Dáil Éireann debate -
Wednesday, 9 Mar 1966

Vol. 221 No. 8

Financial Resolutions. - Financial Resolution No. 4: Beer.

Minister for Finance (Mr. J. Lynch)

I move:

(1) That in this Resolution "the Act of 1965" means the Finance Act, 1965 (No. 22 of 1965).

(2) That in lieu of the duty of excise imposed by subsection (1) of section 12 of the Act of 1965, there shall be charged, levied and paid on all beer brewed within the State on or after the 10th day of March. 1966, a duty of excise at the rate of seventeen pounds, nineteen shillings and five pence for every thirty-six gallons of worts of a specific gravity of one thousand and fifty-five degrees.

(3) That in lieu of the duty of customs imposed by subsection (2) of section 12 of the Act of 1965, there shall, as on and from the 10th day of March, 1966, be charged, levied and paid on all beer of any description imported into the State, a duty of customs at the rate of seventeen pounds, nineteen shillings and eleven pence for every thirty-six gallons of beer of which the worts were before fermentation of a specific gravity of one thousand and fifty-five degrees.

(4) That there shall be allowed and paid on the exportation as merchandise or the shipment for use as stores of beer on which it is shown, to the satisfaction of the Revenue Commissioners, that duty at a rate provided by paragraph (2) or paragraph (3) of this Resolution has been paid, a drawback calculated according to the original specific gravity of the beer, at the rate of seventeen pounds, nineteen shillings and eight pence on every thirty-six gallons of beer of which the original specific gravity was one thousand and fifty-five degrees.

(5) That where, in the case of beer which is chargeable with duty at the rate provided by paragraph (2) or paragraph (3) of this Resolution or in the case of beer on which drawback under paragraph (4) of this Resolution is payable, the specific gravity of the beer is not one thousand and fifty-five degrees, the duty or drawback shall be varied proportionately.

(6) That section 24 of the Finance Act, 1933 (No. 15 of 1933), shall not apply or have effect in relation to the duty of customs to which this Resolution refers.

(7) 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. Cosgrave

This Resolution increases the duty on beer by 2d a pint. This must be considered in the light of an inquiry held last year into beer prices. This proposal makes a complete mockery of that inquiry. As a result of the inquiry, an order was made directing a reduction of 2d a pint and this applied irrespective of whether any increase has been made in the price of drink. It was inequitable and unfair in so far as it applied to publicans whose prices had not been increased as well as to those who had increased prices. Now, the Government propose to raise the price by the equivalent of the reduction made in the order. As well, the licensed trade, in common with other trades and businesses, must meet increased rates and other demands, a variety of additional charges, including distributive charges because of increases in the price of petrol and oil.

We feel this tax also is unnecessary. When the turnover tax was introduced, one of the reasons given was that the traditional sources of revenue were incapable of bearing additional taxation. This Budget now imposes taxation on traditional items by a further £12½ million. It seems the traditional sources not merely were not incapable but have borne very substantial additional taxation and that beer and spirits have borne more than a fair share. There are considerable numbers of people employed in these trades, apart from owners of licensed premises and their employees, and their interests may well be adversely affected by this. We feel it is unnecessary, that it is contrary to the advice given in the Report of the Department of Finance and the NIEC comments on it.

Mr. M.P. Murphy

I ask the Minister again to give us the duty on beers. First of all, there is stout. I ask him to give us the new rate, including turnover tax, on a pint of stout and on a bottle of such beers as Time, Double Diamond, Phoenix and Lagers. This is information the public should know.

Mr. Dillon

I am glad the Leader of the Opposition has reminded the Minister that his predecessor came into office to justify the turnover tax. The principal ground on which he justified it was that the traditional sources of revenue—tobacco and petrol—were no longer available to him and that an increase in taxation upon either of these items would have the result of diminishing returns. This Budget, and the one that went before it, of course, reveal that that claim was a shameless falsehood. I freely admit that the Minister was not then the Minister for Finance. He will not however, wish to divest himself of his joint responsibility as a member of the Government. The Minister made that affirmation in the House in the hearing of those then present.

I wonder, when we tax beer, as we propose today, to the tune of £2¼ million, if we ask ourselves the question: Who is to pay it? It will certainly not be paid by the wealthy in this country because they simply have not got the capacity to absorb the beer to produce £2¼ million. From the very estimate we give of the probable yield of this tax it is manifestly based on the conviction that it will be consumed by those who cannot afford to consume spirits or wine but who feel it no extravagance on occasions to drink beer. I see now, and I am not surprised, that the Minister is left alone in the Fianna Fáil benches with the distinguished exception of Deputy Kennedy from Wexford. That valiant soul should be remembered. Even Deputy MacEntee has fled the scene.

