Wednesday, 6 June 1923
Dáil Éireann Debate
AN CEANN COMHAIRLE: The deletion of the German Reparations Recovery Act? I do not think it is a matter of sufficient substance to re-commit the Bill. I think that can be very well taken on this particular motion.
(2) During the period commencing on the date of the passing of this Act, and ending on the 30th April, 1924, Chloroform and Sulphuric Ether may be delivered to any public hospital using the same for Medical or Surgical purposes without payment of duty in such cases as the Revenue Commissioners may approve, and subject to such conditions as to proof security and otherwise as the Revenue Commissioners may impose for the purpose of protecting the Revenue.
This amendment is intended to give temporary  relief to public hospitals in respect of the import duty on chloroform and sulphuric ether, and is intended to meet the views expressed by Deputy Sir J Craig and other Deputies on the last occasion when the Bill was before the Dáil.
Mr. JOHNSON: I support this amendment, and I urge that the same arguments that would apply to a change in this respect might well apply to other changes of a similar nature. The imposition of a tax upon chloroform and sulphuric ether has been hurtful to hospitals by imposing upon them a charge which they cannot afford, and also directly affects the suffering public. There are similar faults that might be remedied in a similar way. I have had, for instance, information about the effect of one of the provisions of the Bill which quite undesignedly is seriously affecting an industry—making the industry of furniture-making almost impossible. It will hardly be believed, for instance, that by the imposition of a tax on spirits and through spirits upon varnish, where a plain kitchen chair would, say, cost 5/-, the cost with varnishing is about 6/9. I am quite sure there is no intention that an imposition of a tax upon spirit which is going into industrial purposes shall so hardly hit an Irish industry as to make the completion of furniture-making impossible. So many industries are affected by such a tax as that that I would urge the Minister to consider whether, under the Bill as presented, he is empowered to make remissions and, if not, whether he will not take power in the Bill in present circumstances, as an emergency matter, to make such remissions when convinced that the effect of these taxes is so detrimental to the public wellbeing. The information I have is that the cost of polishing a cheap bedroom suite would normally be 35/-, that the tax on the polish used on that work is 25/-. So that in the case of chairs the selling price of Irish-made chairs was 5/-, and English-made chairs of a similar kind 4/6, and, as a result of this tax, about 2/- is added, to the detriment of the Irish trade. When we come to larger pieces of furniture, coach-building  and the like, the disadvantage is very great. There is no Irish-making of varnish to any extent to meet the present demand. It would take quite a long time for that tax to have a protective effect that might be put as an argument in its favour. In the meantime, this very great disadvantage is created, and I urge upon the Minister that he should consider how far it would be possible under the Bill to make remissions in cases of unthought-of interference or disadvantage. I am sure this is very far away from the amendment, but I think it is justifiable as showing the necessity of such an amendment as is proposed. This is merely an additional reason why an amendment of this kind should be accepted.
Sir J. CRAIG: I am very grateful to the Minister for Finance for the consideration he has shown in introducing this amendment, which I trust will be readily accepted by the Dáil. The amendment seems to me to meet very fully the request I made in this matter on Friday last, and I desire, therefore, to thank the Minister on behalf of the managers of hospitals, who will in this way be relieved of a considerable increase in their expenditure during the year, and also to thank him on behalf of the poor of the city, who will not now have the contemplation of being put to sleep by inferior ether or an inadequate amount of ether.
The PRESIDENT: I am thankful for the very graceful speech of Deputy Sir J. Craig, and I would say as regards the other matter raised by Deputy Johnson that my attention has been drawn to that and I am looking into the matter. Further than that I cannot go at the moment.
“Provided that where death duties are payable in Great Britain or Northern Ireland as well as in Saorstát Eireann in respect of property passing on a death occurring before the 1st day of April, 1924, the said Section 34 of the Finance Act, 1917, and Section 42 of the Finance Act, 1918, shall  apply only to the surplus of such Stocks and Securities as shall remain after application of as much of the holding as can be applied in discharge of death duties in Great Britain or Northern Ireland and in every such case the Revenue Commissioners shall be entitled to obtain from the persons tendering the stocks or bonds towards payment of death duties such information as will enable them to determine the amount of the surplus aforesaid.”
