WHO TAKES THE PROFITS?

Evening Post, Volume CXXVIII, Issue 116, 13 November 1939, Page 6

WHO TAKES THE PROFITS?

When anti-profiteering and pricecontrol measures are in the air it is well that the public should know how prices are governed and what becomes of the so-called profit made on sales. An enlightening analysis made by Mr. M. S. Myers, general manager, at the annual meeting of the D.I.C, supplies an answer in simple form. Of the average pound spent by the company's customers during the past year, Mr. Myers said 12s lOd went to the suppliers of goods, 3s 9d for salaries and wages, Is 4d for income tax, land tax, and Social Security tax, ls ld for general trading expenses, 2d for rates, 7d for dividend, and 3d was retained in the business for development. Thus employees received six and a half times as much as shareholders, and taxation' more than twice as much. One point that is at once suggested by the analysis is that a proportionate reduction of taxation would cheapen goods more than a reduction of net profit. Further, that the parties most interested in keeping the business sound and payable are those who draw most from it: first, by a long way, the employees, and next, the Government. If the basis of business is disturbed by State intervention, the delicate balance of distribution of the proceeds of sales must be upset. Then who will stand to lose most? Obviously those who now take most. Clearly, the analysis shows that interference should be avoided as far as possible, since it may easily cause much harm at the price of a little good.