TOPICS OF THE DAY.

THE HOUSE OF LORDS AND TAXATION.

IN the confused and difficult, region of Constitutional law and practice concerned with the respective rights of the Lords and Common's in regard to taxation there is one thing which is absolutely clear and certain. The Lords have no right to lay any tal upon the people. No proper understanding of the problem can be arrived at by any one who does not keep this in his head, and remember the further principle upon which it is based. Englishmen are not taxed from above, but tax themselves. .Therefore only they themselves, through their representatives, can impose a tax. It is true that this principle is a little unfair and illogical as regards the Lords, since Peers cannot sit in the House of Commons, or vote for persons to sit there. The anomaly arose front the fact that the Lords at one time used to tax themselves, though they could not tax their fellows. For four hundred years and more, however, they have had to admit that to them the principle of "no taxation without representation" does not apply, except so far as it is to be found in the fact that the assent of the Lords is required before a Tax Bill becomes law.

The principle we have just stated being admitted, certain deductions flow logically therefrom. If the Lords cannot tax, it is clear that they cannot alter or amend a tax. If they attempted to do so, the Commons would say :— "This altered [or amended, or increased] tax is not our tax. You have changed it and made it something different, and therefore it is your tax,—a Lords' tax, which is an impossibility." Next, all taxes must originate in the Commons. Yet, strange as it may seem, from the principle that the Peers cannot tax the House of Commons has actually sought to deduce the principle that the Peers cannot relieve the people of a burden sought to be laid upon them by the Commons. The inability to tax has been actually twisted into an inability to prevent taxation,— perhaps the strangest deduction ever made in the history of false logic. "It would be a crime for me to hit Jones ; therefore it is a crime for me to prevent Smith hitting him." That is the logic of the House of Commons. Surely we cannot be wrong in sa,ying that a conclusion so ridiculous must be as bad in law as in reason.

The next point to be remembered in this controversy as universally admitted is—Though the Peers cannot tax, the assent of the Peers is necessary to an Act imposing a tax. The Constitution guards us against the imposition of taxes by a siugle unchecked Chamber. But as the House of Lords cannot tax, which, as we have pointed out, means also cannot alter or change a tax, and as a Bill must have the assent of the House of Lords, it follows that the House of Lords must either pass any particular tax or reject it, and that . no other course is open to it. Up to this point all is plain sailing, and all sides and authorities are agreed. But now comes an extraordinary claim or usurpa- tion on the part of the House of Commons,—a claim which. we hold can be shown to be due to a piece of verbal con- fusion. From the very proper assertion that the House of Lords has no right to tax, and therefore no right to alter or amend a tax, the House of Common's has jumped to the superb non sequitur that the House of Lords has no right to alter or amend a Tax Bill, but must either accept or reject it as a whole. The claim of the Commons is based .upon a failure to distinguish between a tax and a Bill imposing a tax. . No doubt at the time when this false deduction was first made each tax had . very of ten a separate Bill of its own, and therefore the verbal con- fusion did not much matter. If, however, several taxes are placed in one Bill, the mental and verbal .confusion between a tax and a Bill becomes of enormous importance. Take, for example, the present Budget. The Budget is put into one Finance Bill. That Bill contains a great number of separate taxes. But because the Lords admittedly cannot alter the nature of any one of the taxes suggested, and must either accept or reject each tax as a whole, it by no means follows that they cannot alter any clause in the Bill in which these separate taxes are contained, but must either accept or reject the Bill as a whole. The fact is, a modern Finance Bill is like the order of Composita3 in botany. It is composed. of a number of little flowers of taxation, each perfect in itself. But each of these separate taxes, though it cannot be amended, may be accepted or rejected. That this is so, and that the Finance Bill is a. composite Bill or collection of Tax Bills, is seen • in the fact that each tax has to have a separate Resolution in Committee of Ways and Means for its foundation. You can tell what is a separate tax by noting whether it had a Resolution to itself. Thus our contention is—The House of Lords is at liberty to accept or reject, but not to alter or amend, any separate tax, whether contained in a Bill of its own or grouped with other taxes in a general Bill. A separate tax is one which is founded on a separate Resolution in a Committee of Ways and Means.

