Finance Bill, 1933—Report.

I beg to move amendment No. 1, and in that connection I am prepared to accept amendment No. 2, standing in the names of Deputies Anthony and Bennett:—

1. In page 13, before Section 19, to insert a new section as follows:—

(1) In this section the expression "entertainments duty" means the excise duty referred to by that name in and chargeable under Section 1 of the Finance (New Duties) Act, 1916, as amended by subsequent enactments.

(2) Entertainments duty shall not be charged or levied on any entertainment in respect of which it is proved to the satisfaction of the Revenue Commissioners—

(a) that the entertainment is promoted by the Irish Amateur Boxing Association or by a club affiliated to or under the direct control of that association, and that the entertainment consists solely of an exhibition of the sport of boxing at or in connection with which no money is awarded or paid to any of the participants or contestants, whether as a prize, remuneration, or otherwise; or

(b) that the entertainment is promoted by the Badminton Union of Ireland or by a club affiliated to or under the direct control of that union, and that the entertainment consists solely of an exhibition of the game of badminton; or

(c) that the entertainment is promoted by the Irish Lawn Tennis Association or by a club duly affiliated to or under the direct control of that association, and that the entertainment consists solely or mainly of an exhibition of the game of lawn tennis which is an international lawn tennis contest; or

(d) that the entertainment is promoted by the Irish Amateur Swimming Association or by a club duly affiliated to or under the direct control of that Association, and that the entertainment consists solely of an exhibition of the sport of swimming.

(3) Where a person who has paid entertainments duty in respect of one or more entertainments held by him after the 1st of November, 1933, shows to the satisfaction of the Revenue Commissioners—

(a) that each such entertainment consisted solely of a race or a number of races between greyhounds released from a box trap in pursuit of a mechanical hare, and

(b) that all such entertainments were held in one and the same place, and

(c) that such place was not situate within twenty miles of any city or town having a population of more than twenty thousand, and

(d) that similar entertainments were held in such place by such person before the 1st day of June, 1933,

the Revenue Commissioners shall repay to such person the entertainments duty so paid by him, but subject to the limitation that not more than one hundred pounds shall be so repaid to any one person in any one year beginning on the 1st day of November.—(Aire Airgid.)

2. In the proposed new section at the end of sub-section (2) to add a new paragraph as follows:—

or

(e) that the entertainments is promoted by the Irish Amateur Rowing Union or by a club duly affiliated to or under the direct control of that union, and that the entertainment consists solely of an exhibition of the sport of rowing. —(Deputies Anthony and Bennett.)

As I said I am prepared to accept amendment No. 2 also.

No. 2 as it stands?

Yes, I think so.

Is the Minister accepting No. 2?

Yes. In amendment No. 1 there is a verbal alteration. On the first page of the printed sheet of amendments in paragraph (c) sub-section (3) the words "in or" should be inserted before the words "within 20 miles of any city or town."

Amendment No. 1, as amended. agreed to.
Amendment No. 2 agreed to.

I move amendment No. 3:—

In page 19, before Section 37; to insert a new section as follows:—

(1) Any person owning (whether beneficially or in a fiduciary capacity) a trade or business in respect of which excess profits duty is or may be charged or chargeable or having a power of sale over any such trade or business may apply to the Revenue Commissioners for such certificate as is hereinafter mentioned, and, if the Revenue Commissioners are satisfied that such person has agreed to sell such trade or business but has not completed such sale or that such person bona fide intends as soon as conveniently may be to sell such trade or business and the Revenue Commissioners are also satisfied that the facts in relation to the charge and payment of excess profits duty in respect of such trade or business for every accounting period justify them in so doing, the Revenue Commissioners shall issue to such person a certificate signed by an officer of the Revenue Commissioners duly authorised in that behalf by them, certifying either (as the case may require) that no excess profits duty is chargeable in respect of such trade or business or that all excess profits duty chargeable in respect of such trade or business has been paid.

