^* reminded the House that he had moved the rejection of the Bill on the Second Reading. The Committee had struck out the recital as to rating the Wallasey and West Kirby Local Boards. He believed that the Bill was unnecessary, and that view was supported by the engineer of the Mersey Docks and Harbour Board. He had since learned that other of the officials of that Board did not approve of the Bill as far as they were concerned. It had been promoted entirely by the landowners, who had endeavoured to shift the expense and burden of carrying the Bill upon the ratepayers. To that he objected, as a principle which the House ought not to accept. He was told that, as the Committee had passed the Bill, he ought not to have moved its rejection. In answer to that objection he had only to say that if the Bill was of any value to the landowners who promoted it they, and not the ratepayers, ought to bear the expense of it. For the second time this Bill had been brought before the House. When originally introduced in 1889 the preamble was found by the Committee not to have been proved. It had now again been brought forward, and the Committee had again refused to accept this principle of throwing any part of the cost of the extension proposed by the Bill upon the ratepayers. Had the Bill been thrown out on Second Reading the ratepayers under the two Local Boards would have been relieved of the cost of having to again oppose this Bill before a Committee of this House. This was a question of principle, and not one which required sifting out upon evidence, and it was therefore competent for the House to decide. If that decision had been given, the ratepayers would have been exonerated from the expense of appearing before the Committee. Such procedure might, in many cases, amount to a positive denial of justice by putting the public to unnecessary expense. He was very glad that the Committee had acted upon the view he had brought before the House, and that these landowners would have to bear the cost of bringing in the Bill. The main feature to which he had taken objection having been removed from the Bill he would not move its rejection.

Bill to be read the third time.

^* moved, for Mr. GRANT LAWSON, to amend Clause 2, providing that property passing on the death of the deceased should be deemed to include property specified in four sub-sections, by inserting the words "when situate in the United Kingdom." He would not re-open the general question with regard to property situate out of the United Kingdom, which had been so fully discussed and settled more or less satisfactorily. Owing to the alterations made it had become necessary for the words he proposed to be inserted at the beginning of the clause. As it stood, the second sub-section would apply to property belonging to the deceased situate out of the United Kingdom—that the property should be included only if, before the passing of the Act, Legacy or Succession Duty was payable in respect thereof. That was an exhaustive statement with regard to property situate out of the United Kingdom. If that were so, Section 1 ought to be limited to property situate within the United Kingdom, so that the two sections together would refer to the class of property meant. This was rather in the nature of a drafting Amendment, but he did not know whether the Solicitor General would desire to go further and say it was one of substance. The question whether it was a drafting Amendment merely or one of substance depended upon the question whether it was contemplated that no property but of the United Kingdom was to be taxed which was not specifically mentioned in the clause. The effect of the Amendment would be, by way of definition, that the property would not fall within the scope of the other clause.

Amendment proposed, in page 2, line 5, after the word "deceased," to insert the words "when situate within the United Kingdom."—( Mr. Butcher. )

Question proposed, "That those words be there inserted."

said, the Amendment of the hon. and learned Gentleman appeared to be based upon a misunderstanding of the first section. The latter part of the first sub-section provided that

"all property passing on the death of the deceased when situate out of the United Kingdom shall be included only if it is liable to Legacy or Succession Duty or would be so liable but for the relation of the person to whom it passes,"

and that provision applied to the whole clause.

said, he was unable to follow the hon. and learned Gentleman's statement. His hon. Friend asked the plain question whether, under Sub-section (a) any property out of the United Kingdom was to be taxed which was not specifically taxed in Sub-section (b). There were two parts of the clause, one of which was intended to be a qualification of the other.

said, he had pointed out that the latter part of the section governed the whole clause. Unless the property was situate outside the United Kingdom it was subject to and would come under the limitation at the end of Clause 2.

said, there was no indication that one part of the clause was intended to be a qualification of the other. As he understood it, the object of the clause was to give a specific and careful definition of what was intended by "property passing on the death of the deceased." That was, however, dealt with in general terms in Clause 1. The Chancellor of the Exchequer would observe that Sub-section (a) contained a misstatement; there might be property of which at the time of death the deceased was competent to dispose, but which nevertheless was not property passing on the death of the deceased. Were they to take the second sub-section of the clause not as a further definition of the kind of property dealt with, but as a modification and qualification of Subsection (a) in the first part of the clause? If so, all he could say was that it was extremely bad drafting, and could only lead to confusion when the provisions of the Bill came to be interpreted by the Courts of Law. Surely it would be much better to insert the words suggested by his hon. Friend or some other words, such as "save as in hereafter provided."

said, they were all agreed that there should be no confusion in the matter, and he hoped that an Amendment to be proposed later on by the Solicitor General, and which was on the Paper, would remove any ambiguity.

said, he was sorry he could not quite agree with the Chancellor of the Exchequer, for it seemed to him that the Solicitor General's Amendment would leave matters unchanged; the language would be but little clearer and the sense would be unchanged. The Amendment, in fact, would not clear up the awkward ambiguity. Next he came to the Amendment actually before the House. He was bound to confess his disappointment at not having heard some further statement as to the treatment of property out of the United Kingdom as a result of the representations made by the Colonies. He was aware that the Government had promised to lay on the Table a letter from Sir Charles Tupper on the subject, and he hoped it would be promptly forthcoming, because it was important they should see it before they came to the consideration of that branch of the Finance Bill, and before they decided on taxing for the first time property situated out of the United Kingdom. The Secretary for India on the previous day rather led the House to suppose that in the case of an estate of £25,000 there was no alteration in the duty. He, on the contrary, thought there was a tremendous alteration.

I rise to Order. I think this question arises on a later Amendment in the name of the hon. Member.

said, that while it might be more convenient to discuss the matter on the later Amendment he could not admit that he was out of Order in debating it at that stage. Still, as a matter of convenience he was willing not to go fully into the matter on that occasion, and he would content himself with pointing out generally that in the case of property situate out of the United Kingdom enormous extra taxation was imposed by this clause. Sub-section 2 contained what were supposed to be exceptions and limitations; but as the first part of the clause stood, it did undoubtedly, as the Leader of the Opposition had pointed out, throw a net over all property, whether or not it was liable to Legacy or to Succession Duty. What his hon. and learned Friend submitted was that the first part should not be assumed to go further than the second part of the clause. Was it not reasonable to suggest that in the first part of the clause they should only throw the net to cover property within the United Kingdom, inasmuch as in the second part they would be dealing directly with property out of it, and restricting the duty to certain descriptions of property so situated?

Question put, and negatived.

said, he wished to move to leave out from Sub-section (c) the words "and the words voluntary and voluntarily, and a reference to a Volunteer, were omitted there-from." He admitted that the point was to some extent discussed during the Committee stage; but the discussion was a little indefinite, and he and his friends were never quite certain what the Government meant by proposing to abandon these words. He considered the point of such great importance as to justify aim with challenging a Division on the subject. He proposed, in the first place, to remind the House what the law was before the Finance Bill was introduced, and then to show the operation of this particular provision. This Subjection (c) virtually interfered with the Inland Revenue Acts, 1881 and 1889, because it proposed to enact that the words of those two Acts should be construed as if the provision extended to real and personal property. He held that that was most objectionable, but still it was part of the principle of the Bill; it had been amply discussed in Committee, and they would not again challenge it. But besides enacting that, the sub-section went further, and provided that the provision was to be construed as if the words "voluntary" and "voluntarily" and a reference to a "volunteer" were omitted there from. It was clear that Section 38 of the Act of 1881 created exemptions in favour of voluntary settlements, and the section really comprised a comprehensive statement of all kinds of personal property that could fairly be put into the account for the payment of the Death Duties, while the three Sub-sections (a),(b), and (c) explained the exemption in favour of voluntary settlements. The operation of Sub-section (c)was further extended by bringing in the provisions of the Act of 1889, which really constituted an extension of the beneficent provisions of the Act of 1881. Now this Bill proposed to do away with those exemptions, and he thought they were entitled to ask the Chancellor of the Exchequer what he meant by it? Let his fiscal and political conscience answer. No doubt the object that the right hon. Gentleman had in proposing to leave out the words "voluntary and voluntarily" was to be able to draw more property into his net. In the previous Acts a very comprehensive definition of the word "property" was given, and this particular class of property was exempted from the payment of duty. He should await the right hon. Gentleman's explanation with some interest, for he held that to impose a tax upon it now was contrary to every sense of English justice. He had explained the general apprehension, and he came now to a specific apprehension on a point as to which they were justly and naturally anxious; he meant the case of marriage settlements. They noted with a limited amount of gratitude that the right hon. Gentleman proposed to exempt from the new duty property passing to the wife by marriage; but if the Estate Duty was to be charged on marriage settlements, a great injustice would arise. If at the time of her marriage property were settled on a woman in the name of trustees, that property from that time forward was never at the disposal of the husband; she enjoyed the benefit of it during their joint lives. Then why, on her husband's death, should she be called upon to pay Succession Duty upon it? Surely such a charge would create a sense of rankling injustice in the minds of thousands of persons. Hon. Members opposite might laugh at that, but he could assure them there was nothing more shocking than that a poor widow, in her moment of sorrow and weakness, should be mulcted in a heavy fine for the payment of Death Duties. He would be only too glad to be told that he was wrong in supposing these marriage settlements would have to pay duty. No question that had been discussed during the Debate on the Bill had been regarded by hon. Members on both sides of the House with the same intense interest as this. No doubt where the husband was still in a position to make some provision to meet the payment of this unexpected imposition the case was not so hard, but there were many persons too late in life now to provide for this new charge on that portion of their property which before was exempted from taxation. He was perfectly sure, also, that owing to the omission of these words many persons would have to pay duty upon property which they did not inherit, and upon which Succession Duty was not justly payable at all.