The amendment I desire to propose to Section 21 arises out of the acceptance by the Minister for Finance of a request of mine that he should alter the date at the end of Section 21, Sub-section 2, from 1923 to 1924. He made that concession to me, but he and I overlooked the possibility of considerable loss to the Exchequer of the Free State if people were clever enough to take advantage of our mutual oversight. The amendment I desire to move now is to protect our Exchequer against a possible loss. The Minister agreed that bonds had been issued with the condition that they might be accepted in payment of Death Duties at their face value in case of death before 1924 should be accepted by our Exchequer. Now, there are a great many people who at death will be liable to pay Death Duties in the Free State in Great Britain. Supposing they had £1,000 duty to pay in Great Britain and £1,000 to pay in the Free State and had £1,000 in bonds it would be very hard luck on us if they were to make us take £1,000 worth in bonds at their face value, which were in fact worth only £940 or £950, and that they should pay £1,000 in cash to the rival Exchequer over the way. The effect of the amendment is that anybody who has bonds and who has to pay Death Duties both here and in England shall be bound to take his bonds first to the country that issued them, instead of sending them here. The effect is that if a person comes here and tenders bonds and is liable for Death Duties in Great Britain or Northern Ireland he can be told to take his bonds there first and our Exchequer will accept only what is left over after he has got rid in England of whatever bonds are required to discharge the duties there. I hope I have explained myself clearly so that the Dáil  understand the object of the amendment. I may say that the wording of the amendment has passed the eagle eye of the Attorney-General and his adviser and that they consider it will have the effect I have stated.
Mr. DUGGAN: I move to delete Section 22, page 10. The reason for the deletion of the Section is that money recovered under the German Reparations Recovery Act, 1921, is not in the nature of a tax and consequently the matter is not proper in the Finance Bill. It does not properly come within the scope of this Bill and it must be dealt with by a separate measure, which will be done at the earliest possible opportunity.
Mr. JOHNSON: In the meantime, are we to understand that the duties payable under this Act will be collected? Inasmuch as it is not the imposition of a tax, but is rather the repealing of an Act that empowers the imposition of a tax, surely it might be passed. I would like to know whether any action will be taken by the Customs officials under this Act in the meantime pending the passing of legislation.
AN CEANN COMHAIRLE: The Deputy is out of order now, but I am not insisting on that. The Deputy spoke before. I asked him was he making a point of order and he said he was not. I informed him on that occasion that the Bill was being received for Final Consideration.
AN CEANN COMHAIRLE: I am not anxious to rule, but I am anxious that the Deputy should be clear as to what he is doing. He made a speech on the motion “That the Bill be received for Final Consideration.” I interrupted him in the gentlest possible manner to inform him that he was making a speech on the motion, and he continued at some considerable length. However, I take it that the matter is so important that there is no objection to the Deputy making a second speech.