(2) A certificate issued under this section shall discharge any purchaser for valuable consideration in money or money's worth of the trade or business to which such certificate relates from the person to whom such certificate was issued and all persons deriving title to such trade or business from or through such purchaser from all claims for excess profits duty in respect of such trade or business, and shall (save in case of fraud by the person to whom such certificate was issued or failure by him to disclose material facts) also discharge such person and all persons deriving title to such trade or business from or through him otherwise than for valuable consideration in money or money's worth from (as the case may be) all claims or any further claim for excess profits duty in respect of such trade or business.

This amendment relates to the certificate of discharge which has been asked for during the course of the debate on those portions of the Bill which deal with the liability for excess profits duty. The amendment, as will be seen from the face of it, contemplates the issue of a certificate only in a case in which a sale is in contemplation, or in which there has been actual agreement to sell, but the sale has not been completed. Under the amendment the person to make the application for the certificate will be the vendor, and it will be for him to satisfy the Revenue Commissioners that there is no outstanding liability for excess profits duty. Once the certificate has been issued it will have the effect of discharging a bona fide purchaser for valuable consideration from any claim in respect of excess profits duty, even though there was fraud or failure to disclose material facts on the part of the vendor. The certificate also discharges the vendor from liability except in cases of fraud or failure to disclose material facts.

In connection with the proposed new section it is to be noted that an owner in a fiduciary capacity, for instance an executor, who contemplates selling a business, may apply for a certificate under this section instead of applying for a certificate under the old Section 37, which will now become Section 38. A certificate issued under the latter section would have the effect only of discharging the executor from excess profits duty. It would not have the effect of discharging a person who purchased from the executor, or otherwise derived title from him. I think that the proposed amendment goes far to meet the various points of view which were expressed in the debates on the Committee Stage of the Bill. It represents to the mind of the Revenue Commissioners and to the mind of the Minister for Finance, the extreme limit of practical concession in this matter. As I have already said, in view of the considerable opportunities for securing full discharge which it will afford to those people who own property and have the bona fide intention of selling it, whether there is an immediate purchaser in view or not, I think it ought to meet with the acceptance of the Dáil, and I believe will go far to remove many of the objections which were raised with regard to the policy the Government were pursuing in relation to excess profits duty.

This amendment, to my mind, does nothing to meet the objections that were raised on the Committee Stage. As was prognosticated on that occasion, the Revenue Commissioners have become active, and proportionately as the Revenue Commissioners have become active the Minister has become passive. The result of it is that this saving clause is introduced into the amendment, that "the Revenue Commissioners shall issue to such person a certificate" if the Revenue Commissioners are satisfied "that such person has agreed to sell, and are also satisfied that the facts in relation to the charge and payment of excess profits duty in respect of such trade or business for every accounting period justify them in so doing." There is no reason whatever why the Revenue Commissioners should not put their heels on the ground and simply say: "We are not satisfied," whereupon the vendor has no means whatever of compelling them to arrive at a finale.

What I suggest to the Minister, and suggested on the Committee Stage also, is that this amendment should have given the vendor the right to go to the Revenue Commissioners and say: "I want, within, say, two or three months, a certificate of discharge, or in the alternative an assessment for total liability so that I can go before the appropriate tribunal and challenge it and, if necessary, upset it." That gives the vendor some security that at some appointed date he can force a conclusion on the Revenue Commissioners. As the amendment stands at present, I think the Minister will agree that he has no such guarantee at all. The Revenue Commissioners can stand fast, say they are not satisfied, refuse to make a final assessment, and at the same time refuse to give him a certificate of discharge. He is no better off than he was. Is not that so? As the amendment at present stands, so it seems to me, and, unless a time limit is put in there and an opportunity given to the vendor to do what I suggest, in my opinion the amendment introduced by the Minister is of very little value.