Amendment proposed, in page 2, line 21, to leave out from the words "personal property," to the word "and," in line 23.—( Sir R. Temple. )

Question proposed, "That the words proposed to be left out stand part of the Bill."

said, that if it were not contrary to the evidence of his own senses he would have supposed that the hon. Baronet had come to the consideration of this question for the first time that afternoon, and had taken part in none of the discussions upon it which had been proceeding for the last two months. He asked, in the first place, whether the Government were going to do away with the exemptions, as he called them, granted to Volunteers under the Acts of 1881 and 1889.

Will the right hon. Gentleman interpret the words of Sub-section (c) of Section 38 of the Act of 1881? Do they not provide that where in these cases Stamp Duty has been paid it shall be returned?

said, he could not waste time by answering questions as to whether twice two made four or five. It was a matter of common knowledge as to the effect of the Act of 1881 on voluntary settlements. The hon. Gentleman was under an absolute misapprehension] of the effect of those Acts, as the Act of 1881 for the first time imposed a duty on this very class of property. The object of the Government in framing the present Bill was to place all classes of property upon the same footing for the purpose of calculating the amount of Death Duty payable by the estate. All, therefore, that was necessary for them to do to carry out that object was to remove from the clause they were considering the words proposed to be omitted. If that were agreed to then settled property would be brought upon the same footing as voluntary settlements. They would, therefore, not do away with the supposed "exemption" as to voluntary settlements, for those would remain exactly in the same position as they were placed in by the Acts of 1881 and 1889. He declined to occupy the time of the House by again explaining the effect of the words "voluntary and voluntarily"' as applicable to that class of property. Of course, the omission of those words would directly affect the case of all marriage settlements, as that class of property would henceforth be charged with the payment of Succession Duty. The humbler classes of the community, who had no settlements, had to make these payments as between husband and wife, and it would be unfair if one class was to be discharged from those payments and the other was not. He hoped the hon. Baronet would consider the answer he had given sufficient, and would not further press the matter.

^* said, the remarks of the Chancellor of the Exchequer had been devoted almost exclusively to the question of settlements; but, as a matter of fact, settlements were dealt with by Sub-section (b), and he ventured to say that no such clause as this had ever appeared before in any Act of Parliament. The Chancellor of the Exchequer was imposing duties of a new and untried kind on property, and executors and others who had to pay the heavy duties were subjected to penalties if they did not bring in affidavits stating what property was liable. If penalties were imposed the Chancellor of the Exchequer should at least make it clear to the executors and others what course they should take in order to avoid the penalties. He did not think that this could be gleaned from the clause as it at present stood. Was there any class of property which was made liable to duty by the insertion of those words which was not made liable by the other clauses of the Bill? Unless there was some such property the words were idle, useless, and misleading. Why could not the Government explain the meaning of the words?

We have done it over and over again.

^* said, he must apologise for not being able to grasp it. Could the learned Solicitor General give them an illustration of any class of property which would be made liable to the duty under these words which was not already liable under other parts of the clause?

said, he thought the whole difficulty arose from the fact that the Government had taken a clause intended for one purpose and applied it to another object. Section 38, as the Chancellor of the Exchequer had told them, was entirely directed to stopping up gaps left by former legislation with regard to Probate Duty. It was a provision against evasive dispositions of property, and as such he admitted it was necessary. But it had solely in contemplation arrangements of a voluntary character. When, however, settlements were made for a valuable consideration the case was different. He had endeavoured to understand the sub-section with the result that he agreed entirely with the hon. and learned Member who last spoke, that there was absolutely no class of property made liable by the section which was not already charge-able under other parts of the Bill. He believed the section had been inserted under an entirely erroneous view. He challenged the Government to controvert that.

said that, as he understood the Chancellor of the Exchequer, marriage settlements, however long they had been made before the passing of this Bill, would be affected by it as if they had been made after the passing of the measure. He thought that there was some hardship in this, and for this reason: that those settlements were made before the Finance Bill was thought of, and had no reference whatever to its provisions. Persons who were alive could alter their testamentary dispositions in conformity with the Bill, but this could not be done with old settlements as the persons who made them had no longer any control over them. Hence great hardship must arise.

All this was discussed at great length yesterday.

said, there was no doubt that the lesson learned by those who had the interests of their family at heart, was that the best thing to do was to cheat the Chancellor of the Exchequer by dying at once, and so come under the old duties. But they were not disposed to do that, and therefore they were interested in securing a just and equitable settlement.

^* said, the Chancellor of the Exchequer had somewhat complained of the repeated discussions on various matters connected with the Bill, but he thought they might congratulate themselves on the fact that those repeated Debates had at last brought home to the mind of one of the right hon. Gentleman's followers—the only one who had ventured to express an independent opinion—that a real hardship was being inflicted on persons who were, if he might say so, the victims of existing marriage settlements. He did not profess to be able to discuss this sub-section, because he candidly confessed that he did not understand it; but it seemed to him to be as bad a specimen of drafting as could possibly be presented to the House. It referred first to the Act of 1881; secondly, to an amendment of that Act by the Act of 1889, and then, taking the two together, it said that they were to be construed as if real property as well as personal property were included, and certain words were omitted. Lawyers might understand these things, but he did not think that laymen could. They had had a statement clear and definite from the hon. and learned Gentleman the Member for York, who had shown that he, at any rate, understood the Bill at least as well as the Chancellor of the Exchequer. He had stated that, in his opinion, the words proposed to be omitted by the hon. Gentleman the Member for Kingston did not bring within the scope of the Bill any kind of property not brought within its operation by other portions of the Bill. The hon. and learned Gentleman had appealed to the Government to give even a single example of any one kind of property thus newly brought in. He noticed that during the Debate the Solicitor General left the House presumably to consult the draftsman on this point, and he would, therefore, now press him for an answer to the appeal.

said, the right hon. Gentleman had suspected an occult motive for his departure from the House, and he was perfectly right. In reply to the question which had been specifically addressed to him, he would say that he could well imagine cases which these words would cover, such, for instance, as the case of a father six months before his death making a settlement of his property on his sons and absolutely depriving himself of all interest in the property. The whole of the clause was fully explained by the Attorney General and himself. They need not be ashamed to state that the object was to make the net wide enough to catch all kinds of transactions which were successful in evading the Probate Duty. They did impose two duties, and they did not unjustly impose one duty upon property. There might be some overlapping, and he thought it would not be easy to effect the object they had in view in catching all properties without some redundancies. His hon. and gallant Friend had asked whether marriage settlements were included. The answer was in the affirmative. Supposing a man settled £10,000 upon himself for life and on his wife after his death? If he were sufficiently well-to-do to do that, why should the property escape duty when in the case of a man who, unable to settle it at the time, subsequently accumulated it, it would have to be paid by his widow?