Mr. DARRELL FIGGIS: The point that I urged before and why I wished to have possession of the Revenue Commissioners' White Paper was because of the very points that have been raised in the amendment brought before the Dáil to-day and the question raised by Deputy Johnson with which the Minister for Finance says he is dealing. A  number of cases like that are bound to arise. One reads through the Customs and Excise Tariff and particularly the Schedule under the two heads of the Depreciated Currency duty and the Key Industry duty, in each case a duty of 33-1/3 per cent. ad valorem, and it is impossible to gauge what the effect of these duties will be in the future. No Deputy in this Dáil can possibly make such an estimate in the future. The Minister for Finance is unable to make such an estimate and no person in Ireland can make that estimate. Take the absurdities to which Deputy Johnson referred earlier when he was dealing with the question of varnish. All these matters in their incidence in Ireland, a country for which these duties were not devised, will work a great deal of harm, I feel, in the future, in one way and another, and I think it will be quite consonant with the purpose of the Bill and I think it will be very much to the convenience of the Minister himself if the Minister were to take powers in the Bill to surrender any duty if, at a later date, it is found that that duty is either, on the one hand unproductive, or on the other hand, injurious. It could surely be no harm to take the powers in the body of the Bill and to introduce an Order, or at a later date, making such variations as might be required, and I urge the reconsideration of that now. The Minister has enforced it in the words that he has himself said. He stated that this question of varnish is going to receive his attention. I think there are many other questions that would also require his attention and perhaps they will receive his attention in due course, but that particular case of furniture varnish certainly will, and is receiving it. But if the Bill had been adopted we would have found ourselves unable to vary these monstrosities except by way of entirely new legislation. The course that I am recommending at the moment, and the course I recommended in Committee, is that he should take power in the Bill, and if such cases should occur in the future an order should be laid upon the table of the Dáil surrendering such duty for, as I say, on the one hand because it is unproductive or on the other because it is working certain injudicious effects.
Take the Schedule of articles set out under Depreciated Currency duty, and  take those set out under the Key Industry duty; you have here, not merely matters which we might undertake the manufacture of, and where certain protection might give a benefit if that fiscal policy were to be the fiscal policy adopted for the future, but where you have got certain metals and certain metallic compounds on which a duty is imposed, these metals and metallic compounds, being used in Ireland for manufacturing purposes, they are simply put in here because the compounds are made in England and in Germany. In Germany they are made much cheaper than they are made in England, but we impose a duty in Ireland. I think the effect of that duty, from the Revenue point of view, will be very little, but the effect of that from the industrial point of view, may be very serious indeed, and should that be proved so in the future, it would be impossible to vary it without an entirely new Bill, whereas if the course were adopted of taking, in some short clause, powers to surrender this in this new year, the experimental year, an Order could be laid on the table of the Dáil, and such variation produced. The Government has the opportunity still at its disposal for bringing in amendments of this kind, and I urge that they re-consider the matter with a view of taking such powers.
Mr. DAVIN: When one such as myself, not an expert in financial matters, listens to the various conflicting views of the many Deputies who have studied this question, one would feel inclined to wander into a debate on the question of Protection. We had Deputy Dr. White stating here the other day that he was in favour of a Protective tariff, and we have Deputy Figgis arguing with the President in favour of the release of Customs duties, which are, I presume, the outcome of the Treaty position. In view of the fact that we have assurances from one of the Ministers that a Commission is being set up to go into the whole question of fiscal policy, I do not wish to go into that matter at the moment. I would be prepared, personally, to give qualified support to any policy of Protection, and qualified for two very good reasons. I would like to think that in the case of any Irish industry seeking Protection that there was sufficient expert knowledge, and sufficient finance behind the undertaking to produce an equally suitable article within Ireland  under reasonable conditions before I would be prepared to say that they should receive Protection. I would not like to think that the present or any future Government would give Protection to any industry that would be prepared to carry on the profiteering scandals that are going on in the country. I would support any policy of protection subject to the consideration, whether or not the industry that was seeking protection was making undue profits out of its business at the particular time. I ask the President is he prepared to make any statement now regarding the question of this official export list, or could he say if he is prepared to make any modifications in that particular list? We have had it stated in the Press, perhaps rightly so, that there are people in the country who are not extremely anxious to help the working of the Customs arrangement. I would like to think that there were no unnecessary restrictions imposed on people who felt that way, and that nothing in the nature of unnecessary statistical information that was being asked for should be pressed, especially where such information was likely to hamper the smooth working of the export traffic. I referred to certain questions the other day, and I would like to know from the President if, as a result of conversation with the Revenue Commissioners, or other responsible officials, there is likely to be any modifications of this particular list. I contend, in the case of the information asked for, particularly with regard to non-dutiable goods, that that information is asked for simply and solely for certain statistical purposes so far as the Government is concerned. I would go further and say, from what I know, that the information that is being supplied at the moment, in connection with that particular matter is absolutely unreliable.
