses would not be able to take advantage of it. If the larger picture-houses could not, I think it would probable prove exceedingly difficult for the smaller houses to do it. I think that there is nothing to be done in the matter but to allow picture-houses some possibility of varying their prices in accordance with the conditions as they exist, remembering always that the competition and the desire of the public to have their entertainment as cheaply as possible will operate to prevent an undue increase of prices. I do not think that we could do much in the way of increasing the scale of duty at the top. That would lead simply to the higher priced seats being unoccupied.

With reference to the question raised by Deputy Murphy as to whether Section 2 could be clarified or not, we have come to the conclusion that it does not require clarification and that in any case it would be difficult to put in anything in the section to suggest that it would only apply in cases of fraud. If we were to do that it would mean that we would be driven into the position of accusing people of actual fraud who were dead. It is clear that the case will only apply to actual cases of evasion. Deputy Wolfe has asked a certain question about assessments received since Judge Shannon's judgment was delivered in regard to which the executor might be taking no action and where the time for appeal had passed. So far as that is concerned additional time will be allowed. That is, the executor will not be at any disadvantage in that respect because of the amendment being passed in the Bill.

Mr. J.T. Wolfe

Will there be an assessment made?

Mr. Blythe

Either a new assessment will be made or no objection will be taken to his appealing after or beyond the usual time so that he can appeal in the ordinary way and he will not be injured by this. On the point of substance as to whether an executor might lose the right to appeal against an assessment because of any confusion in this matter I want to make it clear that that will not happen and that the executor will continue to have the right to appeal. With regard to the cases that have been before the courts, on inquiry I find that there is only one case where the point has actually been argued before the courts. In that case what has happened is that the assessments have been discharged. With regard to the assessment for the three years which this section governs there will be no appeal taken against that. The judge has discharged those assessments for three years and also the other assessments. With regard to the appeals dealt with by the circuit judge, the position is that no appeal will be taken against his judgment and, therefore, the assessments remain discharged. The person has won his case and, therefore, it will not be affected. There was another case where there were certain preliminary points before the court. There may have been some other cases that have proceeded to some extent. What it is proposed to do in respect of those cases where the point of dealing with the section has not come to argument before the courts, is simply to pay the costs of the litigation in which these people have been involved.

Mr. Wolfe

The Minister left out a very large class of cases, cases in which these assessments have been made, and have come before the special commissioners. They have there been argued and are at present awaiting judgment. What will the Minister do with them?

Mr. Blythe

What we propose to do in this particular case is to pay the legal costs.

Mr. Flinn

And make the people liable for the penalty.

Mr. Blythe

There was a certain amount of confusion in the previous debate which had been as it were reintroduced to-day, that is, the question of penalties. There is no question of penalties involved in this. All that will happen will be this. The tax which the man became liable for in his lifetime, except that the amount was not determined, will now be recovered from his estate, but there will be no penalties whatever. Nothing will be recovered, and nothing will come into the Exchequer except the tax, which the man during his lifetime, avoided making payment of, by failing to give complete returns. I will not go into the question as to whether that was fraudulent or not.

Deputy Little asked about the question of a certificate to executors in order to enable them to wind up an estate. That is a matter which I will have to consider further before I will finally answer him. I will just say this that the section in this Bill does not alter in any way the time for winding up an estate, because an additional assessment must still be made within three years of the year in which the death occurred. So far as that is concerned there is no change in the time within which an estate can be wound up.

Mr. Briscoe

Deputy Little's point was that an executor, in the usual course of affairs, endeavoured to wind up an estate within what is known as the executor's year and that it will not be possible henceforth for that executor to receive a certificate at the end of the executor's year to enable him to distribute the estate to the beneficiaries. To keep himself free from any liability he will have to hold up the final disposal of the estate for three years.

Mr. Blythe

That point does not really arise in connection with this particular section, but with regard to the question of what is being done in England, I think Deputy Wolfe must have misunderstood.

What I said was that the law is the same, almost word for word, here as it is in England. In England, it has always been understood in precisely the same sense in which it has been understood here. It has been acted upon in that sense and assessments have been made just as they were made here. It has not been challenged in England, but it has here. With regard to the judgment, what I say is that the judgment was a Circuit Court judgment. Revenue cases are heard in the Circuit Court in camera. In this particular case there was only counsel on one side. There was no counsel appearing for the Revenue, because it came on in the ordinary way of Circuit Court cases. It is for that reason and because that often happens that we do not generally, and people outside generally do not, regard a Circuit Court decision as very conclusive in regard to the law. Of course there are two other courts to which we might appeal. There is no guarantee that the case was fully argued in the Circuit Court.

Mr. J.T. Wolfe

Why not go on with the appeal?

