FOOTING THE BILL

Wairarapa Times-Age, 26 April 1939, Page 5

FOOTING THE BILL

DEMANDS OF THE BRITISH BUDGET PEACE TIME RECORD ESTABLISHED. HUGE OUTLAY ON DEFENCE. (British Official Wireless.) (Received This Day, 10.20 a.m.) RUGBY, April 25. The Chancellor of the Exchequer, Sir John Simon, opened the largest peace time Budget in a crowded House of Commons this afternoon. Its most impressive feature was the revelation that expenditure on defence alone will be £630,000,000. In all taxpayers will have to find £942,000,000 in the presentlyear and defence loans will bring in approximately £380,000,000. The chief points in the section dealing with proposals for raising the required revenue are as follows: — No alteration is proposed in the standard rate of income tax, but surcharges are imposed, of a further 5 per cent on incomes up to £B,OOO, and a further 10 per cent on incomes over £3OOO. A surcharge of 10 per cent is added to the existing duty on estates exceeding £50,000.

The horsepower tax on motor vehicles, as from next January 1, is to be increased from 15s to 255. A new excise duty is imposed on photographic plates and films manufactured in Great Britain, which is equivalent to about 2d. on the most popular sizes of roll films used by amateur photographers. The basic duty on tobacco is increase ed from 9s 6d to Ils 6d per lb. One farthing per lb is added to the duty on sugar. Much amusement was caused when Sir John Simon opened his speech by recalling that Mr W. E. Gladstone, in a speech which lasted for 3;] hours, presented in 1853 the first of the thirteen Budgets for which he was responsible, when the expenditure for the year reached the grand total of £53,000,000, and Mr Gladstone proposed a progressive reduction in the income tax which then stood at 7d in the pound, until it finally disappeared in 1860. Unfortunately, added Sir John Simon, the Crimean War broke out, expenditure rose and the prospect of abolishing the income tax vanished beyond recall. His task, he proceeded, was to present the Budget proposals at a time when the standard rate of income tax was 5s 6d in the pound and the total expenditure was more than twenty times that of the 1853 Budget. Reviewing the actual results of the last year, Sir John Simon said the revenue was estimated at £944,750.000, but in fact totalled £927,250,100. and he attributed the falling off of the estimated revenue to uncertainties which arose out of the international situation. Expenditure from revenue last year, including payments of under £13,000,000 in respect to the sinking fund, totalled £939,999,000. The whole of the country’s finance was governed and conditioned by defence expenditure, which last year was £254,500,000 and which, with issues under the Defence Loan, gave a total of £382,500.000 for the three defence forces. With an addition for expenditure on food storage, almost exactly £400,000,000 was spent on defence last year. It was most relevant to bear ill mind that figure when they came to the far bigger expenditure to be provided for in the present year. After noting the results of the year s out turn on various items of revenue and expenditure, Sir John Simon saidthe net total of naTional debt increase during last year was £826,000,000 raising it to £8,863,000,000. Of this increase, £180,000,000 was represented by the National Defence Loan, issued at 98 in July.

THIS YEAR’S PROSPECTS DETAILS OF EXPENDITURE. MAINTENANCE OF SOCIAL SERVICES. (British Official Wireless.) (Received This Day, 10.25 a.m.) RUGBY, April 25. Passing to the prospects of the Estimates for the present year, Sir John Simon said he proposed to. leave the fixed debt charge at 230 millions and to repeat the precaution taken in recent years of getting authority to borrow for the purpose of meeting the statutory sinking fund if the provision in the fixed debt charge was not sufficient. ~ . , The total estimated for Consolidated Fund services from, 1939 would be £247,200,000 and that for civil service £675,244,000. The latter figure includes the estimated expenditure in the present year on air raid precautions oi £42,191,000, of which 37 millions will be found from borrowed money and the remainder from revenue.

Omitting defence and supplementary estimates, the total expenditure from revenue for which he had to provide in this year’s Budget, he said, added up to £922,444,000. The fact that such large sums had to be provided for defence had not meant that social service should be reduced. The cost of social services and civil expenditure as a whole was increasing. The total growth since 1925 of civil expenditure from taxes alone might be put at 186 millions.