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Dáil Éireann - Volume 7 - 25 April, 1924

COMMITTEE ON FINANCE. FINANCIAL RESOLUTIONS. - RESOLUTION No. 4.

Mr. BLYTHE: I propose:

(1) That a Customs duty at the rate of sixpence on the pound shall be charged, levied and paid on all preparations made from or containing cocoa in any form imported into Saorstát Eireann on or after 26th day of April, 1924, in addition to any duty which may be chargeable in respect of any spirits contained in any such preparation, but in lieu of any duty which might otherwise be chargeable on any other ingredient contained in any such preparation.

(2) The provisions of Section 8 of the Finance Act, 1919, shall apply to the duty mentioned in this Resolution, with the substitution of the expression “Saorstát Eireann” for the expression “Great Britain and Ireland,” and as though preparations made from or containing cocoa in any form were included in the Second Schedule of the Act in the list of goods to which five-sixths of the full rate is made applicable as a preferential rate.

This is the duty under which a large amount of confectionery imported into this country will come. As I have already said, along with the sugar confectionery, the revenue expected from this is about £40,000. The degree of protection will vary from twopence to sixpence. The goods are certainly a luxury type of goods.

Mr. JOHNSON: There is a change in this, is there?

Mr. BLYTHE: Oh, yes. Previously the goods were charged on their cocoa content. Now they will be charged a flat rate of sixpence, which, of course, in the majority of cases will actually be fivepence, in accordance with the existing arrangement for Imperial preference which we are carrying over. This duty is in substitution of the duty which was previously paid on cocoa content. Now it is a flat rate.

Mr. ALTON: Does this mean that drinking cocoa will be liable to tax? That, I think, is hardly a luxury.

Mr. HEFFERNAN: On a point of procedure. I would like to know how we are to act with regard to these Resolutions. I intended calling a [93] division on the last Resolution, but according to the procedure I could not do so. If I propose an amendment as a direct negative——

AN CEANN COMHAIRLE: There was nothing to prevent a Deputy from calling for a division on the last Resolution.

Mr. GOREY: Except lack of speed. He would want to be very fast, though.

AN CEANN COMHAIRLE: I do not know whether the Deputy has read the statement as to the Budget procedure. These Resolutions will have to be reported separately when passed in Committee, and when they are reported amendments can be proposed to them. After they have been reported and passed in some form or another they will have to be put into the Finance Bill. That will have to go through five stages, and in Committee on the Bill amendments can be proposed to each section, and in every stage a division can be called. So that the opportunity for calling divisions is exceedingly great in this matter.

Professor MacNEILL: Enough to satisfy anybody.

Mr. JAMES O'MARA: Am I to understand that chocolates made in England are to be charged fivepence, while chocolates made in France, say, are to be charged sixpence? Is there Imperial preference?

Mr. BLYTHE: Yes. We are not disposed to eliminate Imperial preference in making any change.

Mr. O'MARA: Is it on chocolate that is manufactured in an English factory, or is it if the cocoa is grown in an English Colony? Will that get a preference, and will the subsequent manufacturer get a preference—will the manufacturer in the English factory get another preference?

Mr. BLYTHE: There will be only one preference. It will be on goods as they come in.

Mr. O'MARA: Will it be on Imperial cocoa or on Imperial chocolate?

Mr. BLYTHE: We will be dealing with the manufactured article. It will be on the manufacture.

[94] Mr. JOHNSON: There is a phrase of this Resolution which suggests to me possibilities of very interesting amalgamations. “A Customs duty at the rate of sixpence in the pound shall be charged... on all preparations made of or containing cocoa,”... “in addition to any duty which may be chargeable in respect of any spirits contained in any such preparation but in lieu of any duty which might otherwise be chargeable on any ingredient contained in any such preparation.” Now the rate of sixpence in the pound is about threepence, I think, additional to the duty on sugar, is it not?

Mr. BLYTHE: Twopence three-farthings is the duty on sugar really.

