Dáil Éireann díospóireacht -
Tuesday, 26 May 1925

Vol. 11 No. 20

DAIL IN COMMITTEE. - FINANCE BILL—SECOND READING (RESUMED).

Mr. DARRELL FIGGIS

I would like to take this opportunity of saying how heartily I congratulate Deputy Wilson on the speech he made before the adjournment. I think it was one of the best speeches, worked out on strict business lines, that this Dáil has heard, and I feel that it would be a very great thing, if I might venture to say so without offence to the parties concerned, for the education of this country, if that speech could be reported verbatim. I welcome it all the more because I think the Minister has not done himself justice in the lines on which he has approached his arguments towards this Finance Bill. He has rather defended it to-day on the lines, that he has found it necessary to remit certain forms of taxation, and, inasmuch as the country could not afford remission at this time, it was necessary to put the money so remitted on to other articles, and so make up the total he requires. I look at it rather from the point of view that in this Budget we are setting out for the first time to find the form of taxation suitable to the economic and fiscal needs of the country. I have said before, and I repeat it now, we have taken over a system that was devised for the needs of another country, of another people, whose conditions are fundamentally different from those that prevail in this country; and, having taken that over, it was necessary that we should continue it for a short time, as there were too many things to do, especially during the early years of the establishment of this State, to think of any fundamental changes in a fiscal direction. Now that we are beginning to think for ourselves—I congratulate the Minister on this Bill for this reason if for no other —and as we are thinking out our own needs for our own circumstances, we should do so, as far as possible, as if we had a clean sheet to write our own individual record on in the beginning. The Finance Bill bears all those characteristics. Take the duties levied on clothing. I asked the Minister in Committee on the Finance Resolution, if he would set out exactly the articles to be charged in a Schedule and put that Schedule in the Bill. I repeat it now, knowing that it is probably too late to have it done this year, but these duties imposed on this occasion will be continued in, at least, one subsequent Finance Bill, and, I suggest, as soon as possible, we should give the various articles on which a duty is to be levied and let them be stated in the Schedule so that we may know where we are. I suggest also, and I ask the Minister to consider it carefully, that even though the figures of the revenue to be got from these new taxes are provisional and subject to many rectifications, let us still have these provisional figures when he comes to review the situation at the end of the financial year. He will have before him certain figures which will be provisional.

Let us share that knowledge with him, also sharing the knowledge that these figures are provisional. I ask this because I know that some Deputies have found themselves handicapped in these matters because the Minister has necessarily a much fuller knowledge than Deputies could hope to have in the depositories of his Department, but, at least, the summarised results ought to be in the possession of Deputies. In regard to the boot tax, the clothing tax, and the furniture tax, I urge that a Schedule should be made of the various articles to be included under the heading of each particular tax and, then, as against each particular heading, to put in "subject to rectifications," that time will make when the cost of collection can be put in on the other side of the scale, and also to put in the revenues that these particular items earn. In that way, while we are experimenting—the Minister for Finance has said that at this stage we are doing little more than experimenting—in order to discover for ourselves that scale of taxes, that category of articles, we ought to tax without unnecessarily holding ourselves bound to the system which we have inherited. It is obvious that we are doing that now for the first time in the Finance Bill in any substantial measure; let us do that in such a way, month by month, so that the information will be in the hands of Deputies. When the next Budget comes to be considered Deputies will then have the knowledge before them in the summarised results on which the Minister will base his Budget. Then, I think, it will be possible to go into the question which Deputy Wilson has touched on, and which is a matter of great importance. I have characterised this Finance Bill as an attempt made by this State, through its Minister for Finance, to find out those articles upon which revenue should be got. I urged before that some of the duties should have been charged upon imports of commodities which are manufactured in this country by what is admitted to be, and what is unquestionably, our premier industry—agriculture. Deputy Wilson came here to-day and gave full facts and details, and threshed the thing out in a thoroughly business-like way, to show what that would mean, and he found himself faced by the greatest problem in regard to all taxes on food, and, that is, whether they would or would not increase the cost of living. I think he established that the result would not be an increase in the cost of living, at least, in the items which he chose. In case that argument should arise, he gave an instance which I have been interested in, and which has been practised by the French nation within the last two or three years. They have imposed a duty on imported wheat, and they have so arranged it that if the cost of wheat goes higher than a certain figure, which is under constant revision by the Finance Department, the benefit is automatically remitted. Consequently, the farming community, and those who handle the products of that community, have always that figure within which to work. That has proved practicable, and has given good results. There has been criticism that in particular cases and in particular months it has not given such results, but, broadly, it is admitted that the result has not been an increase in the cost of living. We need not, however, go there. We can stay at home. We have a magnificent example of scientific taxation on farming commodities in what was known in Grattan's Parliament as the Foster Corn Law.

I commend the Minister for Finance, and he will find it will abundantly repay him, to make a careful examination of the administrative methods of working what is known as Foster's Corn Law, where the duty on one hand, and the inward bounty on the other hand, are so balanced that in respect of any particular commodity the imported article must always remain at the same price as the home-manufactured article.

It might be thought that would not be a very great benefit to confer, that is to give the result, as I have stated it, of keeping the imported farming commodity always at the same price as the home-manufactured farming commodity. We have been reading what the Minister for Posts and Telegraphs has stated in the country as to the need for greater tillage. The result of Foster's Corn Law was that tillage increased rapidly every year, and remained constantly increasing during the whole period of Grattan's Parliament. Economic history reveals clearly that result was due directly to the incidence of this tax levied and administered in that form. There was more than that fact. Not only did land go into tillage, that had not been in tillage for many years, and not only did Ireland turn from being a pasture to being a tillage country more and more every year, but the pasture itself increased. Lands that had been left wild were brought into pasture. That was achieved as a result of the scale of taxes so levied that the incoming agricultural commodity was taxed, and the home-manufactured commodity protected, and yet at no period did the cost of living in respect of the food of the people increase. If these results can be achieved, if you can still keep the cost of living for articles of food which the farmer provides at a constant level, or keep it on the down grade, or stop it at least from going on the up-grade—if we can do that, while at the same time earning some small revenue by a protective tax of that kind, and give that benefit to the manufactured article of our premier industry, then that result is well worth attaining. Here, for the first time in a great measure, we have started to devise a fiscal system for our own needs. If the venture is a sound one, and I believe it is, it should be brought to the benefit of our chief industry, which is agriculture.