The Minister for Finance, in discussing a previous Resolution, justified what he did today by the fact that the same was done in 1956. Did he advert to the fact that the tax he is putting on today is on top of the tax established in 1956 plus the tax put on by his colleagues in successive budgets since then, plus the turnover tax and now the tax in the Financial Resolution we are considering today? Does the Minister appreciate that the tax put on commodities such as beer and tobacco are cumulative taxes? In any case, whether or not the Minister realises it, one fact is self-evident from the volume of revenue the Minister seeks to derive from this tax and that is that he intends to levy it on everybody.

Is it extravagant for a working man to consume a bottle of stout per day? Let us face the fact that for any man who does, this Financial Resolution is designed to collect at least 6d. a week, assuming that he abstains on Friday. I often wonder, when Deputies of this House are confronted with a Financial Resolution—upon which Deputy MacEntee is so anxious that we should concentrate our attention—if we forget the implications of our action? Did anyone believe, when Fianna Fáil were campaigning in the last general election, that they were campaigning for authority to levy 6d. a week on every man who drank beer and voted Fianna Fáil?

Mr. M.P. Murphy

The Deputy is very moderate in his estimate of 6 bottles of beer a week.

Mr. Dillon

I see that the Parliamentary Secretary to the Minister for Industry and Commerce has now come into the House to join Deputy Kennedy, the valiant man from Wexford.

Mr. S. Flanagan

We are paying Deputy Dillon the compliment of listening to him and perhaps he might refrain from such comments.

Mr. Dillon

I should like to see Deputy J. Gibbons, the Parliamentary Secretary to the Minister for Finance Deputy S. Flanagan, the Parliamentary Secretary to the Minister for Industry and Commerce and the valiant Deputy from Wexford, Deputy Kennedy, stand on their platforms in their respective constituencies and say to the people: "We want your votes to tax tobacco, to tax beer, to tax whiskey, to tax petrol, to tax table waters, dances, motor vehicles, petrol——

An Leas-Cheann Comhairle

This resolution deals specifically with beer.

Mr. Dillon

Beer—and I would throw in all the others as a bonus. However, I should like to hear their explanations. It fascinates me that, in the first Budget they have introduced since they got back into office——

Mr. M.P. Murphy

The second.

Mr. Dillon

It is the first Budget on which they have had time to cogitate. It fascinates me that they have provided all this on beer and heaven too, on income tax, petrol, tobacco, spirits, table waters and motor vehicle duties. I should be very interested to hear what they will tell the neighbours when they go home. How will they explain that they did not know 12 months ago, of their intentions to levy these taxes? What has happened since they were on the hustings urging the people to "Let Lemass Lead On"?

Mr. L'Estrange

To prosperity.

Mr. Coogan

To another mystery tour.

Mr. Dillon

I must give them this credit. The advertisement, as I read it, was: "Let Lemass Lead On". It did not say where—to damnation or to salvation. In the eschatological sphere, I suppose it is the quintessence of free will that you should be free to choose damnation. I suppose in politics, it is the quintessence of individual liberty that you should be free to choose Fianna Fáil but at least we are delivered from damnation. The fault I find with the Fianna Fáil Party is that they not only forebore telling the people where they would lead them but that they positively led them to believe that nothing was more likely than that "Lemass would lead on."

An Leas-Cheann Comhairle

We cannot have a general debate on this Resolution which refers only to beer. The Deputy should stick rigidly to the Resolution.

Mr. Dillon

I am sticking rigidly to it. I am referring to a placard asking the country to "Let Lemass Lead On" and I am asking if that placard meant that they should let Lemass lead on to a tax on beer. I do not think anybody told that to the electorate. In fact, that is what the placard has turned out to have meant and I am making the Fianna Fáil Party, for whom the Minister for Finance speaks, responsible for this Resolution. I want, in respect of each of these Resolutions, to declare the fraud they represent in the Fianna Fáil claim to "Let Lemass Lead On."

I believe they concealed deliberately from the people the knowledge they must then have had that they were leading the people into a catastrophe which would make a Financial Resolution such as this necessary in this Budget. They cannot pretend that this was absent from their minds because they were abundantly warned of it from the public platforms. They strenuously denied this and the present Minister for Finance and his colleagues declared that anybody who warned the people 18 months ago was undermining the economic future of the country. I charge the Minister for Finance with having persuaded the people to believe that the very reverse of what was inevitable was going to come to pass.

