asked the Chancellor of the Exchequer whether he is aware that it is anticipated that the opera- tion of the National Insurance Bill will have an important bearing upon, the number of persons who now seek medical and other relief, and that consequently a lesser number of relieving officers and other Poor Law officials will be required; and whether it is the intention of the Government to insert clauses in the Bill to provide compensation for officers whose interests may be affected, in such manner as was provided in Section 120 of the Local Government Act, 1888, and Section 28 of the City of London (Union of Parishes) Act, 1907?

I am glad the hon. Member realises that the ultimate effect of the Bill will be an important relief to the ratepayer. But this effect will, of course, be gradual, and, having regard to the normal growth of population and of the standard of care for paupers, it is not anticipated that such reduction of establishments as takes place will outstrip the regular wastage through death and superannuation among the officers employed.

I regret that the Chancellor of the Exchequer is not able to-be present at the commencement of this. Debate, but I understand he will be here shortly, I am quite aware that notice of this Debate being taken to-day was rather short, and the Chancellor of the Exchequer has other engagements which have been of some long standing. Therefore, I do not wish to complain, but I do think I have matters to raise which command serious attention, which are occasioning very strong feeling in the country, and which are connected with the administration of the Revenue Department. I do not wish to cover a large area or to confuse the issue; I wish to make a plain statement of facts. I think I shall be justified in drawing certain deductions from those facts, and in asking for a clear answer from the representatives of the Government as to how the Finance Act of 1909–10 is being administered, how certain calculations are being made, upon what basis they are being made, and what legal authority there is for the methods which are now being adopted by the Valuation Department. May I enter one caveat. Practically all the matters which I shall raise have already been referred to in this House either by question and answer across the floor or in Debate, and we have never yet had an answer. Either the questions have been scamped or answers have been given that investigations are necessary and that a reply will be given later. The investigations may have taken place, but the replies have never been given. There has therefore been ample notice, and I do enter a caveat against any of the points I am going to raise being put off to a future occasion which may never come. I will preface my statement by quoting an answer given by the Financial Secretary to the Treasury (Mr. Hobhouse) when asked by the right hon. Member for Hertford whether he would lay on the Table of the House a copy of the instructions which were given to the official valuers as to how they were to carry out their valuations. The answer he gave was:—

"He gave the House his assurance that the principle adopted is to make every valuation on a lair and reasonable basis."

That was the assurance which the right hon. Gentleman gave to the House. I propose to quote chapter and verse, showing how these valuations are being carried out, and to ask the House to decide for itself whether that assurance then given was justified, and whether the valuations are or are not being carried out on a fair and reasonable basis. I will first of all take a case which has been printed by newspapers throughout the country, but it is rather remarkable it has received no notice whatever from newspapers supporting the party opposite, either by way of narrative or comment. I wrote a letter to the Press last Saturday week giving full particulars of this case, and I stated all the facts. I must restate them shortly and the point which arises out of them. I do not bring it forward in any sense as an isolated case. The strength of the position is that the precise way this case differs from thousands of other cases is simply that the whole procedure from start to finish is actually completed in this case. The valuation has taken place, and the claim for duty has been made. Here is a small property in Richmond, Yorkshire, which belonged—there is no objection even to mentioning the names of the persons concerned —to a Mr. Walker, who purchased it in 1887 for £500, who spent £100 in adding a shop-front to it, and who made other improvements. He died and left the house to his widow, with remainder to his two daughters. The widow died in 1910. The property was valued for Death Duties at £500, and duty was paid upon that figure. The property then passed to the two daughters, who sold it for £500. We therefore have the property purchased for £500, and £100 spent upon it, valued for Death Duties at £500 in 1910, and sold for £500 in the same year. I have here in this envelope the real documents in the whole of the case. The different Government forms, Form IV., and the valuation claims that have been made—they are all available, and can be quoted if desirable. Form IV. was served in the same month that the property had been sold. The ladies in their return informed the Inland Revenue Department that they had sold the property for £500, which they claimed to be its value. They were then served with a valuation, and the valuation officer, instead of accepting the value of £500, at which the property had been in turn purchased and sold, and upon which amount Death Duties had been paid, placed a value upon it on 11th April, 1909—rather more than twelve months prior to the sale, and valuation for Death Duties—of £380, £321 being the value of the buildings and £58 the value of the site. The ladies, having parted with the property, naturally assumed that they had nothing to do with any duty on a property in the possession of a third person, and they, therefore, passed the valuation on to the purchaser. The sixty days allowed by the Act having lapsed, a further form was served upon them, and that stated that the value on the occasion was £500. The value of the buildings remained the same—£321; so that the value of the site had increased from £58 to £178; consequently there was an increment of £120 on which duty would have to be paid. The ladies were naturally alarmed. This £500 was practically the whole of the property which they possessed; they had in fact no other property, and their annual income from it was about £22. They were, I repeat, naturally alarmed at the prospect of losing a whole year's income in this way, and they felt that the claim was so obviously unjust that they had only to represent the matter to the valuer to get the matter instantly adjusted. Their solicitor accordingly communicated with the valuer, but ho, saying he had no power, referred them to the superintending valuer for the northern district, who, in turn, referred them to Somerset House. The facts were all placed before the Commissioners of Inland Revenue, and the reply received was:—

"I am directed by the Commissioners of Inland Revenue to acquaint yon that they are unable to accede to your application for an extension of time in which to prepare objections to the valuation in question."

The answer takes that form because the only way in which that outrageous provisional valuation could be amended was for the Commissioners of Inland Revenue to exercise the power which they possessed under the Act to give these ladies an extension of the period of sixty days in which to appeal. It was a quite excusable oversight on the part of the ladies that they had allowed the sixty days to elapse, because the property no longer belonged to them, and they imagined that they had nothing to do with any duty that might be levied upon it. The Commissioners were asked not to remit the duty, but merely to allow the facts to be placed before the referee in order that the real value of the property might be fixed according to the Act. But in this curt letter which I have read they refused even to exercise this power and to allow a reasonable extension of time for a review of the valuation. The next stage is the official demand upon these ladies for £22 Increment Duty. That is the history of that particular case.

In order to show that it is not an isolated case, perhaps I may be allowed to read a letter which I received from Mr. S. Elliott, of Nottingham. The writer says in it:—

"My wife bought, over twenty years ago, two free-hold houses for £550, and spent more money on them. Some years ago she advertised them for sale for £525. She was offered £500, but refused it. She died last December. For estate duty purposes the value of the property was put at £150. On June 28th. 1911, I received a valuation form in which the original total value was put at £300. I have tried to get it increased to £400, but the valuer will not do it."

Here you have officials of the Department actually accepting duty on £450, and then subsequently putting the original value of property at £300 and claiming duty on the difference. This is going on all over the country. I may state still another case, which I think is even worse. On this, I submit, we are entitled to an answer, as I raised it in this House so long ago as the 29th March last, and invited the Department to make inquiry into. It was the case of a nursing home at Plymouth, or, rather, at Stonehouse. The property was purchased for £1,000 on 29th September, 1910. The total gross value placed on it on 30th April, 1909, was £750. The value of the buildings was fixed at £560, and, deducting that from the sum of £1,000 which the property fetched when sold, a site value of £440 was arrived at, and Increment Value Duty claimed on it. The matter has been the subject of considerable correspondence. The solicitors for the nursing home took the matter up, and so did the Land Union. The latest stage is one which will astonish even hon. Gentlemen opposite, if they have any faculty of surprise left in them. This claim is so obviously unjust that the officials have informed the solicitors that if they will withdraw their notice of objection and pay the Increment Value Duty the Commissioners will be advised to return one-half of the duty as an act of grace; and, further, they say they are prepared to make this offer openly, so as to remove any suggestion of conspiracy! I do not know how much further it is possible for a Government Department to go. I would put it to the Committee that if any private individual carried on business transactions with another private individual on the lines on which this Government Department is carrying on its transactions with the taxpayers he would soon find himself in a criminal court, and probably in gaol.

