GREATEST BRITISH BUDGET EVER

Dominion, Volume 8, Issue 2574, 23 September 1915, Page 5

GREATEST BRITISH BUDGET EVER

INTRODUCED ■ THE NEW IMPOSTS TAXES ,ON INCOMES AND COMMODITIES ' ;■' ; v ' o ; -r—. By Telegraph—Press Association—Copyright ■ .. >. • (Rec. September 22, 8.15 p.m.) London, September 21. ( Ths Houso of Commons to-night presented one of those rare scenes which mark the biggest events in its history. The greatest Budget ever introduced drew an enormous crowd within and without the' House. ParliamentSquare and the approaches to Palace Yard were filled with people anxious to see the controllers of the country's destinies passing through to Westminister Hall. The lobbies, and Central Hall were blocked by people anxious to get admission to the Chamber or secure a first hint of t(ie new burdens of taxation. Merchants or their representatives" always crowd Parliament bai Budget night, for changes in duties mean much to the masters of commerce, and many are the expedients resorted to in order to escape from the building with news of a fresh tax or a lowered duty. Soene In the House. , Within the Chamber gangways and galleries were packed to suffocation. Many members before noon had deposited cards on their seats. Applicants for tickets to the Strangers' Gallery thronged the -precincts in crowds'for'which there was not a tithe of accommodation. Some two thousand peers and diplomatists looked down from their respective galleries upon 'an animated sceneblack coats and white waistcoats, dotted with bald heads and sprinkled with khaki uniforms. Well-dressed women could be described behind the grille of tlie Ladies! Gallery. But it might have been a harem, for not a face was distinguishable. The front.bench was an olio podrida, a strange compound of all sorts of p'olitios—Radicals and Tories side by sid6. and Sir Alfred Mond in close coalition with Sir Ilarrv Verney.

The danger zone was the Irisli bloc, where every man was on the qui vive to defend the sacred cause of. whisky. Their watchfulness was not in vain.. Spirits were; spared from; the sacrifice. There was no brilliancy about the picture. The House was 'crowded- with an eager, perspiring assemblage, hanging on the Chancellor's lips to know what would be the next burden on the taxpayer. There were ninety-four questions, and though some were nostponed, the delay was great.before-Mr. M'Kenna was able to unfold his burden, which,',on the. whole, was lighter than had generally been expected. It gratified , many that the inoome tax touched the; weekly wage-earner, and greatly delighted the happy possessor of £100,000, whose annual tax was not more than £34,000. The new 'duties were not in excess of the general expectation. '. ' Tho Chancellor's Proposals. ; ; Tho Chancellor of the Exchequer (Mr. Reginald M'Kenna), in introducing the Budget, asked the House to assent to great and unprecedented burdens ■The estimate of revenue on the existing basis was £272,000,000, ana the expenditure £1,590,000,000. Ho was sure tho country would courageously and confidently face the outlay. Every section must contribute to malco great sacrifices. He estimated that at the end of this year -the deadweight debt would be £2,200,000,000, but- this would in' nowiso cripple, our resources. Wo had a Navy costing £190,000,000 a year, an Army costing £715,000 000 and external'aclvances amountinc; to £423,000,000.., The estimated daily rite of expenditure for all services from now to tho end of the financial year waß upwards of. £4,500,000, and possibly rising towards tha close of the financial year to upwards of £5,000,000. 'Hie expenditure, for the current year included £360,000,000 on present and past moritorium bills . and £170,000,000 on ordinary national services, excluding the Army and Navy. There was no record of any nation voluntarily accepting liabilities bearing so high, a proportion to its total income for t;hich provision must bo made within a single year. Fiscal Theorleo Jettisoned. . In regard to the new taxation, both .the strict Free-trader and th'e scientific Tariff Reformer must' tenworarily put fiscal theories aside, and look to the, condition of the. foreign oxchances. They must discourage imports; and they must also have a strict regard for the necessity of a reduction in consumption. . It was proposed to add 40 per cent, to tho income tax rates, combined with improved machinery for assisting employees and, special relief for those in Teceipt of reduced incomes. Tho 40_per cent, increase will bo for "the full year, making 20 per cent, for tho remaining six months. The exemption limit would be reduced, say. to £130 mid abatement to £120. Tho tax would be payable half-yearly. "Tito proposed changes in tho income tax would yield an increase of £11,974,000. ronlisiiur in a full year £44,400,000. Mr. M'Kenna continued: "The wealthy man's lot will not be a happy one when ho is called on to find £34,000. Given time, it'caii be dono, and if necessary, further burdens can be met. A sudden blow, however, might cripple tho individual. , The tax on the excess of business profits will be charged on the business year ending between September. 1914, and July, 1915. A 50 per cent, fax will be imposed upon profits above £100 over the previous year's profits. This tax, after deducting the income tax, amounts to GO per cent, on profits. _ ' "The existing lower rate of.tli'o income tai is Ik. Gel., and'the 40 per cent, increase means a minimum of 2s. Id. Tho existing higher rate is 2s. Oil., ami the 40 per cent, increase means a maximum of 3s. 6d."

