Skip to main content

New Clause—(Abolition Of Estate Duties On Agricultural Land)

Volume 390: debated on Thursday 3 June 1943

The text on this page has been created from Hansard archive content, it may contain typographical errors.

From the date of the passing of this Act, estate duty shall not be levied on any land used for the purposes of agriculture.— [ Mr. Colegate.]

I beg to move, "That the Clause be read a Second time."

This Clause deals with a fundamental matter affecting long-term agricultural policy, on which I venture to urge that it is the duty of the Government to take a decision as soon as possible. The whole atmosphere surrounding this question has been greatly changed during the past few months by a remarkable series of reports which show great unanimity on certain points. In addition to that, there has been a change of attitude towards agriculture in many quarters, quarters which have not in the past been regarded as particularly favourable to agriculture. I refer to reports issued by the Federation of British Industries, the London Chamber of Commerce, the National Union of Manufacturers and, perhaps the most striking of all, the Wholesale Textile Association, who are quite emphatic in their recommendation that the restoration of British agriculture is essential to the future prosperity of the country. Those reports show the essential place that British agriculture must hold in the economy of the country.

Next I come to the expert reports, which tell us what is one of the main features which will ensure the restoration of British agriculture to its rightful place in the economy of the country. I refer to the reports of the Royal Society of Agriculture of England, an expert body; to the Central Landowners' Association, an interested body who are entitled to have their views heard; to the sub-committee of the Conservative Reconstruction Committee, who have issued a remarkable report which has received favourable notice in every quarter; to the National Farmers' Union, which is very closely in touch with the whole situation; to another very remarkable report, signed by a group of peers of all political parties; and then to the Forestry Societies, the Royal English and the Royal Scottish; and lastly, but not least, in fact to the most remarkable report of all, the Scott Report, which, I gather from references made to it in this House, is accepted by almost everyone concerned.

Let me take first the report of the Central Landowners' Association. It is a very good report, and I advise everyone to read it. They say that it has already been pointed out that the incidence of Death Duties is the most competent cause of the break-up of agricultural estates, and they go on to say:
"No more effective method of eliminating such estates could have been conceived. If it is accepted by the Government that the remaining agricultural estates should be retained then it follows that such a result can only be achieved by the remission of those duties where land is scheduled for the production of foodstuffs and timber."
When we are asking for the remission of Estate Duties on agricultural land, we understand that proper Regulations should be made to see that that land is only freed from Death Duties while it is used for agricultural purposes.

Now take the Conservative post-war reconstruction report, one of the best upon agriculture that has been produced for many years. It comes up against this difficulty almost at once. It says:
"The most difficult to defend from an agricultural standpoint is Estate Duty. It is capricious and uncertain in its incidence. The accidents of life and death may give to one estate comparative immunity, while another feels its effects with crushing severity. In the absence of outside resources it can seldom be met without the break-up to a greater or lesser extent of the estate which is called upon to pay it. Again, under existing tax procedure the rate of tax will increase with the size of the estate and with the total wealth of the owner, a position which may be just from the standpoint of the taxpayer, but which bears no relation to agricultural needs. Psychologically it is disastrous. The guiding motive of the best type of owner is regard for the permanent welfare of his estate."
I do not think that would be denied by anyone who has any knowledge of the conditions of the agricultural industry. The report goes on:
"To such a man the knowledge that, on his death, taxation will destroy his life's work, cannot but have a most depressing effect. The evil effects of the Duties are not confined to the great estate. Equally onerous are the smaller sums demanded from the owner-occupier. To find them involves an inroad on working capital, which almost invariably impairs the future efficiency of the farm as a productive unit."
I come now to the report of the Royal Agricultural Society of England, a body composed of nothing but experts, and they make a very brief reference to the matter. They simply say:
"One of the prime causes of deterioration of the countryside and the loss of fertility has been the incidence of Death Duties. It is impossible to withdraw from the land, at frequent and irregular intervals, large sums of capital without exhausting its power of reproduction which is vital to the nation."
I will quote just a sentence from the report of the National Farmers' Union. Farmers by no means see eye to eye with landowners on every question, and their evidence is really of great value. They say that before the war they had, in collaboration with the C.L.A., made representations to the Chancellor of the Exchequer with regard to the incidence of Death Duties on Agricultural land and the need for relief for expenditure for the maintenance and development of agricultural production. They go on:
"The force of these representations has been intensified by war-time conditions and action in response to them should be an essential feature of the Government's long-term plans for the industry."
I come to the report of the Peers, who include one Socialist ex-Minister of Agriculture. They were quite emphatic. They said:
"Death duties in their present form as applied to the owner of agricultural land are incompatible with the proper maintenance of that land. The maintenance of the present system of landlord and tenant (which leaves the tenant's capital free for working the farm) depends primarily on such relief from death duties as would arrest the drain on the landlord's capital, which should be at disposal for the maintenance and improvement of the fixed equipment."
I will not refer to the Forestry Societies' reports, which are equally emphatic, but will go on to the Scott Report. This matter was not within the Scott Committee's terms of reference, and therefore the Report did not make recommendations. When the Committee turned to the subject of rural amenities and the position of agricultural land in England however, almost the first thing, in the first few pages, upon which they were compelled to comment was the incidence of Death Duties. This body was not concerned with landowners at all. Their terms of reference concerned the future of agriculture and rural England. The Report says:
"During the years before the war of 1914–18, as well as since, rising taxation and the incidence of death duties seriously reduced the ability of many landowners to make necessary improvements or to maintain their farms in good tenantable condition. Many estates became heavily mortgaged. To retain their farms many tenants bought them, often at high prices and frequently with borrowed money. This lock-up of capital in the land meant less money for working capital and became for many owner-farmers a source of considerable embarrassment when later the general world depression in agriculture brought low prices."
That is very remarkable testimony from the Scott Report.

