Resolution No. 2—Customs and Excise. - Tobacco. – Dáil Éireann (15th Dáil) – Tuesday, 8 May 1956

Resolution No. 2—Customs and Excise. - Tobacco.

Mr. Sweetman

I move:—

(1) That in this Resolution—

"the Act of 1932" means the Finance Act, 1932 (No. 20 of 1932);

"the Act of 1934" means the Finance Act, 1934 (No. 31 of 1934);

"the Act of 1952" means the Finance Act, 1952 (No. 14 of 1952).

(2) That the duty of customs on tobacco imposed by Section 20 of the Act of 1932 shall, as on and from the 9th day of May, 1956, be charged, levied and paid at the several rates specified in Part I of the Schedule to this Resolution in lieu of the several rates at which the said duty is now chargeable by virtue of Section 12 of the Act of 1952.

(3) That the duty of excise on tobacco imposed by Section 19 of the Act of 1934 shall, as on and from the 9th day of May, 1956, be charged, levied and paid at the several rates specified in Part II of the Schedule to this Resolution in lieu of the several rates at which the said duty is now chargeable by virtue of Section 12 of the Act of 1952.

(4) That sub-sections (3) and (4) of the said Section 19 of the Act of 1934, and sub-section (5) thereof subject to paragraph (5) of this Resolution, shall apply to tobacco which is chargeable with the duty of excise imposed by sub-section (1) of the said Section 19 at a rate specified in Part II of the Schedule to this Resolution, and for the purpose of such application references in the said sub-sections (3), (4) and (5) of the said Section 19 to Part I of the Sixth Schedule to the said Act of 1934 shall be construed and have effect as references to Part II of the Schedule to this Resolution.

(5) That the rebate on unmanufactured tobacco mentioned in sub-section (3) of Section 20 of the Act of 1932, as amended by Section 18 of the Act of 1934, and in sub-section (5) of Section 19 of the Act of 1934, shall, on and from the 9th day of May, 1956, be at the rate of 5d. per lb.

(6) That the rebate on hard pressed tobacco mentioned in sub-section (2) of Section 17 of the Finance Act, 1940 (No. 14 of 1940), shall, in respect of any such tobacco sold and sent out for use within the State by any licensed manufacturer on or after the 9th day of May, 1956, be at the rate of 12/4 per lb.

(7) That as respects unmanufactured tobacco which, apart from this paragraph, would be entitled by virtue of Section 5 of the Finance Act, 1950 (No. 18 of 1950), to the preferential rates of customs duties specified in the Second Schedule to the Finance Act, 1949 (No. 13 of 1949), the duty of customs chargeable thereon on delivery from bonded warehouse shall, as on and from the 9th day of May, 1956, be charged, levied and paid at the rates for unmanufactured tobacco specified in Part III of the Schedule to this Resolution.

(8) That, subject to the provisions of paragraph (9) of this Resolution, there shall be charged, levied and paid on all stocks of tobacco of every description which at 5 o'clock in the afternoon of the 8th day of May, 1956, are in the ownership or possession of a licensed manufacturer of tobacco and in any place in the State other than a bonded warehouse, a duty of excise, payable by the manufacturer, at the following rate, that is to say:

(a) so far as the stocks consist of tobacco (including snuff) other than unmanufactured tobacco, 7/11 for every lb. weight of the stocks, and

(b) so far as the stocks consist of tobacco (including snuff) other than unmanufactured tobacco, 7/11 for every lb. weight of unmanufactured tobacco from which, in the opinion of the Revenue Commissioners, the stocks were derived.

(9) That the duty provided for by paragraph (8) of this Resolution shall not be chargeable on any manufactured tobacco (including cigarettes, cigars and snuff, other than offal snuff) as to which it is shown to the satisfaction of the Revenue Commissioners that it was at 5 o'clock in the afternoon of the 8th day of May, 1956, fully prepared for sale by retail and that either—

(i) it was not the product of any operation carried out by any manufacturer in whose ownership or possession it was at that time; or

(ii) it was at that time held as retail stock in premises used for selling tobacco by retail; or

(iii) it was at that time in transit from seller to buyer under a contract of sale:

Provided that no tobacco shall be deemed for the purposes of this paragraph to have been fully prepared for sale by retail if, according to the ordinary course of business of the person in whose ownership or possession it was or to whom it was in transit, it had still to be subjected to some further process (other than packing) before being sold by him.

