The Select Committee appointed to inquire into the Several DUTIES levied on imports into the United Kingdom, and how far those Duties are for Protection to similar Articles, the Produce or Manufacture of this Country, or of the British Possessions abroad, or whether the Duties are for the purposes of Revenue alone; and to whom several Petitions were referred; and who were empowered to report the Minutes of Evidence taken before them to the House; — have considered the Matters to them referred, and agreed to the following Report:

The Evidence is of so valuable a character, that Your Committee could hardly do justice to it in detail, unless they were to proceed, step by step, to a complete analysis, which the advanced period of the Session will not allow them to do. They must, therefore, confine themselves to reporting the general impressions they have received, and submit the Evidence to the serious consideration of the House, persuaded that it cannot be attentively examined without producing a strong conviction that important changes are urgently required in our Custom-house legislation.

The Tariff of the United Kingdom presents neither congruity nor unity of purpose; no general principles seem to have been applied.

The Schedule to the Act 3 & 4 Will. 4, c. 56 [1834], for consolidating the Customs Duties, enumerates no fewer than 1,150 different rates of duty chargeable on imported articles, all other commodities paying duty as unenumerated; and very few of such rates appear to have been determined by any recognised standard; and it would be difficult for any person unacquainted with the details of the Tariff to estimate the probable amount of duty to which any given commodity would be found subjected. There are cases where the duties levied are simple and comprehensive; others, where they fall into details both vexatious and embarrassing.

The Tariff often aims at incompatible ends; the duties are sometimes meant to be both productive of revenue and for protective objects, which are frequently inconsistent with each other; hence they sometimes operate to the complete exclusion of foreign produce, and in so far no revenue can of course be received; and sometimes, when the duty is inordinately high, the amount of revenue becomes in consequence trifling. They do not make the receipt of revenue the main consideration, but allow that primary object of fiscal regulations to be thwarted by an attempt to protect a great variety of particular interests, at the expense of the revenue, and of the commercial intercourse with other countries.

Whilst the Tariff has been made subordinate to many small producing interests at home, by the sacrifice of Revenue in order to support these interests, the same principle of preference is largely applied, by the various discriminatory Duties, to the Produce of our Colonies, by which exclusive advantages are given to the Colonial Interests at the expense of the Mother Country. Your Committee would refer to the Evidence respecting the articles of Sugar and Coffee, as examples of the operation of these protective Duties.

Your Committee refer to a general Account prepared by the Inspector of Imports, of the several articles imported into the United Kingdom in 1838-39, stating in separate columns the quantity imported, exported, and retained for home consumption, with the rates of duty chargeable on each, and whether in a raw state, partially manufactured, or manufactured; by which it appears that 862 articles are divided into eight Schedules, which they submit to the serious consideration of The House: viz.

Schedule I containing 349 articles, producing less than £100 each of Customs
duty, and in the aggregate
Schedule 2 containing 132 articles, producing from £100 to £500 each
Schedule 3 containing 45 articles, producing from £500 to £1000 each
Schedule 4 containing 107 articles, producing from £1,000 to £5000 each
Schedule 5 containing 63 articles, producing from £5,000 to £100,000 each
Schedule 6 containing 10 articles, producing from £100,000 to £500,000 each
Schedule 7 containing 9 articles, producing from £500,000 each and upwards
Schedule 8 Containing 147 articles on which no duty has been received, but on which there has been an excess of drawback of

It appears from the evidence of Mr. Porter, of the Board of Trade, that the total amount of Customs Revenue received in the United Kingdom in the year ending January 1840, was £22,962,610, of which total amount,

17 articles, each producing more than £100,000 produced 94½ percent., or
That 29 articles produced 39/10 per cent., or
And that these 46 articles produced 98 2/5 per cent.,or
That all other articles, amounting to 144 in number, produced 13/5 percent, or
Showing that 190 articles, exclusive of about £80,000 collected upon 531 other articles, and excluding 147 articles, upon which an excess of drawback of £5,398, was allowed, produced the total revenue of

It will be seen that 17 articles, affording the largest amount of Customs Revenue, are articles of the first necessity and importance to the community; viz. sugar, tea, tobacco, spirits, wine, timber, corn, coffee, butter, currants, tallow, seeds, raisins, cheese, cotton wool, sheep's wool, and silk manufactures; and that the interests of the Public Revenue have been by no means the primary consideration in levying the Import Duties, inasmuch as competing foreign produce is in some instances excluded, and in others checked by high differential duties, levied for the protection of British colonial interests; and, in many cases, such differential duties do not answer the object proposed, for it appears, in the case of foreign clayed sugars, where it was obviously intended they should be excluded from the British market, that the monopoly granted to British colonial sugars has so enormously raised the prices in our market, that they have lately come into consumption, though charged with a duty of 63s. per cwt., while our plantation sugars pay only 24s.

Another inconvenience which the differential duties create is, that they offer a premium for evading the intention of the Legislature; foreign coffees are charged 1s. 3d. per lb.; colonial coffees only 6d.; while coffees imported from the Cape of Good Hope, pay 9d. Now, as the cost of sending, in an unusual and indirect way, coffee from foreign countries to the Cape is only from ½d. to 1d. per lb., very large quantities are shipped from the Brazils and Hayti to the Cape, and thence re-shipped to England; the English consumer thus pays the increased duty, and the difference of freight, and the foreign coffee is not excluded from the British market, though it was obviously the purpose of the law to exclude it.

