NA TURE 



481 



THURSDAY, MARCH 22, \\ 



THE REVENUE METHOD OF ESTIMATING 

 AND CHARGING THE DUTY ON SPIRITS. 



THIS subject has attracted some notice since Sir 

 Henry Roscoe put a question to the Chancellor of 

 the Exchequer the other night in the House of Commons, 

 as to whether his attention had been called to the fact 

 that, owing to the present faulty system of charging the 

 duty on spirits, a loss to the Revenue of from ^60,000 to 

 ^80,000 per annum did not occur, without any corre- 

 sponding benefit to the trader, and whether he would 

 appoint a Departmental Committee to inquire into an 

 improved system of estimating the percentage of spirit, as 

 proposed by Dr. Derham. To this the Chancellor replied 

 that the above estimated loss was based on an erroneous 

 assumption, and that the introduction of the suggested 

 system would be attended with difficulties comparable 

 with those which would accrue to the substitution of the 

 decimal for the present system of coinage. The grounds 

 of these objections could not of course be given in answer 

 to a question, and therefore the public are not yet in a 

 position to judge how far the Revenue Departments can 

 make them good. The statements of Dr. Derham are, 

 however, perfectly plain, and demand plain answers. 



They are (i) That the essential defect of the present 

 system is well known and acknowledged by the Inland 

 Revenue Department. 



(2) That this defect depends on the erroneous assump- 

 tion made by Sikes in constructing his tables that any 

 given quantity of spirit does not alter in bulk or in 

 strength with variations of temperature from the normal 

 of 51^ F. 



(3) That the only argument which can be advanced in 

 defence of the present system is that deficiencies at 

 temperatures below 51° F. are compensated by over- 

 estimates above 51° F., so that on the whole the Revenue 

 neither gains nor loses. 



(4) That on the contrary it is a fact that at least five- 

 sixths of the spirits paying duty are taken out of bond 

 durmg the nine cooler months of the year when the 

 temperatures in warehouses range from 51° F. downwards 

 so that in the case of these spirits a constant loss accrues 

 to the Revenue, and also to the trader from under-estima_ 

 tion of his stock, which he must dispose of at that estimate. 

 Whilst in the summer months, owing to the construction 

 of warehouses, evaporation of spirits, &c., the temperature 

 of the spirits does not often exceed 51° F., so that there is 

 but a slight compensating gain to the Revenue from that 

 source. 



(5) That the objections to the present plan can be 

 entirely removed by adopting the suggested system, which, 

 without altering the standard of measure— the proof 

 gallon — without introducing any change in the notation 

 of over- and under-proof, or any alteration calculated to 

 confuse the trader, substitutes tables founded on a 

 correct principle instead of an erroneous one, a scientific 

 and exact for an unscientific and inexact instrument, which 

 not only will facilitate the work of the Government 

 officials, but will give correct results at all temperatures. 



In consequence of the " nou possumus " reply of the 

 Vol XXXVII.— No. 960. 



Chancellor, Sir H. Roscoe gave notice that he should 

 move for a return of the number of proof gallons taken 

 out of duty free warehouses for consuviption last year, 

 specifying the number of proof gallons at each degree of 

 temperature when the account was taken for payment of 

 duty ; all spirits taken out for methylation, exportation, 

 ships' stores, and removal to other warehouses, which do 

 not pay duty, and which may have recently been dis- 

 tilled, being excluded. Such a return would either con- 

 firm or disprove Dr. Derham's contention, and there 

 seems no reason why such a return should not readily be 

 obtainable. It appears to us that the comparison of the 

 introduction of the decimal coinage made use of by Mr. 

 Goschen was an unfortunate one. The introduction of the 

 decimal coinage would obviously occasion a great amount 

 of confusion and perplexity, for a time at least, and would 

 in the end only substitute one coirect and convenient 

 system for another equally correct though less convenient. 

 The adoption of the improved system of charging duty on 

 spirits would occasion, on the contrary, no material 

 change, none likely to cause confusion or perplexity, but 

 would replace an incorrect and inconvenient system by 

 one at once correct and more convenient. The Chancellor 

 moreover hinted that the vested interests of the trade in 

 the property of the present instruments must be safe- 

 guarded. If the new and correct tables became 

 legalized and were adopted, Sikes's hydrometer could 

 equally well continue to be used, or any instrument can 

 be employed which furnishes specific gravities. Mr. 

 Goschen also stated that Dr. Derham's instrument is too 

 delicate for ordinary use. This appears to us to be the 

 weakest part of his argument. The ball in the new in- 

 strument, the most vulnerable part of the hydrometer, 

 happens to be of the same size and strength as that in the 

 ordinary Revenue instrument. It is true that a somewhat 

 different method of attaching the poises is adopted, but 

 this is a mere detail, and more a question of taste and 

 opinion than of principle, and it is certain that the form 

 can, if desirable, be made so as to be indistin- 

 guishable from Sikes's instrument, for the characteristic 

 feature of the new system is to be found in the bulks and 

 specific gravities of the poises, and not in the shape or 

 size of the stem or bulb. 



The Revenue authorities can scarcely, we imagine, fail 

 to admit that certain defects in Sikes's system exist, for 

 these can be demonstrated by reference to Sikes's own 

 tables. Hence we incline to the belief that the erroneous 

 assumption to which the Chancellor referred consists in 

 taking for granted that there is a general correspondence 

 between the temperatures of warehouses and that of the 

 mean shade temperature of the country, for this is the 

 assumption made by Dr. Derham. The returns which 

 have been asked for will decide this point. But mean- 

 while it may be of interest to see how the large figures of 

 from ^60,000 to ^80,000 per annum have been obtained. 

 The Customs and Excise deal annually with some forty 

 million gallons of proof spirit or their equivalent, which 

 for the most part lie for a longer or a shorter time in 

 warehouse. If we assume that the average strength of 

 the spirit when removed from warehouse for consumption 

 is 25 overproof, then thirty-two million gallons by measure 

 are equivalent to the forty million gallons upon which 

 the duty is charged, so that, if the rate of removal be 



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