So far as this amendment and the section generally are concerned there is at least this limit of concession which the Minister has mentioned, that if a person wants definitely to be sure that he is not going to be charged excess profits duty his only possible course now is to sell his business. Again, if he does intend to sell his business there is, as Deputy Dillon has pointed out, delay. There is no period in which the Revenue Commissioners are bound to give a discharge or an account—one or the other. It is 18 years since this tax was imposed. It is some ten or 11 years since it ceased to be operative, and we are spreading this over that period. At this moment anybody in business who has either discharged his obligations in connection with excess profits duty, or who, perhaps, was never assessed, is in doubt as to whether or not there is any charge. What is the limit of concession? The limit of concession leaves us practically as we were, that when the Revenue Commissioners are satisfied then they shall issue a discharge; not until they are satisfied. Normally, a person is selling a business; he has paid his excess profits duty during whatever period he was liable; he must now go to the Revenue Commissioners to get a discharge in order to satisfy the person who is going to purchase. He has had no dealings with them for eight, nine or ten years, but as long as that section or that amendment of the Minister's stands he is bound to go to the Revenue Commissioners to get this discharge to qualify for sale to the person who is going to purchase.

I should like the Minister to direct his attention to that particular aspect of his amendment, that even in the case of persons who have not had an excess profits duty assessment for ten years, who discharged it ten years ago, when about to sell now, the person who is to purchase may say: "You must go to the Revenue Commissioners to get a discharge." If he does not go to the Revenue Commissioners there is no sale, unless there is an insurance or something of that sort.

I see no point in the amendment except that the person who purchases property has this guarantee, that he will not purchase until he gets a certificate from the Revenue Commissioners. It would not be tolerated anywhere, if a levy were due and had to be made, that it should not be made within some fixed period. This does not get us anywhere. The vendor cannot do anything. The Revenue Commissioners say: "No, we will not give it to you." We know perfectly well they will not give it. Theoretically it is there, but the vendor cannot get it; he has no compulsory power. There should be some provision in the Bill to cover that point. During the period when negotiations are proceeding between the vendor and purchaser, and before the sale is completed, the Revenue Commissioners should make their assessment or else withdraw their claim. This merely protects the purchaser when he has actually purchased.

Will the Minister not say a word on this limitation?

The genesis of this amendment was the suggestion made when Section 36 was originally being considered by the House, that it would be unfair, not to vendors, but to purchasers, if the assessment were to be made, in accordance with the practice hitherto existing, on the person for the time being the owner of the business. Deputy Dillon said in that connection that quite obviously the purchaser may know nothing about the assessment; he may know nothing about the liability of this business for excess profits duty, and some provision should be made to safeguard the purchaser. That was the genesis of the matter.

In subsequent discussions the position of the vendor was brought in and, in order to advance some way to meet the criticism which had been made here—and, in view of the past record of those who now constitute the chief Opposition, that criticism was not very consistent—I agreed that in a case where a bona fide sale was in contemplation the person who had a business which, in his opinion, might be liable to excess profits duty, might go to the Revenue Commissioners and secure from them a certificate which would be a full discharge in every case in which there had not been a fraud on the part of the vendor or a failure to disclose material facts. Quite obviously if this business was, in the opinion of the Revenue Commissioners, likely to be liable for excess profits duty, they could not give a certificate until they were fully satisfied that it was not in fact so liable.

The principle adopted in this amendment is not a new principle. It is the basis upon which, in a similar case in the year 1928, the then Minister for Finance acted in regard to the payment of income tax under Schedules A and B. Section 6 of the Finance Act of 1928 relates to the case of a landlord or immediate lessor or the occupier of any property charged or chargeable under Schedule A or Schedule B of the Income Tax Act, 1918, and gives him the right to apply to the inspector of taxes for the district in which such property is situated for a certificate that all income tax charged under the said Schedules for all the years of assessment ending prior to the 6th day of April preceding the date of the application has been paid——

The previous year.