said, the hon. and learned Gentleman had dealt, in the latter part of his observations, with the formidable and burning questions whether it was or was not proper that marriage settlements should be made to pay this duty, and he had repeated with emphasis the argument so often put forward by the Chancellor of the Exchequer that any privilege given to rich men should also be extended to poor men. But the difficulty he had always felt was this: that they were dealing with husband and wife as two persons instead of one for the purpose of the Death Duties, and he did not think that that fitted in at all with the ordinary conditions of social life. Nothing that the Chancellor of the Exchequer had advanced had diminished the injustice which they felt would be inflicted, whether they were dealing with the rich or with the poor. The Chancellor of the Exchequer was very angry with his hon. Friend for going over and over again the Debates which had already taken place, but he was bound to say that having consulted hon. Members around him they were unable to recollect any speech by the Attorney General in explanation of these words; all they had was some obscure reminiscence by the Solicitor General of some speech by his learned Leader. The Solicitor General had cited the case of a father who six months before his death settled his property on his son without any power of revoking the settlement. But he did not believe that even such a case as that required these remarkable words in order to cover it. Although they did not always understand the Attorney General and what he was driving at, they knew he always talked law, and he could not believe that he had been understood by his own colleagues or that there had been a perfect recapitulation of his opinion. He felt driven therefore, to support the Amendment of his hon. and learned Friend. He should, indeed, in one sense be sorry to see these words left out; they were such a remarkable and interesting example of the legal style, and it would be a thousand pities to deprive the Statute Book of that gem of legal drafting. However, if his hon. Friend went to a Division he should support him, as they must not sacrifice everything to legal style, even although it ought to be inserted in any anthology of English law as a specimen of what the House of Commons and its legal advisers could do when they set their minds to work. But he would repeat they must not sacrifice everything to style, and therefore he would be compelled, in view of the future serenity of mind of executors and legal advisers, to support the removal from the Bill of a clause which, whatever its intrinsic charms, was one certainly calculated to perplex those whose duty it would be to interpret the measure, and to involve them in serious legal difficulties.

said that, according to the Official Debates , when this matter was discussed on the previous occasion the Chancellor of the Exchequer expressed regret that the Attorney General was unable to be present, but added that the able and competent gentlemen who had drafted the Bill had considered the point carefully and regarded the words as necessary. The Solicitor General and the right hon. Gentleman were, therefore, scarcely justified in accusing his hon. Friends of a lack of memory because they failed to remember what explanations were given by the Attorney General. He gave none.

said, the Solicitor General had, in reply to his hon. Friend below the Gangway, drawn a distinction between the case of a rich man making a marriage settlement of £10,000 and the case of a poor man, whose accumulations subsequent to marriage became liable to the Death Duties. But was it not a common practice in the case of a man unable to set apart the settled sum at the time of his marriage to keep the money in his business, and to covenant with the trustees to pay it off from time to time. Surely poor men as well as rich men were interested in this question. He would like to know whether in such a case as he had referred to, and assuming the settlor died before he had paid the settled money, but left sufficient estate to pay it, the trustees would be able to recover it from the estate without paying the Death Duty upon it?

[No answer was given.]

Question put.

The House divided:—Ayes 187; Noes 119.—(Division List, No. 165.)

On Motion of Mr. R. T. REID, the following Amendment was agreed to:— Page 2, line 29, to leave out "and all," and print the following four lines as Subsection (2).

moved to leave out lines 29 to 32 on page 2. He said, he still hoped that the Government would reconsider their position in regard to the taxation of foreign and colonial property. The question had been postponed from time to time, and representations had been made to the Government on behalf of the Colonies on the subject. He suspected that representations had also been made or would be made on behalf of foreign countries. He had reason to believe that the further representations made by the Colonies amounted to this: that they were by no means satisfied with the Amendment proposed to be introduced by the Chancellor of the Exchequer. It was of no use for the Chancellor of the Exchequer to say that the tax upon foreign property was not a new tax. Up to this moment the Government had never assumed or attempted to tax any property that was not either actually or constructively in this country. But in pursuance of the doctrine that moveable property followed the person it had been assumed that personal property was in the country where the owner himself was. Consequently, the State had assumed to a certain extent to tax personality abroad. It had, however, only been taxed to the extent of the Legacy or Succession Duty upon it when it came into the hands of the successor. No attempt had ever been made to levy Probate Duty out of the United Kingdom for the very sufficient reason that Probate Duty only applied to property within the jurisdiction of the British Courts. The Chancellor of the Exchequer said that the new Estate Duty was the analogue of the Probate Duty. If so, the right hon. Gentleman must not attempt to levy it on any property out of the jurisdiction of the British Courts. The main increase of duty that would be levied under this Bill would be imposed upon property which had never been taxed before for Probate Duty. The Secretary for India (Mr. Fowler) had on the previous day referred to a case of £25,000. In an ordinary case of a testator domiciled in Great Britain leaving his property to persons in this country, the present Probate Duty was 4 per cent., and the widow would have to pay the percentage. If the property were situated out of the United Kingdom the individual would not pay a single farthing. Under this Bill she would pay £1,000 on the £25,000. If the property were left to a child that child would at present pay 1 per cent, on £250, while under the Bill he or she would pay £1,000. Then there was the case of £100,000. If personal property to the value of £100,000 situated outside the United Kingdom were left to the widow she would at present pay nothing, whilst under the Bill the property of the widow would have to pay £5,500. A child inheriting £100,000 would at present pay £1,000, while under the Bill he or she would pay £5,500. If property to the value of £1,000,000 situated outside the United Kingdom were left to the widow she would at present pay nothing, while under the Bill she would have to pay £80,000. He thought he had shown that there would be a very large nominal increase of duty in respect of property out of the United Kingdom. The increase was, however, really nominal, and could not become real. The Chancellor of the Exchequer knew that in the case of personal property left in charge of a foreign executor he could not hope for a single farthing of the duty. Was it not manifest that whenever a man had personal property situated out of the United Kingdom and was faced by such a terrible accumulation of duties as was proposed by this Bill—duties amounting in some instances to 19 per cent—he would take the precaution of putting his property into the hands of a foreign executor? If he did so the right hon. Gentleman would not get a farthing of duty. No doubt the right hon. Gentleman thought he would get it from the English executor, but he would only do so as far as the English executor had property at his disposal, and such property might be little or might amount to nothing at all. Take the case of a foreigner domiciled in this country and having £20,000,000 of property abroad and £1,000,000 at home. The duty on the total amount would be £1,600,000, and of course that could not be obtained out of the £l,000,000 in this country, even if that £1,000,000 were left in this country. His profound conviction was, and he believed it must be shared by the Department, that not a penny of the duty on property situate out of the United Kingdom would ever come into the coffers of the Chancellor of the Exchequer. Was it worth while to dissatisfy the colonists and to run the risk of a difference with foreign nations for the sake of a duty which would give little or no return? He thought that when the Chancellor of the Exchequer considered the representations of the colonists and the representations he might also have had from foreign Powers, and when he had also consulted the able officers of the Department concerned he would see that he was running very serious risks without much chance of getting any return.

Amendment proposed, in page 2, line 29, to leave out from the word "property" inclusive, to the word "Property" in line 33."—( Mr. Gibson Bowles. )

Question proposed, "That the words down to 'only,' in line 30, stand part of the Bill."

This is a renewal of the discussion of a large question which has been discussed before. If I remember rightly, the proposal to charge foreign property passed in Committee without observation or opposition. As regards foreign property, I do not believe that any serious doubt exists in the mind of anybody that such property ought to be charged as far as we can get at it. The notion that we are to encourage investments abroad by giving them the enormous bonus of a relief from the taxation which falls upon investments made in this country is one which I believe the great mass of Members of this House and people outside would not entertain for a moment. I cannot conceive anything that would be more unjust or impolitic. The hon. Member advises me to take counsel with the officers of the Inland Revenue. I wonder whether he supposes that I have not done so or that I do not almost spend day and night in taking counsel with them as to every clause and line of this Bill. They know what they are about in this matter; they know that there is a certain amount of foreign property on which we can collect the tax and a certain amount on which we cannot. We do not pretend to be able to levy the tax on real property, and there are circumstances in which we cannot get at personal property. The hon. Member, however, has very correctly said that the doctrine of the law is that all personal property follows the individual. From that point of view personal property belonging to an individual in this country is, in the eyes of the law, situate in this country, and that is the principle on which we base our proposals. It is on that ground that we have always levied Legacy and Succession Duty on foreign property. As the hon. Member says, Probate Duty has not been levied on foreign property. That is not a question of principle, but a question of jurisdiction. The ecclesiastical jurisdiction of the Probate Court attached to probate methods of levying which were not applicable to the case of foreign property. In recasting the duty we saw no reason whatever why we should not levy the Estate Duty in respect of personal property, which, though situate in a foreign country, belongs to a person living here. All we propose to do is to remove the technical objection arising out of the peculiar constitution of a Spiritual Court which, up to this time, has prevented probate being levied on foreign property. That is the whole of the question. The hon. Member began his speech by painting a picture of the enormous sums that might be levied on property abroad. He pointed out that if a widow succeeded to £1,000,000 we should get £80,000. Well, I think that a lady with £1,000,000 could well afford to give us £80,000. Then the hon. Member said we should not be able to levy the tax on property abroad, and, indeed, that we should get less than we do now. It that be so, if the result of the ignorance and blundering of the Chancellor of the Exchequer and the Law Officers and the officers of the Inland Revenue is that we are going to levy less than is levied now, I cannot conceive why, from the hon. Member's point of view, he should oppose our proposals. As to the question of the Colonies, that does not arise now, but will come up on the Amendment to be moved later. We are proposing to charge nothing that we do not now claim to charge under the Legacy and Succession Duties, though it is quite true that we put an additional charge in the form of Probate Duty. We are quite aware that there are methods by which the attempts to collect the tax may be defeated, but that is no reason why such property should not be got at for the purposes of taxation in cases where it can be reached. The officials of the Inland Revenue are of opinion that as under the Legacy Duty and as under the Succession Duty we do at present get a certain amount of contribution from property held abroad, so we shall get it in future under the form of Estate Duty. I confess that I think those who are responsible for our finance past and future will be extremely unwise if they deprive the English taxpayer of the relief which he would obtain by contribution from property elsewhere and capital invested abroad, and if you give an enormous preferential bonus to holders of capital invested in other countries.