I would like the two Parliamentary Secretaries and the Deputy from Wexford present at the moment to state if they knew that a Financial Resolution of this kind was going to be proposed. I ask them to state did they anticipate that a tax of this character would appear in the Budget of 1966? If they did, I ask them did they conceive themselves to be under a duty to tell their constituents of that? If others told their constituents that the inevitable consequences of Fianna Fáil policy would be this, did they tell the people that prognostication was false? If they did, what are they going to tell the people now?

It is a matter of consequence to all of us that people should be persuaded that public men in this country do not deal in falsehoods. If the Government Party in this country can be clearly convicted of that course, it redounds to the discredit of all of us. We hear people speak with contempt of politicians and not infrequently it is the technocrats who speak so eloquently in this way. Does the Minister make the defence that he was misled by his own technocrats? Does he tell us that he was persuaded by his own technocrats that this present condition in which we find ourselves would not come to pass?

An Leas-Cheann Comhairle

This is developing into a general debate which is out of order on this Resolution which refers exclusively to beer.

Mr. Dillon

I am referring exclusively to beer.

An Leas-Cheann Comhairle

An occasional reference to beer does not make it relevant.

Mr. Dillon

We are entitled to discuss this Resolution on beer. We are getting into the habit in this House of thinking that the imposition of taxes by Resolution ought to pass automatically and that then we can discuss them later for three weeks or a month, but in the meantime the people are paying these taxes. I want to challenge these taxes before they are put on.

An Leas-Cheann Comhairle

The Deputy may not debate the whole economic structure of the country on the beer Resolution.

Mr. Dillon

I am asking Deputy Flanagan and Deputy Gibbons did they tell their constituents when they asked for their votes that they were going to tax beer. I am asking the Minister for Finance what did he tell the people in Cork and Kildare. I have no doubt he addressed meetings in both constituencies.

Mr. J. Lynch

Strangely enough, never in Kildare.

Mr. Dillon

It must be a relief to the Minister's conscience that he was not a party to this inglorious transaction in County Kildare.

An Leas-Cheann Comhairle

Again, that is not relevant.

Mr. Dillon

At least we can be reassured that the Minister did not go to Kildare and tell the people there that nothing was further from his mind than to put a tax on beer. If he did not go to Kildare and tell that story to the people there, he went to Cork and the story he told there was that he had to put on the turnover tax because he could not tax beer.

Mr. J. Lynch

That has been answered twice over since.

Mr. Dillon

And he said that he was going to give the workers a 12 per cent increase to offset the turnover tax because he could not tax beer. How does he reconcile that with what he is doing now? He has now pledged the solvency of the State on his confidence that he will get £2¼ million from beer this year. He has made his Budget so tight that for the first time he makes no allowance this year in his Budget for any percentage of expenditure allowed for in the Budget but not likely to come in course of payment during the year. This £2.25 million must be realised or we must have a supplementary Budget in the autumn. Will the Minister tell us how he can reconcile that confidence with his statement in Cork that the turnover tax was justified by the fact that the Government could not get additional revenue from beer?

Mr. J. Lynch

The Deputy is putting words into my mouth which I never used.

Mr. Dillon

I do not believe the Minister for Finance will dissent from the proposition——

Mr. J. Lynch

I justify my argument for turnover tax on a different basis altogether.

Mr. Dillon

I am certain the Minister will not wish to dissociate himself from the argument made here in my presence by the then Minister for Finance, that he was finally forced to have recourse to turnover tax having been satisfied by his advisers that the traditional sources of taxation would not yield the revenue required.

Mr. J. Lynch

In the times then prevailing.

An Leas-Cheann Comhairle

The question of the turnover tax does not arise on Financial Resolution No. 4. The Deputy is hanging a general debate on this Resolution and that is not in order.

Mr. Dillon

I am discussing, strictly and relevantly, I suggest, the desirability of levying £2¼ million on beer——

Mr. S. Flanagan

As well as what I said to the people of Mayo. What has that got to do with it? I shall have a few words to say when the Deputy has finished.

Mr. Dillon

I think it has to do with the personal honour of every one of us——

Mr. S. Flanagan

That is enough of that. What I did or did not say to the people of Mayo—I shall explain about that.

Mr. Dillon

Anybody who got votes by representations that have proved to be unfounded is under an obligation to justify himself and I do not think any members of Fianna Fáil warned the electorate——

Mr. S. Flanagan

We have heard this once already and that is quite enough.

