BRITISH BUDGET

Taranaki Daily News, 6 April 1916, Page 5

BRITISH BUDGET

A HUGE EXPENDITURE. INTERESTING FIGURES. By Cable.—Press Association—Copyrig'i t London, April 4. In introducing his Budget Mr. McKenna, Chancellor of the Exchequer, said the shortage of tonnage had had a considerable effect upon the revenue, as had also the prohibition of certain imports. Tp compiling his statement he was assuming that the war would last throughout the whole financial year. T'ne actual expenditure last year was £1,559,000,000, or £31,000,000 'less than the estimate. The actual net issues of loans to our allies amounted to £204,000,000, and to the Dominions £52,000,000—in the latter case £16,000,000 less than was estimated. This result was due to the public spirit of the overseas Governments, for which they owed them thanks. (Cheers.) Making allowances for certai- facts the total assistance to the- allies was £313,000,000. In pursuance of a scheme for the purchase of American securities they bought a considerable amount out of the funds, and by their re-sale built up a large reserve to meet future needs." The purchase money was included in last year's expenditure. The proceeding would constitute an asset in America with which to begin the current year.

REVENUE AND EXPENDITURE. The total revenue lost year was £336,707,000, an increase of £31,753,000 above the estimate. The expenditure was £1,559,000,000. The deficit was met by borrowing £600,000,000 by the war loan of June, £ 154,000,000 by the sale of Exchequer bonds, £50,000,000 by the Anglo-French American loan, and the balance by the sale of Treasury bills, WAR INDEBTEDNESS. Our total war indebtedness was £2,140,000.000, whereof £368,000,000 was advanced to our allies and the Relief would come to us in the future in regard to these items, but wo were responsible now and had to bear the whole dead weight. Additions made to our taxation fully assured the national creditors that their capital and interest were secure. There would be an inevitable increase in expenditure during the coming year. War services accounted for £1,120,000,000, and there would he an additional £30,000,000 of miscellaneous expenditure, bringing up t)"! war expenditure over three millions daily. Advances for the allies and Dominions might be pteced at £450,000,000, and consolidated services, including interest debit, £1,577,000,000. These with other services brought up the total to £1,825,000,000. or almost exactly five millions daily. He would be disappointed if serious economics were not effected during the year and the large total reduced. He thanked his Majesty for his kindly gift to the war funds. On Mr. Astjuith's return they would decide how it would be spent. He estimated revenue for the current year at £1,508,000,000, whereof permanent taxation would provide about £423.000,000, leaving a deficit of £1,323,000,000. In addition they would aiso have to meet a new charge for interest and sinking fund, which lie calculated at £79,000,000. | ] new taxes; Regarding new taxes, the object would be to get revenue to meet obligations, to pay as large a proportion of the war cost as possible, and to distribute fairly the burden of taxation. Therefore he proposed to impose taxes to bring in £509,000,000. There would be a'small increase in the income-tax on small incomes, rising to a maximum of five shillings in the pound. Earned incomes up to £SOO would pay 20.3d, from £SOO to £IOOO half a crown, and successive stages to five shillings. A new scale on unearned incomes would commence at three shillings on incomes not exceeding £3OO, rising by sixpenny stages to five shillings on incomes exceeding £2OOO. He estimated that these increases should produce £43,500,000. The super-tax would be unchanged.

Dealing with the double income-tax he said that would have to be dealjt with in the promised reconstruction of the income-tax laws. For the present, where a Dominion's tax was not less than eightpence he would not impose any fresh burden.

A voice: What does that mean? Mr. McKenna: It means that whatever they suffer they will continue to suffer, but they will not suffer any more than that. The additional tax would not apply to the naval and inilita'.'y forces. New customs and excise taxes were estimated to bring in £2,800,000. There would be a tnx on amusement tickets, including football and horse-racing, rising from a halfpenny to a shilling according to the cost of a seat up to 12s Od, with an additional shilling for seats above that amount. This was estimated to reajfce £5,000,000. He would also impqse a tax on railway tickets yielding £3,000,000.

WAIT PROFITS TAXATION. A White Paper reveals that the excess profits tax yielded £1,400,000 against an estimated yield of £8,000,000. During the year £160,428,000 was repaid to the Bank of England, and Exchequer bonds amounting to £ 16,395,000 were redeemed. In the estimates for the current year Civil Servico reductions amount to £3,524,000. EXTEA DUTY ON SUGAR. Received April 5, 5.5 p.m. ' London, April 4. An additional one penny per pound duty will be fixed on sugar, yielding seven millions. Cocoa, coffee, and chicory an; to be increased to sixpence a pound, producing two millions; matches to 3s Od per 10,000 matches; mineral waters fourpence per gallon, yielding two millions. TAXING MOTORS. It is proposed to double the present duty on motor-cars up to 18 horse-power, and treble on the higher-powered curs and motor-cycles not exceeding four horse-power. This is equal to two guineas on the higher-powered machines. The duty on motor-ears and motor-cycles will realise £BOO,OOO. The excess-profit tax will be increased to 60 per cent. ;"!' 'A PROBABLE SURPLUS. *:* Summing up, Mr. McKenna said he calculated that by March, 1917, he would have required to meet in an ordinary year i £388,000,000, Our gerjnMieat _j^

venue was '£423,000,000, leaving a surplus after another year of war of £85,000,000. When peace came England would have a margin for the remission of. taxation. Civic courage waa as important as military courage, and we might justly claim that wo are not found wanting in these great virtues, —— i OUR WONDERFUL RESOURCES. Received April 5, 8.80 p.m. London, April '4. Mr. McKenna explained that the reason that the yield from the exces* war profits tax was so small was due to the delay in passing the Finance Bill. JJe added that tiro manner in which the British credit had withstood the immense claims upon it was truly wonderful to those unfamiliar with our financial methods and resources. An examination shows that wo have not borrowed a pound without providing new taxation to cover interest and provide a liberal sinking fund. PROTESTS. Mr. William O'Brien protested against Ireland's inclusion in the Budget; she could not bear the burdens of indefensible taxation. Mr. Barnes thought that the new duties would press severely on the poorer classes, especially the railway" ticket*. COLLECTION OP DUTIES AUTHORISED, | Received April 5, 9 p.m. London, April 5. The House of Commons passed a resolution authorising the collection of duties according to all Mr. McKenna'e proposals. SATISFACTION AT PROPOSALS. Received April 5, 11.25 p,m. London, April 6. There is general approval of Mr. McKenna's announcement that the excess profits tax will be extended to the sales of profit-producing assets, thus securing to the Exchequer a share of the profits on sales of steamships. Some which cost £30,000 are now selling at £200,000. Regarding tariff reform, the newspapers regret that the Government is neglecting the opportunity of imposing a protective tariff with preference to the dominions and allies.