Never has there been such unanimous testimony from widely differing interests and from such expert committees, such universal condemnation of the evil effect of Death Duties on agriculture, which is one of the major industries of this country. I would remind the Committee of the very wide difference there is between the incidence of Death Duties upon a money fortune and upon agricultural estates. If anyone leaves a large sum of money in a bank, the heir may very much regret that he has to draw a very large cheque in favour of the Chancellor of the Exchequer, but there is no difficulty about it. Unless that money forms the working capital of a business, or part of it, no harm is done to production. No business or estate is damaged. If you leave a large holding of shares in some company, some may have to be sold to pay the Death Duties, but that does not affect the company by a single farthing. If you are lucky enough to inherit some shares of the Imperial Tobacco Company, the money for the Death Duties is not provided from either the working capital or the fixed capital of the company but is provided by other members of the public, who purchase the shares.

Take the case of a man inheriting an agricultural estate. If he has not large outside resources, he must break up the estate, and that does no good to agriculture whatever. On the contrary, it does an enormous amount of harm. He may exercise the option, which the Treasury give him, of paying over a series of years. That is no help to the question from the angle from which I regard it, namely, the prosperity of British agriculture, because what does it mean? It means, because the net income is not high compared with capital value, that over a series of years the heir is short of money and is inevitably tempted to starve the estate, cut down on the repairs, and generally do little draining, etc., and thus seriously impair the fertility of the land. Whatever means he adopts he has to do one of two things, eat either into his fixed capital by disposing of part of the estate, or into his working capital by withdrawing money from it.

This question, I know, has been raised many times before, but, I would remind the Committee, never in the circumstances in which it can be raised to-day. This is the first opportunity, this is the first Finance Bill, on which we have the right to press upon the notice of my right hon. Friend the cumulative effect of these expert reports which I have quoted. The question has been raised before, and I just want to refer to that, because it has a considerable bearing upon the decision which I think the Chancellor ought now to take. In passing, I may say that the venerable and illustrious author of those duties, the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George) said—[Interruption.] Ah, yes, but they were not on the scale which we know, and which affect agriculture. I am refer, ring to the time from 1909 and 1910. The author of these increased duties, I should have said, has said that agriculture is too heavily taxed. No one could fail to see, including the right hon. Gentleman, that these Estate Duties were heavy and had an extremely harmful effect. This was brought out very clearly in the Budget Debates of 1925. I may remind the Committee that the Chancellor of the Exchequer of that day was my right hon. Friend the present Prime Minister. The Death Duties were increased, but as a result of debate, as a result of the evidence then brought of the damage being done, a concession was made, and the Death Duties on agricultural land were not increased in the 1925 Budget. From that day to this there has been no increase. Every succeeding Chancellor of the Exchequer has had to maintain this differential rate for Death Duties on property and on agricultural property. I think I am right in saying that the scale to-day is the old scale under the Finance Act, 1919. Nobody has dared to change it, although the rates have been put up on every other form of property, because it has been recognised by Chancellors of all parties that the Death Duties were doing an extremely large amount of damage to the agricultural industry of this country.