(10) That every licensed manufacturer of tobacco shall not later than the 15th day of May, 1956, make a return to the Revenue Commissioners in a form approved by them giving such information as they may thereby require and, in particular, showing the quantities by weight of tobacco of every description in his ownership or possession at 5 o'clock in the afternoon of the 8th day of May, 1956, in any place in the State other than a bonded warehouse.

(11) That every licensed manufacturer of tobacco shall—

(a) produce, if so required, to any officer of Customs and Excise the trade books and all accounts and documents belonging to or in the possession of such manufacturer which are necessary for verifying the return made in pursuance of paragraph (10) of this Resolution, and

(b) render all reasonable assistance to such officer in the taking of an account of the tobacco which was in the ownership or possession of such manufacturer at 5 o'clock in the afternoon of the 8th day of May, 1956.

(12) That every licensed manufacturer of tobacco shall, immediately upon making the return required by paragraph (10) of this Resolution or on the 15th day of May, 1956, whichever is the earlier, pay to the Revenue Commissioners the full amount of the duty mentioned in this Resolution on any tobacco which was in his ownership or possession at 5 o'clock in the afternoon of the 8th day of May, 1956, and was chargeable with the said duty, and the Revenue Commissioners may, if they think fit, defer the payment of the duty to a date not later than the 1st day of January, 1957, upon the manufacturer giving security by bond or otherwise to their satisfaction that such duty will be paid.

(13) That every manufacturer required by paragraph (10) of this Resolution to make such return as is mentioned in that paragraph who either fails to make such return or makes a return which is incomplete, false or misleading in any material respect or fails or refuses to do anything which he is required by paragraph (11) of this Resolution to do shall be guilty of an offence under the statutes relating to duties of excise and shall for every such offence incur an excise penalty of £50, and all tobacco in relation to which such offence was committed shall be forefeited.

(14) That where drawback is payable in respect of tobacco on which the excise duty provided for by paragraph (8) of this Resolution has been paid, such drawback shall, to the extent of the duty paid in pursuance of the said paragraph (8) as determined by the Revenue Commissioners, be a drawback of excise.

(15) It is hereby declared that it is expedient in the public interest that this Resolution shall have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1927 (No. 7 of 1927).

SCHEDULE

DUTIES ON TOBACCO

PART I.

CUSTOMS

		£	s.	d
Unmanufactured:—
If Stripped or Stemmed:—
Containing 10 lbs. or more of moisture in every 100 lbs. weight thereof	the lb.	2	2	9½
Containing less than 10 lbs. of moisture in every 100 lbs. weight thereof	,,	2	7	6½
If Unstripped or Unstemmed:—
Containing 10 lbs. or more of moisture in every 100 lbs. weight thereof	,,	2	2	9
Containing less than 10 lbs. of moisture in every 100 lbs. weight thereof	,,	2	7	6

		Full	Preferential
		£	s.	d.	£	s.	d.
Manufactured:—
Cigars	the lb.	2	15	0	2	5	10
Cigarettes	,,	2	13	0	2	4	2
Cavendish or Negrohead	,,	2	14	6	2	5	5
Cavendish or Negrohead Manufactured in Bond	,,	2	14	0	2	5	0
Other Manufactured Tobacco	,,	2	12	6	2	3	9
Snuff containing more than 13 lbs. of moisture in every 100 lbs. weight thereof	,,	2	12	0	2	3	4
Snuff not containing more than 13 lbs. of moisture in every 100 lbs. weight thereof	,,	2	14	6	2	5	5

PART II.

Excise.

		£	s.	d.
Unmanufactured:—
Containing 10 lbs. or more of moisture in every 100 lbs. weight thereof	the lb.	2	1	8
Containing less than 10 lbs. of moisture in every 100 lbs. weight thereof	,,	2	6	4
Manufactured:—
Cavendish or Negrohead Manufactured in Bond	,,	2	3	8

PART III.