Those who have based upon the proposition that the House of Lords must either accept or reject a particular tax as it stands the proposition that the House of Lords must either accept all taxes or reject all taxes together will no doubt tell us that we are only quibbling with words. They will profess to brush aside the Spectator's arguments by roundly asserting that the precedents show that the House of Commons has always declared that the Lords must accept or reject a Money Bill in toto and not alter or amend it, and that therefore we are not really meeting the argument of the Commons. In answer to this, we venture to say that we can show how the verbal muddle to which we have alluded has grown up. Further, though this verbal muddle has never been, as it were, specifically detected or analysed in detail by the Lords, the illogical pretension of the . Commons to convert a principle which refers to taxes into one referring to Bills has never been admitted by the Lords, but, on the contrary, has been strongly repudiated. Instinctively, as it Were, the Lords have always refused assent to the Commons' proposition, though they have not based their refusal on as strong grounds as they might have based it. That, however, does not matter. A truth does not cease to be a truth because the strongest arguments in its favour have not been put forward. The process by which the House of Commons came to confuse taxes and Bills—not, we believe, deliberately, but because at the time when it did so the principle of "One tax one Bill" was so often followed—can easily be made clear. In 1671 the House of Commons passed a Resolution on a. Bill for the imposition of a tax on foreign commodities which ran as follows :—" That in all aids given to the King by the Commons the rate or tax aught not to be altered by the Lords." To this proposition we have no word of objection, nor do we believe it possible for any person who understands our history and Constitution to have any. It is clear law. Very soon, however, the Commons began the process of building up an unsound, or rather ambiguous, proposition upon a sound one. On July 3rd, 1678, they passed a Resolution to the following effect :— "That all aide and supplies, and aids to His Majesty in Parlia- ment, are the sole gift of the Commons ; and all Bills for the granting of any such aids and supplies ought to begin with the Commons; and that it is the undoubted and sole right of the Commons to direct, limit, and appoint in such Bills the ends, purposes, considerations, conditions, limitations, and qualifications of such grants; which ought not to be changed or altered by the House of Lords."

If this Resolution is road carefully, it will be noticed that the confusion between Bills, aids, supplies, and grants is just beginning to appear. The first clause of the Resolu- tion is obviously sound, and does not go beyond that of 1671. The next clause is also sound, and follows properly from the principle. Again, the third proposition is true, because it merely says that there must be no alterations in the grants, but does not say that there must be no elimination of particular grants from Bills containing more than one grant. The fourth proposition is also sound, for the " which " obviously refers to the grants which it insists must not be changed or altered by the House of Lords, and not to the Bills. Still, the general effect of the Resolution is decidedly ambiguous, and if hastily read tends to suggest and support the notion that it is Bills which must be accepted or rejected as a whole, and not taxes, aids, and grants. In all probability, however, if some one at the time had said to the drafter of the Resolution that it was ambiguous because it did not properly distinguish between the taxes and the Bills con- taining the taxes, he would have declared that there was, and could be, no real ambiguity. As each grant or tax generally bad a separate Bill, you could not alter the tax without altering the Bill, or the Bill without altering the tax. Therefore it was mere pedantry to bother about distinguishing between the Bill and the tax. Nevertheless, on this failure to distinguish between the two a vast and swelling structure of error has been raised.

A proof of this is to be found in the well-known case which arose in 1689 when the Lords amended a Money Bill. On this occasion a very able dialectical battle took place at the Conference between the Lords and the Commons. Here the controversy appeared to rage over the question of altering a Money Bill, but what was really in dispute was the altering of a tax. The Bill was a one-tax Bill. In this controversy the Commons, to begin with, went back to the sound ground of denying to the Lords the right of altering a tax, instead of denying the right of altering a Bill. That this is so will be seen by the following quotation from the reasons given by the Commons for desiring a Conference on the amendment of the Poll Bill by the Lords, May 9th, 1689 :— " All money, aids and taxes to be raised or charged upon the subjects in Parliament are the gift and grant of the Commons in Parliament, and are and always have been, and ought to be, by the constitution and ancient course and laws of Parliament and by the ancient and undoubted rights of the Commons of England, the sole and entire gift, grant and present of the Commons in Parliament, and to be laid, rated, raised and paid, levied and returned for the public service and use of the Government, as the Commons shall direct, limit, and appoint, and modify the same. And the Lords are not to alter such gift, grant, limita- tion, appointment or modification of the Commons in any part or circumstance."

That, of course, is a perfectly sound proposition, and one which we agree with Lord Lyndhurst in declaring not to have been disputed by the Peers. The extract, however, concludes with a passage in which the confusion between a tax and a Bill appears :— " Or otherwise to interpose in such Bills than to pass or reject the same for the whole, without any alteration or amendment, though in ease of the subjects."

Here, if the Lords had grasped the nature of the verbal confusion which was going on, they ought to have replied : "We accept your proposition as long as you keep to the principle of 'One tax one Bill,' as long, that is, as a tax and a Bill may roughly be regarded as synonymous."

As we have said, this confusion between taxes and Bills imposing taxes would havt had no practical disadvantage had the practice of "One tax one Bill" been universal. As Lord Lyndhurst showed in his speech on the Paper-duties in 1860, the House of Lords constantly rejected Money Bills, but they were Bills which contained only one specific tax. That is, the Lords rejected taxes and Bills in tote. Following these precedents, they in 1860 rejected the Bill repealing the Paper-duties. Mr. Gladstone proceeded to get the better of the Peers by a piece of vicious logic. Refusing to distinguish between taxes and Bills, he grouped all his money projects in one composite Bill, and then, seizing upon the undetected verbal confusion in the old controversy, he roundly asserted that the precedents showed that when a Bill was once called a Money Bill, the Lords must pass it or reject it as a whole. If this argument is accepted, the result must be in fact, if not in name, to abolish the right of the Lords to share in the imposition of taxes. If all the taxes are put into one Bill, and that must be rejected or accepted as a whole, then the Lords could not prevent a particular burden being laid upon the people without throwing the whole finances of the country into confusion.