The total amount raised by these duties is not large. Taking it in general, I think I am right in saying it has never been higher than £4,000,000 in recent years, and I think it has frequently ranged between £1,000,000 and £2,000,000 a year. That is not a very serious amount in a Budget of the £1,000,000,000 mark. I am not going to translate it into terms of battleships or bancors. I prefer to deal with the old-fashioned pounds, shillings and pence. Nor will I refer to destroyers. It must be realised that although the total amount is not large, seen as an item in the national revenue, the effect on individual owners is crushing, because this is not a tax of £2,000,000 or £3,000,000 or £4,000,000 levied over the whole of the agricultural estates of the country. It depends entirely upon the chances of death. Some estates, large estates, having landlords capable of keeping those estates in first-class repair, may go on for years without paying a farthing towards this levy, whereas a neighbouring estate may have to pay these duties in respect of two deaths in a very short period of time. Anyone who has seen, as I have, the effect on an estate of two deaths in a short period, will know it is disastrous, not only to the man who inherits, but to the tenants and to the people in the villages concerned.

I have dealt with that point. It may be said, "You have pointed out the evil and damage that this tax does. Surely someone must benefit?" I entirely agree; someone does benefit—two groups, indeed three. Two great groups benefit, mainly. They are the jerry builders and the land speculators. These duties are the charter of the land speculator and the jerry builder. I take an estate within my own knowledge, within a few miles of my own home. I passed through it recently. There was a beautiful house, there were wonderful woods. The people could not stand up to the effect of the Estate Duties. They threw in their hand altogether. A land speculator bought the whole thing, lock, stock and barrel. Pass that place to-day—windows empty, woods cut down, everything disposed of, men who have been employed in the neigh-hood discharged. What more would have happened if a foreign enemy had taken that place? Hitler, in his attacks on England, made a threat. He said, "I am going to destroy every country house which is starred in Baedeker." It was quite unnecessary. The Treasury are going to destroy the houses and contents of every house starred in Baedeker. They are doing it. When I was in America some time ago I noticed near the shores of Lake St. Clair, near Detroit, two Elizabethan houses, which had been sold in this country, taken down and re-erected there stone by stone, brick by brick. It was a horrible sight to me. They looked forlorn. I say, "Why should Britain sell its birthright and heritage in this way?"

At the risk of wearying the Committee I must, having dealt with the primary effects, just deal with the secondary effects of this iniquitous tax. You will see in the "Daily Mail" to-day the headline "America buys the family treasures." How true that is. How true it has been ever since these Death Duties have been in operation. The fact is that anything of high excellence in the way of furniture, pictures, books and manuscripts is one of the commonest forms of raising Death Duties at the present time. Many owners of estates feel that, to use an old-fashioned phrase, they have to do their duty to the land. They try to maintain the estate for their children, for the workpeople, and for all concerned. Therefore, their tendency is to look around, and to say, "What about the pictures; what about the other old treasures? We are offered so much for them." That is going on on a large scale, which I am sure a number of people in this country have not recognised. I am not looking now at the international art collections; I am talking of our native indigenous genius, the Romneys, the Raeburns, and others that you will find in the country houses of England. I am not talking about Matisses and that sort of thing, but of the native arts of England, the furniture made by Englishmen for Englishmen, the portraits painted by Englishmen of Englishmen—and by Scots, too; take the wonderful Raeburns that you can find about the country to-day; or that you could find once. Take the simple case of the Shakespeare folios. In many country houses there was an old Bible and a first folio of Shakespeare. I am well within the facts when I say that 95 per cent. of these folios are in the libraries of America. If you want to pursue Shakespearean bibliographical research to-day, you have to go to America to do it.