PREFERENTIAL RATES OF CUSTOMS DUTIES ON UNMANUFACTURED TOBACCO.

		£	s.	d.
Unmanufactured:—
If Stripped or Stemmed:—
Containing 10 lbs. or more of moisture in every 100 lbs. weight thereof	the lbs.	2	1	3
Containing less than 10 lbs. of moisture in every 100 lbs. weight thereof	,,	2	5	10
If Unstripped or Unstemmed:—
Containing 10 lbs. or more of moisture in every 100 lbs. weight thereof	,,	2	1	2½
Containing less than 10 lbs. of moisture in every 100 lbs. weight thereof	,,	2	5	9½

Mr. Lemass

Will the Minister state if any part of the additional 5d. per packet of 20 cigarettes which consumers will now be paying will go to the tobacco manufacturers or distributors?

Mr. Sweetman

It is 4½d. duty and a ½d. to the trade.

Mr. Lemass

Is it a ½d. for the manufacturers or distributors?

Mr. Sweetman

Between the whole trade.

Mr. MacEntee

I think the House should hear the Minister for Social Welfare upon the fact which the Minister has now disclosed to the House that, of the 5d. that is now to be imposed on the packet of 20 cigarettes, the tobacco manufacturers and other persons engaged in the tobacco trade are going to get a ½d. We all remember the speeches which the Minister for Social Welfare made on the 1952 Budget when, acting on the advice of the Prices Advisory Body set up by the Minister's own colleague, the then Minister for Industry and Commerce, we conceded that it was only equitable and just that the benefit of the equivalent of a tax of 1d. per packet of 20 cigarettes would inure to the tobacco industry as a whole and all those engaged in it. The Minister for Social Welfare twitted the Government of the day that this was only passing it over to those whom he described as the millionaire manufacturers and foreign combines. I think that before the House decides on this Resolution it is entitled to hear from the Minister for Social Welfare whether he is now prepared to support giving this money to the millionaire manufacturers and the foreign combines as he described them in 1952.

Mr. Corish

You gave them £900,000.

Mr. Lemass

How much are we giving them now? What does a ½d. for 20 represent in cash?

Mr. Sweetman

This Resolution provides for a duty equivalent to 4½d.

Mr. Lemass

The price is going up to-morrow by 5d. How much does ½d. represent in cash for the manufacturers? Does it represent £500,000?

Mr. Sweetman

The Minister for Industry and Commerce will, no doubt, assign the appropriate Order which will be available to the Deputy.

Mr. Lemass

Normally in the past 1d. on 20 cigarettes was assumed to bring in £1,000,000. It is possible that the Minister is estimating for some reduction in consumption following this very heavy increase in tax. Would I be right in saying that this ½d. to the trade involves £500,000? Of the additional amount which the consumers will pay every year, £500,000 will go to the trade. Has anybody calculated that? Did somebody decide the need of that?

Mr. Morrissey

There is not any question of £1,000,000 and the Deputy knows it.

Mr. Lemass

Up to the present a ½d. on a packet of 20 cigarettes produced £500,000. It may be that there will be such a falling off in consumption that it may not produce £500,000 this year. If that should happen, no doubt the Estimate for the Department of Social Welfare will have to be expanded because there will be considerable unemployment.

Mr. Morrissey

That is what is worrying the Deputy.

Mr. Lemass

It is certainly not worrying the Deputy. I am looking for information. Presumably, somebody calculated how much the ½d. to the trade would give them. Somebody must have decided they needed that to maintain their profits. Was there any examination or did they just think of a figure?

Mr. MacBride

Could the Minister tell the House whether the introduction into use of the filter cigarettes has affected seriously the revenue of tobacco? Could he further tell the House whether he has taken that into account in estimating the amount of revenue which he hopes to derive this year?

Mr. Sweetman

Deputy Lemass knows perfectly well what is done on these occasions and that is that the Minister for Finance imposes a duty figure and it is for the Department of Industry and Commerce, immediately that announcement is made, to deal with the exact margin in the manner in which these margins will be distributed between the various brands of cigarettes. The figures the Deputy gave us in respect of a ½d. yielding £500,000 would not be accurate, partly because of the decreased consumption due to a variety of reasons, including the one mentioned by Deputy MacBride. I do not propose to segregate the various component parts of that reduced consumption but the Deputy can take it, as can be seen from the figures I gave, that an increase of 4½d. in duty means £2,945,000, excluding the duty on stocks.