There is only one other matter I desire to touch on, and that is in regard to the administration of these new taxes you have levied. The Minister for Finance, when we were in Committee on the financial resolutions, gave an assurance to this House that the administration would be of such a kind that it would not cause an unnecessary amount of irritation. I know that that is his intention in the matter, but methods are still being adopted that lead to very considerable irritation, and I know the cause. It is a very honourable and proper cause— that the officers who are administering these new duties, especially in regard to clothing for incoming travellers, regard themselves, and rightly so, as in a responsible position, and they feel that it is better to be too severe than to be too lax. I urge the Minister to see that instructions are given that irritation will not be caused. I do not know how other Deputies find it, but within the last fortnight I had quite a number of complaints brought to me, and I have been asked to set down questions in respect of particular cases where passengers resident in this country, or visitors coming to this country, have been put to a very great deal of inconvenience in a way that I do not think is the intention of the duty to cause. In fact, I know that it is not the intention of the duty, for I have cases, and I can give the Minister a definite record of them, where articles that have been brought out of this country and brought back again in three or four days, nevertheless have these duties levied on them. I know that in the way of administration experience will bring a kindlier method of handling these duties. That is the tendency in other countries, and it will be the same here. I think, in view of the fact that there are a large number of visitors expected, whether rightly or wrongly, whether hopefully or unhopefully, this year, that the Minister might take steps to do what experience would bring in its natural course in a year or two, and what might be brought as a result of a definite instruction from him, within a week or two.

Mr. GOREY

I intend to say very little on the Second Reading of this Bill. I do not want to refer to the speech which has been delivered by Deputy Wilson. It was a speech that certainly gives those responsible for our fiscal policy here food for thought. When the next Budget is introduced, it is to be hoped that more aspects of the case, than have been looked at so far, will be taken into consideration. There is one small matter that I have been asked to refer to. It is the amusement tax which agricultural show committees are obliged to bear. This is a tax which hits very severely all our agricultural shows in the provinces. As a rule, very large crowds do not attend the shows, and therefore the committees which promote them find it very difficult to carry on. I have had letters from many of them in which they tell me that they have been put to the verge of abandoning their exhibitions. I am sure every Deputy in the House will agree that there is nothing more conducive to the spread of education, in all matters that tend to promote the welfare of the agricultural industry, than these agricultural shows which are held all over the country. The exhibits that are to be seen at them help to bring home to the minds of the people the fruitful results that up-to-date methods as applied to the agricultural industry are calculated to achieve.

A number of important Bills dealing with the marketing of agricultural produce have recently been passed in this House. At the recent Spring Show in Ballsbridge some splendid exhibitions were given, particularly in the matter of egg packing. I wish the demonstration that many of us witnessed there could be repeated at every agricultural show in the country. The demonstrations in butter-making at the Show in Dublin, as well as provincial shows, have also had a highly educational effect. I am convinced myself that the demonstrations in these matters given at our agricultural shows are calculated to do more good even than the work at the agricultural colleges. The reason for that is, that the lessons to be learned at these demonstrations are brought home so directly to the minds of the people. The agricultural shows held throughout the country are not organised for profit making purposes. Every penny made at them is devoted to the expansion of the healthy influence which they are calculated to serve.

I think it should be the object of the Government to see that these show exhibitions are given plenty of scope for expansion, and I would urge on the Minister for Finance that it is not desirable to have a tax imposed on purely educational enterprises of this kind. I am convinced that it is a form of taxation that should be remitted, and that every effort should be made to encourage these show committees to extend their splendid work. As regards the Bill generally, our views on its various provisions have been expressed on many occasions, and I do not think there is any necessity to repeat them again. Mere repetition is not going to carry us very far. In conclusion, I hope the Minister for Finance will give serious consideration to the appeal which I have made to him in connection with our agricultural shows.

Mr. HEFFERNAN

I desire to support the appeal made by Deputy Gorey in regard to the tax on agricultural shows. I have been asked by several show committees to take up this matter with the Minister. The Minister has been good enough to take the entertainment tax off outdoor sport fixtures such as were referred to to-day. In my opinion, the agricultural shows are of far greater value to the country than these sports. If the Minister were to remove the tax at present imposed on agricultural shows it would only mean a slight loss to the revenue. It is probable that the total sum involved would not amount to more than a few hundred pounds altogether.

On the question of income tax, I am sorry the Minister has not adopted the suggestions we have made with regard to a reduction in the basis of assessment in the case of farmers. I do not suppose there is any use in pressing him any further in regard to that: that the farmer should be assessed on one-third of his valuation rather than on his full valuation as at present. I would ask the Minister, however, to bear that point in mind. I can assure him that we will not let him forget it in the case of future Budgets. As regards the assessment of income tax on the ordinary people of the country, I would plead with the Minister that he should try to inculcate amongst the inland revenue officials the desirability of adopting different methods in the future to those which they have been accustomed to employ in the past. It seems to me, from the experience of people who have had to deal with these inspectors, that the latter seem to reverse the procedure which the law prescribes in the case of the criminal. They seem to regard the man who is being assessed for income tax as guilty before he is proved innocent. They apparently believe that everyone who is endeavouring to get his income tax assessment placed on a proper basis is a rogue, and as one who is trying to get the better of the inland revenue authorities.

I suggest to the Minister that, owing to the complications which are daily arising in regard to income tax, and to the new arrangements which are being made from time to time in the basis of assessment as well as in regard to the different rates that prevail in this country and in England, his Department might consider the advisability of issuing a booklet containing, in simple language, an explanation of the income tax laws, particularly in so far as they apply to the conditions that exist in the Saorstát and in England. There are, I know, certain publications available. These deal principally with the system as it prevails in England, but they do not explain, or at least make it easy to understand, the system of assessment as it obtains here. The result is that people in a large way of business are obliged to employ specialists to get themselves set right on this matter. The employment of these specialists means considerable expense to these people. I believe they are not allowed the expense which they are put to in this respect.

I believe that the Acts dealing with income tax are so complicated that people are obliged to employ specialists to elucidate their application. When the final assessments in the cases of these people come to be made they should be allowed for the expense they incur in employing these specialists. There is one point that was brought to my notice with regard to the tax on wearing apparel. There are certain people who buy and get made a considerable quantity of clothing in Ireland by Irish tailors. These are mostly wealthy people. They travel a good deal, and when going from Ireland to England they bring a fairly considerable quantity of this newly-made clothing with them. I have been asked to enquire whether, when they are returning to Ireland, they will be obliged to pay the tariff duty on these articles. The new clothes which they brought with them from Ireland to England may not have been worn at all while in the latter country. It is quite usual with some of them to bring a trunk full of clothes with them on the journey. They may not wear any of these new clothes while in England, and what they are anxious to know is, if they will have to pay duty on them when returning home, even though the cloth itself was purchased in Ireland and the goods were made up in this country by Irish tailors. This idea is not a creature of my own imagination; it is a real tangible case put before me by men who make clothes in this country.

