the navy this year; and those were to be found in the growing necessity for a further protection to our commerce in every part of the globe, and in the establishment of three new naval stations -one on the coast of Africa, another in the Pacific, and a third in the Chinese seas. He should propose to employ this year 4000 men more than were employed under the estimates of last year. That increase would not be for the purpose of war or of aggression, but for the protection of our commerce, and the maintenance of peace. The expense so caused would be 184,000l. There would also be a vote for always keeping at our command a squadron of eight or nine sail of the line, which would create no jealousy among Foreign Powers, and another for the purposes of increasing and improving our steam navigation. In respect, therefore, of the vote for the navy, and the ordnance connected with the navy, there would be in the votes of this year an increase of nearly one million. For this increased expenditure the revenue of the next year would, he thought, suffice, even if the House would not consent to continue the income-tax. It was quite clear, however, that if it did not continue the income-tax, in the year following a deficiency of revenue would be discovered. The question which he must next put to the committee was, whether they would run the risk of that deficiency by making no provision to meet it, or whether they would postpone the consideration of that deficiency till the year 1846? Her Majesty's Government thought that it would not be a prudent course so to disregard the future condition of the country.

Ministers were, therefore, induced to propose the continuance of the property-tax for a further period; and before he asked the assent of the House to that proposal, he felt it necessary to explain what were their views as to the appropriation of the surplus revenue which would then be placed at their disposal after all the exigencies of the public were provided for. He would assume for the present that the committee would sanction the continuance of the property-tax, and would then give them an estimate of the revenue which he expected to derive from that source. Supposing the property-tax to be continued, the revenue,

on the 5th of April, 1846, would amount to 53,700,000l., and so long as the other sources of revenue were productive, might be calculated at that sum, deducting only a sum of 600,000l. from China, which would only be receivable for one year more. He would, therefore, take the amount of the revenue at 53,100,000l. The public expenditure he had already calculated at 49,000,000l. There would, therefore, be left on the 5th of April, 1846, a net surplus of 3,409,000l., if the committee acquiesced in the demand of Ministers for increased naval estimates. He now approached the most important question of all, namely, what was the mode in which this surplus, or a part of it, could be applied to the relief of taxation? He would not have proposed the continuance of the income-tax, if he had not felt the strongest persuasion that it was competent for the House, by means of it, to make arrangements with respect to taxation, which would be the foundation of great future com

mercial prosperity, and which would add materially to the comforts of those who were called upon to contribute to it. In considering how they would appropriate any surplus of revenue, several important considerations must always be before them. They must first consider the claims to reduction of taxation on account of the heaviness of the duties on articles which entered into general consumption; then they must also consider what were the taxes which pressed most heavily on those raw materials which constituted the staple manufactures of the country. Then, they must consider what were the taxes which required the greatest establishment of revenue officers for their collection; and then what were the taxes which, if reduced, would enable them to diminish the same establishment, so as to reduce their expenditure. Lastly, they must consider what were the taxes which, if removed, would give new scope to mercial enterprise, and occasion an increased demand for labour. He did not say which of these considerations ought to predominate, but they were all of importance. If the property-tax were continued, Ministers intended to make a great experiment with respect to taxation, in the hope that the general prosperity which would result therefrom would fill up the void caused in future years by the cessation of taxation. They did not propose to maintain any material surplus of income over revenue; but in the conviction that the House would, at all events, maintain public credit, if they proposed the reduction of certain taxes, which were more onerous than productive. He would first