Your committee cannot refrain from impressing strongly on the attention of the House that the effect of prohibitory duties, while they are of course wholly unproductive to the revenue, is to impose an indirect tax on the consumer, often equal to the whole difference of price between the British article and the foreign article which the prohibition excludes. This fact has been strongly and emphatically urged on Your Committee by several witnesses; and the enormous extent of taxation so levied cannot fail to awaken the attention of the House. On articles of food alone, it is averred, according to the Testimony laid before the Committee,that the amount taken from the consumer exceeds the amount of all the other taxes which are levied by the Government. And the witnesses concur in the opinion that the sacrifices of the community are not confined to the loss of revenue, but that they are accompanied by injurious effects upon wages and capital; they diminish greatly the productive powers of the country, and limit our active trading relations.

Somewhat similar is the action of high and protective duties. These impose upon the consumer a tax equal to the amount of the duties levied upon the foreign article, whilst it also increases the price of all the competing home-produced articles to the same amount as the duty; but that increased price goes, not to the Treasury, but to the protected manufacturer. It is obvious that high protective duties check importation, and consequently, are unproductive to the revenue; and experience shows, that the profit to the trader, the benefit to the consumer, and the fiscal interests of the country, are all sacrificed when heavy import duties impede the interchange of commodities with other nations.

The inquiries of Your Committee have naturally led them to investigate the effects of the protective system on manufacture and labour. They find on the part of those who are connected with some of the most important of our manufactures, a conviction, and a growing conviction, that the protective system is not, on the whole, beneficial to the protected manufactures themselves. Several witnesses have expressed the utmost willingness to surrender any protection they have from the Tariffs, and disclaim any benefit resulting from that protection; and Your Committee, in investigating the subject as to the amount of duties levied on the plea of protection to British manufactures, have to report that the amount does not exceed half a million Sterling; and some of the manufacturers, who are supposed to be most interested in retaining those duties, are quite willing they should be abolished, for the purpose of introducing a more liberal system into our commercial policy.

Your Committee gather from the evidence that has been laid before them, that while the prosperity of our own manufactures is not to be traced to benefits derived from the exclusion of foreign rival manufacturers, so neither is the competition of continental manufacturers to be traced to a protective system. They are told that the most vigorous and successful of the manufactures on the Continent have grown, not out of peculiar favour shown to them by legislation, but from those natural and spontaneous advantages which are associated with labour and capital in certain localities, and which cannot be transferred elsewhere at the mandate of the Legislature, or at the will of the manufacturer. Your Committee see reason to believe, that the most prosperous fabrics are those which flourish without the aid of special favours. It has been stated to Your Committee, that the Legislation of Great Britain, whenever it is hostile to the introduction of foreign commodities, is invariably urged by the foreign states that produce such commodities, as a ground and a sanction for laws being passed by them hostile to the introduction of products of British industry; and while on the one hand, there is reason to believe that the liberalizing the Tariffs of Great Britain would lead to similar favourable changes in the tariffs of other nations, so it is seriously to be apprehended that a persistence in our illiberal and exclusive policy will bring with it increased imposts on, if not prohibitions against, the products of British labour being admitted to other countries.

With reference to the influence of the protective system upon wages, and on the condition of the labourer, Your Committee have to observe, that as the pressure of foreign competition is heaviest on those articles in the production of which the rate of wages is lowest, so it is obvious, in a country exporting so largely as England does, that other advantages may more than compensate for an apparent advantage in the money price of labour. The countries in which the rate of wages is lowest are not always those which manufacture most successfully; and Your Committee are persuaded that the best service that could be rendered to the industrious classes of the community, would be to extend the field of labour, and of demand for labour, by an extension of our commerce; and that the supplanting the present system of protection and prohibition, by a moderate Tariff, would encourage and multiply most beneficially for the State and for the people our commercial transactions.

Your Committee further recommend, that as speedily as possible the whole system of differential duties and of all restrictions should be reconsidered, and that a change therein be effected in such a manner that existing interests may suffer as little as possible in the transaction to a more liberal and equitable state of things. Your Committee is persuaded that the difficulties of modifying the discriminating duties which favour the introduction of British colonial articles would be very much abated if the Colonies were themselves allowed the benefits of free trade with all the world.

Although, owing to the period of the Session at which the inquiry was begun, Your Committee have not been able to embrace all the several branches which come within the scope of their instructions, they have thought themselves warranted in reporting their strong conviction of the necessity of an immediate change in the Import Duties of the kingdom: and should Parliament sanction the views which Your Committee entertain on these most important matters, they are persuaded that by imposts on a small number of those articles which are now most productive, the amount of each impost being carefully considered with a view to the greatest consumption of the article, and thereby the greatest receipt to the Customs, no loss would occur to the revenue, but, on the contrary, a considerable augmentation might be confidently anticipated.

The simplification they recommend would not only vastly facilitate the transactions of commerce, and thereby benefit the revenue, but would at the same time greatly diminish the cost of collection, remove multitudinous sources of complaint and vexation, and give an example to the world at large, which, emanating from a community distinguished above all others for its capital, its enterprize, its intelligence, and the extent of its trading relations, could not but produce the happiest effects; and consolidate the great interests of peace and commerce by associating them intimately and permanently with the prosperity of the whole family of nations.

6 August 1840

Last modified 13 August 2002