. Taxes on War Profits and Incomes. He proposed to tax war profits/ and also to raise the super-tax scale". 'A' man without children earning 60s; weekly wotild pay 18s. lid. quarterly; a mail similarly circumstanced earning 80s. weekly would pay 465. 2d. quarterly; a man with ,-65000 per year would pay £1029; the mail with £10,000 per year would pay £2529: a in an with over £10.000 would pay 7s. in the £ for all in excess over £10,0(10. The possessor of £100,000 per year wouM pay £34,000. The -revenue from the excess of war profits was estimated at £30,000,0(10 for the fulf year, hut only £6,000,000 would be.', collected before March 31. The total additional revenue for the full cfTcctiV'e year Miuder the inland revenue was estimated at £77,000,000., Commodities-and Luxuries. • It was oroposed that, t.he sugar,dut.v he -inernaserl by a half-penny .per pound, yieldinc £11.700,000 a. : year. Them would be 50 per c<?nt. increase on tea, coffee, dried fruit,n, and toba/m The increase on tea imilcl 4} •uiUiDOfc a tiu. and an tobtaea jfiSJjQQ-.COOi

There would be an increase of the motor spirit duty of 3d. per gallon. The patent medicine duty would bo doubled, yielding a quarter of a million. Thoro would bo 110 alteration in regard to beer and spirits. Dealing with imports which might properly bo restricted by duties for reasons of foreign. exchange and restriction of luxury, ho proposed an ad valorem duty of 33J per cent, on motowiars. motor-cycles, kinema films, clocks, watches, musical instruments, plateglass and hats, vielding £1,150,000 per year. , eo .P e r cent- duty on cocoa will return an amount of £290,000. J. lio board which is controlling the liquor traffic has imposed restrictions Awiero necessary, and these already have resulted in. a considerable reduction m the consumption. . - . \ A perusal of tho returns showing 'the countries supplying our inreorts gives a good reason why mctor-cars, etc., should be clioseii ' for taxation. Men's and women's'hats aro included. Proposals Are Not the Last Word Yet. y., hl tho po ¥ alld telograpll rates : ™ ul<l Yield an increase of <'&4,y/o,U(Ju. ! ■ ' ■ The total additional revenue from Customs and excise duties for thci pren!i m?rl»i' 0 £25,000,000, and the total new taxation would yield A/10,215,000 per year. ■ " Tho-Retrenchment Committee adopted the suggestion for the abolition of halt-penny postage and the reduction of the weight of the letter carried for Id. fnero would be a-higher scale for parcels post, inland telegrams, press' telegrams, an increase m the poundage on postal orders, and higher telephone charges. v Wo would treble our debt and double our taxation if the war continued. His proposals were tho last word. He urged increased personal economy. In reply to a question Mr. M'Kenna said that in future the wage-earner would be treated like anybody else in respeot to incomo tax, while the excess profits tax would bo charged on the profits on any business cxcept agriculture, whether made on war or not. "The estimated revenue for the next finanoial year is £387,000,000. If we are willing,- or-Tather, as we are willing, to bear the burden—(cheers)— wo shall bo able to do so. AVe accept tlie burdens of taxation partly becauso we can limit our power to consume." \ Feeling of the House, Mr. Chaplin (Unionist) said that he was glad the imposts were mostly Customs duties. All classes would willingly contribute, remembering that it was for country, home, and England. ' (Cheers.) Sir Frederick Banbur,y (Unionist) said that if too'heavy a burden were laid on the wealthy it would involve a difficulty in getting loan money. Excessive taxation would be certain to cripple the industries. He felt tempted to propose a tax on excessive wages in the same way a3 they were going to tax manufacturers' war " profits. One reason for the present great expenditure was that the Government paid through the nose for everything. Mr. R. P. Houston (Unionist) said that it was possible that after the war the profits and 6upor-taxes man with £100,000 nominal income would become a minus quality. ■ Mr. T. Lough (Liberal) complained that t!he Government was giving fictitious and exaggerated figures of the cost of the war, and the House was entitled to an explanation of Mr. Asquith's prediction that it would reach £5,000,000 a day. . Mr. Tim Healy (Nationalist) said that the present state of affairs showed that the free-trade fetish was dead. Tile bottom had fallen out of the freetrade pot.• ■ ' Mr. L. Hardy (Unionist) declared that the farmer must have capital if he were expected to respond to the appeal for-an increase in his production. Mr, M'Kenna replied that profits on agriculture would not be .taxed. Mr. J. G. Butcher (Unionist) congratulated the Government on its proposals to raise a gigantic revenue with reasonable fairness to all classes.

ilr. R. L. Outhwaite (Liberal) said that a striking feature of tho Budget was tho fact that tho free-trade policy had been scrapped. He believed in the taxation of imports. A sop had been thrown to the ta'riff reformers in tho Cabinet, but the vast revenue of the commercial interests had not been touched. It must be taxed in future, or so towards protection. Mr. M'Kenna, answering a question, said that it was obvious that only a small part of the deficit could be met by taxation. ■ They must borrow on a future occasion. It was essential to reduce the imports because -we could not increase exports, as our own capital and labour -were otherwiso engaged. We could not do too much by taxation, without interfering with the industries on which the export trade depended. ... . Proposals Carried. The resolutions embodying the Budget were agreed to unopposed. There were some Radical protests against the tea and sugar duties. The House tlien adjourned.' • , PRESS AND PUBLIC COMMENT ON THE BUDGET (Rcc, September 22, 11 p.m.) London, September 22. ,The newspapers describe the Budget as "a big, bold Budget. \ The "Daily Graphic" regrets the absence of a war tax on all letters, and the small weekly tax on wages, collected through the employers. The chief difficulty willbe the increase in the tobacco duty and the price of cheap packets of cigarettes. It is questionable whether.it will be possible to retail five cigarettes for a penny. The Trade fears that "the abolition of the half-penny postage will bill the picture post-card craze. The duty on ' kinematographs applies to eighty per cent, of the films shown, of which ninety per cent." are American, and should result' in a considerable exploitation of. the English film firms; but this may bo met by a general increase in the price of admission. ' The Labour Party will meet to-morrow to discuss the Budget. Some object to the tea and duties, and the lowering of the income tax standard' of exemption. ■