Mr. JOHNSON: Yes, twopence three farthings on sugar. I wonder whether there are any possible combinations which would enable the cocoa to be a minor ingredient and the other stuffs a major ingredient on which duty would be higher than sixpence in the pound. I missed the point of the exemption in the case of spirits, but it did occur to me that there must be possible combinations which would allow cocoa to be the vehicle by which other things of more highly taxable content would be brought through.

Mr. HEFFERNAN: I would like to ask the Minister if this means that such articles as chocolates will have a double protection, that is the protection on sugar and the protection on the cocoa contents?

Mr. BLYTHE: No, they will only have the one protection; that is, the manufacturer of chocolates here will pay duty on his sugar and on his cocoa in the ordinary way.

Mr. ALTON: I do not think the Minister heard my question. Some Deputies do not understand yet whether drinkable preparations, like Van Houten's and Fry's, are exempt from the tax or not. I think they cannot be considered luxuries. Certainly they are the poor man's food.

Mr. BLYTHE: They are not exempt from the tax. The average rate paid at the moment on cocoa—that is cocoapowder—is just over threepence, so that this will mean an increase on the cocoapowder [95] imported into the country. As a matter of fact, it is simpler to make than many of the other preparations which will be taxed by this. It is already made in the Saorstát, and there seems to be no reason, in view of the comparative simplicity of manufacture, why the output should not be very greatly increased here. It is not a luxury, but it is a minor part of the commodity so far as taxability is concerned, and I think there is no good reason for excluding it.

Major COOPER: Broadly speaking, the Minister wishes to encourage us to drink tea and discourage us from drinking cocoa, because cocoa is going to be taxed at a very much higher rate than tea, even China tea. Deputy Johnson on a previous Resolution asked the Minister if he had an analyst whom he could consult. I wonder whether the Minister has a doctor whom he could consult, because I think the general verdict of the medical profession is that cocoa is beneficial and that tea— particularly taken in large quantities— is not. Cocoa helps to build up the strength, while large quantities of tea— particularly the lowest taxed tea, strong Indian tea—is not good for the health of the people. I remember when we were discussing the Old Age Pensions Bill Deputy Lyons spoke of the Minister dragging the poor old age pensioners out and drowning them in bog holes. I am not quite certain if the Minister is not now taking all the people of the Saorstát, not excluding the old age pensioners, and driving them into lunatic asylums, by this encouragement of the consumption of tea to the detriment of everything else. I really am at a loss to see any principle, other than the narrow financial principle, that has guided the Minister in putting these proposals before us. I do not believe that the country will be happier or more healthy if this Resolution is carried.

Professor MacNEILL: I drink tea about five times a day, and as a proof that I have not the slightest belief in Deputy Cooper's argument, I hope to be drinking tea before the clock gets very much further advanced.

[96] Mr. LYONS: Now we see why the reduction was made in the tea duty. It is because it is mostly consumed by Deputies on the Government Benches.

Mr. HEFFERNAN: Is this meant as a protective duty or as a revenue duty?

Mr. BLYTHE: It is meant as a protective duty.

Mr. LYONS: Does this include shell cocoa? Shell cocoa costs 2½d. per pound. Will this mean 8½d. on the person who has to purchase it?

Major COOPER: Two hundred per cent. tax! That is Protection.

Captain REDMOND: Does shell cocoa mean a preparation containing cocoa, or is shell cocoa not cocoa in the raw state? If that is so, would it not be exempt from this tax?

Mr. BLYTHE: In the old list cocoa was down under three heads. One was “husks and shells,” another was “cocoa powder.” They are not disturbed. Then the third heading was “preparations of cocoa.”

Mr. WILSON: Does the Minister say we are going to get £40,000 by the imposition of this tax?

Mr. BLYTHE: Not this one; this one and the confectionery tax jointly.

Mr. WILSON: Then it is not a protective duty; it is a revenue one.

Mr. HEFFERNAN: Does the raw material come under any further tax?

Mr. BLYTHE: No. It will continue to come in at the same tax as before.

Captain REDMOND: That includes the shell cocoa, then.

Resolution put, and agreed to.

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