Mr. Blythe

I do not regard it as at all certain—I have been advised that there is considerable doubt—as to what the ultimate decision would be, but I am not prepared to let the matter remain over and have a great deal of costly litigation and a great deal of revenue remain out of the Exchequer and burdens imposed on other people who have paid all they were liable to pay, for the benefit of the successors of those who avoided what they ought to have paid. It has happened in England that before a matter was finally decided in the courts legislation had been introduced to see that the existing practice was upheld by law. As a matter of fact, in the Finance Bill of the present year in Great Britain there is a section dealing with a point which was before the court and on which no judgment had been delivered by the final court at the time the section was introduced.

Mr. Little

Might I ask the Minister is it not a fact that in that particular case the judgment delivered in the British court was in conformity with the law, and that what the British Government was afraid of was that it might be reversed on appeal? There was not the same direct conflict between the judge and the Government. Might I ask the Minister whether he will inquire into the question I raised?

Mr. Blythe

Yes, but I shall give the Deputy no promise of favourable consideration.

Professor Thrift

Does not the Minister think that, when delay in the courts has prevented a decision being given, it is hard lines that this Bill will now prevent a decision from being given and do no more than grant the costs which have been incurred?

Mr. Blythe

The point has not really come before the courts at all. It is very hard to distinguish between that case and cases in which proceedings may only have been nominally commenced. I say that if they get their costs I do not think it is really hard on them. I do not see where the line could be drawn. I have been looking into that matter.

Question—"That the Bill, as amended, be received for final consideration"—put.

The Dáil divided: Tá, 58; Níl, 45.

Tá

• Aird, William P.
• Beckett, James Walter.
• Bennett, George Cecil.
• Blythe, Ernest.
• Bourke, Séamus A.
• Carey, Edmund.
• Coburn, James.
• Collins-O'Driscoll, Mrs. Margt.
• Conlon, Martin.
• Esmonde, Osmond Thos. Grattan.
• Finlay, Thomas A.
• Fitzgerald, Desmond.
• Fitzgerald-Kenney, James.
• Gorey, Denis J.
• Hassett, John J.
• Heffernan, Michael R.
• Hennessy, Michael Joseph.
• Hennessy, Thomas.
• Henry, Mark.
• Hogan, Patrick (Galway).
• Holohan, Richard.
• Lynch, Finian.
• Mathews, Arthur Patrick.
• McDonogh, Martin.
• McFadden, Michael Og.
• McGilligan, Patrick.
• Mongan, Joseph W.
• Mulcahy, Richard.
• Murphy, James E.
• Connolly, Michael P.
• Cosgrave, William T.
• Daly, John.
• Davis, Michael.
• Doherty, Eugene.
• Dolan, James N.
• Doyle, Peadar Seán.
• Duggan, Edmund John.
• Egan, Barry M.
• Murphy, Joseph Xavier.
• Nally, Martin Michael.
• O'Connell, Richard.
• O'Connor, Bartholomew.
• O'Donovan, Timothy Joseph.
• O'Hanlon, John F.
• O'Higgins, Thomas.
• O'Leary, Daniel.
• O'Mahony, The.
• O'Sullivan, Gearóid.
• O'Sullivan, John Marcus.
• Reynolds, Patrick.
• Rice, Vincent.
• Roddy, Martin.
• Shaw, Patrick W.
• Sheehy, Timothy (West Cork).
• Thrift, William Edward.
• Tierney, Michael.
• White, John.
• Wolfe, George.

Níl

• Aiken, Frank.
• Allen, Denis.
• Alton, Ernest Henry.
• Anthony, Richard.
• Blaney, Neal.
• Boland, Gerald.
• Boland, Patrick.
• Briscoe, Robert.
• Broderick, Henry.
• Buckley, Daniel.
• Carty, Frank.
• Cassidy, Archie J.
• Clery, Michael.
• Cole, John James.
• Davin, William.
• Derrig, Thomas.
• De Valera, Eamon.
• Everett, James.
• Fahy, Frank.
• Flinn, Hugo.
• Fogarty, Andrew.
• Good, John.
• Gorry, Patrick J.
• Goulding, John.
• Harris, Thomas.
• Houlihan, Patrick.
• Jordan, Stephen.
• Kent, William R.
• Lemass, Seán F.
• Little, Patrick John.
• MacEntee, Seán.
• Moore, Séamus.
• Morrissey, Daniel.
• Murphy, Timothy Joseph.
• Myles, James Sproule.
• O'Connell, Thomas J.
• O'Kelly, Seán T.
• O'Reilly, Matthew.
• O'Reilly, Thomas.
• Ryan, James.
• Sexton, Martin.
• Smith, Patrick.
• Walsh, Richard.
• Ward, Francis C.
• Wolfe, Jasper Travers.

Tellers: Tá, Deputies Duggan and P.S. Doyle; Níl, Deputies Boland and Allen.

Fifth Stage ordered for Friday.