BRITAIN.

Taranaki Daily News, 23 September 1915, Page 5

BRITAIN.

THE BUDGET. POSITION OF BRITISH FINANCES EXPLAINED. TREMENDOUS EXPENDITURE, London, Sept. 21. Mr. McKenna, in his Budget speech, asked the House to assent to great and unprecedented burdens. He estimated the revenue on the existing basis at 272 millions and the' expenditure at 1590 millions. He was sure the country would courageously and confidently face the outlay. Every section must contribute and make" great sacrifices. . He estimated that at the end of this year the dead weight of debt would be S2OO millions. This would in nowise cripple our resources. We had a navy costing 190 millions, an army costing -715 millions, and external advances amounting to 423 million?;

He estimated the daily rate of expenditure on all services from now to the end of the financial year at upwards of 4'/ s millions, possibly rising towards the close of the financial year to upwards of five millions. The expenditure for the current year included 36 millions on pre and post moratorium bills and 170 millions on ordinary national services, excluding tin: army and navy. There was no Xecord of any nation voluntarily accepting liabilities bearing so high a proportion to its total income for Vhich provision must be made within a sjhgle year. With regard to new taxation, both the strict freetrader and the scientific tariff reformer must temporarily put their fiscal theories aside. They must look at the condition of foreign exchanges and discourage imports, and also have strict regard to the necessity of reducing consumption. Besides the increase in the incometax, improved machinery would be contrived to assist employees and to give special relief for reduced incomes. BIG INCREASE IN TAXATION. The 40 per cent, increase in the in-come-tax would be for the full year, making 20 per cent, for the remaining six months. The exemption limit would be reduced to, say, £l3O, and the abatement £l2O. The tax would be payable half-yearly. The proposed changes in income-tax would yield an increase of £11,974,000, realising in a full year £44,400,000. He proposed to tax war profits, also •to raise the super-tax scale. A man without children earning 60s weekly would pay 18s lid quarterly, a man similarly circumstanced witli 80s weekly would pay 40s 2d quarterly, a man with £3OOO a year would pay £ 1028, a man with £IO,OOO a year would pay £2529, a man with over £IO,OOO a year would pay 7s in the £ on all the excess over £IO,OOO. The possessor of £IOO,OOO a year would pay £34,020. The revenue from excess war profits was estimated at 30 millions for a full year, but only six millions would be .collected before March 31. The total additional revenue for a full effective year under the inland revenue was estimated at 77 millions.

The proposed duty on sugar would increase the price a halfpenny per pound, yielding £117,000 per year. It was proposed to make a 50 per cent, increase hi' the tax on tea, coffee, dried fruits, -and tobacco. The increase on tea would produce 4'/ a millions a year, that on tobacco 5 millions. There would be an increase in the motor spirit duty of 3d a gallon, and the patent medicine duty would be doubled, yielding £250,000. There would be no alteration in the duty on beer or spirits. Dealing with imports which might properly be restricted by duties for reasons of foreign exchange and the restriction of luxury, he proposed an ad valorem duty of 331-3 per cent, on motor-cars, motor-bicycles, cinema films, cloaks, watche9, musical instruments, plate glass and hats, which would yield £1,150,000 a year.

The changes in the post office and telegraph rates would yield an increase of £5,976,000. The total additional revenue from customs and excise in the present .year would bo 25 millions, and the total new taxation £10,215,000 a year. The retrenchment committee had adopted the suggestion for the abolition of halfpenny postage, a reduction in the weight of a letter carried for a penny, a higher scale for parcels post, inland telcgTams, press telegrams, an increase in the poundage on the postal orders, and higher telephone charges. Mr. McKonna announced: We will treble our debt and double our taxation if the war continues. His proposals were not the last word, and he urged increased personal economy, EXCESS PROFITS. Received Sept, 22, 8.30 p.m. London, Sept. 22. In reply to a question, Mr. McKenna said that in future a wage earner would be treated like anybody else in respect to income-tax, while the excess profits tax would be charged on the profits of any business, except that of agriculture, whether made during the war or not.

RARE SCENE IN PARLIAMENT. THE PUBLIC'S INTERESTS. London, Sept. ■>). At the introduction of the Budget the House of Commons presented one of those rare scenes which mark the biggest events in its history. It was the greatest Budget ever introduced, and drew an enormous crowd inside the House. Parliament Square approaches and Palace Yard were filled with people anxious to see the controllers of the country's destinies passing through to Westminster Hall. The lobbies and central hall were blocked with people anxious to get ad mission to the Chamber or secure the first hint of the new burdens of taxation. Merchants, or their representatives, always crowd Parliament on Budget night. Changes of duties mean much to the masters of commerce, and .many are the expedients resorted to in order to escape from the building with the news of a fresh tax or a lowered tax. Within the Chambers the gangways f.nd galleries were packed to suffocation. Many members before noon had deposited their cards on their seats. The applicants for tickets to the Strangers' Gallery thronged the precincts. Some two thousand peers anil diplomatists looked down from their respective galleries upon an animated scene. There wex« Macic coats and white waist-

coats, dotted with bald heads and sprinkled with khaki uniforms. Welldressed women were descried behind the grille of the Ladies' Gallery, but it might have been a harem; not a face was distinguishable. The front, bench was a strange compound of all sorts of cals and Tories side by side, Sir Alfred Mond in close coalition with Sir Harry Verney. Received Sept. 22, 8.15 p.m. London, Sept. 22.