I have always felt with the Chancellor of the Exchequer that this preferential advantage given to foreign investments is one which is very difficult for this House to accept. But, at the same time, we are forced to the conclusion that if you are going to insist upon taxing these investments abroad, the whole scheme of levying money by Death Duties has inherent objections which ought to have been taken into account by the Chancellor of the Exchequer when he first laid his plan before us. I entirely agree that we cannot have this preferential bonus upon foreign investments; but if it be true, as I think it is true, that you cannot without difficulty collect the duty abroad, then the dilemma brings clear to our minds the fact that this plan regarding the Death Duties is one surrounded by inherent difficulties which no legislative ingenuity will wholly overcome. I should like to ask the Government one question. They propose to tax personal property invested abroad, and not real property. Why? Because, says the Chancellor of the Ex- chequer, the principle of our law is that personal property is where its owner is—that mobilia sequuntur personam . Those, I think, were the words quoted, but language does not become good sense because it is couched in bad Latin, and it is really absurd to tell us that personal property is where its possessor is. It is nothing of the kind. There are some kinds of personal property which, no doubt, are where their possessor is; but to tell me, for example, that the lease of a house, a great property abroad, which I suppose, is personal property, follows the individual owner more than freehold property abroad, is really to ask me to accept a proposition which manifestly contravenes elementary common sense. The Government, in truth, are bound by their own proposals to tax not merely foreign personality but foreign realty. It may be very difficult for them to get hold of it; but it will not only be difficult, but almost impossible to get hold of personal property. Why should the thing be done in the one case and not in the other? I think they say with great force, that not to tax personality abroad is to put a premium upon foreign investments; well, not to tax realty abroad is also to put a premium upon foreign investments. As a matter of fact, a large amount of English money is invested in foreign realty in land in the colonies and abroad, and I cannot see why the Government, on the strength of this Latin quotation, are going to tax one form of property and not another. The Chancellor of the Exchequer throughout this Bill is nothing if not logical. He laid down certain general principles in his Budget speech which he appeared to confound with the eternal, immutable principles of justice, with which, however, they certainly have no identity or even in some cases similarity. But at least the right hon. Gentleman ought to carry out those principles logically, and if there be a logical conclusion to be drawn from the proposal now under consideration it is that every form of property, whether real or personal, situated in England or abroad, ought to pay this Death Duty whenever it can be made to do so. I will say no more upon that question, but I will content myself before I sit down with asking a question of the Chancellor of the Exchequer which I think will be of great importance when we come to the colonial question which will be raised on a subsequent Amendment. In a previous Debate the Chancellor of the Exchequer said very confidently that none of our Treaties with foreign countries in respect to commercial matters made the Most-Favoured Nation Clause applicable to the colonies. Well, the Chancellor of the Exchequer may have been right when he said that. I have, of course, no longer access to official documents, but I must say that my own recollection of the subject does not agree with that of the Chancellor of the Exchequer, and I have seen it stated on very high authority that one insuperable practical objection to anything like a commercial union between Great this very Most-Favoured Nation Clause, of Britain and her colonies is the existence I hope when the opportunity presents itself that the right hon. Gentleman will be able to give us conclusive evidence that his interpretation of this matter is the correct one, because it would be a serious thing if, after the Budget has passed, it should turn out that he has acted against the letter, and perhaps the spirit, of our Treaties with other nations. It would cause great financial perplexity, and might require even legislative action.

Of course, we are prepared to bear in mind what the right hon. Gentleman has said on this subject, and to inquire into it.

Question put, and agreed to.

moved, in page 2, line 30, leave out from "if" to "but," in line 31, and insert—

"Under the law in force before the passing of this Act, Legacy or Succession Duty is payable in respect thereof, or would be so payable."

He said, there was no substantial difference in the two sets of words, but it had been thought more advisable to use the form he now proposed, so as to show it was not intended to impose the tax on property which was not liable to duty of some kind before.

Amendment proposed, in page 2, line 30, to leave out from the word "if," to the word "but," in line 31, and insert the words—

"Under the law in force before the passing of this Act, Legacy or Succession Duty is payable in respect thereof, or would be so payable."—( Mr. R. T. Reid. )

Question proposed, "That the words proposed to be left out stand part of the Bill."

remarked that as the Amendment was originally put down it read "Legacy and Succession Duty," but he was glad to see the Solicitor General had adopted the form he (Mr. Bowles) suggested, and which he used in his Amendments, and had altered the expression to "Legacy or Succession Duty." But even if this Amendment were made, he did not quite see the necessity for these words. He observed that the result was that instead of having 13 they had 25 words. He supposed, therefore, the draftsman of the Bill was paid by the folio and not by the job. He did not see that the words added anything; they would have the same effect as the words which were used before, and he did not know that there was any material objection to them.

Question put, and negatived.

Question, "That those words be there insered," put, and agreed to.

moved, in page 2, line 32, after "relationship," insert "to the deceased." He said, that if the Amendment were accepted the part of the clause to which it referred would then read—

"And all property passing on the death of the deceased when situated out of the United Kingdom shall be inclusive only if it is liable to Legacy or Succession Duty, or would be so liable but for the relationship of the deceased."

Of course, he understood that the relationship might not be to the deceased, but to the originator of the settlement, and it might be necessary to insert other words. He conceived that this was a Bill charging property passing on the death of the deceased which was the deceased's own property, therefore it would only apply to the particular property derived from the deceased. If otherwise, he should be quite ready to insert other words. Certainly they could not leave the word "relationship" alone as it stood. It must be relationship to somebody, and some words were required after the word "relationship." Whether he had suggested apt or sufficient words he did not know, but certainly some sufficient words were required.

Amendment proposed, in page 2, line 32, after the word "relationship," to insert the words "to the deceased."—( Mr. Gibson Bowles. )

Question proposed, "That those words be there inserted."

said, this matter was highly technical. The words as to relationship were inserted here because there was no Legacy or Succession Duty where such property passed, and that being so, it was desirable it should be expressed in some kind of apt legal language. The hon. Member said the word ought not to be "relationship," but "relationship to the deceased." He did not assent to that. It might be that the liability to Succession Duty would depend upon the relationship not to the deceased but to the settlor, and, accordingly, the words of the hon. Member would not be appropriate. It might be the settlor or it might be the deceased, and the best way to meet the matter, as it seemed to him, was to use the language which now appeared—namely, "but for the relationship of the person to whom it passes;" it being obvious to all lawyers that this referred to those cases in which, by reason of the relationship, the Legacy and Succession Duty which would otherwise be payable would not be payable. The words were quite sufficient and clearly pointed to what was intended to be struck at. Under these circumstances, he deprecated the introduction of words which, instead of giving assistance, might lead to confusion.

did not know that it was worth while pressing this Amendment. As a layman, he agreed with his hon. Friend. It appeared to him that usually the language of this Bill was English and unintelligible, or intelligible and un-English. This came under the second category. It was not English, but it was perfectly intelligible, and nobody reading the clause could have the least doubt as to what it meant. It was something to have the matter intelligible, and they were not disposed to quarrel with it on this account. He never, however, saw the word "relationship" used without implying to whom the relationship was. At the same time, as the meaning of the clause was perfectly clear he did not think the Amendment should be persisted in.

said, that under the circumstances he would ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

On Motion of Mr. R. T. REID, the following Amendment was agreed to:—Page 2, line 33, after "not," insert "be deemed to."

moved, in page 2, line 35, after the word "deceased," to insert the words

"or under a disposition made by the deceased more than 12 months before his death where possession and enjoyment of the property was bonâ fide assumed by the beneficiary immediately upon the creation of the trust, and thenceforward retained to the entire exclusion of the deceased, or of any benefit to him by contract or otherwise.'"