It is not my intention at this stage of the Finance Bill to put down amendments dealing with tariffs. I think we made our protest in the previous stages of the Budget, and I think it would be only burdening the House with unnecessary discussion, to continue the matter further. But it must not be thought that I, or any of the party to which I belong, have abandoned our views with regard to tariffs. We are still opposed to tariffs. We do not believe that they can be for the good of the general community of the country. We believe that they may do harm, and more harm than good, and we certainly believe that they will not be of any benefit to the agricultural community.

Mr. P.J. EGAN

Does Deputy Wilson think that?

Mr. HEFFERNAN

Deputy Wilson has decided to take a line of his own, and apparently has sacrificed principle for expediency. I do not believe in doing so. I believe that principle should stand before expediency. I do not intend to follow the lines adopted by the Government followers who have decided in favour of the tariff policy. I do not intend, at this stage, to deal with arguments put forward by Deputy Wilson. I recognise that they were very forcible, but I am inclined to think that on a close analysis they would not be found to be sound. I am in agreement, largely, with the statement made by the Minister for Agriculture, and that is that agricultural products cannot be effectively protected, and though you might possibly protect to a very slight extent, the advantages gained by the whole agricultural community would be so slight that they would in no sense compensate for the loss they would suffer owing to the tariffs imposed on other articles and the increased cost of living that would arise from such. We have not yet, in this country, arrived at this stage of general tariffs. We have tariffs only on particular articles, but the tendency will be to go in the direction of a general tariff, and I have no doubt that pressure is being brought to bear, and will be brought to bear, upon the Minister, from all quarters, to impose tariffs on this, and that, and the other thing.

For my own part, I am determined to stand on the principle of free trade, and to fight protective tariffs as long as I can. I do not believe that the small sop that could be thrown to agriculture, and it would be a tiny and infinitesimal sop, could compensate for the loss that would come to agriculture owing to the imposition of protective tariffs. Contrary to Deputy Wilson's idea, I believe that the only agricultural article that could be effectively protected is barley. I believe barley could be protected, and without increasing the cost of living. I believe protection might not result in any increase in the price to the farmers, but it certainly would result in increasing the revenue of the State. You have a big combine controlling the whole barley market in this country. That combine is making immense profits, and if it had to pay a slightly increased price for imported barley it could pay that price without increasing the cost of its product. It would have the effect certainly of increasing the revenue of the country, but I also agree with the Minister for Agriculture that it would not have a protective effect unless you controlled the price and gave a subsidy to the growers of barley or increased the price which the barley-growers get at present for their product. But it would be a revenue-producing tax. Why not make it a revenue-producing tax, and make the Minister provide, by a tariff, for all branches of the revenue in this country in addition to what he is doing?

Mr. WILSON

For Deputy Heffernan's information, I may tell him that the importation of barley to this country annually amounts to £187,000.

Captain REDMOND

We seem at long last to have reached an ideal state of government. We have members of the same party in different parts of the House according, at any rate to the last speaker, advocating different principles in regard to tariffs. The last Deputy said that he was with the Minister for Agriculture in regard to his policy in that direction, and almost in the same breath he told us that the Government were formulating a tariff policy. We have Deputy Wilson advocating his tariff and a further increase, and extra tariffs, and we have Deputy Heffernan saying that he is going to stick to the principle of Free Trade.

Mr. HEFFERNAN

Has Deputy Captain Redmond read the speech of the Minister for Agriculture on this question of tariffs? Because the Minister said then that after due consideration he had decided that no benefit could accrue to agriculture from the imposition of tariffs upon agricultural products. Although the Minister is with the Government in proposing tariffs for other articles, he does not see that any benefit could accrue from the imposition of tariffs on agriculture. On that point I agree with him, but I cannot agree with him in regard to the imposition of tariffs on other articles.

Captain REDMOND

If I understand the Deputy's mind, it is that he is in favour of tariffs on some articles because they are not agricultural products, and that he is not in favour of others because they are agricultural products. Now we know where we are.

Mr. HEFFERNAN

I say Deputy Redmond is deliberately misrepresenting what I said.

AN LEAS-CHEANN COMHAIRLE

Deputy Heffernan must not make a statement of that kind.

Mr. HEFFERNAN

I did not intend to convey that at all. I am not in favour of tariffs at all.

Captain REDMOND

Then we have it that Deputy Heffernan is an out-and-out staunch free trader to the backbone, and not in favour of any tariffs of any kind. We know where we are. Deputy Wilson is in favour of tariffs where he thinks that the situation has arisen and that circumstances have so altered that tariffs are beneficial to the country. We have the Minister for Agriculture in favour of certain tariffs according to Deputy Heffernan, and not in favour of others. I think that is an ideal state of affairs, because, as I said, we have the Deputies from different parties advocating different policies in regard to different tariff proposals, and that, to my mind, is the proper position for us in this country to-day. The idea of suggesting that we, belonging to any party, or to no party as some of us do, should bind ourselves as Deputy Heffernan does, hand and foot, to a stereotyped policy of free trade upon the one hand, or to a policy of tariff reform on the other, in the circumstances, and the conjuncture in which we find ourselves at the present moment is, I think, nothing short of idiocy. I take my stand, if I may be allowed to do so, with Deputy Wilson. I think the speech he made was one on which he deserves congratulation from all quarters of the Dáil and the country. I think it was a forcible speech and well reasoned and certainly a courageous one, and I hope that other Deputies, not agreeing, perhaps, with all the members of their own party, will have the courage to come forward and say so, and advocate the course to be adopted, not upon the mere ground of principle, but upon what I consider the high ground of expediency.

The Minister, in his opening statement in regard to the Second Reading, told us that he had only the narrow margin of £10,000 to work upon. A narrow margin that is indeed. He also said that he would have to take up the position—the sphinx-like position which, I think, he has been rather accustomed to taking up and, if I may say so, that he has been very successful in taking up for some time past—of resolute and determined opposition to anything in the nature of any further or, as he called them, any big remissions being made. With his point of view I do not think that any of us could quarrel; I do not think any of us could quarrel with him upon that score. I was very glad indeed to hear him qualifying his remark about refusing any amendment in the nature of a remission. What he did say was that any amendment involving substantial loss of revenue would have to be opposed by him. I am not with Deputy Wilson in this. I am not going to propose that there should be any further imposts, or that new duties should be placed upon new articles.