Mr. Coogan

Not half enough for you.

Mr. S. Flanagan

I know that ignorant blacksmiths do not like——

(Interruptions.)

Mr. Donegan

On a point of order, is it in order for a Member to refer to another Member of the House in a derogatory fashion?

Mr. M.P. Murphy

On another point of order, does this professional gink here think that a professional blacksmith is something beneath contempt?

Mr. Donegan

I do not want to refer to anybody's profession or occupation but merely to point out that a Member referred to another Member as ignorant and I think that is not in order. I refer to the fact that a Member of this House referred audibly to another Member as being ignorant.

Mr. Coogan

For the benefit of the ignorant solicitor beyond, I would remind him that the blacksmith played his part in the fight for freedom—my father did so—better than the Deputy himself.

(Interruptions.)

Mr. Coogan

I am not ashamed of it. There was Seán MacEóin also.

An Leas-Cheann Comhairle

Will the Deputy allow Deputy Dillon to proceed?

Mr. Donegan

I am sorry, but I have raised a point of order.

An Leas-Cheann Comhairle

The Chair did not hear Deputy Flanagan but the Chair heard Deputy Coogan.

Mr. Coogan

The Chair must be deaf.

Mr. Donegan

That is very interesting.

Mr. J. Lynch

Without justifying the matter, that is not a point of order.

Mr. Dillon

There is no need for anybody to get cross——

Mr. J. Lynch

I am not cross.

Mr. Coogan

No, the broken-down solicitor.

Mr. Dillon

I admire the Minister for not getting cross. It is not necessary for anybody to get cross for the purpose of effective debate. I am discussing the impact of this Resolution on the ordinary men and women of the country, and I am interested in nothing else. I think it would be well for all of us to avoid excogitation about our various professional occupations. The matter at present under discussion is a tax of 1d a bottle on beer and 2d per pint on stout. I believe that to be a very burdensome tax on the masses of the people, a tax on people in very modest circumstances who can ill afford to pay it. I believe it to be a tax of which Fianna Fáil gave no hint —far from it—in the whole course of their campaign which was designed rather to persuade the people that the likelihood of their doing anything like this was extremely remote. I ask the Minister to justify the burden, to justify the misrepresentation of which I believe his Party were guilty and to tell us if he sees any prospect of a remission of these taxes at any time, or does he intend to go on letting the ordinary people pay?

Lastly, I ask him to tell us honestly: does he really believe this tax will make no difference to the cost of living of the ordinary family? I am warning him of the vicious circle of rising costs which some day somehow must be broken. Where is the start of stability to begin? Does the Minister believe it is reasonable to say to those who can least afford it: "You must pay more but you must do with less". I find it hard to see the justice of such a requisition on the masses of the people and I should be interested to hear from the Minister how he believes it to be possible to get that stability in prices and wages in industry which he says is indispensable to our economic survival, if this Resolution, designed to net £2¼ million from the masses of our people, is to form part of the Budget.

Parliamentary Secretary to the Minister for Industry and Commerce (Mr. S. Flanagan)

I have very little to say on this Resolution but 15 years ago when I made some reference to Deputy Dillon which he did not like, he offered me what he described as a lesson in charity and suggested to me that people should not look over each other's walls. Since that time 15 years ago, neither in this House nor elsewhere, have I made unfair criticism of Deputy Dillon, either in public or in private. I merely want to tell him now that I consider myself no longer bound by that and when I come to speak in the Budget debate, I shall consider myself free to say things that I would not otherwise say.

Mr. M.P. Murphy

I want to ask the Minister——

Mr. J. Lynch

I have not forgotten the Deputy's question. Or has he something else to ask? If so, I should prefer he would do it now so that I can save my voice.

Mr. M.P. Murphy

Not now. It is essential to what I have to say to know what the Minister's figures will be.

Mr. J. Lynch

I should say at this stage it is fairly usual for the Minister to be allowed to talk on radio and television on the evening of the Budget. Apparently, it is not going to be my privilege to do so, unless the debate ends quickly.

Mr. Donegan

What time is the Minister on at?

Mr. J. Lynch

I should have been at Radio Éireann nearly an hour ago. However, that is up to the Opposition.

Mr. Lindsay

Parliament cannot take second place to television.

Mr. J. Lynch

What is sauce for the goose is sauce for the gander. I am sure the Leaders of the Opposition——

Mr. Lindsay

Parliament must not take second place to television.