If the onus of supplying such information is upon the person who exports the goods, then I say that no third party should be tied down to supplying or securing the information not given by the people exporting the goods, and which can only be obtained after considerable inconvenience and expense to the third party. I would like to know if the Minister has any information to give on that aspect of the question. With regard to the question of Income Tax, I have stated here before, and I have good reason to know, that there is considerable  opposition to the Clause in this Bill dealing with the question of compelling the employer to act as a tax-gatherer. Clause 6 states: “Where any employed person has omitted to make payment of any income tax under Schedule D or E due and payable by him for any year, the Revenue Commissioners may give notice to the employer of such person at any time after a period of three months has elapsed since such income tax became due and payable, requiring such employer to deduct the amount of income tax so in arrear from any remuneration payable by him to such employed person.”
I want to have a distinct statement from the President as to what is meant by Income Tax arrears. Is it meant the tax that is collectable at the end of the financial period? There has been a system in operation, particularly so far as the railways are concerned, by which the Income Tax has been deducted off the salaries' list fortnightly or monthly. I want to know if any arrangement of that kind has been authorised or sanctioned by the Government. I want to know from the President if he considers it fair that railway companies, or any other company, should, under the terms of this Bill, deduct Income Tax in that way, and if the companies have the right to the use of that money, which belongs to the employee, for one year without giving him any interest for the use of it. I want a distinct statement with regard to that aspect of this Clause of the Bill, and to have a definition of what is meant by arrears of Income Tax when the person liable in this Bill is obliged to pay the money.
The PRESIDENT: These are very ticklish things, and I ought to get notice of them. We have no information regarding statistics, I regret to say. I will make inquiries for the Deputy and see if I can get the particulars that he requires. As regards Income Tax, I take it that arrears of Income Tax, in respect  of the year 1923-24, mean sums of money due to the State on the years 1922-23, 1921-22, or 1920-21. As regards the interest on the money collected, I do not know that there is very much in that point. It is not, in my opinion, a very strong point. The company, or the person, gets some little trouble in collecting the money, and I think it would no more than compensate for any cost or expense that they would be put to in that collection.
Mr. DAVIN: That is the fact, because of the law that was in operation and which you are now copying, or trying to put into operation. You are copying what was the law of the British Government. I want to be quite clear on this. Under the terms of this Bill the railway companies are deducting Income Tax off the monthly salary lists, so far as the salaried officials are concerned. I want to know if the arrears, when deducted monthly, are paid monthly by the companies to the Revenue Commissioners?
The PRESIDENT: I cannot say, but that is a matter for the Revenue Commissioners to get in the money as rapidly and as quickly as they can. The law as it stands, I believe, authorises, empowers or directs railway companies to deduct Income Tax. I told the Deputy that the last day. I think he scarcely accepted the statement, but it is the fact.
The PRESIDENT: I am glad to hear that. As regards Deputy Figgis's suggestion, I would like to have the power he suggests, but I would prefer to have it for imposing taxation rather than relieving it. My recollection is quite accurate. Some Deputies criticised the Government for having the legislative power to do things by Order, but I do not know whether the Deputy (Mr. Darrell Figgis) was one of those who criticised us for that, but at all events  he will have another opportunity, in the very near future of drawing the attention of the intelligent electors to the infirmities of the Ministry, and for every mistake they made he can say he warned them beforehand, and for everything they did right he can say it was on his suggestion they did right.
The PRESIDENT: Oh, I hope very shortly. Now, we all know there may be some difficulty in adapting changes that come about. We will take any and every opportunity of dealing with these changes as they arise, but there is no necessity for always shouting “wolf” in regard to these things. Some of them are not by any means so serious as they appear, and I take it that whenever a case does arise which on the merits of it necessitates treatment, it will get that treatment.
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