William Gladstone presents his first budget as Chancellor of the Exchequer

In a speech lasting four and three quarter hours, Gladstone proposed an extension of income tax for seven years, over which time it would gradually reduce. ‘By 5th of April 1860’, Gladstone concluded, ‘The income tax will by law expire.’ Although seeking its abolition, Gladstone recognised the importance of income tax, ‘an engine of gigantic power for great national purposes’. He retained it to build up surpluses to pay for potential military conflicts and to allow for the removal of custom duties. The budget proposed to remove duties on 123 articles and significantly reduce them on a further 135. This would as Gladstone put it allow the nation’s wealth ‘to fructify in the pockets of the people.’ The budget was met with acclaim and not only enhanced Gladstone’s reputation but also the stature of the office of Chancellor.