Mr. J. Lynch

As I say, what is sauce for the goose. There are two other television appearances by the Opposition Parties. Perhaps they can be cancelled just as well. However, I want to say this. We on this side of the House are entitled to claim the same motivation as Deputy Dillon ascribes to himself, when we entered politics as when he entered politics, and we did so with the intention of serving to the best of our ability, and to the capacity we have got, and as objectively as we can, the people of the country, without having all forms of degradation ascribed to us. I try to do my job as well as Deputy Dillon or any of his colleagues did when they were on this side of the House. We may have our limitations but certainly we do our job as honestly and as objectively as possible and it is disgusting to hear a man, who attributes such high praise to public service as Deputy Dillon does, pour contumely on those who do not agree with him.

Mr. Dillon

Surely on their policies?

Mr. J. Lynch

Surely the virtues do not all lie with those who agree with Deputy Dillon. It is true that the proposed tax will net something in the nature of £2¼ millions. I know that it is going to be an impost on ordinary people, not only on the people who cannot afford wines and spirits. I know many people who drink pints and bottles of stout who would not care twopence for the best bottle of wine that Deputy Dillon could provide for himself in his favourite club. Similarly with spirits. I am not saying that this is the reason for imposing the tax. The duty is necessary to provide taxes for the running of the State generally.

When I spoke on the turnover tax in my constituency I justified it on the basis that the media for taxation on which this State had to depend were too limited in their scope and it was desirable that the scope of these taxable items should be broadened without having over-dependence on what have been called the old reliables. It was probably valid for my predecessor, Dr. Ryan, to say in 1963 that the revenue from these old reliable sources had reached saturation point. It was relative in the circumstances then prevailing but as standards of living improve, as incomes improve, that may no longer be relevant, as was shown last year when increases in certain taxation produced worthwhile increases to the Exchequer. In answer to Deputy Murphy, in regard to the increase in beer—the term includes stout, porter, ale and lager—in the case of stout, which as the Deputy is aware, accounts for the bulk of the consumption of beer, the increased duty adds twopence to the present duty element per pint.

Mr. M.P. Murphy

Which brings in one shilling?

Mr. J. Lynch

No, 9.5 pence per pint to 11.5 pence per pint. In the case of porter, sales of which are very small, and porter being of lower gravity, the duty will add about 1.7 pence to the present duty element of 8.1 pence per pint. The gravities of the other beers to which he referred, a variety of ales and lagers, vary to a considerable extent, as the Deputy probably knows, but on average the gravity tends to be half way between that of stout and porter and on average the duty element of 8.6 pence per pint on ale and lager will be increased by slightly less than twopence per pint.

Mr. M.P. Murphy

It is lamentable that the Minister has been forced to introduce an additional tax on beer because the people who drink beer, particularly stout, are mainly people in the lower income group. In the rural parts—the same can be said for the rest of the country—having a drink is traditional. We have publichouses scattered all over rural Ireland and it is not unusual for people to gather, when their day's work has concluded, in the local publichouses to discuss the day's work, over what are termed a few pints. Mark you, that is the only thing which many of our rural people enjoy, having this discussion in their publichouse if not every night then on a few nights during the week or on a Sunday evening. By imposing this additional twopence on the pint we are making it very difficult for this group of people because we know that there is a very wide variation in incomes at present and that variation has been made a great deal wider in the immediate past as a result of Government policy of pushing up salaries that were already high and keeping depressed salaries that are entirely inadequate.

The Minister will appreciate that the man working for the Cork Corporation or the county council or the Department of Lands, married or single, has to make do with a wage in or around £8 per week and his take home pay for a full week's work is not more than £7.10 0d in his own county of Cork. It may be more in the city but in the rural parts of Cork his take home pay at present is not more than £7.10. 0d. These are the people who enjoy their pint occasionally and it is the only recreation, if I may use that word, which they have, meeting in the publichouse. It is unfair for the Minister to ask this group to give him an extra £2¼ million to measure up to his Budget requirements particularly having regard to the fact that their incomes have been allowed to continue in a depressed state and when only in the past few weeks we jerked up the salaries of the higher grades by £895,000.

An Leas-Cheann Comhairle

That does not arise on the Resolution.

Mr. M.P. Murphy

I am dealing with the tax on beer.

An Leas-Cheann Comhairle

I hope the Deputy will deal with it. At the moment he is dealing with the question of incomes.