Look at the position which the Government take up. Look at the state of the bench usually occupied by Ministers. We have only one right hon. Gentleman on that bench. He was not responsible for this Act, and I think I may fairly say he has not thoroughly mastered its intricacies. We have no Law Officer of the Crown present, the Chancellor of the Exchequer is not here, and we have to state our case to the Financial Secretary to the Treasury on a matter of vital importance to thousands of small owners. What kind of reply are we likely to get? I have stated my three cases. They are typical of hundreds of thousands of other cases. There are hundreds of thousands of small houses which have been undervalued all over the country. There is no limit to the number of cases where this undervaluation has taken place. Where the difference comes in is that it is in comparatively few cases that the actual claim has arisen because the occasion has not yet arrived. The undervaluation will in every case lead to claims. What is the position which the Valuation Department take up? Let us go back to this typical Richmond case. Here you have a piece of land with a house upon it; it is valued as on 30th April, 1909, at £380, with a full knowledge that it has just been sold for £500. The site value is fixed at £58. The occasion arises before the original valuation was made and there fore these two valuations are served practically simultaneously; in one case the total value is fixed at £380 and in the other at £500. The whole difference in the other case is credited to the site value which is placed at £178, the allegation being that in twelve months this small piece of land has increased in value threefold. I have had careful local inquiries made and there has been no increment of value. It would be a very extraordinary increase if it took place in a frontier town in Canada, but to say that in Richmond in Yorkshire, the value of a piece of land can have legitimately increased from £58 to £178, and therefore the unfortunate owner is to be mulct in a whole year's income to the State, is a travesty of justice.

The next point that arises upon that is what is this site value? The so-called site value is a legislative Mrs. Harris; it does not exist. It is like the ink which the cuttlefish puts out to conceal its retreat. It is to fog the issue. We are told that site value is being taxed. You would therefore think it would make some difference what site value is. Site value is a pure myth, and, whatever site value you put upon the property by the procedure which has been adopted, the tax will remain absolutely the same whether the site value was called £l or £200. Here you have this property valued on one occasion at £380 and on the other at £500. The buildings are valued at £321 and the site value at £58. The whole value must consist of these units and can consist of no other, the land and buildings. On the other occasion the value of £321 stands, and the whole difference goes to site value. That sounds a very complicated and difficult proceeding and fogs the issue. Now let us reverse it for the sake of argument. Instead of saying the land is worth £321 and the site £58, reverse it, and let us suppose the buildings are worth £58 and the site worth £321. What would have happened? When the property is revalued at £500, the buildings remain at £58, £58 is taken from £500 and you get exactly the same difference between it and £321 that there was between £58 and £178, and the duty will be just the same. Let us put it at £100 for the site value, the property valued at £380, the buildings put at £280 and the site value at £100. The property is sold for £500, the buildings are left at the same figure of £280, £280 is deducted from £500, which will leave £220. The £100 is deducted from £220, which leaves £120 site value, the exact figure which was arrived at in this case on the other figures. Therefore the whole myth of site value is absolutely exploded. There is no such thing as site value. It is merely a dummy which is set up in order to enable the Treasury to extract, on every occasion of sale, 20 per cent. of the entire difference between the guesswork figure at which they have valued the property and the entire value which the property fetches in the market. There is. no other interpretation. That brings me to the position of the valuation on the occasion. There have been important questions asked upon that point. My hon. Friend (Mr. Royds) asked the Chancellor of the Exchequer how and on what principle the valuation on the occasion was going to be made, and whether there was to be a valuation at all. The Chancellor of the Exchequer answered:—

"The deductions directed to be made on the occasion of sale under Section 2 of the Finance Act are those specified in Section 25 (4) of the Act. and are calculated by reference to the circumstances existing at the time of the sale. The first of these deductions is the same amount as has to be deducted for the purpose of arriving at the full site value from gross value. This necessitates a fresh computation of the gross value and additional site value at the time of the sale. The gross value will be completed in the manner prescribed by Section 25."

If that meant anything it meant that there was to be another valuation, but no-second valuation is made in any of these cases, and that is the really important point upon which I want a very clear answer. Do the Government claim that the way to arrive at the site value on the occasion is invariably, as is now being done in practice, to simply deduct the same value, whether real or imaginary, of the building which was fixed upon on the original valuation, and then to debit the whole difference to site value? I am sorry to see there is no law officer in his place, because I am raising a matter of which I have given due notice to the law officers.

Does the hon. Gentleman mean the original value of the house or the present value?

The original value. It is the procedure adopted in all these three cases, and so far as I am aware in all other cases, that no new valuation is made and it it assumed that because on the original date of the valuation the house had a certain value, the value remains the same on the occasion, and on the occasion when the duty is levied it is assumed that the house is of the same value, and because the property was sold at £500 the £321 is deducted, and the entire difference is treated as site value and is liable to site value duty. There is another point which arises on this matter which is of some interest from more than one point of view. It has always been claimed for this remarkable piece of legislation that it was to encourage building and to prevent people from holding up land and not using it for the purpose of development. Now we see the effect of the 10 per cent. deduction in this particular way of calculation. What happens is this. There is an allowance made of 10 per cent., not on the total original value, but on the site value. Let us suppose that you have two properties each worth £300. One is bare land, and the other is land and a building worth £300. Let us suppose that both properties increase in value to £400. In the case of the bare land you have an original site value of £300, and when it increases to £400 there is an increment of £100. There is an allowance in that case of 10 per cent. on the whole of the £300 of original site value. On the whole property, in other words, £30 is deducted, and the increment for which duty is payable is on £70. The Other property goes up to £400 and is sold. Duty is levied on the principle followed in all these cases. You have an increment of £100, but as the building is valued at £350 there is a deduction not on £300, but only £50. Is that the way in which building is encouraged, and the way in which the owners of small house property obtain an advantage? I should have added another case, which is a most striking one. It was referred to in a letter to "The Times" by Mr. Ivory, a well-known writer to the signet in Edinburgh. He pointed out how a particular property belonging to a client had been valued at £20,000, and how, notwithstanding protests which were made, he failed to obtain any amendment of that figure. He intimated his intention of appealing, and he got an eminent valuer of high repute to go and meet the Government valuer on the ground. He told how within a week that valuation was amended to £45,000. If the original valuation of £20,000 had been allowed to stand there would have been a claim for Increment Value Duty of about £5,000. Obviously that is pure robbery, but it is not more so in that case than in other cases.