I have the temerity to get up and to suggest to the Minister that with the sum of £10,000 at his disposal he might make a remission in regard to two particular items. Those two items I will deal with as shortly as possible and I think I will be able to show that they will involve a very small amount indeed of loss to the revenue. In the first place, this time last year I took the opportunity of appealing to the Minister and of pointing out the existence of both an Excise and a Customs duty upon cider. I reminded the House that this duty had been imposed in England, partly, if not entirely, as a war measure and that it had been since then removed. I also reminded Deputies on that occasion that as far as we are concerned in the Saorstát there is only one cider producing factory and that, in effect, it was a one-man tax. I do not believe that tax amounts to more than about £1,000 a year. The tax is not only a Customs tax, but also an Excise one, and surely it stands to reason that it would not only be very little loss to the State from the point of finance or revenue, but that it might be quite a considerable gain to encourage the manufacture of this healthy beverage by remitting at least the Excise duty thereon. Keep the Customs duty there by all means. Give a chance to this small and, in spite of everything, thriving industry. Encourage the growing of apples in the neighbourhood of Clonmel and Dungarvan, where they are grown at present, though not to the extent that they might be. If that is done, it would be a benefit to the community amongst whom the factory exists, and certainly it would be no great loss to the Treasury, and it might eventually be a benefit to the country at large. Twelve months have elapsed since I spoke on this matter before, and I hope that by this time the Minister has considered it and that he may be able to give up some of the £10,000 in that respect. I do not think that is a large demand. I think it is certainly a well-grounded one.

Of course this Bill, being a Finance Bill, must be bristling with anomalies. Perhaps some of the anomalies it bristles with might include brushes. We have two taxes, one a tax on furniture and the other a tax upon wearing apparel. As Deputy Cooper said, neither of these was defined to the extent that anybody knew what the tax was on. I do not know what we do to-day. I have received correspondence from various parts of the country asking me whether there is a tax upon this or whether there is a tax upon that. One correspondent asks me whether a tooth-brush is to be considered wearing apparel or furniture.

Mr. BLYTHE

Neither.

Capt. REDMOND

I am very glad to hear that. The correspondent asks me whether a chimney sweeper's brush is to be considered furniture or wearing apparel. Perhaps the Minister can tell?

Mr. BLYTHE

Neither.

Captain REDMOND

Neither? I do not want to get the Minister out in that because, as a matter of fact, I have in my possession a letter informing me that chimney brushes, imported, as they are, from Belgium, have actually been declared by the Revenue Commissioners to be articles of furniture. These brushes are not made in this country. They are not made of hair; they are made of some peculiar product manufactured in Belgium. I am very glad to hear from the Minister now, and I hope he will confirm his statement, that chimney brushes are not to be taxed as furniture. There are many other anomalies, but, as I have said, they were only to be expected. I am sure when framing Sections 18 and 19, which deal with duties upon bottles, and when the Minister made a provision whereby empty bottles which were imported into this country, then exported and re-imported, would not be subject to a second duty, he did not mean that what are known as containers, namely, full bottles, should be treated otherwise. That is as the matter stands according to the Bill we have before us. The position is this: that before this present Bill there was no tax upon containers; that is, upon full bottles. The tax now proposed to be placed upon them is a tax—not an ad valorem duty, mark you, but a tax. I do not know how it was arrived at. It seems to me it was arrived at in an arbitrary fashion. There may be some grounds for the figures arrived at. The tax, at any rate, is a tax of 3d. per dozen upon bottles under five ounces, and 6d. per dozen upon bottles over five ounces.

Now, what is the position, say, of the importers of mineral waters? When I say mineral waters, I mean waters which cannot and are not produced in this country. Take waters like Hunyadi, Apollinaris, Apenta water, and Vichy water. I could go through a long list of those natural springs whose water is bottled at the source and imported into this country. The position, according to this Bill, is that they will have to pay, in the first place, 8d. a gallon duty, which they have, of course, paid previously, and they will also have to pay this tax of 3d. a dozen on smaller bottles and 6d. a dozen on larger bottles. According to the section, there is no provision made whereby they shall be enabled, when they import those bottles, to export them and re-import them without having to pay a second duty. It comes to this: every time these mineral waters are imported in these bottles they will have to pay a separate duty. That, to my mind, does not seem fair in regard to the provision made for empty bottles.

Of course it may be said that this may be something in the nature of protection. Protection for what? It certainly is not a protection for the opening of mineral water springs in this country. It may be a protection for the manufacturing of artificial waters, which these are not. It is not a protection, I venture to say, in regard to the glass industry, because when these bottles are imported they are usually exported to be refilled, and if this duty is going to be such that it will have to be paid upon every occasion of the importation of these bottles, the result will be that these bottles will be imported here, that they will be dumped in the country, and that instead of being an encouragement to the glass and bottle industry, which we all hope to see revived and thriving shortly, the duty will mean that it will be a discouragement. I hope, therefore, the Minister will be able to see his way to modify this Section 19 in the same manner as Section 18 has been modified, and if I might respectfully suggest to him, he has merely to repeat the provisions made in Section 18 sub-section 3 (d) in regard to empty bottles.

As far as the loss of revenue is concerned, I suggest it would be infinitesimal, if any, because there might be much more loss of revenue on the losses occasioned through the non-production of Irish bottles owing to the dumping of these foreign ones, than if this duty were not charged, over and over again. It does seem certainly rather ridiculous that the same duty has to be paid upon any size bottle over five ounces. That is to say, as much duty will be charged upon a dozen soda-water bottles as upon a dozen champagne bottles. There is no basis, I submit, shown here for the duty that is sought to be imposed. It is not an ad valorem duty; it is not a protection duty, because it would be hardly fair to say that the Minister would make such a dishonest proposal as that he would endeavour to secure protection for Irish mineral waters under the cloak of placing a duty upon imported bottles.

I do not think that would be a fair comment to make, and not being an ad valorem duty, not being a protection duty, and certainly as no great revenue accrues to the country, I think that the Minister might favourably consider my suggestion and place the people in these trades in the same position as those who are engaged in importing empty bottles. Of course it may be asked, where is the necessity for these mineral waters at all? There is something in that argument, but, after all, they come from great natural springs. Some of them come from our friends the Germans. Take Apollinaris. Some come from France, such as the Vichy water; others come from Austria and Hungary, and they are products which we cannot produce in this country. That being so, I sincerely hope that the Minister will see his way to accede to my request.

The Bill as it stands has been altered in a few respects, and in the respects in which it has been altered from the original resolutions I heartily concur, especially in regard to Section 27. I think the Minister's action is highly commendable in that regard in doing away with the entertainment duty upon all classes and all kinds of outdoor sports in the country. I only wish that his example will be followed in other quarters and that Irishmen of all classes and of all shades of politics will be allowed to attend all kinds of sport, no matter what nationality that sport may come from.