Is it wise to let your heritage go like this? This land and all its treasures of architecture, art, furniture, books, manuscripts, and what you like, have been handed down not for our own personal disposition, as many people think, but in trust for those who come after us. One of the questions we must ask about any statesmanship and any taxation is, what is the physical result? Is the land better, and are there more good houses large and small, or has the land degenerated, and have the houses gone out of repair; are the people living on their capital? An American said to me, "We Americans are the residuary legatees of the whole of English art." It is perfectly true. They have already got a large quantity of it. I press this matter most strongly on the Chancellor.

I have spoken at length, and I will sum up my argument very briefly. First, I have demonstrated that all expert opinion agrees that the effect of Death Duties is disastrous to the capital structure of agriculture. Is there anyone who denies that? Secondly, I have shown that all reports dealing with this subject, from whatever quarter they come, recommend the immediate abolition of these Death Duties. Thirdly, I have shown that the secondary effect of these Death Duties, namely, the putting of the whole of the country houses of England in pawn, is a disastrous step, and that it should be stopped at once. Lastly, the total amount of money accruing to the Treasury is not great. Had I more time I could have shown that it is very doubtful whether there is any net gain to the Exchequer, because, as a result of this exhaustion of capital, it has been necessary to pay subsidies for drainage and other purposes which might have been avoided had a more statesmanlike course been followed. This enormous damage is, I think, more important than any question of mere pounds, shillings and pence. It Is our heritage that we are selling lightly. We must not do it. I appeal to my right hon. Friend to see whether he cannot accept this Clause, and, if he cannot, to promise us such consideration that we may hope that the new long-term agricultural policy of England is going to be based on a system of taxation which will not exhaust the fixed capital of that industry.

I would like to congratulate my hon. Friend on a very fine effort, and a very persuasive one. He will not expect me, however, to make an announcement on this matter to-day. As he said, the reports which he has quoted are under the consideration of the Government, and they are one of the matters which will have to be considered in connection with the Government's policy on agriculture. This, I think, will be some comfort to him. His speech will be available to my colleagues and myself when we consider this question, and I can assure him that we shall give it the greatest consideration.

There is not a single argument which can be brought forward in favour of this proposal which cannot be brought forward for reducing the Death Duties on many other kinds of property. If it is true that they injure the interests of agriculture, it is equally true that they injure the interests of other industries. The hon. Member has attempted to escape from that dilemma by saying that in the case of industry ownership is very often vested in shareholders, who can sell their shares without affecting the actual control and conduct of the undertaking; but that applies in the case of agricultural estates. Every one of us knows that scores upon scores of agricultural estates have been turned by their owners into limited liability companies, to deal with this very problem. It is open to them to continue that process as far as they please. In that way the continuity of the company's ownership can be maintained, and the problem of raising the money can be dealt with by disposing of the shares, in precisely the same fashion as owners of shares in an industrial undertaking deal with the problem of paying Death Duties. In fact, there is no other object in this country which is dealt with so tenderly, so far as Death Duties are concerned, as is agricultural land, which is taxed upon a lower rate than other property, and on which the owner has an option, which is not given to any other payer of Death Duties, to pay the amount of the taxation by instalments spread over a number of years.

It is said that this taxation is a burden upon agriculture—a burden, that is, upon the industry on farming—but there is no proposal from the hon. Member to exempt from the burden of Death Duties the stock-in-trade of the tenant farmer, by which he carries on the actual operation of farming. It is only a proposal for exempting the owner of land from Death Duties upon the land. Let us not forget that the land is made up of two elements. There is the land itself, and there are the buildings and the other improvements which have been made to it. If there was a proposal to distinguish between those two things in order to encourage the provision of improvements, quite a good case could be made out. The Scott Report, to which reference has been made, contains a series of proposals that there should be a fresh system of valuation which would make that distinction between the land itself and the buildings and improvements which are placed upon it. If such a distinction were made, there would be an opportunity, not only in this case, but in other cases, to make a distinction between the actual contribution to production and the ownership of a natural resource which has not been created by anybody.