The Amendment, he said, aimed at excluding from the definition of property passing on the death of the deceased any property held by the deceased in the way described.

Question proposed, "That those words be there inserted."

moved to amend the Amendment by inserting after the word "death" the following words:—

"Or in the case of a disposition for value made more or less than 12 months before his death."

His Amendment showed exactly how difficult it was to assent to the Amendment put down by the Solicitor General. As he understood, this clause was taken from the Customs and Inland Revenue Act, 1889. Section 11, Sub-section 1, amended the Customs and Inland Revenue Act of 1881. Sub-section 2 of Section 38 of the Customs and Inland Revenue Act, 1881, hereby amended was as follows:—

"The description of property marked (a) shall be read as if the word 'twelve' were substituted for the word 'three' therein, and the said description of property shall include property taken under any gift whenever made, of which property bonâ fide possession and enjoyment shall not have been assumed by the donor immediately upon the gift, and thenceforward retained to the entire exclusion of the donor or of any benefit to him by contract or otherwise."

The words were taken from the old Act. The meaning of the old Act was in its application to what were commonly called "voluntary gifts." In the old Act they had a provision providing for the case where no value was given, and it was thought right to say that 12 months before the time of the death of the person making the disposition he should not be at liberty to make such a voluntary settlement. He thought the matter was not at all unimportant, but it was a little difficult to understand. The point was this: a man made a will; that was a voluntary instrument, and the persons taking under the will were volunteers. A man made a donatio mortis causa , on account of death, immediately preceding death, and that was looked upon as equivalent to a will, and therefore duty was payable under it. In reference to voluntary settlements within 12 mouths before death, they had been, for the purposes of duty, put upon the same footing as property passing under the will itself, and the persons were regarded as volunteers taking under a voluntary instrument. Now they had au entirely different thing. The clause proposed by the Solicitor General was applicable in its terms not merely to voluntary instruments but to instruments for value, and therefore it became extremely necessary to see they were not imposing terms in respect of property which passed for value, which the Legislature had not seen fit to impose in reference to voluntary instruments. There was no connection between a disposition by a man, even if only made a day before death, if he received money consideration for it, or whether he made it 25 years before death for the reason that it did not apply in that case. But it did apply in the case of a voluntary instrument. Why in the case of dispositions or settlements for value should the limit of 12 months be applied? It appeared to him it was quite clear and obvious that the words of the Solicitor General's Amendment ought only to be applicable to cases of voluntary gifts and settlements, and, therefore, he proposed to insert (as an Amendment to the Amendment), after the word "death," the following words:—"Or in the case of a disposition for value made more or less than 12 months before his death." As regarded all property which ought to be caught, Section 2, Subsection (c), would catch them, because under the Act of 1889 it was already provided that such Act should read as if the words "voluntary" and "voluntarily" were left out. Take this case by way of illustration. Say a man settled a sum of Consols on his daughter's marriage, in consideration of the husband's father bringing in an equivalent sum on his part. Settlor A, the father of the woman who married, was himself one of the trustees. The money, £10,000, was invested in his name and the name of another person. Suppose that three months after the settlement A's co-trustee died and A became the sole trustee. Two months later A died himself. As the clause was drawn it appeared to him that duty would be payable on A's will with regard to the money in the settlement, and of which he was merely trustee. He begged to propose his Amendment, which he hoped the Government would accept.

Amendment proposed to the proposed Amendment, in line 2, after the word "death," to insert the words

"or in the case of a disposition for value more or less than 12 months before his death."—( Mr. Byrne. )

Question proposed, "That those words be inserted in the proposed Amendment."

said, the hon. and learned Gentleman was good enough to show him the words he intended to move a few minutes ago, so that he was aware that what the hon. Member was about to propose was somewhat different to the Amendment he had placed on the Paper. He thought that if he had the opportunity of discussing this question privately for a few minutes with the hon. and learned Gentleman he should be able to convince him this Amendment was an unnecessary one. Let him point out shortly what was the real purpose and bearing of this clause which the hon. and learned Member seemed to have misapprehended somewhat. Sub-section 2 of the clause provided that they should not tax property held by the deceased as trustee for another person under a dis- position not made by the deceased. In the Committee stage he was asked to strike out the words "under a disposition not made by the deceased," on the ground that, if he was trustee, under no circumstances ought property he held as trustee to be considered as property passing on his death. The answer he then made was, that if they did omit the words they would never get property passing at all. Supposing that they were to exempt property held by the deceased as trustee when he himself created the trust, all he would have to do would be to create himself a trustee of his own property, and thus escape duty altogether. But for the purpose of still further safeguarding and exempting properties from this clause the Government proposed, in the Amendment down in his name, to say this: that although the disposition might have been made by the deceased himself, yet that it should not pay duty now if it complied with certain conditions, one of which was that it should have been made more than 12 months before death; and that the deceased should have divested himself of all possession and enjoyment of the property, but should still remain trustee. They had taken the analogy of the Account Duty. That course was found necessary in the case of the Account Duty, and it was felt that the analogous course should be followed here, and the period extended from three to 12 months, or otherwise this procedure would be used as a method for evading the duty. Then came the hon. and learned Member for Essex, who wanted to insert words in the Amendment, the effect of which would be to make the Bill declare that the tax should not be paid upon a disposition made by the deceased, for any value, more or less than 12 months before death. In other words, he said that although the deceased held property as trustee, and although he made himself trustee, yet that it might not be assessed to this tax in the case of a disposition for value made at any time by the deceased. Did the hon. Member mean the full value? because if he meant an inadequate value there was another object.

said, that his intention was that the disposition should have been made in consideration of the full value of the property, and that the trustee should be merely the bare trustee, having no beneficial interest whatever in the property himself.

said, that in that case the Amendment was absolutely unnecessary, and for this reason: because it was not the intention of the Government that in the case of the death of one who happened to be a bare trustee this duty should apply. In such a case, what passed on death would be the bare trust; it was not a beneficial interest; nothing whatever passed except the bare trust and the obligation and duties of the trust. Therefore, when they really analysed the object and purport of the hon. and learned Gentleman's Amendment, it was to raise the question whether, in the case of a trustee having no interest whatever except the bare trust, the trust property was to pay duty or not. Besides what he had already stated, he would remark that the proper place to discuss this question was on the definition clause, and to introduce it now in reference to one particular class of property—namely, property of which a man should be trustee and of which he himself was the original owner, would be an entirely erroneous course. In his opinion, the Amendment of the hon. and learned Gentleman was quite unnecessary, and he was also quite clear that even if it was desirable the question should be raised the proper place to raise it would be on the Definition Clause.

^* thought the House would be obliged to the Solicitor General for the clear and lucid explanation he had given them of this complicated matter. He had stated very fairly that he entirely agreed with the hon. and learned Member for Essex, and that he did not believe in the case which his hon. and learned Friend desired to provide against—that it would be possible any duty could be payable. Then there was no difference between the Solicitor General and his hon. and learned Friend, but both were agreed.