——and that no further income tax under the said Schedules is chargeable for such years, and the inspector of taxes on being satisfied as to the facts shall issue a certificate to that effect.

That is for the previous year.

The position here is exactly analogous; that is, that the certificate in either case could not be issued until the inspector of taxes and the Revenue Commissioners are satisfied that there has been a full discharge of the liability.

One is a property tax and the other is excess profits duty.

One is a tax on business and the other is a tax on property.

There is no analogy.

With all respect to Deputy McMenamin, there is a perfect analogy. I could understand a great deal of heat being engendered by the Opposition in this discussion if it had not been that we are now attempting to cure in a limited way a defect in the law which existed all during their régime and which they made no attempt to cure.

Many people would be obliged if there were no amendment of this sort.

If there are disabilities, the disabilities are not of our creation. They arose from an interpretation of the law which was made in 1922 and which has been consistently acted upon, not merely by us but by our predecessors. That interpretation is that the person who is for the time being the owner of the premises is liable for excess profits duty. That is the interpretation of the law which has been consistently acted upon for the past 11 years. We are now, in respect of that interpretation, proposing to make a concession which, if there is any real substance in the criticisms advanced, ought not to be made now but should have been made in 1922 under the Government of which the Deputy opposite was the head.

The Minister is drawing an analogy which is quite beside the question.

Is this Bill being recommitted?

Deputy McMenamin has already spoken and he is not entitled to speak twice as the Bill has not been recommitted.

The Minister has apparently overlooked Section 35, in which he is repeating something which we did.

The Revenue Commissioners have won.

Yes, hands down.

Amendment 3 agreed to.

I move amendment 4:—

In page 22, First Schedule, Ref. No. 6, second column, after the word "busts" to add the words "but excluding fire bricks and fire blocks, fireclay sunk fires and fireclay backs including interiors, boiler and flue blocks, and flue linings."

I propose to accept this amendment.

Amendment agreed to.

I move amendment 5:—

In page 22, First Schedule, Ref. No. 6, second column, after the word "busts" to add the words "but excluding bricketts for fancy brickwork (such as mantel surrounds) vestibule tiles, garden border tiles, field drain pipes, ridge tiles (plain or ornamental loose or fixed ornamentals), finials, gate pier blocks, Staffordshire blue bricks, pressed and wire cut ornamental string brick courses and ventilating or air bricks."

I am not able to accept this amendment.

Can the Minister say that any of the articles mentioned in this amendment are manufactured in this country at the present time?

No; but there is no reason why very effectual substitutes for these articles cannot be made here.

Will the Minister tell us where we can get substitutes for "Staffordshire blue bricks, pressed and wire cut ornamental string brick courses and ventilating or air bricks"?

I said substitutes.

I see there is some kind of pipe manufactured which I suppose the Minister will suggest is a substitute for field drain pipes, but I should like to know from experts whether the pipes manufactured in this country are adequate for the purpose. Does the Minister seriously believe that the items mentioned in the amendment can be successfully manufactured in this country, or is the wish father to the thought. I suggest it is, because I think the Minister knows as much about Staffordshire blue bricks as I do, and that is absolutely nothing.

Amendment, by leave, withdrawn.

I move amendment No. 6:—

In page 22, First Schedule, Ref. No. 11, second column, after the words "or cisterns," to add the words "but excluding galvanised steel storage cisterns of 400 gallons capacity and upwards."

I think the Minister rather suggested he would make enquiries as to the capacity of existing tanks made in this country and installed by different firms. I should like to ask the Minister if he has found anything wrong with my information when I stated that a 400 gallon tank was about the limit of anything likely to be manufactured here for a long time to come.

