A

MONG the minor improvements in the conduct of public affairs introduced by Sir R. Peel, that of bringing forward the financial statement at a much earlier period of the Session than had been usual heretofore, is deserving of mention. This practice undoubtedly tends much to the convenience both of the Legislature and of the public, more especially when the changes introduced by the Budget are of such a nature and magnitude as materially to affect the interests of classes or of individuals, to whom the earliest notice of a prospective change is often of great importance. Moreover, in the recent circumstances of the country, measures of finance and commercial policy have assumed so prominent a place in legislation, and enjoy such a preponderance in public interest, that to defer the revelation of the intentions of Government till the Session is far advanced, would seem to be an unreasonable disappointment to the just expectations of the community. The great scheme of commercial reform which distinguished the Session of 1845, was accordingly introduced at the earliest period after the opening of Parliament, taking precedence of all the other measures of Government. It was brought for

ward by Sir R. Peel in a Committee of Ways and Means on the 14th of February; and notwithstanding the great anticipations which had been entertained, it produced no little surprise upon the House, owing to the bold and comprehensive character of the schemes which were disclosed. The speech in which Sir R. Peel developed his plans was one of his ablest efforts, and fully supported his reputation, as a lucid and masterly exposition of financial policy. He commenced by saying that though he had had considerable experience in the discharge of official duties, and though he had frequently addressed the House on matters of great public concern, he could not approach the subject on which he had then to address the committee without great anxiety, and a deep consciousness how inadequate and imperfect the explanation would be which he should endeavour to place before it. But though he rose under some disadvantages as to the period of the year at which this communication was made, yet after the declaration made in Her Majesty's speech, that it was the intention of Ministers to propose the continuance of the income-tax for a certain number of years, he felt that he had no other alternative than to submit to the House

the general views which the Government took of the financial condition and the commercial policy of the country. It would be his duty to discuss this great question-whether it be consistent with the public interest that the present amount of public expenditure should be maintained, or whether it be not right that there should be in some important respects an increase of expenditure beyond the precedent of former years? If the committee maintained the latter proposition, the question which he should then have to submit to it would be this -whether it is fitting that the expenditure should be met from the ordinary sources, or whether it is more advisable that the tax on income and property should be continued, for the double purpose of providing for the due execution of the public service, and of enabling Parliament to repeal other taxes pressing on the industry and commercial enterprise of the country? After referring to the estimate of the probable revenue and expenditure which was made by the Chancellor of the Exchequer in April 1844, when he brought forward his budget, and, after showing that the surplus revenue, on which he had calculated for the whole year, had been greatly exceeded by the actual amount of revenue received on the 5th of January, 1844, he proceeded to estimate the surplus revenue which would be in the Exchequer on the 5th of April, 1845, at a sum which at the very least would amount to 5,000,000l. He then submitted to the House an estimate of the probable receipt of the revenue for the year ending the 5th of April, 1846, on the assumption that the House

would not sanction the incometax, and calculated that it would amount to 51,000,000l.; and, supposing the estimates of the ensuing year to be the same as they were during the last, he calculated the total amount of expenditure to be 48,557,000l. But if they deducted from this surplus the sum to be derived from the receipt of half a year's income-tax which would become due in the interim, and from the payment of the instalment from China, there would be in that case a small deficiency in the revenue as compared with the expenditure of the year. The question then arose whether Ministers were justified in demanding, under such circumstances, an increased expenditure on account of the public service. He was satisfied that they were justified. He showed that no saving could be made by the abolition of offices and reduction of salaries. A sufficient force of revenue officers must be kept up to insure the collection of the revenue and to give facilities to the transaction of commerce. No diminution of the army could be recommended, on account of the extent of our colonial dependencies, and of the necessity of our sending out relief to the regiments who garrisoned and protected them. The army was a very complicated and expensive machine, which would be dislocated and deranged if due attention were not paid to its support. An increase in the army was not a measure which he should propose, but any diminution of it would be a measure to which he could not consent. The military estimate for the present year would therefore be 6,600,000l. There were reasons which induced him to propose an increased estimate for the navy this year; and those were to be found in the growing necessity for a further protection to our commerce in every part of the globe, and in the establish ment of three new naval stations -one on the coast of Africa, another in the Pacific, and a third in the Chinese seas. He should propose to employ this year 4000 men more than were employed under the estimates of last year. That increase would not be for the purpose of war or of aggression, but for the protection of our commerce, and the maintenance of peace. The expense so caused would be 184,000l. There would also be a vote for always keeping at our command a squadron of eight or nine sail of the line, which would create no jealousy among Foreign Powers, and another for the purposes of increasing and improving our steam navigation. In respect, therefore, of the vote for the navy, and the ordnance connected with the navy, there would be in the votes of this year an increase of nearly one million. For this increased expenditure the revenue of the next year would, he thought, suffice, even if the House would not consent to continue the income-tax. It was quite clear, however, that if it did not continue the income-tax, in the year following a deficiency of revenue would be discovered. The question which he must next put to the committee was, whether they would run the risk of that deficiency by making no provision to meet it, or whether they would postpone the consideration of that deficiency till the year 1846? Her Majesty's Government thought that it would not be a prudent course so to disregard the future condition of the country.