He meaning the full value.

said, that both agreed in such cases that no duty would be payable. The wording of the clause as it now stood did seem to justify the doubt raised by his hon. and learned Friend. What did the clause say? That property passing on the death of the deceased should not include property held by the deceased as trustee for another person. Then that statement the hon. and learned Gentleman proceeded to qualify by the words "or under a disposition made by the deceased more than 12 mouths before his death," and so on. Surely the introduction of this qualification limited the Operation of the preceding words, and unless a case came within this qualification it would be one in which duty would be payable; therefore his hon. and learned Friend had moved to insert words to avoid any possible doubt as to a case on which both he and the Solicitor General were entirely agreed. The Solicitor General was responsible for the drafting of the Bill, and he dared say his hon. and learned Friend might not be disposed to press his suggestion at this particular point after the strong expression on the part of the hon. and learned Gentleman that the proper place would be the Definition Clause. He confessed he should have thought that where they stated definitely that the property should not be deemed liable to the duty under a disposition made by the deceased more than 12 months before death, that they ought also to say that such a disposition might be made at any time provided it was for full value. As there was a doubt, he thought, after the statement of the Solicitor General, they might look to the Government to insert some such words as his hon. and learned Friend proposed.

wished it to be clearly understood that where a man sold a property for its full value, but remained a bare trustee for the purchaser, no duty would be payable. If there was any doubt as to the effect of the clause on that point the matter could be set right when the Definition Clause came before the House.

expressed the opinion that there might be certain eases which under the clause as it stood might be liable to pay duty on the death of a bare trustee, and therefore, though this might be of rare occurrence, it was necessary some Amendment such as that suggested by the hon. Member for Essex should be inserted.

said, that if the Amendment was to be made at all, this, and not the Definition Clause, was the proper place for it. The Solicitor General told them they need not be afraid about a man who had made a trust 12 months before his death for adequate value, because that which would pass at his death would be a naked trust. But the clause showed that even where a bare trust passed, a man was still held liable for the duty, if the disposition was made by himself. Therefore, the explanation of the hon. and learned Member was not conclusive. But the explanation of the action of the hon. and learned Gentleman was that the addition to the clause which he proposed was part of the barbed wire, which he had taken from Section 31 of the Act of 1881, which was designed to prevent evasion, but evasion of a totally different kind. Section 31 of the Act of 1881 was intended to prevent voluntary evasion under voluntary settlements, and it was now proposed to apply it to a different state of things and to different settlements. What reason and what justice was there in bringing under this duty such cases as that of a man who had made a trust, and he himself became the trustee for valuable and adequate consideration? What did it matter in a case of that kind whether the trust was made within a year, or without a year, of a man's death? The Amendment was absolutely necessary, for without it they would charge Estate Duty on a bargain made by a man by which, for adequate consideration, he had divested himself of the real property and had only a fiduciary property in the estate; and if his hon. and learned Friend went to a Division he would vote for him with a clear conscience.

Question put.

The House divided:—Ayes 141; Noes 202.—(Division List, No. 166.)

moved the omission from the Solicitor General's Amendment of the words "possession and." He did not think the hon. and learned Gentleman had fully seen the effect of taking words out of an Act passed for a different purpose and putting them into this Bill. He would give an illustration. A declared himself to be trustee for £5,000 in Consols for B; the dividends on the Consols went for 20 years to B; but the Consols were for all that time in the possession of A, and continued to be in his possession at the time of his death. Was it, or was it not, intended by the Government that at the death of A, who had possession of the Consols at the time of his death, duty was to be payable? for he asserted unhesitatingly that under the clause as it stood Estate Duty would be charged on that property on the death of A. Take another case. Suppose A declared himself to be trustee for a piece of land, and had got legal possession of the land, and held it for 20 years, the rents all the time being received by B, was it or was it not intended that at A's death duty should be payable? In his opinion, the word "possession" in the clause would make such property liable for the payment of duty. B was the sole beneficiary of the property; he was in the enjoyment of it, and it did not matter a bit whether he assumed possession of it in the legal sense or not. He wished to say, with all respect to the Solicitor General, that it was not a sufficien answer for the hon. and learned Gentleman to say that those words were in use in another Act, because that Act was passed for a wholly different object. It was quite clear the words were improperly introduced; that they would lead to the taxing of property that was not meant to be taxed, and that the words had been taken from a former Act without considering in what respect the object of that Act differed from that of this Bill.

Amendment proposed to the proposed Amendment, in line 3, to leave out the words "possession and."—( Mr. Byrne. )

Question proposed, "That the words 'possession and' stand part of the proposed Amendment."

said, the hon. and learned Gentleman did not appreciate the object of the Amendment, or he would not try to alter it. That object was to say that the Duty should not be levied in some cases where the deceased was a trustee, even upon property which he himself had voluntarily settled. The question was, under what conditions was it safe to exempt from taxation property which once belonged to a man, of which he still remained trustee, and which he parted with for no valuable consideration? Exactly the same problem came before the late Government in 1889, and they came to the conclusion that certain safeguards were necessary before you exempted from taxation property which had once belonged to the deceased, of which he remained a trustee, and for which he had received no value whatever. The late Government held, and laid it down in Section 11 of the Act of 1889, that they must require as extreme proof of the bonâ fide character of the transaction that there should be not only enjoyment, but also actual possession. Not only enjoyment, but possession was the test required by the late Government, and the present Government proposed to use precisely the same words, in order to secure external proof of the genuineness of the transaction.

said, if the words of the Amendment needed amendment, the House ought not to be precluded from amending them, simply because they were found in the Act passed by the late Government. He and his hon. Friends had not got such a mighty respect of the words of an Act of Parliament, even though it were passed by a Government composed of their own friends. The hon. and learned Gentleman had not dealt with the case put by the Proposer of the Amendment, and he had not shown what was gained by retaining the words except that they were in conformity with another Act. The case of his hon. and learned Friend who moved the Amendment was that if they allowed the words "possession and" to remain in the clause they exclude from the benefit of the clause the very transaction they desired to include—namely, where possession was in the hands of a trustee, and enjoyment in the hands of the beneficiary. The words would really have the effect of frustrating the object which the hon. and learned Gentleman's Amendment was intended to secure.

said, it seemed to him that there was considerable difference between the words "possession" and "enjoyment," and he was of opinion that the words "possession and" ought to be struck out.

Question put, and agreed to.

Words inserted.

said, he proposed to add the words "or the use or benefit of some person for whom he was trustee" at the end of Sub-section 1, which provided that Estate Duty shall not be payable on any reversion or annuity purchased "for full consideration in money or money's worth, paid to the vendor or grantor for his own use or benefit." A man might buy a piece of property for, say, £5,000, and convey it to some other person declaring himself to be trustee, but having no other interest except that of trustee for, it might be, his son, or daughter, or grandson. Why should that case be left out? After what the Solicitor General had said, he could not anticipate that the Government would accept the Amendment, but he certainly could not see why they should not.

Amendment proposed, in page 3, line 2, after the word "benefit," to insert the words "or the use or benefit of some person for whom he was trustee."—( Mr. Byrne. )

Question proposed, "That those words be there inserted."

said, the object of this clause was to make doubly clear, so to speak, what was already provided— namely, that a reversion which had been sold by the deceased for value received should not be deemed to pass on the death. It was stated that the Courts of Law had laid it down in analogous cases that there was no danger of this; still these words had been put in. The hon. Member proposed the words, "or the use or benefit of some person for whom he was trustee." It seemed to him that, by importing trustees into a clause of this kind the door would be opened to a variety of evasions. The Amendment was one on which it was possible that there might be a great many questions arising, and he did not want to leave the matter in doubt. But if the hon. Member would consent to withdraw the Amendment in favour of the next Amendment, standing in the name of the hon. and learned Member for York (Mr. Butcher), which dealt with leases as a matter of concession, he would accept that Amendment with verbal alteration. He would propose to alter the last words of the latter Amendment so that they should read, "acting as a trustee." He did not know whether that would meet the view of the hon. Member. At any rate, he could not accept the present Amendment.

said, he could not withdraw the Amendment, for the reason that the insertion of the words the Solicitor General agreed to accept would increase the difficulty he (Mr. Byrne) wanted to obviate unless the present Amendment were adopted. They were simply intended to widen the scope of the present Amendment.

Question put.

The House divided:—Ayes 148; Noes 211.—(Division List, No. 167.)

^* said, he would move the next Amendment subject to the verbal alteration the Solicitor General had indicated. He proposed as an Amendment to Section 1 of Clause 3 to add words that would extend the exemption from Estate Duty allowed in that clause in the case of leases for lives that were sold in consideration of money or money's worth, provided that the purchase-money was paid to the grantor for his own benefit, to the case also of "a lease sold for the use or benefit of any person for whom the grantor was a trustee."

Amendment proposed, in page 3, line 2, after the word "benefit," to insert the words

"or in the case of a lease for the use or benefit of any person for whom the grantor was a trustee."—( Mr. Butcher. )

Question proposed, "That those words be there inserted."

said, he bad stated that he would be prepared to accept this Amendment, altered as he had indicated, as a matter of compromise; that was to say, in the event of the last Amendment having been withdrawn. The hon. Member for Essex, however, had rejected the compromise, saying that the present Amendment would injure the clause rather than improve the clause. Under the circumstances, hon. Members would agree that he was not strictly bound by the terms of his offer. Still, while he thought the Amendment was quite unnecessary, he did not wish to be unreasonable; and if his hon. and learned Friend would agree that the Amendment should read "for the use or benefit of any person for whom the grantor was acting as trustee" he should not oppose it.