Let us assume for the sake of argument that Death Duties on agricultural land do to some extent fall upon persons who are actually conducting the business of farming. It is not a serious burden placed upon that industry. The amount in question is comparatively small. For the past 20 or 25 years the amount of Death Duties collected in respect of agricultural land has fallen to about half what it was. The amount now collected, something over £1,000,000—and I speak from memory—is only a very small part of the agricultural output of this country, which is well over £250,000,000. Therefore, this amount is of the order of much less than 1 per cent. of the agricultural output of the country. It is useless to suggest that the condition of agriculture is seriously influenced by the effects of this taxation. Reference has been made to the break-up of great estates, and something may be said for that in some cases, unless we are all prepared to stand by a system in which the ownership of the land of this country is concentrated in the hands of a comparatively few individuals. I question from the very foundation the soundness of an argument of that kind unless we believe in a state of society in which there is a great gulf fixed between those who have large possessions and the mass of the people of the country.

I sympathise with those who wish to preserve many beauties which have come down to us from the past, but the dispersal of these artistic treasures is not due to the incidence of Death Duties upon agricultural land. It had started long before the Death Duties on agricultural land came into existence and before they had attained any significance whatever. The Huntingdon Library in California, to which the hon. Member referred, has one of the most marvellous collections of ancient documents. The Battle Abbey deeds were sold by the owner of the land more than 100 years ago, before any question of Death Duties came into consideration at all. If owners of land desire to preserve these things for the benefit not of themselves, but of the nation at large which has contributed out of the rents which it paid to the owners of agricultural land, there are means open for them to do so. They can hand over their property to the National Trust in order that it shall be preserved for the benefit of every one of us. There is no reason why those who feel patriotic in this matter should allow artistic treasures of that kind to be dispersed. I hope that the proposal which has been made will be looked at from all its aspects—from its economic aspect and from the other aspects which have been mentioned—and in the light of the fact that every proposal of this kind means that more taxation has to be placed upon somebody else in order to improve the conditions of those whom it is hoped to benefit.

I would not have risen had it not been for the speech to which we have just listened, but I feel that there is a fundamental misunderstanding on this problem. It is looked upon by hon. Gentlemen opposite as a problem of ownership. It is nothing of the kind. It is a problem of management. If we can only realise that the management of an agricultural estate is just as important to the agricultural industry as the management and physical use of the land itself, we might get a better and a truer realisation of the proper function of the landowner. The hon. Gentleman referred in particular to estate companies and the shares which could be sold in the same way as industrial shares. I ask the hon. Gentleman to disabuse his mind of the fact that the shares of estate companies, if they are sold, do not have any effect whatever upon the management of that estate. They have just as direct an effect on that estate as if the company had not been formed. I myself am a land agent, and I have entered into many negotiations on the subject of the formation of estate companies, and I have never been able to see any advantage in that form of alteration. But a lot of people have done so, I agree. It does not affect in any way the unfortunate incidence of Death Duties so far as the capital in the estate is concerned. If shares have to be sold, then land has to be sold in order to realise the shares.

Another point that the hon. Member made, that there should be along with this suggestion an alleviation of burdens on the farmer's stock, is entirely a different one. if a farmer has to pay the duties, he first of all pays on a very much lower capital value, and consequently his stock is far more realisable than that of the landowner. The real point is that, in my experience, it is almost invariably the large estate in a ring-fence which is efficient, both economically and technically. It is a large estate which has all the advantages of a central workshop, a central maintenance unit and a central executive management. Wherever that ring is broken and the estate is reduced in size you get inefficiencies creeping in. The effect of Death Duties is that in almost every case the farm or farms on the outskirts of the estate are first sold off. Each of those farms goes to probably one owner, or perhaps one man buys all of them. Almost invariably he buys for investment what will give him 5 per cent. on his money. That is one principle that has done more damage to the agricultural industry than anything else.