That throws some little light upon the value which the Chancellor of the Exchequer attaches to this valuation as giving to the Government and the country an accurate knowledge of the value of the property which we possess. Here we have a case of a property of £45,000 valued at £20,000. There was another case in Edinburgh which I quoted here not long ago of a property which was valued in 1908 at £l,000, and which was valued under this Act a few months afterwards at £450. These cases are piling up innumerably, and this is becoming a matter which is arousing great indignation in the country among the owners of small properties. It is a matter upon which a serious answer is necessary. I wish to ask the law officers with regard to the right of appeal. It is quite clear that the owners have the right of appeal within sixty days against the original valuation from the time of that valuation, but what is not clear, and what I am unable to find out is whether there is an appeal under the Act against a valuation on the occasion. I may say this is not my own point. It has arisen in consultation with one or two eminent counsel at the Bar, one being Mr. Danckwerts. So far as we can discover, there is no means provided under the Act for an appeal against a valuation on the occasion, and we do not even know whether what occurs on the occasion is a valuation at all. By Section 33 of the Act which deals with appeals, I find that appeals are allowed against the first or any subsequent valuation of the total value or site value of any land. The words of the Act are extraordinarily tricky, and one reading it would think you could appeal against the first or all subsequent valuations. Section 33 says that appeals are allowed against the first or any subsequent valuations "except as expressly provided." Then you come to paragraph (b) of that section, and you find that "the original total value and the original site value, and the site value as ascertained under any subsequent valuation shall be questioned only by means of an appeal against the determination by the Commissioners of that value where there is an appeal under this Act, and shall not be questioned in any case on an appeal against an assessment of duty." An appeal is allowed first of all generally except as expressly provided. Then it is expressly barred again, except on valuation where there is an appeal under this Act. There appears to be no means of appeal provided for against a valuation on the occasion.

I wish to ask the hon. and learned Gentleman to say whether under the Act there is an opportunity for appeal. By Section 27 there is an appeal against the valuation on the periodic occasion, but I am referring to the valuation on the occasion referred to in this particular case. I ask how and when the Act provides for an appeal in that case. If there is no appeal, what happens? You have the whole thing hanging upon a provisional valuation. I admit that it may appear to be unnecessary, because the valuation on the occasion is fixed by the sale. Now the small owner, for the first time, becomes aware that he is liable to a heavy duty. A small owner is served with an original valuation, which is less than what he believes to be the value of his property. He cannot afford to employ a skilled professional adviser, and he is glad to accept an undervaluation because he believes it will involve a light tax. The sixty days are allowed to expire, and his opportunity for appeal is barred. Then the occasion arises when he sells the property at its real value. This process of valuation is gone through, and a heavy and obviously unjust, and I believe illegal, claim is made against him. But he has absolutely no opportunity for appeal as far as I can see. The Act is extraordinarily and very cunningly drawn so as to deprive the taxpayer of any opportunity of getting the case reviewed. I should have thought this was due to accident, but what makes me think it is not accident is the studied policy of the Valuation Department in not bringing doubtful points before the referee.

I asked a question on the subject the other day in the House of Commons. I think I have a right to complain of the manner in which ques- tions are answered. I received from one of the most eminent valuers in the country a letter, in which he asked me to ascertain the opinion of the Department on certain points of obviously general importance. I think the Committee will allow me to state what the points were. I asked whether there is to be another computation for deduction of time, whether there was or was not to be a deduction for Land Tax, whether there was or was not to be. a deduction for roads, because a deduction had been refused on the ground that the soil of the road still belongs to the owner. That is a point I will not make any comment upon. The valuer also-pointed out in regard to the total value in the case of agricultural land, apart from buildings, that the authorities had one method of calculating site value, and exactly an opposite method in the case of land with buildings. I desired an answer upon all these points. The answer I received was that Commissioners of Inland Revenue have neither the wish nor the power to interfere when an occasion. arises in connection with the valuation of land in the decision of the referee or other legal tribunal under the provisions of the Finance Act. There was not even a word explaining on the part of the Department how it was necessary in the public interest that these points should be settled. I know for a fact that very long ago this particular valuer has on these very points appealed, and desired that the matter should be brought before the referee. But the Department hung up the question. None of these cases have been brought before the Referee, and the inference is quite obvious that the Commissioners are allowing the sixty days to run before anything is done. If you want any further proof of the policy of the Land Valuation Department we find it in the case to which I have referred just now. They are actually offering in order to keep a troublesome person quiet that they will refund the duty if he will accept the claim. They cannot go much further than that.

What is the object of that? It is that there should be no public knowledge of the law, that the law should be kept obscure, and that the man who is taxed should not have any knowledge of what his real liability is, and that the large majority of people who are unable to take professional advice or who, for any other reason, are unable to fight all the details of this complicated legislation, by which they stand to suffer so much, should have these valuations fixed upon them upon a system which the Land Valuation Department have devised for themselves, and which I do not believe exists in the Act at all. I am sure that the House of Commons as regards these doubtful points, and they are many, which must arise under this Act, would agree that they should be at once referred by the Department to the Referees, and further that the right hon. Gentleman should give an undertaking now when these points of law are decided that they should apply to all valuations, whether those valuations were nominally completed before the decision was given or whether they were not completed. It is obvious the real difficulty arises on the provisional valuation, and that the sixty days' limit within which the appeal against the original valuation is permissible is wholly insufficient. I know that the right hon. Gentleman cannot give me an answer on that point now as to the sixty days, but I can raise it again on the Second Reading of the Finance Bill, when that happy day comes. But I hope before that day that he will represent to the Chancellor of the Exchequer the gross hardship which is being imposed upon all property owners by that hard and fast sixty days' limit, after which no appeal is possible against an original valuation.

You cannot really have a stronger case than that with which I opened my statement where you have what is obviously an inaccurate original valuation. I cannot really suppose that the right hon. Gentleman thinks that you can have a value of £58 on a piece of land in 1909, and that within twelve months that value has grown to £178, with no alteration in the circumstances whatever. It is, therefore, obvious what the Department require for this particular case, and it refers to thousands of other cases, is the removal of that bar of the sixty days to the review of an obviously inaccurate valuation. I come now to that question of the minus valuation in Scotland. How is the 10 per cent. allowed which is calculated upon a minus quantity? I have here a concrete case, in which the site value is fixed at minus £400. The Chancellor of the Exchequer, in answer to a question from me, stated that if an increment was revealed, Increment Value Duty would be charged. Let us, therefore, suppose that when the property passes the site value appears to be minus £200. Apparently there would be an increment of £200, for which the owner would be entitled to a reduction of 10 per cent. of minus £400. Perhaps the right hon. Gentleman will explain how he will take off the 10 per cent. of minus £400. With reference to the number of valuations-taken which are now hung up, the right hon. Gentleman has undertaken to give me to-morrow an answer to the question which I asked yesterday. I had hoped it might be available for the Debate to-day. The information I have got is that there are 17,000 cases of valuation at this moment awaiting adjudication.

Do I understand that the hon. Gentleman means valuations of real property?

Real property, freehold and leasehold.

Passing under the Bill itself?

Yes, that is my information. There are 17,000 cases where, owing to the passing of property at death, a valuation of freehold or leasehold realty is required. Seventeen thousand of such cases are awaiting adjudication at this moment. An enormous inconvenience is being caused to the public, and the estates cannot be cleared. This matter has been referred to, attention has been called to it, and questions have been asked about it for a long time in this House, and I hope now that we shall be able to obtain from the Department a clear answer of how Increment Value Duty is going to be calculated on the occasion. I ask the Government to treat this matter seriously, because it is affecting the daily lives of large numbers of people, not only dukes, and not principally rich people; it is the poor man who is really affected by this tax. There is plenty of opportunity for those who have large incomes to get advice. So far as my experience goes, from what I have heard from others, I do not think that this Act has hit large landowners very hard, because it is rather difficult to do ft. You make a bad shot at the big landowners and you kill half a dozen of the little ones. That is exactly the policy which this Act is carrying out. On behalf of a very large number of small landowners who are vitally concerned in this matter, I would ask that this House-should carry out its responsibility, because this House has a responsibility, for its legislation, and that it should be made perfectly clear how these valuations are being levied, and that they should be levied on a fair basis and not on a fantastic basis, as was done in the cases which I have brought before the Committee.