Ministers were, therefore, induced to propose the continuance of the property-tax for a further period; and before he asked the assent of the House to that proposal, he felt it necessary to explain what were their views as to the appropriation of the surplus revenue which would then be placed at their disposal after all the exigencies of the public were provided for. He would assume for the present that the committee would sanction the continuance of the property-tax, and would then give them an estimate of the revenue which he expected to derive from that source. Supposing the property-tax to be continued, the revenue, on the 5th of April, 1846, would amount to 53,700,000l., and so long as the other sources of revenue were productive, might be calculated at that sum, deducting only a sum of 600,000l. from China, which would only be receivable for one year more. He would, therefore, take the amount of the revenue at 53,100,000l. The public expenditure he had already calculated at 49,000,000l. would, therefore, be left on the 5th of April, 1846, a net surplus of 3,409,000l., if the committee acquiesced in the demand of Ministers for increased naval estimates. He now approached the most important question of all, namely, what was the mode in which this surplus, or a part of it, could be applied to the relief of taxation? He would not have proposed the continuance of the income-tax, if he had not felt the strongest persuasion that it was competent for the House, by means of it, to make arrangements with respect to taxation, which would be the foundation of great future com

There

mercial prosperity, and which would add materially to the comforts of those who were called upon to contribute to it. In considering how they would appropriate any surplus of revenue, several important considerations must always be before them. They must first consider the claims to reduction of taxation on account of the heaviness of the duties on articles which entered into general consumption; then they must also consider what were the taxes which pressed most heavily on those raw materials which constituted the staple manufactures of the country. Then, they must consider what were the taxes which required the greatest establishment of revenue officers for their collection; and then what were the taxes which, if reduced, would enable them to diminish the same establishment, so as to reduce their expenditure. Lastly, they must consider what were the taxes which, if removed, would give new scope to commercial enterprise, and occasion an increased demand for labour. He did not say which of these considerations ought to predominate, but they were all of importance. If the property-tax were continued, Ministers intended to make a great experiment with respect to taxation, in the hope that the general prosperity which would result therefrom would fill up the void caused in future years by the cessation of taxation. They did not propose to maintain any material surplus of income over revenue; but in the conviction that the House would, at all events, maintain public credit, if they proposed the reduction of certain taxes, which, were more onerous than productive. He would first

take the taxes connected with the customs, and would submit to the House a proposition with respect to the reduction of the duty on sugar. He proposed, with regard to all sugars but refined sugars, to make this reduction. On brown Muscovado sugar, which now paid a duty of 25s. 3d., he proposed to make a reduction of 11s. 3d., and to reduce the duty to 14s. That reduction would apply to all British plantation sugar, and to sugar the produce of the Mauritius; but there were certain districts in British India, with regard to which a different rule now applied; and with respect to them he proposed that they should pay the same relative proportion of duty which they paid at present, and that the duty should be 18s. 8d. On free-labour foreign sugar he proposed that the protecting duty should not exceed 9s. 4d., and therefore the duty would be 23s. 2d. Any country which had a reciprocity treaty with us could not, of course, be deprived of any right which it enjoyed at present. As to white or clayed sugars, or sugars equal to clayed sugars, he proposed that the duty should be reduced on British plantation sugars from 25s. 3d. to 16s. 4d.; that the duty on sugar imported from India should be 21s. 9d., and that the duty on free-labour foreign sugar should be 28s.; thus retaining the whole amount of discriminating duty which was imposed last year, but applying that discriminating duty in a different manner, giving 9s. 4d. as a protection on Muscovado sugar, and an increased protection of 11s. 4d. on the more valuable and costly article. With respect to the duty on molasses, he proposed to reduce it in the same proportions. As to the admission of refined sugar, he proposed to remove the prohibitory duty on refined sugar imported from those British possessions which were entitled to import Muscovado sugar at 14s., and to place upon such sugar a proportionate import duty, namely, on refined sugar 188. 8d, and 21s. on double refined. He then gave the committee an estimate of the supply of sugar which he considered likely to come from our possessions to this country in the course of the present year, and concluded his observations upon that point by stating that the effect which would be produced on the price of sugar by this reduction in the duty would be a reduction of 14d. per lb.; but taking other circumstances, which always accompanied a high rate of duty, into consideration, he calculated that it would amount to a reduction of 1 d. per lb. He estimated the loss which would be produced in the revenue of next year by the reduction of the sugar duties at 1,300,000l. He next proceeded to state that in the tariff of 1842 he had abolished generally the duty on all exports, with the exception of some few articles. He now proposed to adopt, as a general rule, the abolition of export duties on all articles. He did not propose to except the export duty on coal. After having benefited the coalowners by the removal of the export duty, he did expect that they would give to the people of England the full advantage of the boon which they had received, and the House would hear no more of their combinations to restrict supply, and to enhance price. The

120,000l. He next proceeded to a consideration of the duties levied on and applicable to raw materials used in manufactures. The tariff now included 813 such articles. He proposed to remove the duties applicable to 430 of them. By abolishing these duties altogether, they would get rid of a number of troublesome accounts. If fraud were practised in the introduction of these articles, against which some precautions must be taken, by weighing and examining them, he must apply to the House hereafter for the purpose of obtaining more stringent regulations against it. One advantage of getting rid of these duties would be, that it would dispense with the warehousing system. He then enumerated a number of the articles to which this abolition of duties would apply, as, for instance, the fibrous materials of silk, hemp, and flax; yarns of certain materials, excepting woollen; furniture goods; animal and vegetable manures; ores and minerals, with the exception of copper ore; iron and zinc in their first stage of manufacture; dye stuffs generally, and certain drugs of a noxious character. There were some articles to which this total removal of duty would not apply. He did not propose to interfere with the general principles which the Government had applied to the timber duties. The import of Baltic timber was now increasing, and the estimate which he had formerly made respecting it had not turned out to be incorrect. There was one article connected with timber which he proposed to exempt from duty, he alluded to the