VERY SEVERE

Waikato Times, Volume 125, Issue 20921, 28 September 1939, Page 8

VERY SEVERE

BUDGET IMPOSTS

ADOPTED BY HOUSE SUGAR TAX CRITICISED (United Press Assn.—Elec. Tel. Copyright) (Received Sept. 28, 3.15 p.m.) LONDON, Sept. 27 Sir John Simon, in introducing the War budget in the House of Commons said: “The war has upset the peacetimes estimates of v/hat the taxes will produce and altered the scale on which the national sacrifice must be measured. “This problem must be promptly faced, and boldly handled or irreparable damage might be done. We shall use taxation and borrowing to raise the revenue. It would be necessary to supplement the amount obtained from revenue by large scale national defence loans. We must avoid inflation.

“The contemplated increase in the income tax could not take full effect in the present year. In a full year the rate of income tax would be 7s 6d in the £, and meanwhile the January assessment would be on the bafis of 7s. The reduction in existing allowances could not be made operative at the time of collection on January 1. Similarly on dividends, interest, etc., liable to tax during the present financial year 7s was being substituted for 5s 6d. There would be special provision to mitigate the severity of the increases where there was a substantial drop in income. The new surtax scales range from Is 3d at £2OOO to 9s 6d for incomes over £30,000. Death Duty “If death occurred after September 21, the duty on estates exceeding £IO,OOO and not exceeding £50,000 would be increased by 10 per cent. Estates over £50,000 would be taxed an additional 20 per cent. The maximum for larger estates would be 60 per cent. “The increases in estates duties would produce £6,000,000 in a full year and £1,500,000 in the current year. “The additional tax on beer would be 24s per 36 gallons,‘equivalent to a penny per pint and on spirits it would be 10s per proof gallon. A basic duty on tobacco is being increased from 11s 6d to 13s 6d per lb, equivalent to l£d oz. “Wine increases would be 2s per gallon on light and 4s on heavy. “Sugar duties would be increased by an equivalent of Id per lb on full refined products, with corresponding increases on molasses and glucose. These increases would be effective as from September 27, and would yield £8,500,000 this year, and £lB,000,000 in a full year.” Labour Leader’s View Mr C. R. Attlee said Sir John Simon was right in endeavouring to raise large sums of taxation, but some of the taxes would apply to people who had not got sufficient today. Changes in the allowances for income tax would discourage having children. He had no objection to the taxes on alcohol and tobacco, but the sugar tax should be reconsidered. He welcomed the tax on war profits, but said it would be better to have no war profits. The House adopted the taxation on alcohol and tobacco without division, and later the sugar and income tax resolutions were carried.

The retail price of sugar is being increased by Id per lb. The whisky and tobacco trades are considering the position. Opinion in the lobbies was that the Chancellor’s measures are very severe.

SCALE OF WAR EFFORT

INCREASED COSTS A CRUMB OF COMFORT (United Press Assn.—Elec. Tel. Copyright) (Received Sept. 28, 3.15 p.m.) LONDON, Sept. 27 The scale of the war effort was brought home to the House by the Chancellor’s remarks that the Royal Air Force aircraft today cost from three to seven times more than in 1918, and that broadly it was true to say -a division in the field costs nearly twice as much as it did in the later years of the last war. Before he sat down Sir John Simon gave an assurance that all unnecessary expenditure in the British Government departments would be stringently curtailed, and he appealed at the same time for the avoidance of waste in any form by the public. Sir John Simon concluded by a comparison of the financial position and prospects of Britain and Germany. He said: “This emergency Budget will indicate the gravity of the financial and industrial problems involved in waging war, but let us take a few moments of comfort by wray of comparison. However serious our problem may be, the financial problem confronting Germany is infinitely greater.”

CONCESSIONS TO STUDENTS

LEGISLATION PROPOSED (By Telegraph.—Press Association) DUNEDIN, Wednesday Special legislation providing concessions for university students whose service is accepted for war duty will be brought before Parliament, said the Chancellor of the Otago University. Special facilities are also to be extended to trainees to obtain leave u> sit at the degree examinations in November. Switzerland is to ration sugar, wheat and rice as from November L