Mr. M.P. Murphy

As a publican and a person who has a reasonably good idea of rural life, I am satisfied that the main drinkers of beer come from the lower-income group, such as the workers I have mentioned, self-employed farmers, shopkeepers and others, and we are asking too much of these people. We are asking too much of the working people in asking them to give us 2d more. Is it unreasonable for them to ask us: "Why should we give you 2d more? You have given us no additional income, nor do you propose to give us any additional income in this Budget. Why not ask the people who were given status increases of £1,000?"

An Leas-Cheann Comhairle

We cannot have a general debate on these Resolutions. Resolution No. 12 is provided for the specific purpose of having a general debate.

Mr. M.P. Murphy

There has been some slight change in the system. It is more realistic to discuss this on Financial Resolution No. 4 before it is passed into law rather than discuss it in a couple of weeks when it is already in force.

An Leas-Cheann Comhairle

Standing Orders do not provide for a general debate on the Resolutions.

Mr. M.P. Murphy

I am aware of that. This is asking these people to pay another 2d per pint for beer, a penny per bottle of stout and so on. I will not deal with table waters. It is lamentable, having regard to the incomes of the main consumers of stout, that we should ask them to pay another 2d per pint. We in the Labour Party do not subscribe to that proposal. We oppose it vehemently because we are satisfied the people we represent throughout the country cannot afford to pay that increase.

I do not want to go over statements made by previous speakers but Deputy Dillon pointed out that the Minister's predecessor, Dr. Ryan, said two years ago that beer could not bear any further tax and that the law of diminishing returns would apply, if it were taxed any further. Despite that, we now have this further tax on beer. I think I express the views of every member of this Party when I protest against this imposition which I consider reprehensible.

Mr. Reynolds

I want to protest against the increased price of beer. In 1964, we were told by the then Minister for Finance, Dr. Ryan, that beer could carry no further tax because it would affect consumption. In 1964, there were more people in employment and more money in circulation than at present. The prices of beer and spirits were increased by last year's Budget and we are increasing it further this year. Last year it ended up with a costly inquiry, and the Minister will have to have another inquiry after this increase. If he wants to get a firm price without profiteering he should fix the prices of beer and spirits in the various parts of the country. We know what happened last year. Following the inquiry, a percentage of the publicans reduced the price, but others did not. In increasing these prices, I believe the Minister is thinking of the tourists and not thinking of the people in rural Ireland particularly in the constituency I represent in places like Roscommon and Leitrim. These unfortunate people cannot afford to pay any further increase in the price of beer and spirits. Even prior to 1964, when the turnover tax was introduced, the present Minister for Justice, then Parliamentary Secretary to the Minister for Lands, told the people at a Fianna Fáil meeting in Boyle that they would put a tax on fur coats and expensive jewellery. But they came back and put the turnover tax on essential foodstuffs. They said at that time they could not tax the usual commodities, but in two successive years, they increased the price of beer and spirits. It is time they asked themselves where they are going and who is going with them.

Mr. Lindsay

I want to join with others who have made their protests on behalf of the drinking public affected by this almost perennial imposition on beer, wines and spirits. The first thing to be remembered about this tax is that it is a tax upon a tax. It is a complete unit imposed in each succeeding year on the tax already there. While I join wholeheartedly in the protest on behalf of the consuming public, I want to say further that I think within the ambit of this Resolution there come many more considerations.

Publichouses can be divided into many categories for the purpose of argument against this imposition. I shall divide them into the rather big Dublin and provincial town publichouses, probably owned by a company, then the less big ones in provincial towns, but, above all, I want to refer to the small family publichouses in smaller towns, in villages and at crossroads, where the sale of drink in conjunction with other articles such as hardware and grocery, is a matter of a livelihood. An increase in tax, for a time at any rate, necessarily means a decrease in drinking. A decrease in drinking means a decrease in turnover, with a consequent drop in profits. For the bigger publichouses of this city and the other cities and large towns, this must constitute a threat to employment. Once people find it difficult to make ends meet, the first to suffer are those who are employed.

Then you come to the family publichouse. Some of them will probably work out all right—those on a sounder basis with a bigger turnover where a decrease in business would not involve so much. But to the average run of publichouses in the small towns and villages, this increase in taxation will mean a decrease in drinking, a consequent decrease in profits and, of course, a threat to the family business. It is difficult enough at present for people engaged in any type of business; but for publichouses, which are by and large unpaid and unofficial tax gatherers, to be inflicted in this manner with an imposition of this kind is something to which regard must be had sooner or later.

There was a time a few years ago when it was being argued in favour of the turnover tax that the traditional sources of revenue were drying up and could not be looked to with any degree of confidence to provide a return, but that argument appears to be dropped now and we are back again at the old business of attacking the traditional sources of revenue.