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take the taxes connected with the customs, and would submit to the House a proposition with respect to the reduction of the duty on sugar. He proposed, with regard to all sugars but refined sugars, to make this reduction. On brown Muscovado sugar, which now paid a duty of 25s. 3d., he proposed to make a reduction of 11s. 3d., and to reduce the duty to 14s. That reduction would apply to all British plantation sugar, and to sugar the produce of the Mauritius; but there were certain districts in British India, with regard to which a different rule now applied; and with respect to them he proposed that they should pay the same relative proportion of duty which they paid at present, and that the duty should be 18s. 8d. On free-labour foreign sugar he proposed that the protecting duty should not exceed 9s. 4d., and therefore the duty would be 23s. 2d. Any country which had a reciprocity treaty with us could not, of course, be deprived of any right which it enjoyed at present. As to white or clayed sugars, or sugars equal to clayed sugars, he proposed that the duty should be reduced on British plantation sugars from 25s. 3d. to 16s. 4d.; that the duty on sugar imported from India should be 21s. 9d., and that the duty on free-labour foreign sugar should be 28s.; thus retaining the whole amount of discriminating duty which was imposed last year, but applying that discriminating duty in a different manner, giving 9s. 4d. as a protection on Muscovado sugar, and an increased protection of 11s. 4d. on the more valuable and costly article. With respect to the duty on molasses, he proposed to reduce it in the same proportions. As to

the admission of refined sugar, he proposed to remove the prohibitory duty on refined sugar imported from those British possessions which were entitled to import Muscovado sugar at 14s., and to place upon such sugar a proportionate import duty, namely, on refined sugar 18s. 8d, and 21s. on double refined. He then gave the committee an estimate of the supply of sugar which he considered likely to come from our possessions to this country in the course of the present year, and concluded his observations upon that point by stating that the effect which would be produced on the price of sugar by this reduction in the duty would be a reduction of 1d. per lb.; but taking other circumstances, which always accompanied a high rate of` duty, into consideration, he calculated that it would amount to a reduction of 1d. per lb. He estimated the loss which would be produced in the revenue of next year by the reduction of the sugar duties at 1,300,000l. He next proceeded to state that in the tariff of 1842 he had abolished generally the duty on all exports, with the exception of some few articles. He now proposed to adopt, as a general rule, the abolition of export duties on all articles. He did not propose to except the export duty on coal. After having benefited the coalowners by the removal of the export duty, he did expect that they would give to the people of England the full advantage of the boon which they had received, and the House would hear no more of their combinations to restrict supply, and to enhance price. The total loss from the reduction of the coal duty he estimated at

120,000. He next proceeded to a consideration of the duties levied on and applicable to raw materials used in manufactures. The tariff now included 813 such articles. He proposed to remove the duties applicable to 430 of them. By abolishing these duties altogether, they would get rid of a number of troublesome accounts. If fraud were practised in the introduction of these articles, against which some precautions must be taken, by weighing and examining them, he must apply to the House hereafter for the purpose of obtaining more stringent regulations against it. One advantage of getting rid of these duties would be, that it would dispense with the warehousing system. He then enumerated a number of the articles to which this abolition of duties would apply, as, for instance, the fibrous materials of silk, hemp, and flax; yarns of certain materials, excepting woollen; furniture goods; animal and vegetable manures; ores and minerals, with the exception of copper ore; iron and zinc in their first stage of manufacture; dye stuffs generally, and certain drugs of a noxious character. There were some articles to which this total removal of duty would not apply. He did not propose to interfere with the general principles which the Government had applied to the timber duties. The import of Baltic timber was now increasing, and the estimate which he had formerly made respecting it had not turned out to be incorrect. There was one article connected with timber which he proposed to exempt from duty, he alluded to the article of staves. The Government had given attention to the

mercial prosperity, and which would add materially to the comforts of those who were called to contribute to it. In conupon sidering how they would appropriate any surplus of revenue, several important considerations must always be before them. They must first consider the claims to reduction of taxation on account of the heaviness of the duties on articles which entered into general consumption; then they must also consider what were the taxes which pressed most heavily on those raw materials which constituted the staple manufactures of the country. Then, they must consider what were the taxes which required the greatest establishment of revenue officers for their collection; and then what were the taxes which, if reduced, would enable them to diminish the same establishment, so as to reduce their expenditure. Lastly, they must consider what were the taxes which, if removed, would give new scope to mercial enterprise, and occasion an increased demand for labour. He did not say which of these considerations ought to predominate, but they were all of importance. If the property-tax were continued, Ministers intended to make a great experiment with respect to taxation, in the hope that the general prosperity which would result therefrom would fill up the void caused in future years by the cessation of taxation. They did not propose to maintain any material surplus of income over revenue; but in the conviction that the House would, at all events, maintain public credit, if they proposed the reduction of certain taxes, which were more onerous than productive. He would first