I must apologise to the hon. and gallant Gentleman because I was not present at the opening of his observations, as he was so good as to give an intimation to the Attorney-General, which was passed on to me, that he proposed to raise matters which it might be proper for a law officer to go into in debate. So far as the remarks of the hon. and gallant Gentleman relate to matters of administration, I will leave them to my right hon. Friend (Mr. Hobhouse) to deal with when he comes to take part in the Debate, but I am anxious in the plainest terms, and at once, to deal with the legal difficulties which he has suggested. First of fill, as to the right of appeal. When the hon. and gallant Gentleman tells us of the opinion of the great and distinguished lawyer to whom he has referred, it is with more than usual fear and trembling that I venture to offer an opinion to a different effect.

We have not got a written opinion from that eminent counsel on this point, but only arising in consultation with him, that so far as he is able to discover there is no method of appeal.

There is, at all events, a locus penitentiœ. As I understand, the point raised by the hon. and gallant Gentleman is this; Although when the Budget was being discussed in this House, considerable time was given and considerable care was taken to providing machinery for appeal, the hon. Member thinks that there is a gap in the Act as regards the taxpayer desiring to challenge a provisional valuation of a site on the occasion.

That is quite right.

If this is so, it undoubtedly is not a case of deliberate omission, and it is one of those objections which so far as the Government are concerned we have no wish to leave uncorrected. But let us first see whether the difficulty really arises. I agree entirely with the hon. and gallant Gentleman when he says that the language of these Sections in many cases is difficult and sometimes leads to genuine differences of opinion, and therefore I do not advance the view which I have formed in a dogmatic way. I suggest it for the consideration of the hon. Member. The Section under which this matter arises is Section 33. There can be no doubt that when one looks at the first words of that Section, the substantial object and intention of the Section is to give a man a chance of appeal to a referee before he is fixed with the duty which the authorities think would be right and fair. What I understand the hon. Gentleman to suggest is that, though there is a general provision in the first words of the Section, he fears, and that the suggestion made by those who advise him is, that a man who challenges the site value which is put upon his land on an occasion is tied completely to this site value; and he thinks so, because of the proviso (b), that the original total value and the original site value and the site value as ascertained under any subsequent valuation shall be questioned only in the limited way set out in that proviso. The first two have nothing to do with it. The question is whether the third one is rightly construed as covering the case of site value on an occasion. I suggest to the hon. Gentleman my sincere view, although it is one that needs examination, that that may not be the necessary or indeed the proper construction of those words. I suggest so for two reasons. The first is that there is no difficulty in finding in the Act something else to which those words perfectly naturally refer. Section 28—

That deals with quinquennial valuations.

With quinquennial valuation for the purpose of Undeveloped Land Duty. Nobody will doubt that site value as ascertained under any subsequent valuation will cover that case. Of course that does not prove it does not cover something else as well; but I do not think it does. I do not think if the true sense is given to the phrase "site value" in Section 33, that it does so. If you will turn to Section 25, which is a long section, almost the last words in that section contain the provision—

"Any reference to site value (other than the reference to the site value of land on an occasion on which increment duty is to be collected) shall be deemed to be a reference to the assessable site value."

This shows that assessable site value is the true meaning of the words "site value" in proviso (b) of Section 33. If owing to some mistake, there is no right of appeal in a case of that sort, no one will question that this was not intended or contemplated by those who framed the Act, nor was it contemplated or intended by those who criticised the Act. Consequently one would not wish to strain the construction in that respect. I do suggest that if those who take an interest in this matter will be so good as to refer to Section 28, they will find words which are "very properly applicable, and if they refer to Section 25, they will see there is good reason for supposing that it is really intended that there ought to be a right of appeal in this case where it is obviously needed. No doubt there are many cases in the Act of Parliament of great difficulty, and which offer very legitimate ground of dispute between lawyers on one side and the other, but I think I have at any rate shown that there is some right of appeal. I recognise that the hon. and gallant Gentleman (Captain Pretyman) had a real desire to elucidate the matter, and I assure him that in my observations I have acted in exactly the same spirit.

With the other matters to which reference has been made my right hon. Friend the Secretary to the Treasury will deal. I, however, will venture to make one observation in regard to the question raised by the hon. and gallant Gentleman as to the distinction which arises in working out the 10 per cent. rule on the increment value. The difficulty was put by the hon. and gallant Gentleman in a broad way. He put the case of two properties side by side, each of them worth originally £300. Each of them, as the result of the lapse of so many years, becomes worth £400. The hon. and gallant Gentleman criticised the working of the Act in the case of each of those properties starting at the same lower value and each of them ending at the same higher value. He pointed out that a deduction of 10 per cent. is allowed in the one case to a different amount from that which is allowed in the other. The hon. and gallant Gentleman is much too clear-headed not to see why. He is perfectly entitled to criticise the method of making the allowance by percentage, but if you are going to adopt the percentage method it is a perfectly reasonable thing that there should be a difference in the result between the two cases, for this reason: The first case he puts is one where there are no buildings at all. It is simply a piece of land without buildings. He says, "Here is a piece of land which, when the Finance Act comes into force, is worth £300 site value; £300 represents the whole value, and, after five years, it is worth £400, the difference being £100. You do not exact the Increment Tax on the £100, because you first allow the tax- payer 10 per cent. Ten per cent. on what? Ten per cent. on £300, and that is £500. The reason we tax him on £70 is because the property was land as opposed to land covered with buildings to start with. The whole of the value of that land to start with was due to the land itself as opposed to any structure put upon it. We allow 10 per cent. on the £300 and we tax him on £70 because he starts with land worth £300, and is a recipient of £100 unearned increment, and we think it is fair to tax him on the £70. In the other case which the hon. and gallant Gentleman put, the owner does not start with land worth £300; he starts with land worth £50, and, in five years, it increases to £150. We apply exactly the same rule to that. We do not tax the buildings upon that land; what we tax is increment in the land itself, whether it carries buildings or whether it does not, and we apply exactly the same principle in allowing 10 per cent. in regard to the increment value of the land, but not the increment value connected with the houses. Even though we tax the increment value of the land we do not proceed to tax it the moment it begins to grow, but we allow a certain percentage of growth before we begin to tax at all. It is surely quite right that the percentage should be applied in each case, not to the total of land and buildings, but to the value of the land. I am quite conscious that other points have been fairly raised by the hon. and gallant Gentleman, but I do not think I need deal with them, as they more properly come, being matters of administration, within the province of my right hon. Friend.

I should like to say at once that I entirely agree with the view of the Solicitor-General on the question of appeal, but I think the hon. and learned Gentleman should go one step further, so that at all events, when this lady comes co make her appeal, neither he nor the Attorney-General will raise the argument in court that she has no right of appeal. I am not without justification in saying that, because in the case of the King v. Wrigglesworth a certain interpretation was put upon the Act by the Solicitor-General, but the Inland Revenue Department proceeded to exact the duty.