Amendment, as amended, agreed to.

Other Amendments agreed to.

said, he desired to move the Amendment standing on the Paper in his name, which, though a purely drafting Amendment, seemed to him to be necessary.

Amendment proposed, in page 3, line 10, after the last Amendment, to insert the words "subject to the provisions of this Act contained."—( Mr. Gibson Bowles. )

Question proposed, "That those words be there inserted."

said, it would not be a good precedent to insert the words "subject to the provisions of this Act," because it was all, of course, so subject. If the Government were to consent to insert those words in this instance they might be asked to insert them elsewhere. Under those circumstances, he could not accept the suggestion.

said, he would not press the Amendment.

Amendment, by leave, withdrawn.

^* , in the absence of Mr. Banbury (Camberwell, Peckham), called attention to an Amendment to exempt property under Section 17 from aggregation. This point was, he said, raised in Committee both by Mr. Banbury and by himself, and the Solicitor General was then good enough to say that he would take it into consideration, and see what could be done. It seemed to him that the Amendment of the Solicitor General met the point.

Amendment proposed, in page 3, line 12, after the word "thereof," to insert the words "but property exempted under Section 17 shall not be aggregated."—( Mr. Cyril Dodd. )

Amendment agreed to.

Clause 5.

asked the Solicitor General if he would state the exact meaning of "settled property" under this clause?

said, that, as the clause stood now, it referred to property passing under the will of the deceased which after his death remained subject to any consideration. A question had been asked by the hon. and learned Member for Essex as to the meaning of the words "remaining settled." Beyond all question they meant property settled by the will of the deceased, or subject to provisions operating after his death. It was quite clear that the clause referred to persons who were competent to dispose of the property.

suggested that it surely did not mean that Estate Duty was to be payable as well, and said that words should be inserted to relieve the unfortunate person succeeding to the property.

On Motion of Mr. R. T. REID, the following Amendments were agreed to:—

Page 3, line 25, to leave out "liable to Estate Duty," and insert "in respect of which Estate Duty is leviable."

Page 3, line 26, leave out "after his death remains settled by virtue of any disposition," and insert—

"Having been settled by some other disposition passes under that disposition on the death of the deceased to some person not competent to-dispose of the property."

Amendment proposed, in page 3, line 28, after the word "duty," to insert the words "called Settlement Estate Duty."—( Mr. R. T. Reid. )

Question proposed, "That those words be there inserted."

asked whether this was a new name? for, if so, he could not understand it. He presumed it meant settled for the life.

said, that besides the Estate Duty referred to in the Bill there was the further Estate Duty of 1 per cent, which had been re-christened ."Settlement Estate Duty." The right hon. Gentleman would see there was an advantage in not calling it "further Estate Duty." The name was not very material after all. Names were often given which did not express what was really intended. He hoped the right hon. Gentleman would not take any objection.

Question put, and agreed to.

moved an Amendment in the same clause to the effect that the further Estate Duty on the principal value of the settled property should be levied except where the interest in property after the death is that of wife or husband, and providing that where a settlement continued the Settlement Estate Duty should be payable only once.

Amendment proposed, in page 3, line 29, to leave out the word "but," and insert the words

"except where the only life interest in the property after the death of the deceased is that of a wife or husband of the deceased; but

(b) during the continuance of the settlement the settlement Estate Duty shall not be payable more than once."—( Mr. R. T. Reid .)

Question proposed, "That the word 'but' stand part of the Bill."

said, this had reference to a question with which he proposed to deal in a later Amendment. The condition of the extra duty being payable would not attach if the words now suggested were inserted, because the state of circumstances must arise upon which the Amendment depended which had been previously inserted with regard to the property passing to some person not competent to dispose of it. The words as they stood did not seem to be consistent with the intention of the Government.

Question put, and negatived.

Question, "That those words be there inserted," put, and agreed to.

Amendment proposed, in page 3, line 31, to leave out from the word "settlement," to "payable," in line 32, and insert the words

"the Estate Duty shall not, nor shall any of the duties mentioned in the fifth paragraph of the First Schedule to this Act be."—( Mr. R. T. Reid .)

Question proposed, "That the words proposed to be left out stand part of the Bill."

moved as an Amendment to the Solicitor General's proposed Amendment, line 1, after the word "not," to insert

"unless the deceased was, at the time of his death, competent to dispose of such property."

This seemed desirable in order to make the Amendment consistent with that just adopted, and that was necessary to make the whole clause read together.

pointed out that the duties mentioned in the Schedule would not be payable unless the person was competent to dispose at the time of the death. It seemed to be right as it stood.

Amendment—( Mr. R. T. Reid )—agreed to.

moved, in page 3, line 33, to leave out "unless the deceased," and to insert "until the death of a person who." Those words, he thought, expressed the sense of what the hon. and learned Member opposite desired.

Amendment proposed, in page 3, line 33, to leave out the words "unless the deceased," and insert the words "until the death of a person who."—( Mr. R. T. Reid .)

Question proposed, "That the words proposed to be left out stand part of the Bill."

said the insertion of these words would make clear the contingency under which the Estate Duty would become payable. That explanation afforded an answer to his Amendment, which he would otherwise have moved. It arrived at the same result by a different process.

Question put, and negatived.

Question, "That those words be there inserted," put, and agreed to.

^* moved to leave out of Sub-section (b) Clause 5, the words "or had been at any time" where it was provided that if Estate Duty has already been paid in respect of settled property since the date of the settlement, no further Estate Duty shall be again payable in respect thereof, unless the deceased was, at the time of his death, or had been at any time, competent to dispose of such property. Clearly the intention of the Government was that the Estate Duty should not be paid more than once on settled property during the continuance of the settlement. As the clause stood that intention would in certain cases be defeated, and therefore he proposed to leave out the words in question. If a husband and wife brought property into settlement, on the death of either Estate Duty would have to be paid. And again, on the death of the survivor, Estate Duty would have to be paid, because the survivor would have had power, before the property was brought into settlement, to dispose of part of the property. In other words, property might have to pay duty from 4 up to 16 per cent, though it had never passed out of settlement at all. The Government could hardly have intended that. Many other cases might be put in which a similar result must follow. In other instances objection had been made that if certain words were struck out certain results foreseen by the Attorney General, Solicitor General or the Commissioners would follow, though what they were was never explained. No such consequences could follow here, and if the words were too wide they should be narrowed.

Amendment proposed, in page 3, line 34, to leave out the words "or had been at any time."—( Mr. Butcher .)

Question proposed, "That the words proposed to be left out stand part of the Bill."

would not accuse the hon. and learned Gentleman of any wish to raise another Debate, but for his part he did not think the Amendment was necessary. A settlement came to an end when the property passed to the hand of one who was competent to dispose of it. It then became a free property again. If the hon. and learned Member's next Amendment were accepted—namely, to insert the words "during the continuance of the settlement" after the words "had at any time"—the difficulty would be obviated, and it would not be necessary to omit the words as proposed. Neither was it desirable to insert the words proposed in the next Amendment, and now that the House had ascertained the hang of it, hon. Members would, no doubt, acquiesce in his view.

said, that he could not understand why the words "had at any time" were necessary. He suggested that the clause should read, "or had been at any time since the date of the settlement competent to dispose." His objection to the words "had been at any time" was that they appeared not to be wanted. What he hoped to hear from the Solicitor General was that one Estate Duty only was to be payable. In the condition of things it seemed to him that the words "had been" were necessary, because they could not imagine such a case. If the power of appointment only existed before the settlement, the right way to deal with it would be to insert the words "or had been at any time since the date of the settlement competent to dispose." Probably those words would meet the case put by the right hon. Gentleman. Under the words as they now stood there might be a state of things when a second estate duty would be claimed because the person who died had at a period antecedent to the settlement power to dispose of the property. The general words had no significance. He really thought the Solicitor General might give way.

said, the hon. and learned Gentleman agreed with his friend behind him that it would be unjust to exact a duty because the property had been within the competence of a person to dispose before it was settled, but thought the matter would be better met by a later Amendment. He should like to know when, in the opinion of the Government, a settlement came to an end? For his part, he should think that a settlement came to an end directly a person came into possession of settled property who was competent to dispose of it. On behalf of the Government, it seemed to be argued that a settlement only came to an end upon the death of the person. If that were so, the next Amendment would deal with the point, because the settlement was not continuous.

