GERMANY’S EFFORTS

Hokitika Guardian, 29 August 1931, Page 6

GERMANY’S EFFORTS

EXTENT OF PEOPLE’S BURDEN WHAT THE DECREES MEAN. When the present German Ch ncellor Dr Bruening took office in March 1930, he inherited an accumulated deficit of 1283.7 million marks. In spite of drastic cuts in wages and salaries, and taxation imposed under the emergency decrees of July and December, 1930, the deficit on the ordinary Budget for 193031 was 1190 million marks; but from the extraordinary Budget there was a surplus of 510 million marks to set against the accumulated extraord nary deficit of previous years. The Budget of 1931-32, which was based on the December emergency degree was to balance at 10,713 mi. lions, of which 10,466 millions fell to the ordinary lludget. Already a deficit of 940 millions is anticipated. To the 495 millions by which the revenue of the Reich (according to the now revised estimates) will fail to cover estimated expenditure must be added 79 mi lions for supplementary estimates, making a total of 574 millions. In these circumstances, a new emergency decree was signed in June of this year, appealing to all sections of the German people to accept the necessary sacrifices. DEFICIT IN THREE SECTIONS. The deficit with which the decree has to deal falls into three sections. The deficit of the Reicli is to be mot by economies of 306 millions, and by increased taxation amounting to 268 millions.

In addition, the deficit in respect of

■•emergency” unemployment In-netit amounts to 245 millions and a further sum of 140 millions was allocated for tlic provision of work. This is to be covered by a “crisis tax,” which is the most important measure in the.de ree. Lastly, the 440 millions deficit of the States and Communes is to he met as to 302 millions by salary’reduction and the abolition of wage tax refunds and 35 millions from a new “turnover tax.” The bulk of tlie contributions exac t'd from the German people are as follows :

Public employees, pensioners, and employees of the Reiohsbnnk and the State' railways are to have the r ■ 1 cut by amounts ranging from 4 to 8 per cent as from July 1, and the allowance for the first child, is to he reduced from 20 to 10 marks per month. Civil Servants’ salaries will then be 10.13 per e(‘nt. lower, than during the years 1927-30. IMPOSING A “CRISIS TAX.” The “crisis” tax is to extend corresponding sacrifices to private employees employers, members'cf the profession and other independent workers. It falls into two parts; an additional tax on wages and salaries, and an additional tax on incomes assessed to income tax Officials, who are subject to salary reductions, and persons who are exempt from the wages tilxy wuff-not-' be-'Sul'ject to these supplementary taxes. The tax on wages and , salaries is' graduated from 1 per cent, on gross wages not exceeding 300 marks a month to 3’ per, cent, • onyeariiings < f mere than 3000 marts'monthly. The .supplementary income ranges from If per cent, on annual incomes not exceeding .3600 marks to 4 per cent, on incomes over a million.

The “crisis tax,” which is to be effective until December, 1932, is expected to yield 385 millions in the current year (this just covers the deficit on unemployment expenditure, togetli r with the anoropviation for productive wor’s) and 390 millions next year.

UNEAIPLOVAIENT INSURANCE. In addition to these direct sacrifices of income Germany is undertaking certain reform of unemployment insurance An attempt is to he made to restore (.lie fund to solvency, by a five per cent reduction in benefits : a shortening of the period during which from ' 6 to 20 weeks, and by granting them < n'y the “qjnergenoy” benefit rate; an extension of the waiting period; a tightening of the conditions under which work may be refused; and a means test for minors and married women. Every section of the community is, therefore, contributing in a measure to tbi.s attemot to raise, in nine months some 1200 million marks as a net addition to the burdens already imposed by the Budget. Very approximately this is equivalent to an additional levy of some 24s per head per annum.