I am not the Solicitor-General referred to, but the Law Officer who gave the interpretation did so as one of the Ministers endeavouring to give his bonâ fide judgment as to what certain words, not in the Act of Parliament, but in the Bill which was under discussion at the time would accomplish. For that very reason when the mistake was discovered, care was taken in a practical way to see that it was corrected, and it was corrected by my right hon. Friend in the last Revenue Act.

I agree it was not the present Solicitor-General who interpreted the Bill, but the House was guided in its adoption of the particular Clause by the view of the construction of the words raised by the Attorney-General upon that appeal. On that construction the Inland Revenue authorities at once proceeded and claimed duty. On this occasion, the Solicitor-General having informed us that there is a right of appeal, I ask that when this lady comes before the court she shall not be met by the technical objection that no appeal lies. I think it is fair to ask that no such objection should be taken on behalf of the Government.

I would point out that what I stated was in reply to the hon. and gallant Gentleman. I suggested that an appeal would lie, and certainly, if the true view of the Statute was that there was no appeal, I think there would be the strongest possible case for having that corrected. If I am asked to express the view whether there is a right of appeal, I say yes, and to that view I hold until reason is shown that I should alter my opinion. If there should be any obstacle to this lady's right of appeal of course that would be a proper case to be met and dealt with.

I agree that the argument of the Solicitor-General cannot of itself affect the matter, but I do say that this lady, after his interpretation of the Act, should not be allowed to go into court only to be met with the objection that she has not the right of appeal. She would be mulcted in the costs, after having been encouraged to proceed by the interpretation which has been given by the Solicitor-General. I wish to say a word upon the general question. We must assume to-day that it is right to tax increment in land. Starting upon that proposition, I must say that even the most extreme land-taxer— I mean those who would tax the land to the last ditch—would not wish that the Act should become a mere trap for the unwary, and that people should become subject to taxation simply because they do not know their rights. As a rule they would be poor people who had not the opportunity of taking advice on all the intricacies of the statute, and who would not know that they had incurred duties for increment where there had been no increment, but actually a decrement. If we are all agreed on that view, I think we shall be all agreed that this is an extremely hard case, and one which ought to be set right if it can possibly be set right. Let me recall to the right hon. Gentleman what the case really means. At the very time that the valuers were making their valuation of this property they had before them the statement that it had been sold in September, 1910,. for £500, and that in May, 1910, it had been valued at £500 for Estate Duty. Thus we have the valuation of 1910 of £500,. and an actual sale in 1910 for £500. Having both those facts before them they proceeded for some unknown reason to value the property at £380, knowing that the result of that must be to place an increment on £120 upon these ladies, on their own basis. Where the injustice of this comes in is that they knew at the moment they made the valuation of £380 that in May, 1910, it had been sold for £500. They sent it in to those ladies, who thought, having sold their property, that it did not matter to them. It was not an unnatural' mistake for ladies to make, or for a layman to make, and they did not bother themselves any more about it. They sent it to the purchaser, thinking it concerned him. The Inland Revenue authorities waited their sixty days, or exactly sixty-three days, until the opportunity for appealing against the original valuation was gone, and they sent in their claim as upon an increment of £120.

If those ladies had not been ladies in poor circumstances, and if they had been solicitors or lawyers, it is inconceivable that they would have allowed that valuation to pass. If you are going to take advantage of a mistake, an obvious mistake, of that character, then I say it is a gross and monstrous injustice. If there are any possible means of putting it right, even if it necessitated a special Clause in the Finance Bill, I think the Inland Revenue Authority and the Government ought to put it right, or ought to refund' the amount to those ladies. What is the result? They have valued for the site value at £58, and the duty which becomes payable, simply by a mistake, is £22, or 40 per cent. of the capital of the whole site value. That produces the absurd result that this property has trebled in value in the course of the year, while there is not a vestage of reason shown for any increase in value at all. I appeal to hon. Gentlemen who hold even the most extreme views as to Land Value Taxation. I am sure those Gentlemen do not wish the Revenue to profit by the mistake of those ladies, and that they do not wish to get a tax upon a supposed increment where obviously there has been no increment. So far as I can see the only way you could remedy the matter, and I am doubtful if it could be done in that way, is to extend the sixty days. I am not quite sure whether you could extend the sixty days after the occasion has arisen. If there is a means of doing so surely the very least the Government can do is to give the ladies the fullest opportunity of testing the valuation. That is only one instance, and the fact is that this Act is full of traps and pitfalls for the unwary. What you are going to do is to tax not only real increment but all sorts of artificial increment which you manufacture by algebraical formula which leads you to minus quantities. Those minus quantities show the absurdity of this hopeless business of acting upon algebraical formula.

made an observation which was inaudible.

Minus quantities have arisen in very large numbers indeed, and the very fact that they do arise shows the absurdity of the principle of mere algebraical formula which leads you to a minus quantity for the value of land which everybody knows is worth something. The idea, as was pointed out by my hon. and gallant Friend (Mr. Pretyman), that you are going to tax a man on the difference between minus 400 and minus 200 and then arrive at 10 per cent. on that minus quantity is an absolute reductio ad absurdum of the principle by which you arrive at these results. Let me give one other case generally on the question of principle. You are going to manufacture any amount of artificial increment by comparing unlikely units. Take the case, and it is a constantly occurring case, of a plot of land which the owner contemplates developing, and which he may develop in the course of ten, or twenty, or thirty years. He divides it into plots for the purpose of valuation. Those plots are valued separately so that the back portions are valued as back lands without any access by road at all. The value of the plots separately gives you a much lower valuation than if you valued as a whole. Then, having the separate valuation, suppose the man dies. You then have an assessment for Estate Duty of the whole plot, and you get an increment on property which has remained exactly the same, which is the most ludicrous and absurd result. I am not dealing with the case which was met by the Revenue Act, which disposed of a certain hardship, but of the case where you begin the valuation in separate plots and then as a whole on the occasion of either death or sale. It makes all the difference in the valuation by the unit on which it is based. Why should a man have to pay a tax because a different unit has been taken and when you are not comparing like with like?

Let me refer to the extraordinary way in which the Department have thought themselves at liberty to depart from the words of the Statute itself, and to make upon the subjects all sorts of claims, threatening pains and penalties, and the claims which are absolutely unfounded by the Statute, and let me refer to the means which they have taken and the devices to which they have resorted in order to prevent these questions being decided in the courts. Take the case of Form No. IV. A large number of people thought that that Form was altogether illegal, and, according to most recent decisions, inferentially it is. It was absolutely unwarranted under the Statute which the Government themselves passed in making demands upon millions and millions of subjects and threatening them with pains and penalties all over the country. Certain landowners thought it was fair to have this question decided for the people, and that the people generally should be guided by a declaration of the courts. They go to the courts for a declaration. What do the Government do? One would have thought that as this was an advantageous thing for the country to have decided that the Government would have been glad to have accepted a means of testing whether their action was legitimate or not. Not a bit of it. They set up the plea that you could not have a declaration against the Crown, and they went to the Court of Appeal, which consisted of the present Master of the Rolls, Lord Justice Fletcher Moulton, and Lord Justice Farwell. All those judges concurred in giving a strong decision that the course which the Government was taking in trying to prevent a decision from being given was absolutely unjustifiable, and that they ought to allow the matter to be decided. Lord Justice Far-well said:—

"There was no substance in the apprehension, but if inconvenience was a legitimate consideration at all, the convenience in the public interest was all in favour of providing a speedy and easy access to the courts for any of His Majesty's subjects who had any real cause of complaint against the exercise of statutory powers by Government Departments and Government officials, having regard to their growing tendency to claim the right to act without regard to legal principle and without appeal to any court."