The Bill we are asked to give a second reading to contains, as Deputy Johnson stated, a long list of enactments repealed under the Third Schedule. I must confess that I agree with the Deputy that I would find it very difficult to say anything about almost any of these enactments. It does require a little explanation, and it is hard to expect Deputies to pass a proposal like this without having in some respect at any rate, the faintest notion of what they are passing. There are some of these enactments which are fairly intelligible, but I must say in regard to that income tax proposal of 1918, I confess I am entirely in the dark, and I hope the Minister will be able to enlighten us on that. The Bill will now be passed and will go through its Committee Stage. I do hope that even during the Committee Stage the Minister will be able to consider, even within this small margin of his, this modest request, if I might humbly say so, that I have made in regard to the cider duty and in regard to the duty on bottles.

Mr. P.J. EGAN

I think Deputy Redmond expressed very aptly indeed the necessity for differences of opinion on the question of free trade and protection. The fact of the matter is that I do not think it is possible for anybody to say that he is a whole-hogger as a free trader or protectionist. From the very essence of the subject it is necessarily a matter of discussing the effect of tariffs on each particular industry or otherwise. You cannot possibly generalise on a matter of this kind. I do not propose to waste the time of the Dáil at this stage, after such a long discussion, in going into the general question of tariffs and their desirability or otherwise. I am sorry Deputy Heffernan has left, because I would like to convert him in one respect. He referred to the desirability of a tax on barley and he stated that barley was one of the subjects that could be sufficiently protected. To my mind he is utterly wrong in that.

Mr. GOREY

I think Deputy Heffernan used the word "taxed," not "protected."

Mr. P.J. EGAN

He said "protected," I think. Then he proceeded to say that the effect of a tariff on barley would be to produce revenue. It is necessary to have clear thinking on this topic. You want to decide definitely as to whether or not you are imposing taxes for protection, or simply for the purpose of raising revenue, because you are discussing utterly different things if you are not quite clear on that matter. With regard to a tax on barley the position is, as I have on previous occasions informed the House, that by such a tax you would tax the raw material for our biggest industry, the Dublin stout industry, and as Deputy Wilson very properly pointed out, the total amount of imported barley is valued at only £187,000. No matter what tax you put on, that amount of barley will come in, and it will not have any effect at all towards protecting barley grown in the country, whatever merits it might have in regard to raising revenue. So that really, when discussing the question of a tariff on this substance, we ought to be perfectly clear as to whether we are discussing it from the point of view of the barley industry or from the point of view of providing revenue.

There is one thing that I might call a blemish on an otherwise perfect Budget and that is the Minister's making a present of £600,000 to the farming community in the form of an agricultural grant. It must not be considered for a moment that I disapprove of the farmers getting every reasonable help possible, because I, unfortunately, have a very keen personal knowledge of the difficulties of farming and of the desirability of encouraging agriculture in every shape and form. My particular quarrel with this grant is the form in which the Minister gives it. I think it would have been very much better for him to give assistance to agriculture in such a form as would provide for some contribution of industry on the part of the farming community itself; but this grant is given alike to tillage farmers and grazing farmers. The people who go in for grazing will get this money to help their industry without any contribution of industry on their part. I think it would have been decidedly better if that £600,000 could be concentrated to give encouragement, or relief, to the tillage part of the farming industry, because, personally, I have very little use for the grazing industry. It does not employ enough people; it does not go any way at all towards relieving the tremendous number of unemployed, and I would have preferred to see the Minister give the bonus to tillage farmers, or to any other farmer who put extra land under the plough and who kept it under the plough. That money would then be utilised for giving work to our people, which I consider is the greatest problem we have to face to-day.

There is another matter on which I have already expressed an opinion, and that is the Minister's failure to lower the spirit duty or the beer duty; I more particularly refer to the spirit duty. Temperance is undoubtedly very desirable, but I wish to make the point that the Minister's failure to lower the spirit duty is encouraging poteen-making and encouraging intemperance. The present duty on spirits is £3 12s. a gallon, and it will naturally be seen that there is a tremendous temptation to people to manufacture illicit spirit when they can make so much money out of it. A hatful of whiskey costs £3 12s. There can be no question of doubt that illicit distillation has not yet been got under proper control. I know of my own knowledge that considerable quantities of it are being made. It came under my notice quite recently that there was very considerable pilfering of malt in various districts. I actually heard in one case of a cartload of malt having been taken in broad daylight out of a certain malthouse and distributed secretly to people manufacturing illicit spirits. It must be remembered that every barrel of malt so stolen is equivalent, if it is used alone, to about nine gallons of proof spirit, and if on top of that you allow for the fact that it is mixed with three or four parts of other material for producing spirits, one can see that any considerable quantity of malt finding its way in that direction would mean the manufacturing of a great deal of illicit spirit. I am quite sure that medical Deputies will maintain, as I do, that the consumption of illicit spirit has a very serious effect on the health of our people. To begin with, it is badly and crudely made; fusil oil and other injurious ingredients are not removed from it, and, above all, it is sold at an extraordinarily high strength, which undoubtedly does serious damage to the health of the people.

Another aspect of the thing is that our old Irish pot-still industry is dying fast; there can be no question or doubt about that. I am quite certain that officers of the Customs and Excise will corroborate that statement. The Irish pot-still industry is certainly dying, and that has its reflection on the farming community. That is an aspect of the Budget to which I am sorry the Minister could not see his way to give consideration, and I certainly hope that if he prepares the Budget next year he will try to give some relief in that direction.

Deputy Redmond devoted a considerable portion of his remarks to this tax on bottles. As far as I could gather from the general tenour of his remarks, he objects to the tariff on bottles coming in with Apollinaris and other foreign waters. I would like to remind Deputy Redmond that Apollinaris and other continental waters that are imported are interfering with the consumption of Waterford cider and with the consumption of mineral waters, the manufacture of which gives employment here.

Captain REDMOND

You do not drink cider with whiskey?

Mr. P.J. EGAN

I make a present to Deputy Redmond of the point regarding the use of cider for developing the consumption of Irish whiskey. Personally, I think that if you leave out clubs and places of that sort it has very little consequence. With regard to the general matter of the tax on bottles, there has been some misapprehension, and I hope that the Minister will devote a few words to elucidating the points to which Deputy Redmond refers, because a great many of us are not perfectly clear on it.

Captain REDMOND

The Deputy did not, perhaps, understand me. I did not object to the tax on Apollinaris or upon mineral waters. Neither did I object to the tax on the bottles containing them. What I did object to was that these full bottles were placed in a different position from empty bottles, because empty bottles have only to pay a tax once; they can be exported and re-exported. Provision is made in Section 18 to that effect, but there is no provision in Section 19, and I maintain that the containers should be treated the same way. I am not objecting to the tax at all.

