Resolution No. 3—Customs and Excise. - Hydrocarbon Oils. – Dáil Éireann (15th Dáil) – Tuesday, 8 May 1956

Resolution No. 3—Customs and Excise. - Hydrocarbon Oils.

Mr. Sweetman

I move:—

(1) That in this Resolution—

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

"the Act of 1935" means the Finance Act, 1935 (No. 28 of 1935).

(2) That the duty of customs imposed by Section 1 of the Finance (Customs Duties) (No. 4) Act, 1931 (No. 43 of 1931), as amended by subsequent enactments, shall in respect of mineral hydrocarbon light oil chargeable with that duty, be charged, levied and paid as on and from the 9th day of May, 1956, at the rate of 2/3¼d. the gallon in lieu of the rate specified in paragraph (b) of sub-section (1) of Section 6 of the Act of 1952.

(3) That the duty of excise imposed by Section 1 of the Finance (Miscellaneous Provisions) Act, 1935 (No. 7 of 1935), as amended by subsequent enactments, shall in respect of mineral hydrocarbon light oil chargeable with that duty which is sent out, on or for sale or otherwise, from the premises of the manufacturer thereof on or after the 9th day of May, 1956, or is used by such manufacturer on or after that date for any purpose other than the manufacture or production of mineral hydrocarbon oil, be charged, levied and paid at the rate of 2/1¼ the gallon in lieu of the rate specified in paragraph (b) of sub-section (2) of Section 6 of the Act of 1952.

(4) That as on and from the 11th day of May, 1956, the rate of any rebate allowed under sub-section (2) of Section 21 of the Act of 1935, shall be—

(a) as respects the oil commonly known as tractor vaporising oil, ? the gallon; and

(b) as respects any other hydrocarbon oil, 1/7 the gallon.

(5) That as on and from the 11th day of May, 1956, the rate of any rebate allowed under sub-section (4) of Section 21 of the Act of 1935, shall be—

(a) as respects the oil commonly known as tractor vaporising oil, ? the gallon; and

(b) as respects any other hydrocarbon oil, 1/5 the gallon.

(6) 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).

Mr. MacEntee

I notice that members of the Labour Party, particularly those who represent the rural constituencies, are conspicuously absent when this Resolution is being debated. I want to ask the Minister for Finance, so that it will be quite clear to all the Deputies who are voting to support this Resolution, what in fact it intends to do.

As I take it, Sections (2) and (3) are the sections which impose the main rates of duty, the duty upon petrol and mineral hydrocarbon oils used for the purposes of ordinary personal and commercial transport. Sections (4) and (5) grant rebates, but these rebates are so graded that a tax of 1d. per gallon will be imposed upon all oils used for lighting, heating and cooking. I assume that I am correct in that. Therefore, in the constituency which is represented in this House by, among others, the recently appointed Parliamentary Secretary, Deputy Spring, where oil is extensively used for cooking and perhaps for heating, and in those districts which are not yet covered by the rural electrification scheme, for lighting, and in the constituency of every member of the Labour Party who represents a rural area, every smallholder and agricultural worker will be charged henceforward on all the oil used for these domestic purposes at the rate of 1d. per gallon.

That is what the working class people in our rural areas are paying for the fact that the Government has not tackled what is the basic difficulty in all this matter, the phenomenon of rising Government expenditure. Until we can manage to curb and curtail that, there will be no relief for any taxpayer in this country and the burdens upon the workers, upon the poorer sections of this community, are going to be increased. That is what is at stake here in this Resolution.

Mr. McQuillan

Both the Opposition and the Government have made it quite clear that this country is facing a serious crisis and that one of the causes of that crisis is the importation of commodities from abroad, in many instances commodities for which a reasonable substitute can be produced and found at home. In spite of the fact that this Government has not brought about a reduction in the cost of Government administration, my opinion is that it is our duty as members of this House to take the unpopular step of helping in our own way by our votes to ensure that the importation from abroad of goods that are of a luxury nature is limited to the minimum. Both commodities, tobacco and oils, come from abroad. When Deputy MacEntee suggests that in various constituencies oil is used for fuel and heating purposes, I should like to state that I regret the day we still have to use oil for these purposes. We have a first class native substitute in peat and I should like to see the Government give a dynamic kick in the pants to Bord na Móna and the E.S.B. to get under way with a first class programme, so that our native fuel resources would be exploited to the utmost. Although it may be unpopular to say so, I would not be logical in my arguments down through the years if I did not say that, if a Government are to put on additional taxes, they should be put on some commodity that comes from abroad rather than commodities that are produced in Ireland. I am only sorry that the Minister has not taken immediate steps to cut out the importation of cereals.

An Leas-Cheann Comhairle

That does not arise on these Resolutions which deal with hydrocarbon oils.

Mr. McQuillan

I am not an expert on the actual details of this and I want the Minister to clarify the position in so far as the farming community are concerned with the use of oil and petrol. I think we should ensure, when applying penalties to the public, that the farming community, our primary producers, are given every incentive. Before I cast my vote on this, I want to be assured that it will not have an adverse effect on agricultural production.

