“GOOD OLD WINSTON”

Sun (Auckland), Volume II, Issue 338, 25 April 1928, Page 9

“GOOD OLD WINSTON”

Cheers for Chancellor MOTORISTS RESENT NEW TAX SURPRISES OF THE BUDGET (United P. A.—By Telegraph — Copyright.) (Australian Press Association)

Reed. 9.5 a.m. LONDON, Mon. The police had to clear the way to Downing Street to enable Mr. Winston Churchill, Chancellor of the Exchequer, to pass the crowd on his way to the House of Commons. Accompanied by his daughter Diana, he walked to Whitehall amid cries of “Good old Winston!” A passing bus-driver called, “What about beer and bacey?” and the Chancellor, wreathed in smiles, waved a friendly hand.

Mr. ("m ii rch Ill's surprises were the petrol tax, and children’s allowance off the Income tax. The petrol tax is certainly vigorously opposed by the motorists. Mr. Reece, chairman of the motor section of the Liverpool Chamber of Commerce, describes the tax as wicked and iniquitous, and says it will do untold harm, and keep a large number of cars off the road. Mr. Malcolm Campbell, the racer, regards it as unfair to the motorist, who is already heavily taxed. A registration tax based on horse-power is quite sufficient. - Taxi-owners and drivers say it is simply ruinous. The Commercial Motor Users’ Association estimates that the average goods traffic vehicle will pay £4O to £SO annually extra for petrol. This is simply staggering, and will cost the General Omnibus Company more than £300,000 extra yearly. It is expected that fares will be increased. Sir Robert Horne, a former Chancellor, says he is glad Mr. Churchill has taken the opportunity to bring out a comprehensive scheme for relieving the staple industries. He regrets the necessity of taxing petrol for this purpose has prevented momentarily the cancellation of the tax by horse-power on motor-cars, but the Chancellor says he has not closed the door upon alteration of this important duty. RATING REFORM Sir Robert Horne refers to rating reform, which he says has been favoured by all sections of the House for a long time, but the money has heen wanting. The effect of the reform will be that after October, 1929, all property used for production by means of manual labour will be relieved of three-quarters of the local rates, and agricultural land already relieved of three-quarters will be relieved entirely, local authorities being compensated by Exchequer grants. Offices and private residences will not benefit in any way. The railways, which benefit to the extent of £4,500,000 annually, have agreed to pass on their savings in the form of freight reductions. Petrol prices advanced 4id a gallon, the extra farthing to cover the cost of collecting the tax. As soon as the Budget was known, motorists streamed to filling stations in all parts of London. There were queues of cars.

INCOME-TAX RELIEF

ALLOWANCES FOR CHILDREN WARM CONGRATULATIONS Mr. Churchill, in presenting the Budget, said: “Unless a catas- % trophe on a great scale happens, the finances ought strongly to revive in 1529. Through a steady revival of trade and business, 1929 should be a year of real advance toward prosperity. Indeed, my position in 1929 promises to be the least unsatisfactory that I have had during my tenancy of the Exchequer.”

He kept as a surprise liis announcement of income tax relief until the last, stating that resources hud not allowed a reduction in the standard rate, but he realised that the burden of bringing up children should he lightened where possible. Theretofore he proposed that the alowances for children, which were at present £36 for the first child and £27 for the others, should be raised to £6O and £SO respectively. Furthermore, a concession would be made that the allowances should be applicable to the year of the child’s birth. This would mean that a married man with three or more children, and receiving an income of £4OO annually, would be free of tax. If he were receiving an income of £SOO annually, it would mean that the present tax -would be halved; if it -were £7OO, the reduction would be 17d on the standard rate; if £BOO, a reduction of 14d; if £I,OOO, a reduction of Sd. The cost of the reductions would amount to £2,100,000 for the present year, and £4.500,000 for a full year. Mr. Churchill spoke for three hours 11 minutes. Mr. Philip Snowden, a former Labour Chancellor of the Exchequer, congratulated the Chancellor on a brilliant party achievement. He welcomed the allowances to children, also the rating scheme. His only criticism of the latter proposal was its delay till 1329. Mr. Lloyd George, the Liberal leader, welcomed the income tax exemptions, and characterised the rating relief as the most dominant and important feature. The House rose at 8.7 p.m.

NATIONAL DEBT TOTAL OF £7,527,000,000 “WE HAVE DONE WELL” Mr. Churchill said the Budget of last year had succeeded in spite of adverse circumstances. One blow was the £5,000,000 failure in revenue from beer. There would have been a deficit for a third year running, but for the continuance of the economy campaign. A sum of £10,500,000 had been saved by the Government departments. Encouraged by the success of last year, lie proposed to repeat the process, and to save money wherever possible in administration. They had done well during the year in the repayment of debt. The new sinking fund had been raised above the early level of £50,000,000 to the unprecedented figure of £65.000,000. In addition, the Budget had borne the payment of more than £15,000,000 for accrued interest upon saving certificates. V The nominal deadweight of debt on April 1, 1928, was £7,527,000,000. He had found £28,000,000 more for redemption of debt than Mr. Snowden, the Labour Chancellor of the Exchequer, had done in 1924. The position for dealing with future conversions had been greatly improved by what had been accomplished in the past. The total expenditure for 1928 was estimated at £806.195,000. The expenditure on the Consolidated Fund service was placed at £395,000,000, and the total on supply services at £407,000,000. The total expenditure was, compared with the estimate of £833,390,000 last year, £835,585,000 actually spent. Proceeding to estimate revenue on the existing basis of taxation, the Chancellor of the Exchequer said that Customs and excise revenue moved forward by £2,000,000 or £3,000,000 yearly in accordance w r ith the grow th of population and the general maintenance of consuming power. He saw a chance of a recovery in the revenue from beer, which emboldened him to repeat his estimate of last year. The revenue from spirits, on the other hand, must be expected to resume its continuous descent:

The increased duty upon tobacco ; had more than realised expectations. ! Taxes on silk and on imports under' the Industries Safeguarding Act showed, on the whole, an increase. He expected a yield of £3,250,000 this year from the betting tax, against £2,700,000 last year. The yield of the duties on tea and sugar in the coming year might be expected to respond to the slow upward movement of consuming power. “AN INDUSTRIAL BUDGET” I PRESENT NEEDS MET VIEWS OF THE NEWSPAPERS (United. P.A.—By Telegraph Copyright) Reed. Noon. LONDON, Wednesday. Newspapers are practically unanimous in describing it as an industrial budget, in conformity with present needs. “The Daily Telegraph” says the deplorable plight of the basic industries has compelled the Government to take up one of the most urgent problems of : the day, namely the revision of the j relationship between national and j local taxation. It has recognised that \ this can only be done in stages, the j i first of which has been entered with ' a due sense of the gravity of far- | reaching and immense reactions. “This is the real heart of the Bud- j get, and it is hoped that the British | democracy will grasp the essential j purpose of the scheme. If a heated j | discussion arises, as it may, on the i petrol tax, let the disputants rememj her that the primary object is to help \ to create a pool for the relief of sorelyj smitten industries, and reduction of j the number of unemployed.” i The “Daily Express” says the heavy | impost of 4d a gallon on petrol may j not be oppressive, owing to the pres- | ent low price, but should petrol rise i it will be burdensome. Therefore, it ! is of the utmost importance that the j Government should use its power as | n. majority stockholder in the Angio- : Persian Company to maintain the price ; at its present level. The “Morning Post” states that Mr. 1 Churchill realises that the financial j policy must be made to suit industry, and not vice versa. It is known that out of the now chronic population of a million unemployed nine-tenths are from the staple industries. which formerly maintained the greatness and strength of the country. The “Daily Herald” congratulates the Government on awakening to the plight of the necessitous areas, hut questions Mr. Churchill's scheme. It points out that the tax on petrol affects not only the private motorist, but the growing national transport services. It complains that the Budget ! will mean a general increase in the

cost of living, while the landowners will benefit enormously from the rale of free farms.

DEBT REDUCTION ELIMINATION IN 50 YEARS FEW CHANGES IN TARIFF British Official Wireless Reed. 1.15 p.m. LONDON, Wed. Dealing with the general treatment of the problem of the national debt. Mr. Churchill said that he proposed to return to the policy instituted in Disraeli’s Government by Sir Stafford Northcote, in 1575, and to establish a fixed debt charge. He proposed to put the figure at £350,000,000 yearly. The payment of £350,000,000 a year would extinguish the external and internal debt, including the debt ta the United States, without any addition to the present taxation, in a period of 50 years. Mr. Churchill proposed a few- minor changes in the Customs and excise duties, covering wines, buttons, films, artificial lighters, etc. The total Customs revenue would come to £135,500,000, and the total excise revenue would be £139,000,000. He estimated that the income tax. which would remain at the existing standard rate of 4s in the £l, would yield £235,000,000. He estimated the gross revenue, on the existing basis of taxation, with the aforementioned minor charges, at £512,497,000. making a prospective surplus of £ 6,302,000. LOCAL TAXATION BURDEN OF UNEMPLOYED PETROL TO GIVE RELIEF The Chancellor then entered upon j what he described as the most controj versiai part of his task. He said an j unsatisfactory picture was presented i by the heavy basic industries, in which I unemployment taxation (or rates) entered directly into the cost of production, and affected the competing power of these industries at Home and J abroad. j Some relief on production from local , taxation was urgently needed. He had. therefore, proposed to the Prime Minister that, as a concluding financial effort in this Parliament, he should ! try to form a mass manoeuvre fund of between £20,000.000 to C 20.000.000. for ia great operation upon local governi ment taxation. The Government bad complet' d their | plans. The legislation required for thi3 purpose must inevitably beronv. i the most important measure of its kind. He had to find a substantial amount of new revenae to carry out I the policy. He did not suppose anyone would have much doubt where he. ! ought to turn for it. During the 19th I century the industrial power of this . country rested on a basis of coal, but in the 20th century it had been be--1 coming increasingly dependent upon imported liquid fuel, scarcely any of which was found inside the Britisn ! Kmpire. The Government had, there- • fore, decided to impose a n«-.w duty of Jid a gallon on certain kinds oi imported oil The new tax would be ! confined to lighter hydro-carbon oils, | including petrol.- but excluding liea\ y oils and lubricating oil. The tax would l be imposed as from to-morrow*. It wa-. J estimated to yield 14.000.000 this year land £17,500.000 in 1929. | In order to balance the extra nscal j burden which the tax on kerosene | might throw upon the consumer Mr. Churchill proposed to reduce the existing duties on sugar. The duty on all imported sugar would be reduced by an amount equivalent to id in the pound in the retail price. By this means it was possible also to afford relief to British refiners.