Mr. BLYTHE

Deputy Good referred to the question of the trade in apparel with the North and outside the Saorstát. I think the arrangements for transit without payment of duty and for the warehousing of goods in bond, are such as will permit that trade to be carried on. At any rate, deputations representing the trade have been seen, and while naturally they are not very keen on providing warehouses, I think they are satisfied that the arrangements are such as will allow the trade to be carried on in the future. The question of transit of linen goods to which, I think, Deputy Figgis referred, is covered in the same way. I believe people will have no difficulty in carrying on any trade that has existed. There may be certain expense to be added on. Expense such as warehousing cannot be avoided.

I have not examined the matter of charity clothes fully, and I do not know whether it is necessary in that case to make any arrangements or not. There are occasionally coming to this country charity clothes which perhaps are not wanted. I heard a story recently of a consignment of goods having been sent to some village in the West following a scare which arose some months ago, consisting of all sorts of garments, old dress suits, top hats and so forth. The inhabitants of the village to which they were sent put them on, paraded the town and made a bonfire of them. There may be a case for charity clothes, and it may be possible to admit them free to certain organisations. It is a matter which I will have to look into, and on which as yet I have not been able to come to any conclusion. It is impossible to define the subjects you are to tax in such a way that no question of doubt can arise as to its scope. If we were to prepare a schedule we would find we excluded things we did not mean to exclude, or included things we did not mean to include. It might be possible after years working of a tax to prepare a complete schedule to cover exactly the ground we meant to cover and no more or less. When we are initiating new tariffs, I think it is impossible to be aware of every consideration that is likely to arise. I do not think any serious question can arise as to the scope of the tariff in wearing apparel.

The question of furniture is a little more difficult, but I think soon we will be in a position to issue a comprehensive schedule that will enable any member of the public to know clearly on what he may expect to be charged duty and the articles that will be exempt. Even in the matter of brushes the thing is not so difficult at all. The brushes that are part of the furniture of a house, that may be found in any ordinary house for household use, are taxed as furniture. Brushes intended for personal use are not taxed.

Major COOPER

Would the Minister tell us whether a hearth brush is taxed.

Mr. BLYTHE

Yes.

Major COOPER

Is a chimney sweep's brush taxed?

Mr. BLYTHE

No. I do not think so.

Major COOPER

Would they not both perform the same function?

Mr. BLYTHE

If the Deputy leased a house he might expect to find a hearth brush but I do not think he would expect to find a chimney sweep's brush. There are one or two categories of brushes which it is difficult to decide on and about which we are obtaining legal opinion; brushes which from one aspect might be looked on as brushes for personal use and which, from another, might be looked on as part of furniture of a house. Boot and clothes brushes are important from the point of view of people who make brushes in this country. They are border line cases and we are seeking advice as to whether they come under the term furniture or not. In general, there is not much difficulty in deciding whether those articles are taxable or not.

The provision for a minimum charge of 2s. 6d. is not one we can afford to waive. We have had a very close connection with what is now part of a different economic unit. Large quantities of retail parcels have been imported. Each of those, if it contains dutiable goods, demands attention of a fairly highly paid staff. It does not pay and it imposes an undue and unnecessary charge on the Exchequer to employ a Customs staff examining parcels which only yield a penny or two pence or three pence duty. It is most desirable from that point of view that we should try to decrease importations of those small parcels of dutiable goods. If people will send in and import small parcels of dutiable goods, I think they have no great amount of complaint if some such reasonable figure is charged. It would mean that those new duties would entail an enormous increase in our staff and in our work if we did away with the minimum duty, because the number of parcels coming through the post and otherwise would be very much greater than with the minimum. Each of those parcels would have to be examined, calculations would have to be made, forms would have to be filled up and the expense to the State would be quite considerable.

The whole question of the agricultural aspect of our tariff policy has been discussed a great deal. I agree with those who say that some direct stimulus to agricultural production is necessary. I agree with Deputy Johnson and Deputy Egan. I do not feel satisfied that the best way to give relief or assistance to agriculture is the agricultural grant in its present form. I think during the coming twelve months the whole question of the basis on which the agricultural grant is allocated should be examined. I know that the Minister for Agriculture agrees with me in that. We felt some assistance was necessary for agriculture in this present year. We were not able to arrive at any other basis of assistance except doubling of the agricultural grant. It seems to me that the sum of £1,200,000 given to agriculture, produces a singularly poor result for such a large sum, and if we got a better basis of distribution which would appeal to the country as reasonably fair it would be better to abandon the present system altogether. I promise Deputies so far as the agricultural grant is concerned, that we will during the year, examine the whole question and see whether we cannot get a better basis than the one we have whereby the grazier who lets his land lie there gets as much as the man who employs others in the tilling of his fields. The question of tariffs for agriculture, I believe, is an extremely complicated and difficult thing.

Mr. GOREY

What about investing in a glass roof for the country?

Mr. BLYTHE

If the Farmers' Union would put up a scheme for that, we would think about it.

Mr. GOREY

It might be money well spent.

Mr. BLYTHE

The question of tariffs for agricultural produce is an extremely complicated and difficult one. In conjunction with the Minister for Lands and Agriculture, I gave a great deal of attention to it during the year. We examined this question of tariffs on foreign bacon, butter, and oatmeal, and at one stage we were very much disposed to impose a tariff on some of them. We finally decided against that, with a certain amount of hesitation and reluctance. The difficulty seems to be that in the case of bacon, there is an exportable surplus. It is very difficult to see how you can get better prices for agricultural produce so long as a surplus has to be exported. Home prices will tend to be the prices that can be got for the surplus that must be exported. Other results might be obtained—results of very great national importance, very valuable results and such results as we should seek—but I do not think you will get such results as would directly give benefit to the farmer from, say, putting a protective tax on bacon. Then the question of butter was considered. If we had been able to believe that a tax on butter would have resulted in an increase in winter dairying, we would certainly have imposed it. But we came to the conclusion that the result would not be an increase in winter dairying but simply an increase in the practice of putting summer butter into storage. That would be a small result for a tax which would undoubtedly raise the cost of living in the winter months to the people of the country and of our towns and cities. Against an oatmeal tax we found no real objection, except that we had not thought out fully the whole agricultural aspect of the matter, and it seemed so trifling an act of assistance that we thought it was not worth while doing it.