Mr. Lemass

This is the steepest increase in petrol duty ever imposed in one year. Have the Government made any estimate of the effect of it upon the user of petrol? Did they take into account the intention to impose this higher tax when preparing their estimate of the revenue foreseeable from this duty? I am rather puzzled. The Minister apparently is expecting that the amount paid on road tax on vehicles this year will not merely be considerably above last year, but that there will be a far greater expansion of revenue than was previously in evidence. I presume the Government are aware how badly the motor trade is already hit. I think that the saturation of the market for motor-cars which has been going on recently here would have produced a considerable failing off in the number of new cars registered this year without any Government action; but the Government decided to increase the price of cars by imposing a 15 per cent. additional duty on imported parts. That is already having its effect on a number of firms. In fact, I do not think there is any firm which has not laid off a substantial number of employees. Further impositions on the motor trade in the form of a petrol tax are bound to have further consequences in that direction. Apparently, however, the Government think not; apparently it is assumed that not only will the motor trade not be affected, but that there will be an expansion in it this year at a greater rate than ever before. I think that is a nonsensical assumption.

Mr. MacBride

Has the Minister satisfied himself that this new duty will not affect the cost of fuel to C.I.E. for transport services in Dublin City? In other words, has he satisfied himself it will not affect bus fares? Can he say whether or not this new duty is likely to be made an excuse for another increase in bus fares in the city?

Mr. Cunningham

Surely Deputy McQuillan is not so innocent as to think that an increase of 6d. a gallon on the price of petrol is not going to increase the cost of production on farms and that it is not going to affect the agricultural community? Every Deputy knows that farm production, or a great part of it, is hauled by petrol-driven lorries and other vehicles of that kind. Accordingly, an increase in the price of petrol must affect the cost of agricultural production and will be passed on to the consumer. The new tax will also affect hackney owners about whom there was such wailing and moaning in 1952. It will be a serious blow to these people. Although tractor oil is exempted, still a large part of farm produce will be affected by the increased price of petrol.

Mr. Sweetman

This duty on other hydrocarbon oils includes heavy oils other than petrol, tractor oils and diesel oil. The heavier type of buses run on diesel oil. There is no increase of duty in respect of that user of diesel oil. In respect of Deputy McQuillan's point about tractor vaporising oil, that is excluded from the duty and the rebate provisions by which repayment can be claimed are contained in this Resolution for petrol tractors used for agricultural purposes. Farmers will have to pay to-morrow the same price as they paid to-day for petrol for agricultural purposes.

As far as Deputy Lemass's point about motor vehicles is concerned, he must be aware, as I am aware, every Deputy is aware, and as the country is aware, that immediately after the new impositions on imported parts, people rushed in and bought up cars. The effect of that rush to purchase before the duty impacted on the price of new cars was to bring into tax in the financial year cars that would not have been bought until perhaps May or June.

Mr. Lemass

The Minister should read the report of the Fair Trade Commission. Ninety per cent. of cars are sold on the basis of a trade-in of old cars.

Mr. Sweetman

Surely Deputy Lemass will not suggest that cars taken out in the middle of March in unprecedented numbers were not going to be taxed? Of course they were taxed, and the taxes and the sales came into account as a result and at a greatly accelerated rate compared with what they were.

Mr. Lemass

Registrations were down in January, down in February and down in March.

Mr. Sweetman

Deputy Lemass should remember it was not until March that the proposals were introduced.

Mr. Lemass

But new registrations——

Mr. S. Collins

The Minister has made reference to the fact that heavy road transport will not be affected, and in so far as diesel oil will not be affected by the new tax, I wonder would the Minister ensure that diesel oil used by fishing craft will be put into the same category?

Mr. Sweetman

I would have to look into that. I do not know exactly how that diesel oil is classified. I do not think it would be possible to differentiate, but I will have to look into it.

Mr. Lemass

Surely diesel oil is not being taxed at all?

Mr. Sweetman

Not in so far as the road user is concerned.

Mr. J. Flynn

I would join with Deputy Collins in asking the Minister to consider that question of fishing craft, because, as the Minister is aware, an increase would affect numbers of fishermen who have difficulty in eking out an existence along the south and west coasts.

The Committee divided: Tá, 76; Níl, 58.

Tá.

Barrett, Stephen D.
Barry, Anthony.
Barry, Richard.
Beirne, John.
Belton, Jack.
Blowick, Joseph.
Burke, James J.
Cosgrave, Liam.
Costello, Declan.
Costello, John A.
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.
Glynn, Brendan M.
Hession, James M.
Hughes, Joseph.
Kenny, Henry.
Keyes, Michael.
Kyne, Thomas A.
Larkin, Denis.
Leary, Johnny.
Lindsay, Patrick J.
Lynch, Thaddeus.
Byrne, Patrick.
Carew, John.
Casey, Seán.
Coburn, George.
Collins, Seán.
Coogan, Fintan.
Corish, Brendan.
McAuliffe, Patrick.
MacBride, Seán.
MacEoin, Seán.
McGilligan, Patrick.
McMenamin, Daniel.
McQuillan, John.
Manley, Timothy.
Morrissey, Dan.
Mulcahy, Richard.
Murphy, Michael P.
Murphy, William.
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, Ml.
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.
Killilea, Mark.
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, Donough.
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