This imposition is a mistake. It is a mistake, first of all, because it will create hardship for the less well-off sections of the community who depend, to some extent at least, upon beer and stout as part of their staple food. It also imposes a hardship on the old who must have their traditional tot. Then there is the question of employment in the bigger publichouses, which is a very serious matter, and the most serious matter of all is the one to which I referred last, the family publichouse which is depending for its upkeep and the rearing of a small family on its sales of drink. It is far too much to ask these people, as each year passes, to become once more the tax-gatherers for the Government.

Mr. P. Belton

I should like to point out to the Government that the price at which the licensed trade are buying drink now, is the price at which they were selling it in 1960, and that in a period of five years the Government have taken all this money. In Ireland we are looking for new industries all over the place. We have encouraged outsiders to establish industries here which have been a complete failure whereas, between exports and imports of drink, the balance is £4,700,000 on the right side. This profit is from an industry which is the only non-subsidised industry in the country. There are no gimmicks attaching to this profit. Beer is by far the greatest profit-making drink, because we import a lot more spirits than we export. There is a figure of £6 million or £7 million for beer. If the Government are going to tax this drink there will be less consumption. If there is less consumption each item will cost that little bit more. If there is greater cost per item it means that what we can sell on the export market will be greater in price. The person who produces in Ireland must increase the cost or get rid of staff. When we hit the pint of stout and the pint of beer we are hitting the poor person. There will certainly be a reduction in consumption and if there is a reduction in consumption there will not be the same balance from exports.

Mr. T.J. Fitzpatrick

(Cavan): The object of this Resolution appears to be to collect approximately £3½ million from the sale of intoxicating liquor. The effect of increasing the price of the bottle of stout and the bottle of beer will be to put up the cost of living for the working man. The day is past when a bottle of stout or a bottle of beer is a luxury. As has been pointed out here this evening, it is one of the simple recreations of the working man. The effect of taxing this leisure will be to leave less money to the working man's wife to provide the absolute necessaries of life, will be to reduce the effective value of the wages which the working man brings home on Friday evening.

The result of this increase will be an inevitable demand for an increase in wages. Unless the working people of this country are to take the pledge and I do not think they will—if they do the real object of this Resolution will be lost—there will be less money for the necessaries of life. Housewives will make it plain to the men of this country that they cannot carry on and run a house on the wages handed up to them. The result of that will be that the men, through their trade unions, will demand an increase in wages. That will lead to demands all over the country for increases in wages. It will lead to industrial strife.

In a report which has been published by the National Industrial and Economic Council for consideration in conjunction with this Budget, it has been clearly pointed out that if things are to go on anyway smoothly and if the economy is to be got back on the rails, it can only be achieved if there is no abnormal industrial strife during the year, if there are no strikes in the country, if there is no demand for higher wages. By introducing this Resolution the Government will make it impossible to maintain the condition precedent set down by the NIEC in its recent publication. I wonder if the Government have throught about that and if the Minister for Finance has thought about it. This will start a spiral of events like the turnover tax.

An Leas-Cheann Comhairle

The Deputy is getting into a general debate on this Resolution. May I point out it is unusual to have lengthy detailed criticism of the tax at this stage? Deputies will have an opportunity in the main debate to go over these points.

Mr. T.J. Fitzpatrick

(Cavan): I respectfully submit I am dealing with the economy and the inevitable effects of implementing this Resolution. If I cannot make that point, then I cannot speak on the Resolution at all.

An Leas-Cheann Comhairle

The Deputy appreciates the fact that these Resolutions have to be passed this evening?

Mr. T.J. Fitzpatrick

(Cavan): Subject always to reasonable debate on them.

An Leas-Cheann Comhairle

Subject to the usual debate which has been allowed each year.

Mr. T.J. Fitzpatrick

(Cavan): I must bow to your ruling. I do not intend to be very much longer but as long as I deal with the imposition of this tax and advocate as a reason for not implementing it the results of implementing it, I respectfully submit I am in order.

An Leas-Cheann Comhairle

Might I point out that detailed criticism of the measures is reserved for the appropriate sections of the Finance Bill and the Deputy will then have every opportunity of traversing the ground fully.

Mr. T.J. Fitzpatrick

(Cavan): I shall confine myself to saying that I think the effect of this tax will be to increase the cost of living, to set off another demand for further increases in wages, and if I understand the Minister's Budget speech correctly, he threatens that in such an eventuality he will come back to the House before the end of the year and demand further, bigger and better taxes.