When I said, in the Budget statement, that we were not going to impose any further tariffs on manufactured goods during the period of this Dáil, I made no reference to taxes on agricultural products. We are free to consider that whole matter during the year, and to see if anything can be done. We are agreed that any reasonable steps that can be taken to increase not only agricultural production, but to increase tillage, should have our assistance. We might have an increase in the total agricultural production without any great increase in employment. For instance, improvement in the breeds of cattle might lead to greater production of beef. It might lead to the production of more valuable stores and might increase the value considerably of our agricultural produce and yet give very little additional employment. We feel that it is most necessary to increase tillage in the country. That is one of the things that we are looking for from the proposal in regard to beet sugar. There will be no fortune for farmers in beet sugar so far as I can make out. When it comes to the time when the subsidy will be almost disappearing, beet sugar will not be a highly profitable crop. But this scheme will have other results. It is expected to lead to a general increase in tillage and to an increase in winter dairying. It is with a view, not to its manufacturing results, that we are giving encouragement to the beet sugar industry, but with a view to its agricultural results. The employment of 100 or 200 men for a few months in the year in a factory would not justify the subsidy that will have to be given, but if we can turn grass land into tillage land on a very considerable scale, then the subsidy will have justified itself.

I agree with Deputy Egan about the question of a tax on barley. I think that so long as Farmer Deputies or Farmers' Associations put up a proposal for a tax on barley, it shows that they are entirely muddle-headed on the question of protection. The views of any association that puts up a proposal like that are not deserving of any consideration.

I need hardly refer again to Deputy Johnson's statement in regard to the arrears of income tax and the responsibility that people in the Government may have had for withholding payments in the past. At any rate, the tax is due. It is due to the Saorstát. All reasonable time will be given to the people to pay. I think that people who show a disposition to pay will never be treated harshly or have any cause for complaint. On the other hand, when people take up a stone-wall attitude and are determined not to pay, they must be coerced into paying. I believe that a far greater dislocation of industry and far more trouble between employers and employed would be caused if there were a large number of arrests and imprisonments. I also think, leaving experience out of it, that there is no more easy way for any person receiving salary or wages to pay income tax than through deductions. The people who get their salary paid without the tax being deducted, and who spend it and then receive a demand for income tax, find it very hard to pay; but if a few shillings are deducted every week or month, the thing does not seem to be a very serious burden at all.

With regard to the schedules to which Deputy Johnson referred, I did not think it necessary, at this stage, to go over the Bill clause by clause, or to take all the items in the schedule and to explain them. All the major matters in the Bill have already been dealt with, or were mentioned by me this evening. The matters to which references were not made were really quite minor matters, which I thought could be adequately discussed in Committee.

With reference to the repeal of Sections 21 and 24 of the Finance Act of 1910, those repeals do away with the mineral rights duty which is all that remains of the famous land value duties. This tax during the past few years has, for about 47 assessments, given an average revenue of £119. It does not pay. It is not worth the cost of collection, and it is felt that because it practically gives no revenue, while it gives a certain amount of work and trouble, it ought to be repealed. It is a duty that is of some importance in England, but it is of no importance here. It is scarcely of more account than the old Excise duty on playing cards. If there were to be discoveries or developments here that might make such a duty a matter of importance, this duty could be re-imposed, but at present we do not think it desirable to continue a tax which gives trouble and for all practical purposes gives no revenue. The repeal of Section 14 of the Finance Act of 1916, is a repeal that should have been made last year. The section which then dealt with the exemption of these securities from income tax was repealed, but the other sub-section, dealing with super-tax, was not repealed. The result was that a certain anomaly was created. Section 48, sub-section (2) of the Income Tax Act of 1918, provided that interest in these cases should be assessed to super-tax as if the amount actually received by the taxpayer represented the balance remaining after deduction of tax at the highest rate. For example, when the rate was five shillings, £4 of tax-compounded interest was treated for super-tax purposes as £5 16s. 0d. We now tax the interest as it arrives for income tax purposes, and it is only correct that we should treat it in the same way for super-tax purposes. That is to say, the income tax exemption having been repealed, the provisions in relation to calculation of super-tax, which were based on that exemption, should also be repealed, and it should be assessed for super-tax in the ordinary way. That is a repeal that should have been made last year, when the other provision was repealed, but it was overlooked.

The question of the change in the Section relating to exemption of certain entertainments from entertainment duty is, as I think Deputy Johnson said, a matter that we could discuss more fully in Committee. As a matter of fact, I think that really no entertainments promoted by the G.A.A., if the law were being enforced, would really be exempt if that part of the section which is being repealed were retained. It would be better exempt than have confusion——

Mr. JOHNSON

Is not an option left with the Commissioners?

Mr. BLYTHE

Yes; but certain duties which that Association has been liable in law to pay, have not been collected. A certain confusion of mind in regard to their rights has arisen, and it is desirable that there should be nothing that can be argued about. It would be a very arguable matter if the old exempting section were to remain as it was heretofore. This is a matter with which I will be prepared to deal at length when in Committee.

The other repeal to which Deputy Johnson referred, dealt with Section 68, sub-section 2, paragraph (b) of the Income Tax Act of 1918. That is to remove what we regard as an anomaly. Under the Income Tax Acts—it dates very far back—the Bank of England and the Bank of Ireland were their own assessors. There may be some reason for continuing that privilege to the Bank of England, because it is a bank which occupies a very peculiar position, and which has peculiar relations towards the Government. But the Bank of Ireland here is not by any means in the position that the Bank of England occupies in Great Britain. It seems to us that there is no reason at all why the bank should not be assessed in the ordinary way by official assessors. As a matter of fact, in strict law, if the Bank of Ireland cared at the present time to assess its profits at £5, we could do nothing except bring in legislation. We propose that, for the future, the power of acting as its own assessor should be taken from the bank. The authorities of the Bank of Ireland itself recognises this anomaly, and have no objection to the change being made.

Deputy Johnson referred to the case person who left his coat behind and wanted to import it free of duty. That individual would be allowed to have his coat in free of duty, but, of course, he would have to satisfy the Revenue Commissioners that it was his coat, and that it was left behind. That always creates difficulties.

Mr. JOHNSON

It would cost more than five shillings.

Mr. BLYTHE

Difficulties as regards proof will always arise in such cases, and I do not see how they can be got over. Deputy Gorey raised a question in regard to entertainment tax on agricultural shows. That tax is only charged where a band or something like that is provided. The position is that the people have to choose whether they will have a band or whether they will escape the entertainment duty. I will examine the matter, and see whether we can make a concession in that respect. There is no doubt that a certain amount of rigidity has to be observed in these matters or you would have all kinds of entertainments escaping duty by bringing in a lecture or something else that was exempt, and claiming entire exemption for the entertainment.

Mr. GOREY

I only referred to genuine agricultural shows, promoted by agricultural societies for agricultural purposes.

Mr. BLYTHE

It would be necessary that it should be a genuine show. There might, for instance, be a couple of asses brought in and a prize of five shillings offered for them. If we decide to give any exemption, we shall have to leave it fully in the discretion of the Revenue Commissioners to decide whether the show is a bona fide one or not.