Their watchfulness was not in vain, and their spirits were spared from sacrifice. There was no brilliancy about the picture. The House was crowded with an eager, perspiring assemblage, hanging on to the Chancellor's lips to know what would next be burdened. To the taxpayer there were ninety-four questions, though some were postponed. The delay was great before' Mr. McKenna was able to unfold the burden, which, on the whole, is lighter than was generally expected. It gratified many that the income tax touched the weekly wageearner, and it greatly delighted the happy possessor of one hundred thousand pounds to find that his annual tax is not more than thirty-four thousand. The new duties are not in excess of the general expectation. Mr. AfcKenna continued: "The wealthy man's lot will not be happy when he is called on to find thirty-four thousand pounds in a given time. It can be done and, if necessary, further burdens can be met. A sudden blow, however, might cripple the individual. The tax on the excess of business profits charged to business for the years ending between September, 1912, and July, 1915, will be fifty per cent., with a tax upon profits above £IOO over the previous year's profits. This tax, after deducting income tax, amounts to sixty per cent, of the profits. The fifty per cent, duty on Cocoa will amount to £290,000. The Board controlling the liquor traffic has imposed restrictions where necessary, and these have already resulted in a considerable reduction of liquor consumption. A perusal of returns showing what countries are supplying our imports gives a good reason why motor cars, etc., have been chosen for taxation, and why men's and women's hats are also included.

"It is estimated that the revenue for the next financial year will be £387,000,000, and if we are willing, or, rather, as we are willing to bear the burden —(cheers)—we shall be able to do so. We accept the burden of taxation partly because of the limit of our powers to consume."

Mr. Henry Chaplin said he was glad mostly of the increased customs duties. All classes would willingly contribute, remembering that the burden was for their country, their home, and England. (Cheers),

Sir F. G. Banbury said if too heavy a burden was laid on the wealthy classes it would involve a difficulty in getting the loan money. Excessive taxation was certain to cripple industries. He was tempted to propose a tax on excessive wages', the same as on a manufacturers' war profits. One reason for the present great expenditure was that the Government paid through the nose for everything. Mr. B. P. Houston said it was possible that after the war profits supertaxes a man with an income of £IOO,OOO nominal income would became a minus quantity.

FREE TRADE FETISH DEAD. Received Sept. 22, 8.3 p.m. London, Sept. 22. Mr. T. Lough, complained that the Government was giving fictitious and exaggerated figures of the war cost and members were entitled to an explanation of Mr. Asquith's pTediction that it would reach five millions dailvi

Mr. Tim Healy said the present state of affairs showed that the free trade fetish was dead. The bottom had fallen out of the free trade pot. Mr. L. Hardy declared that the farmer must have capKal if he was expected to respond to the appeal for inincreased production.

Mr. McKenna replied that agricultural profits were not taxed.

Mr. J. G. Butcher congratulated the Government on the proposals to raise a gigantic revenue with reasonable fairness to oil classes.

Mr. R. L. Outhwaite said a striking feature was that the free trade policy was 'Wrapped." He believed that the taxation of imports was a sop thrown to the tariff reformers in the Cabinet. A vast revenue was coining from commercial businesses, but land was untouched. It must be taxed in future. Mr. McKenna, answering a question, said it was obvious that only a small part of the deficit could be met by taxation, and they must borrow on a future occasion. It was essential to reduce imports, bee ins j they could not increase exports, as their own capital and labor wore otherwise engaged. They could not do too nmcl> taxation without interfering where our export trade depends.

The resolutions embodying the Budget were agreed to unopposed, Some Radical protests on the tea and sugar duties were adjourned.

"BIG AND BOLD." PAPER COMMENT.. Received Sept. 22, 11 p.m. London, Sept. 22. Newspapers describe the Budget as a big, bold Budget. , The Daily Graphic regrets the absence of a. war tax on all letters and a small weekly tax on wages collected throu«li employers. The i-hicf difficulty in the in,reasc m the tobacco duty,'it says, is the price of cheap packets of cigarettes, and 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 kill the picture postcard craze. The duty on cinematographs applies to eighty per cent, of the films shown, whereof nine per cent, are American, and this should result in 'a considerable exploitation by British firms, . but it may be met with a general increase in the prices of admission.

The Labor Party meet to-morrow to discuss the Budget. Some members object to the tea and sugar duties, and the lowering of the income tax exemption. GROWING INCOME-TAX. Loudon, Sept. 21. Mr. McKenna will add 40 jwr cent, to the income-tax. SPIES SENTENCED. Received Sept. 22, 7.3j p.m. London, Sept. 21. The Press Bureau stales that a man and woman, of German origin, have been convicted of attempting to send abroad naval information useful to the enemy. The man was sentenced to death, and the woman to ten Years' iraDriaonmeD*'