Mr. Lemass

Including a lot of reliefs.

The Committee divided: Tá, 76; Níl, 57.

Tá.

Barrett, Stephen D.
Barry, Anthony.
Barry, Richard.
Beirne, John.
Belton, Jack.
Blowick, Joseph.
Burke, James J.
Byrne, Patrick.
Carew, John.
Casey, Seán.
Coburn, George.
Collins, Seán.
Coogan, Fintan.
Corish, Brendan.
Cosgrave, Liam.
Costello, Declan.
Costello, John A.
Glynn, Brendan M.
Hession, James M.
Hughes, Joseph.
Kenny, Henry.
Keyes, Michael.
Kyne, Thomas A.
Larkin, Denis.
Leary, Johnny.
Lindsay, Patrick J.
Lynch, Thaddeus.
McAuliffe, Patrick.
MacBride, Seán.
MacEoin, Seán.
McGilligan, Patrick.
McMenamin, Daniel.
McQuillan, John.
Manley, Timothy.
Morrissey, Dan.
Mulcahy, Richard.
Murphy, Michael P.
Murphy, William.
Crotty, Patrick J.
Crowe, Patrick.
Deering, Mark.
Desmond, Daniel.
Dillon, James M.
Dockrell, Henry P.
Dockrell, Maurice E.
Donegan, Patrick S.
Donnellan, Michael.
Doyle, Peadar S.
Dunne, Seán.
Esmonde, Anthony C.
Everett, James.
Fagan, Charles.
Finlay, Thomas A.
Finucane, Patrick.
Flanagan, Oliver J.
Giles, Patrick.
Norton, William.
O'Carroll, Maureen.
O'Connor, Kathleen.
O'Donnell, Patrick.
O'Donovan, John.
O'Hara, Thomas.
O'Higgins, Michael J.
O'Higgins, Thomas F.
O'Reilly, Patrick.
O'Sullivan, Denis J.
Palmer, Patrick W.
Pattison, James P.
Reynolds, Mary.
Roddy, Joseph.
Rooney, Eamonn.
Sheldon, William A.W.
Spring, Dan.
Sweetman, Gerard.
Tully, James.
Tully, John.

Níl.

Allen, Denis.
Bartley, Gerald.
Blaney, Neil T.
Boland, Gerald.
Brady, Seán.
Brennan, Joseph.
Brennan, Paudge.
Breslin, Cormac.
Briscoe, Robert.
Burke, Patrick J.
Butler, Bernard.
Calleary, Phelim A.
Carter, Frank.
Childers, Erskine H.
Colbert, Michael.
Colley, Harry.
Collins, James J.
Corry, Martin J.
Crowley, Honor M.
Cunningham, Liam.
Davern, Michael J.
Derrig, Thomas.
de Valera, Eamon.
de Valera, Vivion.
Egan, Kieran P.
Egan, Nicholas.
Fanning, John.
Flanagan, Seán.
Flynn, John.
Flynn, Stephen.
Geoghegan, John.
Gilbride, Eugene.
Gogan, Richard.
Harris, Thomas.
Hillery, Patrick J.
Hilliard, Michael.
Kenneally, William.
Kennedy, Michael J.
Lahiffe, Robert.
Lemass, Seán.
Lynch, Celia.
Lynch, Jack.
MacCarthy, Seán.
McEllistrim, Thomas.
MacEntee, Seán.
McGrath, Patrick.
Maher, Peadar.
Moher, John W.
Moran, Michael.
Moylan, Seán.
Ó Briain, Donnchadh.
O'Malley, Donnchadh.
Ormonde, John.
Ryan, James.
Ryan, Mary B.
Sheridan; Michael.
Walsh, Thomas.

Tellers:—Tá: Deputies Doyle and Mrs. O'Carroll; Níl: Deputies Ó Briain and Hilliard.

Resolution declared carried.

Dáil Éireann debate -
Tuesday, 8 May 1956