FRENCH BUDGET DEFICIT.

Timaru Herald, Volume XCVIII, 14 May 1925, Page 7

FRENCH BUDGET DEFICIT.

New Minister’s Proposals.

PROBLEM OP MANY MILLIONS

By Cable—Prose Awociation —Copyright. Au.tmii'.n and N.Z. Cable Aieoclatloa

Received May 13, 5.5 p.m. PARIS, May 13

M. Caillaux (Minister of Finance), addressing the Finance Commission In the Chamber of Deputies, outlined the reforms proposed to cover the Budget deficit of £38,000,000. He announced that he proposed to increase taxation by 3,500 million francs, in order that the whole of the permanent expenses of the Budget would be covered. It was also proposed to establish a National Bank of Re-insurance, to Which all insurance companies would be obliged to bring at least 50 per cent, of their premiums. This would ensure to the state a proportion of the profits upon insurance, which is virtually a monopoly. The new taxes would include an increase in the tobacco duties, and a tax on refining petrol. Income tax does not appear capable of increase, but it would be collected under more stringent conditions. The new taxes cannot have the full effect in 1926, so the Treasury must meet the State demands this year. M. Caillaux emphasised that 130,000 million francs of the French debt was in the form of short-term engagements. This was a grave danger. The receipts under the Dawes scheme, amounting to 1240 million would not benefit the Treasury, being allocated to the liberated regions.

M. Caillaux also proposes to earmark a proportion of the receipts from the Dawes scheme to reduce the French debts to Britain and America.