It is this desire on the part of men and women who have no feelings for the land at all and who regard money put into agriculture in the same way as money put into investments that is ruining the industry. These people have no idea how to manage land as it should be managed, with the result that there is an increase in the number of speculative builders and investors. Hon. Members who live in the north of England know that some years ago there was an organisation called "The Forty Thieves," who used to go around buying up the estates of large owners who could no longer afford to run them, break them and sell bits here and bits there to speculative builders, bungalow proprietors or roadside garage proprietors. So, slowly and inexorably our countryside was wrecked and ruined. I hope the Chancellor will consider favourably the suggestion so eloquently put forward by my hon. Friend in this Clause. I ask him to remember that we have one prime national asset in this country—the land. Practically everything else is artificial and man-made, but the land will remain, and everything we can do now and in the future to improve it and to make landowners more efficient and more sensible of their responsibilities is all to the good of the country.

I would not have risen had it not been for the fear that some confusion may have arisen. The speech of my hon. and gallant Friend the Member for Ripon (Major York) may have led some people to suppose that he was strongly against small ownership or even-medium-sized owner-occupiers of land. I am sure that is not the impression he wished to give.

There has been a spread of owner-occupiership in Scotland for the last five years, with very satisfactory results. Both the Mover and the Seconder of the new Clause seemed to suggest that the only way land can be farmed was solely through large estates.

I am glad my hon. Friend has allowed me to correct the impression which he suggests I gave. My hon. Friend who moved the Clause did refer to owner-occupiers' capital being taken up.

The hon. Member for North Battersea (Mr. Douglas) also seemed to confuse the Clause with the method of valuing land. He mentioned the Scott Report. I do not think that was in the mind of my hon. Friend who moved the Clause. I am satisfied that as a result of the Scott Report there will have to be a different method of valuing improvements to the land, but that is not directly affected by the Clause under consideration. It would be a pity to confuse the two issues, because it might be thought that anybody advocating the abolition of Estate Duties on land was opposed to any change in the method of valuing the land, particularly any method of valuing improvements to the land. That is not the case at all. The argument which can be adduced in favour of this Clause is that this duty is an arbitrary tax that may fall at any moment with crushing effect on a particular estate, which may, for the time being, be knocked out. There may be two or three deaths in rapid succession, with the result that there is no capital for development for perhaps 20 or 30 years. I do not think we can continue indefinitely under this system. As has been said, Death Duties falling in that way are a gift from on high to the land speculator as such, not to the farmer who wants to buy his own farm, but to the man who wants to break up an estate and sell it to a jerry-builder for the sole purpose of making as much money as can be made in the shortest possible time, thus doing irreparable damage to the countryside.

Nobody can doubt that there is need for capital in agriculture. The sum involved is trivial in relation to the results which could be achieved; as against the subsidies which have now to be poured out for land drainage and almost everything else, the cost to the Exchequer might be trivial. I am convinced that there are in the long run only two alternatives confronting this country—the remission of Estate Duty on agricultural land as such, and the nationalisation of the land. I do not see any other way of getting the necessary capital into the land of this country. That is an issue which may have to be fought out in the years which lie ahead, but that something must be done now I have not the slightest doubt.

Nothing astonishes me more than the boldness of a certain section of Members. of this House and we have had an admirable illustration of that to-day from the hon. Member who moved this Clause. At a time when the Chancellor is raising considerable sums of money from the poorest classes of the community, against which many in this House have dissented, we have this privileged section in the matter of monetary standing coming here and asking for a remission of taxation on agricultural land. I suppose it is evidence of the buccaneering spirit that has been utilised in industry with very good effect in certain spheres, but to request that the most prosperous industry in the country to-day should be relieved of any part of its proper taxation is astonishing. The hon. Member who moved the Clause was careful to blend together landowners and agriculturists, and I am quite agreeable to that, but the quotations he gave were very prejudiced. It was significant that he did not seek to put the position of agriculture as it is to-day—prosperous, fortunate and well-favoured by the community and the State——

That may well be the case, but surely we cannot argue from the position as it was 20 years ago.

If we did, I think we should be going very far beyond the Clause. I would ask Members, as the Chancellor of the Exchequer said he would go into this from another angle, whether it might not be well to get on with the Bill.

On a point of Order. Is an hon. Member precluded from referring to something which may appear prima facie irrelevant but, nevertheless, is absolutely relevant in the development of an argument? If that is to be ruled out, the Debate will be stultified.

I do not think I ever ruled that at all. My suggestion was that we seemed about to go a long way down a side line, which might entirely stultify the Debate and bring it outside this Clause, which is not very wide.

