Revenue and Taxation.

Press, Volume LIV, Issue 16156, 9 March 1918, Page 8

Revenue and Taxation.

"\Ve dealt briefly and in general icrms yesterday with tho principal points in Sir Joseph Ward's statement of tho revenue and expenditure for the eleven months ended on February 2Sth. Before discussing those points a little more fully wo may recapitulate the facts of thy financial position as disclosed by the In tho year 1916-17 tho revenue was £18,367,517, and the expenditure £14.053,770, leaving a credit bnlanco of £4,308,777. In his Budget last year the Minister estimated that the rovenuo would be £17,232,800, and the expenditure £16,032,702. That is to say, he estimated that the revenue. would fall by £1,084,747, while the expenditure Would increase by £2,023,932, the result being a credit balance of £1,200,098 for the year. For eleven months the revemio has actually increased by £2,515,138, and the expenditure has in- . creased by £771,393. For reasons • which we have previously given, we may expcct a still greater increase in i the revenue on the basis of the -whole

year's comparison, while it is improbable that the expenditure will exceed that in 191(5-17 by so much as a million. It is very difficult to estimate the total receipts from land and income-tax, but w« .shall probably not be far wrong if we estimate a final revenue of 21* miiliois.s. and expenditure totalling 15 millions. This will leave the enormous l.T.lancD for the year of 6i millions sterling, ami as the ordinary Itevcnue Account in the Consolidated Fund began with a credit balance, on April Ist, l:jl7* of £0,474,85-1. the balance to be carried forward on April Ist next will be shown as something like thirteen millions sterling. I'roporly to reai'.so what this moans, one should rcflect that it i> greater than the total revenue in the year 1914-15. Thirteen millions will represent approximately the sum of the revenue balances for tho three years 1915-1(5, 1916-11, and 1917-18. Whence has this great sum been derived? Almost entirely from war taxation, and tho bulk of the war taxation —one might without much error say the r.holo of it—-has en mo from the direct taxes levied on a comparatively small section of the community. The one largo soarc-o of indirect taxation —the Customs tariff—lists actually yielded less in cach of the past three years than it yielded in 1911-12. And now. having built up a large reserve, tho Minister announces that there will be no further taxation, which means that no attempt will bo made to use taxation as an instrument for securing a general and really national contribution to tho cost of the war. Sir Joseph Ward seems to have realised now and then tho impropriety of the partial and inequitable system of taxation in force, for in his 1916 Budget he forecasted a possible change. "Even the humblest in the "land," ho then said, "would probably " tako exception to being altogether (i excluded under the law from making '• sotr,e slight contribution towards holp- ' in rr to win the wu'.y' and the lowering of the income-tax exemption line "would become a 1 question for serious " consideration if the war continues bc"yond tho end of next year" [i.e., tho vear 1917] But, there now stands in the way of "serious consideration" a, huge accumulated balance, drawn from a section only of the population, which would not be there at all if tho Government had not depended entirely upon loans for the financing of tho war. Had tho Government decided to pay a proportion of the cost of the war out of revenue, as we have all along urged, the case for a system of honest and equitable taxation would have been admitted even by the Government' to bo irresistible. The existing taxpayers certainly deserve some consideration now, but nobody can consider the present