Mr. L'Estrange

After the Presidential Election.

Mr. T.J. Fitzpatrick

(Cavan): If he does that what will be the end result? If the Minister for Finance and the Government exhort the lower paid people in this country to tighten their belts, not to demand further wage increases, they should not by budgetary measures make it impossible for them to do that.

Question put.

The Committee divided: Tá, 68; Níl, 62.

Tá

• Aiken, Frank.
• Allen, Lorcan.
• Andrews, David.
• Blaney, Neil T.
• Boland, Kevin.
• Booth, Lionel.
• Boylan, Terence.
• Brady, Philip.
• Brennan, Joseph.
• Brennan, Paudge.
• Breslin, Cormac.
• Burke, Patrick J.
• Calleary, Phelim A.
• Carter, Frank.
• Carty, Michael.
• Childers, Erskine.
• Clohessy, Patrick.
• Colley, George.
• Collins, James J.
• Corry, Martin J.
• Cotter, Edward.
• Crinion, Brendan.
• Cronin, Jerry.
• Crowley, Flor.
• Crowley, Honor M.
• Cunningham, Liam.
• Davern, Don.
• de Valera, Vivion.
• Dowling, Joe.
• Egan, Nicholas.
• Fahey, John.
• Fanning, John.
• Faulkner, Pádraig.
• Fitzpatrick, Thomas J. (Dublin South-Central).
• Flanagan, Seán.
• Foley, Desmond.
• Gallagher, James.
• Geoghegan, John.
• Gibbons, Hugh.
• Gibbons, James M.
• Gilbride, Eugene.
• Gogan, Richard P.
• Haughey, Charles.
• Healy, Augustine A.
• Hillery, Patrick J.
• Hilliard, Michael.
• Kenneally, William.
• Kennedy, James J.
• Kitt, Michael F.
• Lalor, Patrick J.
• Lemass, Noel T.
• Lemass, Seán.
• Lenihan, Brian.
• Lenihan, Patrick.
• Lynch, Celia.
• McEllistrim, Thomas.
• MacEntee, Seán.
• Meaney, Tom.
• Molloy, Robert.
• Mooney, Patrick.
• Moore, Seán.
• Nolan, Thomas.
• Ó Briain, Donnchadh.
• Ó Ceallaigh, Seán.
• O'Connor, Timothy.
• O'Malley, Donogh.
• Smith, Patrick.
• Wyse, Pearse.

Níl

• Barrett, Stephen D.
• Barry, Richard.
• Belton, Luke.
• Belton, Paddy.
• Burke, Joan T.
• Burton, Philip.
• Byrne, Patrick.
• Casey, Seán.
• Clinton, Mark A.
• Cluskey, Frank.
• Collins, Seán.
• Connor, Patrick.
• Coogan, Fintan.
• Dunne, Seán
• Dunne, Thomas.
• Esmonde, Sir Anthony C.
• Farrelly, Denis.
• Fitzpatrick, Thomas J.(Cavan).
• Flanagan, Oliver J.
• Gilhawley, Eugene.
• Governey, Desmond.
• Harte, Patrick D.
• Hogan, Patrick (South Tipperary).
• Hogan, O'Higgins, Brigid.
• Jones, Denis F.
• Kenny, Henry.
• Larkin, Denis.
• L'Estrange, Gerald.
• Lindsay, Patrick J.
• Lyons, Michael D.
• McAuliffe, Patrick.
• Corish, Brendan.
• Cosgrave, Liam.
• Costello, Declan.
• Costello, John A.
• Coughlan, Stephen.
• Creed, Donal.
• Crotty, Patrick J.
• Desmond, Eileen.
• Dillon, James M.
• Dockrell, Henry P.
• Dockrell, Maurice E.
• Donegan, Patrick S.
• Donnellan, John.
• McLaughlin, Joseph.
• Mullen, Michael.
• Murphy, Michael P.
• Murphy, William.
• Norton, Patrick.
• O'Connell, John F.
• O'Donnell, Patrick.
• O'Donnell, Tom.
• O'Hara, Thomas.
• O'Higgins, Michael J.
• O'Leary, Michael.
• Pattison, Séamus.
• Reynolds, Patrick J.
• Ryan, Richie.
• Spring, Dan.
• Tierney, Patrick.
• Treacy, Seán.
• Tully, James.

Tellers: Tá, Deputies Carty and Geoghegan; Níl, Deputies L'Estrange and James Tully.

Resolution declared carried.