FEDERAL BUDGET

Wairarapa Times-Age, 26 September 1941, Page 5

FEDERAL BUDGET

HUGE INCREASE IN WAR EXPENDITURE TOTAL OUTLAY OF £322,000,000. TREMENDOUS AND EXPANDING EFFORT. CANBERRA, September 25. A record Australian Budget, providing for an expenditure of £322,000,000, has been presented by Mr A. W. Fadden, the Prime Minister. This is one-third of last year’s national income. As much as £217,000,000 will be devoted to the war programme, as compared with £161,000,000 in the previous twelve months. This is striking evidence of the tremendous expansion of Australia's war effort. The Budget provides for a new method of combined taxation and compulsory loans to be called war time contributions. The compulsory loans will yield £25,000,000 of which £20,000,000 will come from individuals and £5,000,000 from companies. A post-war credit plan will apply to incomes beginning at £lOO a year in the case of single men and the scale of contribution rises to 18s in the pound on higher incomes and will bear interest at the rate of two per cent, repayable after the war. The Government intends also to obtain an additional £5,000,000 from the holders of existing tax-free loans who will be required to put twenty per cent of the interest they draw on those loans into a post-war credit pool. There is a new company tax of 6d in the pound, estimated to yield £2,500,000. Companies will also have to pay 20 per cent of their undistributed profits into the post-war credit pool and also 20 per cent of the amount which the taxation commissioner normally allows them for depreciation. The budget increases postal rates by a halfpenny and telephone calls by a farthing, which is estimated to yield £1,500,000.

Public loans in the coming year are estimated to bring in £54,000,000, compared with £62,000,000 last year. Income tax will be stepped up by £3,000,000. Mr Fadden announced increases in pay to all the fighting services and also allowances to their dependants totalling £6,000,000. Generally speaking, the increase would be Is a day. The war expenditure would reach the colossal figure of £217,000,000, of which £160,000,000 will, be spent in Australia and £57,000,000 overseas.