Deputy Heffernan said something about the Revenue authorities looking on every income tax payer who was disputing anything with them as being potentially a rogue. The Revenue Commissioners cannot be expected to believe all they are told. I do not think we have reached that stage of public morality where people tell the truth spontaneously and without pressure as an invariable rule when dealing with income tax matters. The Deputy spoke about the issue of a pamphlet couched in simple language, explaining the income tax laws. It could not be done. The income tax laws are very complicated, and any attempt to explain them briefly and in simple language would only lead people astray.

Deputy Redmond suggested the exemption of cider from Excise duty. It is very difficult to see why cider should be exempted if lemonade and ginger ale and similar drinks are taxed, and we certainly could not afford to drop the Excise duty on mineral waters. If we are going to retain the Excise duty on mineral waters, it is very difficult to see how cider can be exempted.

Captain REDMOND

Does not the Minister admit that cider is made from apples, that these are grown in the district, and that the exemption would promote the horticultural industry.

Mr. BLYTHE

The Deputy knows that cider in certain cases is taken as a substitute for beer or ale, which might be made from Irish barley. It is really difficult to see how a special case can be made for ciders except, as the Deputy says, that it is a one-man duty and would be a one-man remission. But if it is wrong to have a one-man duty, it is probably wrong to have a one-man remission.

Captain REDMOND

Would the Minister not re-consider the matter, in view of the fact that this tax was imposed during the War in England, and that it is only in force here because of that. It has been remitted in England, and there is very little revenue derived from it here. I am not suggesting that the Customs duty should be removed.

Mr. BLYTHE

I quite grasp that. The sum involved is a good deal less than suggested by the Deputy. I have not the figures by me, but I have seen them, and my recollection is that it is a good deal less.

Captain REDMOND

Perhaps the Minister would consider the matter between this and the Committee Stage.

Mr. BLYTHE

I will promise to consider it. It is not a question of money so much as the difficulty of making a distinction. The distinction between bottles imported as containers and bottles imported empty in regard to their export and re-importation afterwards, was made advisedly. We allow bottles which have been imported empty, and which have subsequently been exported containing, say, beer, whiskey, or mineral waters, to be re-imported free of duty, because we wish to encourage and assist an Irish trade, but we have no particular interest in encouraging the import of manufactured articles from outside. We have actually to stretch the ordinary Customs law to enable bottles which are first imported empty, or are made here, to be exported and re-imported free, because strictly speaking, the bottles that are re-imported should be identified with the bottles which were exported. We cannot do that, and what we do is, we keep a running account with certain traders. If they export so many bottles full of some commodity, we allow them to re-import the same number of similar bottles empty. That is a stretching of the law, but we think it is legitimate. It is the only way that that particular remission can be allowed. We do not feel inclined to stretch the law in the way we would have to do in favour of people who are actually outside manufacturers producing and sending in goods here in competition with home - produced articles. It is necessary to have the tax on containers in order to prevent commodities being imported in containers for the sake of having the bottles brought in free of duty.

Captain REDMOND

Does the Minister suggest that we can manufacture the natural springs from which Hunyadi, Apollinaris or Vichy water is produced? Does he suggest that it is not advisable for medicinal and other purposes to import these?

Mr. BLYTHE

I do not know much about them really. In any case, what happens is that there is a tax, if the bottle contains over five fluid ounces, of one halfpenny per bottle. That corresponds to something like the tax that the Irish producer of anything that might compete with these natural waters would have to pay if he imported the bottle, and he certainly would have in the present circumstances to pay something of it, if he bought bottles produced here. If these bottles are now collected and sent out again for refilling, they will continue to be sent out in spite of this tax. If it still pays to collect bottles, take them out of the country, and refill them, it will pay them just in exactly the same way, as they will have to pay one halfpenny on each new bottle coming in, and it does not matter to them whether that bottle has been in before or not, whether it is refilled or a bottle that never was filled before. There will be no ill effect on Irish production of glass bottles as a result of not having this arrangement for the free import.

Captain REDMOND

They could sell the bottles here.

Mr. BLYTHE

They could still sell them.

Captain REDMOND

They would not sell them if they could export them and re-import them.

Mr. BLYTHE

I think the contention is that they export them at present.

Captain REDMOND

Not if they have to pay further duty. They would sell them here and buy new ones.

Mr. BLYTHE

They would have to pay the duty still. I do not really see what the Deputy is arguing. It is a matter that we can thresh out more fully on the Committee Stage. Perhaps the Deputy will put down an amendment which would embody his own ideas. Deputy Egan referred to the question of the spirits duty and poteen-making. It is, of course, recognised that the high duty on spirits does lead to the making of poteen, but there would have to be a very considerable reduction in the spirit duty to have much effect on the disposition of people to manufacture poteen if they can. I do not believe that reducing the duty from 72/- to 50/-, for instance, would have that effect. If the duty were 50/- per gallon there would be still a tendency to make poteen, as there would be still a profit in the making of it, if people could do it with impunity. We could not really afford to give a reduction in the duty, even if it were socially desirable, that would make it not very profitable to make poteen. The only way that seems to be practicable for combating poteen-making is better police supervision, heavier penalties, &c. I do not think that it is within the bounds of practical politics substantially to discourage it by a reduction in duty. We might lose £1,000,000 in revenue trying to do it. Even if we gave such a reduction as would lead to the loss of £1,000,000 in revenue, we would not have done very much to discourage poteen-making, because the profit that would still be available would be very considerable.

We had a limited sum to give away in remission of taxation, and we felt very definitely that it was better to give remission on articles of more general consumption than on articles like spirits, or even beer, which is a much more popular drink. In spite of the fact that spirits would seem less able to bear the tax that is now imposed than beer, I think a better case can be made for the reduction of the beer duty. Socially, probably, it would be more desirable to give a reduction in the beer duty. It may be lamentable that an old industry like the distilling industry seems to be very much on the down grade. It is difficult to see what can be done in the matter. To my mind we cannot do much for it by a reduction of taxes. The reduction we would have to give to revive it would be such as we cannot afford. I take it that its revival is, socially, by a great cheapening of whiskey, not a thing to be desired. The spirit duty is no greater here than it is in Northern Ireland or Great Britain. The distilleries in these places seem to be doing better than the distilleries here. I do not know what the reason is, or if the distilleries here can remedy it or not. I suggest, perhaps, that some hope for better conditions lies in the distilleries examining that problem for themselves. It is not a matter for me. I do not say that we should never give a reduction in these taxes. I am not taking up any "Pussyfoot" attitude in regard to them, but I think an article used by, perhaps, one-fifth or one-eighth of the population with any degree of regularity, should not be given the benefit of a tax remission before an article which is used by practically every member of the community.

Question put, and agreed to. Third Stage fixed for June 9th.