I have not had an opportunity of making the enquiry which the Deputy suggested, but I am not in a position to accept his amendment for the same reason that I was not in a position to accept his amendment No. 5. If there are no 400-gallon storage cisterns made in this country, we may find a very effective substitute for them. Where it is not possible to secure an effective substitute it is the intention of the Minister to sympathetically consider any application for a licence to import this article if it cannot be made at home. I would not at all take up the position that these tanks are in any way analogous to Staffordshire blue bricks, but I submit again to Deputy Dillon that quite effective substitutes in the way of home made bricks are to be had in this country: that is, if a person's artistic eye will consider bricks which are made at home out of Staffordshire clay. They are not fire grate bricks.

Is the Minister sure?

Staffordshire blue bricks are not necessarily fire bricks. However, to get back to the cisterns I undertake, on behalf of the Minister for Industry and Commerce, to say that any application to import such cisterns under licence will be considered sympathetically.

Has the Minister power?

Yes, and any application to import these articles will be sympathetically considered, and will be granted if there is no adequate substitute in this country for them.

On this question of cisterns, there is absolutely no substitute for a galvanised steel storage cistern that I know of. The fact that you can use two smaller ones would only mean that the fittings for their connection would make the cost prohibitive. I suggest to the Minister that there is no one at the present time going to manufacture these cisterns in this country. When anyone comes along able to do so, the concession to import can be immediately withdrawn. I would not for a moment suggest that it should not be withdrawn when the output of works in this country is enlarged and able to meet the demand. I suggest to the Minister that under present conditions this is only one of the many things that is absolutely helping to slow down industry and production. I do not for a moment suggest that the Minister will not sympathetically consider an application for a four, five or six hundred storage gallon cistern to be imported into this country. I suggest that there are so many permits, licences, etc., necessary in carrying out any undertaking in provisional schemes which are drawn up by business people from time to time, as to make the rendering of accurate estimates impossible. A person has to make a calculation as to some work in the country, and that means applying for provisional licences to see whether the scheme is going to work. I suggest to the Minister that he should re-consider all these matters.

I should like to join with Deputy Dockrell in his plea with regard to licences. It is extremely difficult to carry on business at the present time. In any general business carried on to-day I suppose in connection with 20 or 30 per cent. of the invoices of merchandise you have to apply for a licence. I am not overstating the case, about 70 per cent. would be clear but for the remaining 20 or 30 per cent., licences have to be applied for. It is very difficult for people not in business to understand the enormous burden of work that places on the shoulders of people who are in business. Take the packing business. We get a licence to import a certain class of bottles at present. If a packet comes to you you may find you have to pay 33? on some of the bottles in that package, perhaps two or three dozen. At present I know a case in which a merchant was served with notice that the Minister for Industry and Commerce had decided to give him a licence to import a certain class of glass bottles, amounting to the number of bottles he imported in the 12 months ending March 1933 divided by five. That merchant looked up his invoices for all classes of bottles imported from three or four firms. The information obtained had to be put into a Schedule, copies of which had to be sent to the Revenue Commissioners. They are with the Revenue Commissioners for the last three or four weeks. I am sure the Revenue Commissioners are doing all they can to hurry matters up but doubtless they have many similar applications to occupy their attention at the same time. So that you see this business of putting a tariff on something and saying, "We will give a permit if you cannot get it," means enormous trouble to the businessman and, virtually, that it is impossible to carry on.

Amendment, by leave, withdrawn.
Question—"That the Bill, as amended, be received for final consideration—put and agreed to.

When will the Fifth Stage be taken?

If the House is agreeable I should like to take the Final Stage now so that the Bill can go to the Seanad as quickly as possible.

There may be a lot to be said on it next week.

That is ominous. After all, a great deal has been said on it already. Is there anything more useful to be said on it? Is there anything which would be worth while occupying Parliamentary time to say, anything which could not be as effectively said in the country as here?

I do not think speeches at cross-roads are in any way a substitute for a discussion of important measures in this House.

I hope they are more entertaining.

Fifth Stage ordered to be taken on Tuesday, 4th July.