I have no desire to digress but it seems strictly logical that, if it is desired to relieve agricultural land, and most other land, some argument should be evolved for the purpose. If agriculture and agricultural land are in a depressed state, the depression extends to other forms of land, but we have had no such suggestion made. The fact is that taxation, generally, is being distributed with a very heavy hand upon all sections of the community, and the layman would assert that there is one section of the community, namely the agricultural, which ought to feel this tax least of all. They have been the favourites of fate and of Parliament, not only of this Government but of previous Governments. Vast sums have been conceded to agriculture as free gifts. These were grants not from high Heaven but from other taxpayers. We have had controlled prices, guaranteeing to agriculture certain specific profits, which the State has not guaranteed to any other section of the community. We have given the free use of implements, lime, fertilisers, and the remission of local rates.

We are not asking for the remission of Income Tax and Super-tax. We are talking of capital taxes—Death Duties.

I am not aware that I mentioned the remission of Income Tax or Super-tax. I am stating that there are these remissions of local rating and differential duties. The working classes, though they may not have many exponents here at the moment, are feeling the same burden of which agriculture is improperly complaining, and no evidence has been submitted to indicate the reasonableness of further remissions for agriculture, which is one of the most prosperous sections of industry. Industrial workers suffer not only through direct and indirect taxation but, in addition, have the burden of unemployment, which is perhaps the heaviest of all. We are promised that that will cease to fall upon them but we have to live and see whether that will be so under the capitalist system. If we indulge in the luxury of great wars in rapid succession, can we expect that these will be paid for, without the levelling down of those who have been in a privileged position in the past? We can only hope that the levelling process may not be too rapid, or indeed that there will be a levelling up rather than a levelling down. The proposals of the Clause would place an additional burden upon the rest of the community in the interest of agricultural landlords.

I rise to make an appeal which I hope may have some effect on the party opposite. I quite understand how the Clause cuts across a good many of their pre-conceived ideas. Since I have been in the House I have often learned a very great deal from their practical experience in certain matters and have changed my preconceived ideas. I trust that they will look at this matter without prejudice and see that there is more in the argument of supporters of the Clause than perhaps they thought. The last speaker treated this as a case of remission of taxation. It seems to me that that is a total mistake. At the present rate, taxation is not simply a question of raising revenue. It is a great instrument of policy, and our case is that this instrument of policy is unfairly affecting one of the great industries of the country. It Is true that, so far as immediate profit is concerned, so far even as capital in the sense of working capital is concerned, agriculture is, for the moment, prosperous, but our case is that the heavy, long-term capital industry is not prosperous, and the reason is the incidence of Estate Duty.

The hon. Member for North Battersea (Mr. Douglas) suggested that there was no single argument that could be applied to agricultural land which could not equally be applied to other forms of land ownership, but that ignores the real character of the capital structure of the agricultural industry. I can cite a case where the owner of a great estate and the owner's son died within a week. Next door there is an estate owned by a college. It has plenty of capital, because a college never dies, while the estate owned by the landowner has been starved of capital, because it has paid double Death Duties. As matters stand at the moment, the capital structure of agriculture demands money from the pocket of the landowner in a sense that other forms of industry and capital investment do not. Whether that is desirable or not I do not propose to inquire, but it is the fact.

It is said by hon. Members opposite that they do not approve of that form of society and that they do not want a dif- ferential form of society in which great landed estates exist in private hands. I am not at this moment arguing against that point of view. I do not say that I support it, although I have greater sympathy with it than hon. Members opposite think. What I say is that this Finance Bill is not an instrument for upsetting the social structure of the country or fundamentally altering it, and what cannot be justified is retaining the present social structure and preventing it from working efficiently. If you want to alter it, alter it by a proper Measure which will restore a proper balance in another way, but do not keep it on in such a form that it cannot operate efficiently. I therefore ask hon. Members, whatever their views, to regard a new Clause of this kind sympathetically, because it is conceived on the basis of the existing structure of society. The arguments against it are based on a misunderstanding of the capital structure of this industry.