They did not resist a declaration any longer, and it was held on Form VIII. that it was illegal and that they were asking all sorts of things which they had no right to demand from the subject. I do say to the House that this is becoming a serious matter. I think it is a matter on which the whole House can agree and that is that this is a sort of intricate statute which ought not to be made a trap for ignorant and unwary people, and also that the Government Department ought not to exceed the functions which are given to it under the statute, and ought not to threaten people, unless they comply with their requirements, with all sorts of penalties, and then when the question comes before the court use every technicality in their power to prevent the courts giving a decision on that particular point.

I rise because of the appeal of the hon. Member to hon. Members on this side who are more particularly interested in the taxation of land values. The hon. Gentleman correctly interpreted our feelings when he says we agree with him and those with whom he is associated in so far that we have no desire that any person under this Act should pay anything except upon land value, and in so far as under any wrong administration it can be shown that any person is paying on. improvement or buildings of any sort or on increment otherwise than land value then we are perfectly prepared to associate ourselves with the hon. Gentleman to secure reform. The hon. and gallant Member for Chelmsford (Mr. Pretyman) has stated this afternoon, and, indeed, has consistently stated throughout these Debates, that in his view no alteration in administration can put this matter right, and that as a matter of fact in his view no alteration by Statute which recognises the existence of land value would put this matter right. His view is that land value is a myth. I took the words of the hon. and gallant Gentleman, who stated that "land value was a Mrs. Harris."

I said site value as referred to in this Act.

The hon. and gallant Gentleman draws some distinction between land value and site value, but it does not appear to me very material. In the hon. and gallant Gentleman's view site value is a pure myth, and does not exist. He has stated so, and his illustrations are illustrations to show that when you are dealing with a composite value, of land and buildings together, it passes the wit of man to discover what value appertains to the buildings and what value appertains to the site. I believe the position of the hon. and gallant Gentleman is that nothing will be satisfactory, except the total and immediate repeal of the Land Taxes. I am sorry the right hon. Gentleman for East Worcestershire (Mr. Austen Chamberlain) is not here now, because I intended to make an appeal to the responsible Leaders of the Opposition, and to ask them whether they associate themselves with the view of the hon. and gallant Gentleman.

I am afraid that is what the hon. Member is not entitled to do. He is only entitled to deal with the administration, and not with the wisdom or unwisdom of legislation on this subject.

I defer to your ruling. But I may be permitted to say that I was at any rate addressing myself to arguments which were adduced by the hon. and gallant Gentleman. I am sure you will allow me to say that so far as those with whom I am associated are concerned we speak for the rank and file of the Liberal and Labour parties on this question. I say this because I judge by the response we received for the memorial we recently presented to the Prime Minister and the Chancellor of the Exchequer, which was signed by 173 Members on this side of the House. The appeal which we made was that the Government ought to endeavour to deal not merely with the grievances of a few persons, but that the Government ought to expedite the valuation so far as possible. It will be most satisfactory if we secure the reforms necessary after the valuation has been expedited. I take it that it will not be in order to show that the hon. and gallant Member's statement makes out that the administration of this Act is falling almost entirely upon the poorer people, and is not hitting the large landowners of this country. I am glad to have that admission, but what a lurid light this statement throws upon the action of the 5,000 men who own half of the land in this country; who in the House of Lords declared they would be brought to absolute ruin if the Budget passed; who have been discharging their gamekeepers and giving as an excuse this Land Tax; who have been denying old age pensions to their workpeople; and who have been refusing to subscribe for the purpose—

This is quite beyond all that is permissible in this Debate.

I thought I was addressing myself directly to the arguments which have been laid before us by the hon. and gallant Gentleman. At any rate I desire, on behalf of those with whom I am associated, to say, that our view is that the action of the Government is open only to this criticism: that the valuation is proceeding far too slowly, and that it is desirable it should be expedited as far as possible. I do make an appeal to the Government to do all that in them lies to expedite the valuation. So far as these hard cases are concerned, I have only to say that since I have been a Member of this House I have listened, on every opportunity, to the hon. and gallant Gentleman who has brought these cases before us. They have, as a rule, been a stage army. We had the case from Aberdare brought before us four times. There was another similar case which was a matter of Debate in this House. Half-a-dozen cases were brought before us by the hon. and gallant Gentleman one after another. It was shown there was no basis for any reasonable complaint with regard to these cases, and they have vanished like the baseless fabric of a dream and left not a wrack behind. We have these new cases this afternoon, and I have again listened with interest to what the Secretary of the Treasury has to say regarding them. They will probably be found equally as easy of explanation as the cases which have preceded them. I do think what afflicts the hon. and gallant Gentleman is not the wrongs of these few people. He is a determined opponent, in the interests of the great landowners, of the liability which this Act places upon them. I think it is a small beginning, and which I hope we will be able to carry it forward.

The Chancellor of the Exchequer in his Budget statement dealt shortly with the Land Value Duties. One of the few sentences he did say has caused a little anxiety up and down this country. This year he told us he hoped to complete the valuation of most of the urban sites, and to collect the Land Duty, which would produce £200,000 this year. Let me give an example in the Division I represent. I suppose there is not a single acre there which has not got a value apart from agricultural value, but I do not wish to suggest it is built over. Twelve miles from where I stand to-day there is land which is hunted over during the winter. I was standing watching a cricket match. I spoke to the owner of the land. I said, "You have got this cricket pitch; you will not be charged duty on it. What about the land all around? It has got a building value." The owner said, "I gave £115 an acre for this land, and if I were willing to sell for £115 an acre I could not get it." That gentleman has got to pay Undeveloped Land Duty. I wish also to deal with another class—the market gardeners. In the majority of instances these men own their own land. If I can make anything of what the Chancellor of the Exchequer said, these men are going to be charged in the near future a tax of 4s. an acre in the year. Are they going to be served not only with the taxation for this year, but last year and the year before. The gardeners asked me, and I am asking the House, is it fair that these men should have to bear this extra taxation at all? These market gardeners have not a monopoly, or something in the nature of a trust, and they do not hold up the price of bread. If they did, it might be right to tax these men. Or, again, suppose they were concerned in getting extra large prices for land by holding up land and preventing building on it. It might then be right to tax them. But they are not.

The hon. Member is talking about legislation. He must confine himself to administration.

At any rate, here we have an industry skilfully conducted by men, the bulk of whom have bought their land at more than agricultural value. If they have to sell, they will sell at a loss. Let me go on to another question. I desire to ask His Majesty's Government a few questions about the simplest Clause in this great Land Act—Section 26. It announces that all land shall be valued. As far as England goes, and Scotland, and Wales, the Chancellor of the Exchequer said his great work had been completed. I asked the Secretary of the Treasury how many Form IV.'s had been issued in respect of England, and the answer was something over 10,000,000, and that 91 per cent. had been filled up by the owners. We are also aware that a great number of provisional valuations have been served on owners as the result of filling up Form IV. In many cases those provisional valuations have been accepted, and in others they have been disagreed to. At any rate, the first stage of the valuation is completed. But what about Ireland?

to the TREASURY (Mr. Hobhouse): I submit that there is nothing in this Vote to cover valuation in Ireland.

If that is so that question cannot be discussed.

Cannot the whole question of land valuation be discussed on this Vote?

There is a separate item for land valuation in the general Irish Vote.