Fortunately the House of Lords, when in 1861 they passed Mr. Gladstone's omnibus Finance Bill, placed it on record that they did not assent to the principle relied on by Mr. Gladstone to bring them to their ,knees. Though none of the Peers appear to have denounced his bad logic, Lord Derby showed that the lords fully maintained their right to accept or reject specific taxes, and did not admit that these became con- secrated ground by being jumbled together. His words are so sound and so prescient that they deserve to be quoted in full. They are as follows :— "We have it in our power to divide the Bill which has been sent up to us by that House ; and, so divided, we have it in our power to adopt it, and to send it back to the Commons for 'acceptance or rejection. By that course we always have a remedy in our hands by which we can vindicate our privileges when we so please; and should circumstances ever arise so extreme as to justify us in taking that course, I hope your Lordships would not be slow to vindicate your rights. But I think it would be an act of power that would undoubtedly be extreme on the present occasion."

Here is the common-sense of the whole business. The Lords, though they have no right to impose a burden upon the people, cannot be prevented from relieving them of a burden sought to be imposed upon them, and that without taking the well-nigh impossible step of throwing out the whole of the taxes of the country. In flue, they may look into the details of the Finance Bill, and reject, though they cannot amend, certain particular and specific taxes contained in it.

From the reasons given above, it is clear that the House of Lords without any breach of Constitutional law or usage could strike out of the Finance Bill the land clauses, or perhaps, better still, could divide the Bill into that part which imposes new taxes on laud and minerals, aud that part which deals with the older duties and taxes, and, accepting the larger half, reject the smaller. That is a course of action which, in our opinion, is not only legal, but expedient, and will have the support of the country.

Before we leave the subject it is perhaps necessary to meet the very sophistical contention that the Lords cannot reject a tax sent to them by the Commons, because the effect of such rejection must be to increase the burden and weight of some other tax. It is argued that, since a particular amount of money must be raised, if a million or half-a-million is knocked off in one instauce, the result must be to swell some other tax by that sum. To this piece of special pleading there is in the present case a very easy answer. The rejection of the land clauses will not, in fact, add to the burden of any other tax, because the very small amount of money which they will bring into the Exchequer in the present year—the only year of which it is now necessary to think—will be more than made up by the underestimating which has taken place in respect of the other new taxes. There is, however, the further answer that it is not the business of the Lords to think of such ulterior consequences of their acts. They must deal with each tax proposed to them on its merits, and must not assume that because they prevent the House of Commons imposing one tax, tho House of Commons will thereupon increase the burden of some other existing tax. On the contrary, it is their business to assume that the House of Commons will propose a new tax which will not be open to the objections that attached to the rejected tax. To accept any other view must simply mean the resignation of the right of the Lords to take a share in the fiscal legislation of the country. If the Lords are pledged to give their assent to taxes in any case, then the • Lords' veto, like the Royal veto, has ceased to exist. But nothing is more loudly or plainly admitted in all the precedents and all the authorities than the fact that the Lords have a right to assent to or dissent from the grant of taxes.

We do not suppose that many of our readers will care ,to dive into the details of the subject which we have been discussing. If, however, they do, they will find much of very great interest in Lord Lyndhurst's speech delivered in the debate in the House of Lords in 1860, and in the speech of Lord Monteag,le, also made in 1860. Lord Monteagle's speech is full of good quotations, among which we may mention the Resolution of the Lords in 1671, which was to the following effect : — •

"That by a new maxim of the Commons a hard and ignoble choice is left to the Lords, either to refuse the Crown Supplies when most necessary, or to consent to ways and proportions of aid which neither their own judgment nor the good of the people can admit."

Another excellent speech was that made by Lord Mont- eagle in the debate in the Lords in June, 1861, the debate which ended in the assent of the Lords to the repeal of the Paper-duties. In the second speech Lord Mouteagle quoted a remark made by Mr. Fox in 1787, when the House had before it a proposition analogous to that advocated by Mr. Gladstone in 1861. Fox warned the House of Commons against a step that he described as being "not only a bad precedent for the Commons, but one which would as absolutely preclude the House of Lords from the rights of free debate as if they followed the example of Oliver Cromwell and silenced that necessary and Constitutional branch of the Legislature."

We will conclude by reminding our readers once more that the root of the whole matter is contained in the Resolution of the Commons in 1671—" That in, all aids given to the King by the Commons the rate or tax ought not to be altered by the Lords." To enlarge this into the proposition that Tax Bills ought not to be altered by the Lords, and then to place the whole of the financial proposals of the Government in one omnibus Bill, is a preposterous usurpation by the Commons which, if it is allowed by the country, will placo us at the mercy of a single Chamber.