One hon. Member suggested that landowners should hand over their property to the National Trust. The National Trust is not designed as a manager of agricultural land. It may have to undertake work of that kind from time to time in the course of its business, but it is not an instrument designed to take over agricultural land. It is not fair, while we have a system of private property, to turn to one particular class of property owner and say, "We are going to allow people who have their money in shares to continue as private owners, but because you own agricultural land you must give up everything you have." Therefore, I ask hon. Members, without prejudice to their general convictions, which I am not disputing at the moment, to give the new Clause the sympathetic consideration it deserves.

I say, frankly, that there is a certain amount of tragedy in the break-up of great estates, but I see a fallacy in arguing that the cure for that is necessarily this proposed Clause. This is a question of national planning and public policy in another direction altogether. I am sure that the Chancellor during the proceedings on this Finance Bill must have been surprised at the number of innocent, helpful people whom he has been punishing and penalising by his taxation. According to one of the arguments used every great landowner has been a benefactor who has held the land together and it has only been the wicked speculators who have broken it up. I know a number of cases in which the reverse has happened, in which the great landowner himself has taken advantage of every development of the community and exploited it by ribbon development and by selling his land to house speculators and making the most out of it. I suggest that he is not in the same category as people who are making profits in other directions.

The suggestion was that the landowner was a person of great generous public spirit, but we have to take landowners as a mixed variety—the speculators, the gamblers and all the other people mixed up in the community of landowners.

The hon. Member has missed the point altogether. I was not talking for the great landowners but for all landowners, most of whom are small men. The imposition of Death Duties gives the opportunity to the jerry-builder and the land speculator. There are landowners who speculate, but they are driven to speculation by the Death Duties.

Surely there are other ways of sharing out the land than by selling it to speculators. Somebody has referred to the formation of a company. There is no reason why a landowner should not form a company and sell shares in it and still keep control of the land. If there is a profit, he can distribute the profit instead of the land. We have to realise that land is a big capital institution. If it is a question of perpetuating the control by one individual of hundreds of thousands of acres and to some extent the destinies of people upon that land, that is a position that has to be considered, but it is not a question of Death Duties. The Government and the people as a whole have no right to subsidise that system at the expense of people less able to bear the burden. So far as I can understand the system of taxation and Death Duties in this country, it is as fair as anything that can be devised. It is for the person who has land to make such arrangements that he can meet his obligations to the community in the proper way. It may be that if two or three deaths take place in rapid succession hardship arises, but hardship arises too in regard to a soldier's estate, if both father and son are killed in the war.

The point is not the hardship to the individual but the damage to agriculture.

The point surely is not the question of relieving a person of a financial obligation but a question of the Chancellor and the Government introducing some arrangement by which if the Death Duties involve the sale of land in a way which will harm the country, some arrangement should be made by which the Government could be able to take over the land. We have an instrument in the county agricultural committees, and I see no reason why they should not take the place of the National Trust so that if a person cannot finance the payment of his Death Duties, the community as a whole, through the Chancellor, should be able to take over the land in trust under the management of the county agricultural committees. This would solve the problem of the breaking-up of estates and ensure good management. There is no guarantee that a landlord is a good manager of land. There may be landlords who are good managers but there are also bad ones. During this war the community has had to see that the land is properly managed by taking it out of the hands of many landlords. The question of efficiency is not guaranteed by the individual ownership of land. I agree that we ought to have efficient management of the land, but it must be guaranteed by public policy and run by the public and not left to private individuals who may or may not be efficient.

May I appeal to my hon. Friends to proceed with the Bill? We have had a useful discussion on this matter but I am anxious to have adequate time for the consideration of the remaining new Clauses. This has been a general discussion and I think that the observations I made were generally satisfactory to my hon. Friends. In these circumstances, I would ask them to allow us to proceed.

May I just say two sentences with regard to two points that have been made?

The Chancellor has made an appeal to hon. Members to end the Debate, and it is only fair to other Members who are giving way that the hon. Gentleman should not continue to make points which have already been made several times. I appeal to him to take the wider view and let the Debate end.

I was not going on to argue but only to correct a statement. In view, however, of your appeal, Mr. Williams, and in view of the satisfactory statement made by the Chancellor, I beg to ask leave to withdraw the Clause.

Motion and Clause, by leave, withdrawn.