Would not my hon. Friend be justified in calling attention to the method of valuation in England, and, without going into detail, contrasting it with what is occurring in Ireland? It is desirable that such a comparison should be made.

A contrast between the two methods, if not carried into too great detail, would not be out of order.

I submit that, although a comparison might not be out of order, I am clearly precluded from replying to any question as to what is happening in Ireland, because of the absence of any provision for Ireland in this Vote.

Can the right hon. Gentleman tell me under what Vote Irish valuation comes?

In the general Irish Vote there is a separate item, for the chief valuer and his staff in Ireland. That item is under the control, not of the Inland Revenue Department, but of the Treasury.

Surely I might discuss shortly the difference between the methods of valuation in Ireland and in England.

I submit that the hon. Member cannot go in detail into the question of valuation in Ireland on this Vote.

I see that there is a separate item for "Valuation under the Finance Act, 1909–10" in the Irish Vote. If the right hon. Gentleman assures me that he is not responsible on this Vote for valuation in Ireland, I must rule the question out of order.

It is a fact that offices have been opened in Dublin, Cork, and Belfast to start the valuation under this particular Act.

If it is not possible to make a comparison between the Irish and English methods on the English Vote, it will also be impossible to do so on the Irish Vote; so that apparently there will never be an opportunity to make such a comparison.

I am not dealing with the mere question of comparison. If the Irish valuation is paid for under another Vote, it must be discussed there.

I understood you to rule that the question might be referred to by way of comparison, although the details could not be gone into. It seems very desirable for purposes of comparison that it should be in order to mention that the Irish valuation is carried out on a different principle from that which obtains in England, in order to justify the criticism of the procedure of the Inland Revenue authorities here.

A passing reference as matter of argument is certainly not out of order.

In Ireland the Act came into force on 30th April, 1909. It is impossible for anybody to say that since 1909 no houses or land have changed hands in Ireland. They have changed hands freely, and at fairly good prices. Has any Increment Duty or Reversion Duty been collected in respect of those sales or changes? The other day I received a letter from a solicitor in Dublin, in which he said:—

"I know as a matter of fact the valuer has been engaged in Dublin and district, as he was with me in relation to several estates I am concerned in, but I have not received any official valuation yet. I have had several cases in Dublin and its vicinity where property has changed hands in the last two years. I have had transactions of that description at least once a month, and in no case has the valuation been made respecting Increment or Reversion Duty. Of course, in all these cases the particulars required by Form IV. have been required to be given, but as I have said no assessment for Increment or Reversion Duty has been issued."

In reply to a question of mine a few weeks ago, the Secretary to the Treasury stated that 20,000 Irish Form IV.'s have been issued, but that none had been issued in respect to agricultural districts.

This seems to be going into the Irish case, which is not in order on this Vote.

Then I will raise the question on the Second Reading of the Finance Bill, when I daresay I shall be in order. I must apologise for the trouble I have given you.

We in this quarter of the House sympathise to some extent with the hon. Member for Chelmsford (Mr. Pretyman) in the hard cases he brings forward. I would point out to him, however, that all these difficulties have arisen simply and solely because he induced the Government to make the valuation a Government valuation instead of a landlord's valuation. If the Budget of 1909 had gone through as it was originally introduced, the valuation being made by the landlords, as it is in Australia and other civilised countries, the hon. Member would not have had all these grievances to bring forward. We would judge him far more leniently than we do at present if we believed he was really anxious to do away with these anomalies and hard cases. I have a proposition to make to the hon. Member, with which I should like the Government to fall into line. The Budget of 1909–10 passed under circumstances of great difficulty, and in the form in which it emerged from those long Debates, it undoubtedly puts before the country an extremely complicated valuation. Original site value, assessable site value, total value—all these different values undoubtedly complicate very seriously what ought to be a perfectly simple matter. Would it not be possible in next year's Finance Bill to introduce Clauses revising the valuation under the Budget of 1909–10, so as to make that valuation far more simple and efficacious, so far as both sides are concerned? We hate these hard cases just as much as the Opposition do, and we can put them right if we are allowed to get the valuation on a sound basis. I know that the hon. Member opposite (Mr. Pretyman) is as earnest on this question as I am. What I would like to do would be to meet him, with some other Members from that side, and some of my hon. Friends, and with the Treasury officials go through the Budget of 1909–10—

That question can hardly be dealt with now, as it is a matter for legislation.

I am merely pointing out that the difficult cases which have been brought forward could be put right to the perfect satisfaction of hon. Gentlemen opposite, of hon. Members on this side, of the Government, and of the country at large. I would ask the Secretary to the Treasury whether some such small sub-committee could not be formed, with the honest intention of improving the present state of affairs and of drafting Clauses which might obviate our having this constant procession of really hard cases. I agree that they are hard cases. I should like the Land Union and my hon. Friends to meet together to deal with the matter.

The next point I wish to deal with in the administration of the Act is that we really must have the valuation made more quickly. It was said, I believe by the Chancellor of the Exchequer, that the valuation would take five years. Five years is an intolerably long time for us to wait. I am afraid that the Government are not really in earnest in trying to get the valuation done more quickly. I have been told over and over again by the Chancellor of the Exchequer and the Secretary to the Treasury that they have all the valuers in the country, and that they could not do it more quickly if they wanted to. That is absolutely not true; they could get more valuers if they wanted them. It may have been true a year ago, but now it is perfectly possible to increase the staff and to get the valuation done far more quickly. We want this valuation, but I am afraid the Government do not. They know perfectly well that, when the valuation is made, we shall force them to tax and rate land values whether they like it or not. Our business now is to see that the valuation is done as quickly as possible, and that the Government do not invent difficulties and put them in its way. As far as I can see the valuation is being done extremely well. It may be necessary to take sample acres of agricultural land and to find the average number of trees, but I am convinced that there are far more difficulties introduced simply through the unnecessary complication of the Finance Act of 1909–10. All these questions of stripping agricultural land of fruit trees and things growing on the land are quite unnecessary complications which we can eliminate in next year's Finance Bill. By that means and by enlarging the staff of valuers we can hasten the valuation and do something to bring Liberalism in this House more into line with Liberalism in the country.

Hon. Members opposite who have spoken seem to lament that the valuation has not proceeded more quickly. I think they make a charge against the administration, but the administration are doing their very best to deal with a very great and very complex question.

I never said they were not. I said we wanted more valuers.

Those whom the Government have seen fit to appoint must have had their hands very full, for they have not only to deal with Increment Duty and Reversion Duty, but also with the Death Duties and valuations under the Licensing Act, so that they have their hands exceedingly full. Of course their task must be a difficult one, because as has been brought out this afternoon by the hon. and gallant Gentleman the Member for Chelmsford, the valuation of site values is a very difficult thing. It is putting up hypothetical cases. There is a very prominent London official who gave evidence a few years ago before the Royal Commission on the Taxation of Land Values. In that evidence he said:—

"On the lines proposed for the new street—from the Strand to Holborn —the first time I went over that property for the purpose of making an estimate of the cost for acquiring the property we required for the street, it took me between four and five days. The last time I revised my figures I was able to do it almost within the day. I only had to go on the second morning for a couple of hours,"

I am afraid the officers entrusted with the administration of the Act have found that their work is very difficult indeed. If we go back to that section of the metropolis with which the official that I referred to was then dealing what do we find? There is a building called the Gaiety Restaurant, which was leased for £6,000 ground rent not long ago. Over £100,000 has been spent upon the building. As an example of how difficult it must be, how very hypothetical it must be, to put a value upon any site in particular, you can now have that building for the amount of the ground rent. The London County Council, to whom the building has gone back—they being the owners of the land—would willingly let you the building and the site for about £6,000. That shows the difficulty of making an actual site valuation. These site valuations are hypothetical; they are based on one's experience, and on market value, but they should not be a basis for taxation.