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take the taxes connected with the customs, and would submit to the House a proposition with respect to the reduction of the duty on sugar. He proposed, with regard to all sugars but refined sugars, to make this reduction. On brown Muscovado sugar, which now paid a duty of 25s. 3d., he proposed to make a reduction of 11s. 3d., and to reduce the duty to 14s. That reduction would apply to all British plantation sugar, and to sugar the produce of the Mauritius; but there were certain districts in British India, with regard to which a different rule now applied; and with respect to them he proposed that they should pay the same relative proportion of duty which they paid at present, and that the duty should be 188. 8d. On free-labour foreign sugar he proposed that the protecting duty should not exceed 9s. 4d., and therefore the duty would be 23s. 2d. Any country which had a reciprocity treaty with us could not, of course, be deprived of any right which it enjoyed at present. As to white or clayed sugars, or sugars equal to clayed sugars, he proposed that the duty should be reduced on British plantation sugars from 25s. 3d. to 16s. 4d.; that the duty on sugar imported from India should be 21s. 9d., and that the duty on free-labour foreign sugar should be 288.; thus retaining the whole amount of discriminating duty which was imposed last year, but applying that discriminating duty in a different manner, giving 9s. 4d. as a protection on Muscovado sugar, and an increased protection of 11s. 4d. on the more valuable and costly article. With respect to the duty on molasses, he proposed to reduce it in the same proportions. As to

or abolition would amount to 3,338,000l., which would nearly absorb the surplus of 3,409,000l. on which he had already calculated. He did not deny that the financial scheme which he had just explained to the committee was a bold experiment; but, responsible as he was to Parliament for its success, he was not afraid to run the risk of making it. He now proposed to the committee to continue the income-tax for a further limited period of three years, because he had a confident persuasion that the reduction in the price of articles of great importance, which would follow this proposed remission of taxation, would be, if not a complete, yet a great compensation for its burden. He would not say that it might not be wiser to give a longer time than three years for testing this experiment. He thought, however, that Parliament ought to have a control over the duration of such a tax. He hoped that so great a source of revenue would not be dried up before the expiration of three years, but at the end of that time, such was his confidence in the elasticity of the country, he thought that they would be able to dispense with the tax if they thought proper. He had now submitted his plan to the committee. He recommended it to them with a deliberate conviction that their sanction of it would conduce to the extension of industry, and to the encouragement of enterprise, and that in consequence of that extension of industry, and of that encouragement of enterprise, all classes of the country, whether agricultural, manufacturing, commercial, or parties not engaged in any particular branch of industry, would either directly or indirectly

be benefited by it, and that every class would find its comfort and its welfare promoted. The conclusion of Sir R. Peel's speech, which occupied three hours and a quarter in the delivery, was attended with great cheering. After sitting down he again rose to express his hope that the House would be prepared to decide on the principle of his resolutions on the following Monday, the 17th.

Lord John Russell thought that they ought not to come to an immediate decision upon such a subject. But on the day named he would be prepared to take a view of the whole subject. In the meanwhile he must express his objection to the proposed arrangement respecting the sugar duties. In answer to a question from Mr. Collett as to the time when the intended alterations would take effect, Sir R. Peel answered, that, with the exception of the article of glass, they would commence directly the Bills could be passed.

Mr. Liddell tendered his thanks to Sir R. Peel for the remission of the duties on the export of coal, and on the manufacture of glass. He vindicated the coal-owners of the north from the charge of combination. If any gentleman would move for a select committee to inquire into the operation of that combination, he would second the motion.

Lord Howick considered that the coal-owners were indebted to Lord Poulett for the remission of the export duties on coal. Though he was member for Sunderland, he highly disapproved of the regulations of the trade, in which the coal-owners had unwisely concurred. They had themselves been sufferers by it. He