The right hon. Gentleman asks when a settlement ends. It ends when the trusts created by it cease to be operative—that is, when a person comes into possession of the property who has a right to do what he likes with it.

said, they might put other cases than that which was put by the hon. Member for York—the case of a tenant having the power of appointment. Supposing he had released the power of appointment, why should there be a charge made in respect of that appointment? It appeared to him this was a case not met by the second Amendment of the hon. Member for York.

said, in such a case he thought the duty ought to be payable. You had tenants coming into possession with authority to use their powers, and if they chose to release them they came within the category of persons who were not exempt under the Death Duties. There was a class of settlement under which you re-settled under the power contained in the settlement, and it was the curious state of the law in this respect that the draftsman must have had in his mind when he chose these particular words.

said, if the power to dispose had been released, and was, in fact, only an inchoate power, surely the settlement would continue.

said, he did not think this Amendment ought to be pressed. The second Amendment which had been accepted by the Government seemed to him to fully meet the case. It was absolutely necessary that the cases mentioned should be met. If a person had an absolute power of controlling how an estate should go, and he said, "Let it go as it would, as if I had no such power," he created a new devolution. With regard to those persons who had that power before the passing of this Act, the Estate Duty was claimable. Why should not that occur again under precisely similar circumstances after the passing of the Act? The Government ought not to consent to the Estate Duty being evaded by allowing this re-settlement.

^* said, the right hon. Gentleman met the case put by the right hon. Gentleman behind him by treating an abstention from exercising a power of appointment as a virtual re-settlement. There was something ingenious and plausible about that argument, but a power of settlement might disappear or cease to exist in other ways. It was conceivable that a tenant for life under a settlement might have a general power of appointment with the consent of the settlor. If the settlor died, his powers of appointment would be gone, but he had those powers at one time, and according to the provisions of the Bill the Estate Duty would be payable because at some time he had the power of disposal. The Government had not yet pointed out to the House any case for which these words were necessary or why it was necessary to charge a fresh duty in a case where the dying person once had an opportunity of disposing of the property.

said, he would put the case of a property settled upon A for life, then upon B for life, and then upon C in fee-simple. One Estate Duty was paid, and then C came into possession. He re-settled the property. He was at one time competent to dispose of the property, but not at the time of his death. It was to meet such a case that the words of the clause were necessary.

Question put.

The House divided:—Ayes 217; Noes 174.—(Division List, No. 168.)

On Motion of Mr. BUTCHER, the following Amendment was agreed to:—Page 3, line 34, after "time," insert "during the continuance of the settlement."

On Motion of Mr. R. T. REID, the following Amendment was agreed to:— Page 3, line 35, leave out from "property," to end of line 39.

moved, in page 3, line 39,, at end insert—

"If, upon the death of the deceased, a life or any less interest in such property arises to the wife or husband of the deceased, the payment of the Estate Duty and the further settlement Estate Duty shall (if otherwise payable) be postponed till after the determination of such interest."

He said that the effect of the Amendment was that the corpus of the property in such cases should not be touched by the Estate Duty until the death of both husband and wife. The Opposition maintained the principle of the unity of the husband and wife, and held that to make a husband or wife pay the duty in the circumstances set out in his Amendment would be contrary to natural justice. He imagined that the loss to the Exchequer which the acceptance of this Amendment would entail would not be considerable.

Amendment proposed, in page 3, line 39, after the word "payable," to insert the words,—

"If, upon the death of the deceased, a life or any less interest in such property arises to the wife or husband of the deceased, the payment of the Estate Duty and the further settlement Estate Duty shall (if otherwise payable) be postponed till after the determination of such interest."—( Mr Butcher .)

Question proposed, "That those words be there inserted."

pointed out that as a concession to the conjugal relations the Government had already agreed that the settlement Estate Duty of 1 per cent, should not be enacted from the survivor of a married couple. Beyond that the Government could not go. Husbands and wives had never been exempted from Probate Duty. But the whole of this subject had been discussed over and over again in Committee, and it was hardly necessary that he should repeat once more the reasons why the Government could not assent to an Amendment of this nature.

said, that the fact that the Government had granted a concession in respect of settlement Estate Duty justified the Opposition in pressing this Amendment. L'appétit vient en mangeant . If a husband or a wife ought to be treated differently from other people in respect of one Death Duty, married persons ought to be treated differently in respect of all such duties. The wily Chancellor of the Exchequer conceded the principle for which they were contending when 1 per cent, only was involved, but refused to apply it when larger sums were involved. He swallowed the sprats, but looked askance at the whale. This wicked Bill would revoke all existing exemptions in favour of husbands and wives, exemptions recognised for more than 100 years. How could the Government defend the remission of the settlement Estate Duty if they refused to remit the Estate Duty itself? The reasons for remitting the duties were precisely similar in both cases. He felt sure that everyone in that House who had ever been a husband or a wife would support this Amendment.

said, that the Report stage of a Bill ought not to be used for the re-discussion of matters definitely disposed of in Committee. The question now raised had been completely threshed out in Committee, and, therefore, it was not necessary to repeat now all the arguments against the Amendment. Husbands and wives had always been liable to Probate Duty. They had been exempted from Legacy and Succession Duty, and that exemption would continue. The duty which they would have to pay was analogous to Probate Duty. The fact that this Amendment had been moved, after the exhaustive treatment accorded to the subject in Committee, ought to teach the Government that it was of little use to make concessions to the Opposition.

said, he thought the hon. Gentleman ought to show some gratitude to the Opposition for the way in which they had discussed this matter. When the late Government were in power the then Opposition insisted upon discussing many Bills on the Report stage Government to that it had received, and with the same fulness as in Committee, and with the same wealth of argumentative, or rather non-argumentative, speech. The hon. and learned Gentleman who had just sat down had entered the House only a short time ago. Had he been present during the whole of the afternoon he would have known that the discussions on the various Amendments that had been proposed had been kept within very reasonable limits indeed. He agreed, however, with the hon. and learned Gentleman that a concession ought not to be made the basis for further demands from the Government. It ought not to be made a platform for further assaults upon their citadels. Therefore, he did not join his hon. Friend (Mr. T. G. Bowles) in pressing this Amendment as the logical conclusion of the concession already made. He did not use that concession as a weapon, but urged the acceptance of the Amendment upon its own intrinsic merits. They had heard from the Government nothing on the Amendment except a declaration from the Solicitor General that he had made so many excellent speeches on .this subject before that he thought there was nothing to be gained by repeating them. He did not ask the hon. and learned Gentleman to repeat his speeches on this subject made relevant to another Amendment; but he did ask him for a speech relevant to this Amendment. Neither the arguments of the hon. and learned Gentleman who had just sat down nor any other arguments he had heard touched the subject of the Amendment now before the House. He could express in two sentences the arguments contained in all speeches delivered by the Solicitor General. The first was that this proposal would ruin the Chancellor of the Exchequer, and the other that to make an exception of any kind in favour of settled property only would be to favour the rich as against the poor. Neither of these two arguments touched the substance of his hon. Friend's contention. If the Amendment were carried the Exchequer would practically lose nothing, and there would be no favouring of the rich. The only question raised was whether the proper time to levy the Death Duty was when the wife had just lost her husband or when the husband had just lost his wife. In the circumstances, he thought the Amendment required some different treatment from the he should be prepared to support his hon. Friend if he went to a Division.

Question put.

The House, divided:—Ayes 161; Noes 212.—(Division List, No. 169.)

It being after half-past Five of the clock, Further Proceeding on Consideration, as amended, stood adjourned. Further Proceeding to be resumed To-morrow.

said, he begged to move the Second Reading of this Bill, and to express a hope that the House would allow the stage to be taken this afternoon. It was essentially a non-contentious Bill, and had, in fact, been introduced with the assent of the Opposition in both Houses of Parliament. Its object was to remove children from the surveillance of the Poor Law and to hand over to the District Councils the duty of appointing School Attendance Committees. He had been allowed to introduce the Bill without opposition, and he hoped it might now be read a second time without opposition. All parties were agreed as to the principle.

Motion made, and Question proposed, "That the Bill be now read a second time."—( Mr. Acland .)

said, he supposed it was not intended that the control of children in their elementary education should be handed over to the District Council.

School Attendance Committees of the District Councils will be substituted for those of the Boards of Guardians. That is all.

^* : Before making a change of this kind it would be well to wait and see what the District Councils are like.

said, he had been pressed by the Opposition to proceed with the Bill without delay in order that the change might be made before the Local Government Act, 1894, came into operation.

It being after half-past Five of the clock, and Objection being taken to Further Proceeding, the Debate stood adjourned. Debate to be resumed To-morrow.

House adjourned at twenty minutes before Six o'clock.