In this London of ours there are in single streets different values. In one case, in one particular house, the ground rent is 6d. per foot. A few yards further on the ground rent is 5s. The differences are thus enormous, and does entitle to the consideration of the House anyone engaged in working out this very complex question. I am surprised at the impatience of some hon. Members of this House at the speed with which the valuation is proceeding. There must be many millions of valuations to make. Some six weeks ago the right hon. Gentleman the Financial Secretary to the Treasury (Mr. Hobhouse) said that up to that date 380,000 valuations had been made. I do not suppose that in the six weeks ensuing they have gone on at a faster rate. Suppose the total is now between 400,000 and 500,000, it is very evident that the total valuations of this country cannot be made within the five years foreshadowed. If they could be made within the five years it would be a very wonderful work. I do not think the hon. Gentleman opposite should be so impatient. If he wants to get a valuation to entitle him to another basis of taxation he will not get it for a long time. He must possess his soul in patience. The officers are doing their duty. They are getting through a difficult job as quickly as possible.

I think everyone who has had any experience of the working of this Act must agree that it is not altogether fair, not indeed at all fair, that the valuers should be blamed for their work, because everybody must see that they must be intensely overworked. I remember a gentleman who was appointed, and who, although appointed, subsequently declined to take up the job, because, as he told me, it was pointed out to him that he would be expected to make hundreds of valuations a week. Everyone knows that work at that pace does not lead to good work, and is not likely to give satisfactory results. I quite agree with the hon. Gentleman the Member for Newcastle-under-Lyme that the valuers are doing their best, and are struggling as best they may with a very difficult situation. They are being asked to do an impossible thing. It is not fair to ask a man to do an impossible thing and then to blame him if he cannot carry it out. I do not propose to deal with the cases which have been freely dealt with as to under-valuation. I hope in this matter that when the Finan- cial Secretary replies that he will be able to give us some explanation. I hope also that he will deal with the case in which the Government raises the valuation from £20,000 to £40,000. I would like to deal with another case. I can give the right hon. Gentleman the names and other particulars if he wants them, but the question is one of interpretation of the Act. In this case four cottages were left by a man who died intestate. He intended, it appears, to leave them to four different persons, to two brothers and two sisters—nephews and nieces. It was desired by the heir, one of the nephews, who was only a poor labourer and in weak health, to pass on the property, so as to carry out the original intention of his uncle. The cottages were valued at from £60 to £48 each. A conveyance was made, and the Stamp Duty calculated at 10s. in each case, or Stamp Duty on a value of £100 was paid, so as to be absolutely clear and cover the amount. This was paid at the local post office.

The post office returned the document, and stated that an adjudication fee of 5s. was required. Complaint was made. The solicitors concerned inquired whether Section 74 Sub-section (2) of the Finance Act, which is presumably the only applicable Section, was the Section relied upon by the Inland Revenue officials. It was pointed out that in this particular case not only was the property subject to Death Duties, full ad valorem Stamp Duty, but also the additional adjudication fee of 5s. They pointed out. that they could not think that what had been done was the intention of the Act, but the words—

"No such conveyance or transfer shall be deemed to be duly stamped unless the Commissioners have expressed their opinion thereon in accordance with that Section…. "—

appeared to make it obligatory; but they suggested that any such adjudication should be carried out by the authorities without any fee.

The extraordinary answer they got was this:—

"The Board cannot waive the fee of 6s. if the documents are forwarded through the post. But I am to point out that no fee would be charged if the documents were submitted for adjudication through a London agent on your behalf."

The local solicitor sent to the London agents, who happened to be able to attend to this matter. There has been much correspondence—this matter began in February—but up to now no decision has been arrived at, and this conveyance cannot be carried out. I think the right hon. Gentleman will agree with me that it is a hard case, and one that ought to be put right. We ought to know whether, under that Section of the Act, the Board are justified in demanding a fee of that kind.

One more point, and that is in reference to a question which I asked in this House not very long ago. I refer to the payment of Undeveloped Land Duty. In cases where the owner has not had time to give notice to the tenant he is not liable for Undeveloped Land Duty. But I have come across cases in which this has been demanded, and I asked in this House in how many cases such demands for Undeveloped Land Duty have been made, and in how many cases the demand has been withdrawn! In a particular case which I know about the demand was made for the years 1909–10 and 1910–11. As a matter of fact, the owner, aware that it was not due till the year 1911–12, wrote and pointed out in reply to a peremptory demand for payment by the Commissioners, that he was not liable under the Act. The Commissioners promptly withdrew the demand. In how many cases, I asked, had this been done? The answer of the Chancellor of the Exchequer was that in no less than 153 cases such demands had been withdrawn. That means that in no less than 153 cases, and I do not know how many others, 153 actually proved cases, a, totally illegal demand has been made, and because the owner happened to know enough about the law to withstand the demand, it was withdrawn. I asked a question as to what happened in the cases where payment has been made, what the Chancellor intended to do with the matter, and the reply was that upon the true facts being established satisfactorily, the money thus paid will be refunded. But the position rests this way: that if the Commissioners make a distinctly illegal demand it rests upon the owner to prove to their satisfaction that it is illegal. Surely that is putting the cart before the horse, putting things the wrong way round, for the party not in fault to prove to the party who has sinned that he has been unfairly treated, and that no expense should be cast upon the Commissioners, in view of the actual mistake they themselves have made? In view of the fact that so very many holders of property are not aware of the operation and details, or the effects of the various provisions of the Act, I think it must be obvious to everybody that 153 is not the total number of cases which have occurred. It is perfectly obvious there must be a great many more, and although I welcome the assurance which the Chancellor gave that in cases where it was proved that an unfair demand was made the money would be repaid, I think it is very unsatisfactory that such methods should be pursued, and I think great care ought to be exercised in making these demands, some of which have been proved to be absolutely illegal. I hope the right hon. Gentleman will give us further assurance in the matter of minus valuation. He knows what it is, and I hope he will give a full explanation for the benefit especially of the hon. Gentleman the Member for Newcastle-under-Lyme.

I know all about it.

The hon. Gentleman, by his interruption of a previous speaker, implied that he did not know anything about it, and I hope the right hon. Gentleman the Secretary to the Treasury will point out that it is a real and distinct class of case, and that it will have to be dealt with, and that these cases of actual minus valuation, which must occur, will be dealt with when they arise.

In answering the questions addressed to me in the course of this Debate I hope to show to the satisfaction of the Committee that the statements made by hon. Gentlemen opposite have been somewhat exaggerated. I think in the working of any new Act, especially such a large and complex one as the Finance Act of 1909–10, there must always arise some misunderstanding and mistakes. These misunderstandings and mistakes on the part of the Department dealing with the Act should, of course, be as few as possible; but I think it is only natural that some should be made by persons who are carrying on new duties, and it is not unnatural that complaints should be made and letters written to hon. Members of this House with a view to getting rid of these mistakes in order to remove all unnecessary hardship. The hon. and gallant Gentleman opposite brought a specific case, which he dealt with at great length, to the notice of the House at the beginning of the year. He told the House then as he told the House to-day, that there were thousands of cases exactly similar to the one which he mentioned.