The Daily News. WEDNESDAY, JULY 16, 1919. GERMAN TAXATION.

Taranaki Daily News, 16 July 1919, Page 4

The Daily News. WEDNESDAY, JULY 16, 1919. GERMAN TAXATION.

It was ineyitable that the expenses of the war that Germany waged, coupled with the reparations, indemnities and cost of the Allied occupation would necessitate the recasting of her financial future. There was room for considerable speculation as to the means that would be adopted to raise the money required to diseliarjfje lia-

bilities and carry on the govern-1 ment of the country. In 1913 Germany's ordinary revenue was £159.719,970, and her extraordinary revenue (loans, etc.) was £9,514,875, making a total of nearly 1691 millions to meet an expenditure of 176 millions. The Imperial revenue was chiefly derived from posts, telegraphs, customs, taxes, duties, rents, the China indemnify, the Alsace-Lorraine railways, and matricular contributions collected by the various States. In 1913 extra taxation was imposed to meet the increased cost of armaments, and the means devised consisted of a levy varying from 0.15 per cent to eight per cent, together with a property tax on the increment accrued in the three years from January 1, 1914, and thereafter every three years. The amount actually raised by loans during the war is not definitely known, but the immense increase of paper money had a most depressing effect on the value of the German mark, which became reduced from eleven pence three farthings to eight pence farthing. It is obvious that the position <>f the German Finance Minister (Herr Erzberger) is no enviable one, and in his recent dexterous speech in the National Asfl-rably he spoke of "the necessity tor homogenous taxation to enable Germany to pay the indemnities and war loans." At the same time he outlined a levy on fortunes, and business turnover, with drastic death duties and heavy taxation on unearned incomes, his moral being that the people must work, otherwise they would be foolish. A' later announcement is to the effect that the capital levy aims at securing four and a half millions sterling by taking from ten to sixty-five per cent of fortunes and jewels over the value of £2500. It would appear inadvisable to accept this message as accurate, for the amount named is so small that either it is an error or the upper class Germans must have stripped themselves, or been stripped of the greater part of their wealth. "We find that in Britain for the year 1916-17 ownership of land and houses produced an income of £177,861,291, and the income from the holding of Government securities was £76,973,462, both these items being in the nature of fortunes. Allowing for a considerable reduction of this wealth in the case of Gferraany it would seem that a levy of from ten to sixty-five per cent must produce many millions. Be that as it may, it is satisfactory that the wealthy class, which has hitherto escaped in large measure the burden of taxation, as well as the burden of the war, should now be made to feel that they must shoulder the financial responsibilities of their country. It was this j class which gloried in the war and j stimulated the gamble on indemnities, so that heavy taxation with drastic levies will bring home to the Junkers, as nothing else could, that the guilty and losers must pay. "What Herr Erzberger did not explain was the fact that the Allies' experience of German methods of finance in borrowing continuously to pay interest on war loans, as well as imposing the burden of taxation on the shoulders of those least able to bear it, led to the insertion of a provision in the peace treaty that the cost of reparation would be a charge upon all German revenues, with priority over domestic expenditure. It is evident that all classes in Germany will have to contribute their quota towards discharging the liabilities to the Allies, and it is only right this course mould be pursued. Probably no serious effort will be made to deal with th 6 war loans for some time to come, as it is morally certain that the reckless borrowing policy has come to an end. The lifting if the blockade should afford a jertain measure of relief, but the 3-ermans will find they are forced to pay cash down for all imports, ft is impossible to feel any sympathy with the Germans, though they are faced with an ordeal that ivill try them bitterly. For that they have to blame themselves, md the penalty is by no means as severe as the circumstances warranted. The economic conditions n Germany are in a sorry plight, ind it will require firmness on the 3art of the Alllies to compel the ibservance of the,peace terms and ;he payment of what is due. If ;he Assembly agrees to the levy woposed by the Finance Minister t should be rigorously imposed, ! or, so far, the wealthy class have lot been made to feel the punishnent that is their due. It would ie nothing less than a crime to alow these fire-brands to escape vith impunity, while the British tnd Allied peoples have been cornjelled to make unprecedented sac•ifices in consequence of German nilitary ambitions. The interssts of justice demand that the vhole of the German people ihould be made to suffer proporionately to their financial standng, and the attainment of that md by the German Government vill be in the best interests of the sountry, and a source of satisfacion to the Allies.

THE CRY OF "BOLSHEVISM." There is a peculiar type of critic in New Zealand to-day who, in his endeavor to excuse the laches of the members of the Coalition Ministry, and to maintain those inefficients in power, raises tho cry of "Bolshevism" whenever anyone dares to turn the searchlight of criticism upon their administrative misdeeds. The Coalition Ministers are sacrosanct, they are the saviors of the country, tho only men who can he entrusted with tho destinies of this fair land in these days of reconstruction, the only ones who can keep at bay the extremists striving to secure the reins of government. The general public should overlook any of their lit.tlo shortcomings and deficiencies, since they, and only they, could have piloted the country through the critical days of the war. This is how the selfsatisfied critics referred to argue, but really they are doing the country and the Coalition Cabinet itself the greatest disservice by perpetually raising the cry of Bolshevism and minimising and excusing the shortcomings of the Government. Indeed, they are the best agents the real Bolshevist has in the community to-day. The public are not all ignorant, and they axe no,t to be misled by specious cries of "Bolshevism" into countenancing for a day longer than can be helped a Government that has passed its day of usefulness and shown a lack of capacity to deal with the peculiar difficulties and problems before the country to-day. When the war was on there was, of course, need for unity and forbearance, and for that reason much was overlooked that otherwise would have been strongly objected to. The Government, unfortunately, misconstaled this patriotic attitude as endorsement and support of its policy, and proceeded serenely on its despotic, and unbusinesslike course, shelving many questions that presented difficulty and bungling most of those it did attempt to deal with. We have in this connection only to refer to its mishandling of recent matters like the epidemic, repatriation, the butter tax imposition, the stranded New Zealanders, the treatment of the consumptive soldiers a,t Eeatherston, the coal question, the railways crisis, etc. The truth is that the Government has suffered from the suspension of the former free and outspoken criticism inside and ou,tside Parliament, and haß now got it into its head that it is as capable as it is indispensable. Bu,t tho war is now over, and the country is to no mood to tolerate incapacity and inefficiency when so much has to bo done—and done quickly—if the war load is to be carried without undue strain.