GREAT SACRIFICES MUST BE MADE

Evening Post, Volume XC, Issue 71, 22 September 1915, Page 7

GREAT SACRIFICES MUST BE MADE

DEBT WILL NOT CRIPPLE OUR RESOURCES (Received September 22, 10.30 a.m.) LONDON, 21st September. The Chancellor of the Exchequer (Mr. Reginald M'Kenna), in introducing the Budget, asked the House to assent to great anJ unprecedented burdens. .The estimate of revenue on the existing basis was £272,000"000, and the expenditure £1,590,000,000. He was sure the country would courageously and confidently face the outlay. Every section must contribute to make great sacrifices. He estimated that at the end of this year the deadweight debt would bo £2,200,000,000, but this would in nowise cripple our resources. We had a Navy costing £190,000,000 and an Army costing £715,000,000, and external advances amounting to £423,000,000. DAILY RATE OF EXPENDITURE. The estimated daily rate of expenditure for all services from now to the end of the financial year was upwards of £4,500,000, and possibly rising towards the close of the financial year to upwards of £5,000,000. The expenditure for the current year included £36,000,000 on present and past moratorium bills and £170,000,000 on ordinary national services, excluding the Army and Navy. There was no record of any nation voluntarily accepting liabilities bearing so high a proportion to its total income for which provision must be made within a single year. FISCAL THEORIES MUST BE PUT ASIDE. In regard to the new taxation, both the strict Free Trader and the scientific Tariff Reformer must temporarily put fiscal theories aside, and look to the condition of the foreign exchanges. They must discourage imports; and they must also have a strict regard for the necessity of a reduction in consumption. INCREASE OF INCOME-TAX. It was proposed to add 40 per cent, to the income tax rates, combined with improved machinery for assisting employees and special relief for those in receipt of reduced incomes. The 40 per cent, increase will be for the full year, making 20 per cent, for the remaining six months. The exemption limit would be reduced, say, to £130 and abatement to £120. The tax would be payable half-yearly. The proposed changes in the income tax would yield an increase of £11,974,000, reaKsing in a full year £44,400,000. TAX ON WAR PROFITS. He proposed to tax war profits, and also to raise the super-tax scale. A man without children earning 60s weetfly would pay 18s lid quarterly ; a man" similarly circumstanced earning 80s weekly would pay 46s 2d quarterly; a man with £5000 per year would pay £1029 ; the man with £10,000 per year would pay £2529 ; a man with over £10,000 would pay 7s in the £ for all in excess over £10,000. The possessor of £100,000 per year would pay £34,000. The revenue from the excess of war profits was estimated at £30,000,000 for the full year, but only £6,000,000 would be collected before the 31st March. The total additional revenue for the full effective year under the inJand revenue was estimated 1 at £77,000,000. NECESSARIES AND TOBACCO. It was proposed that the sugar duty be increased by a, halfpenny pp.r potrad, yielding £11,700,000 a. year. There would be 50 per cent increase on

tea. coffee, dried fruits, and tobacco. The increase on tea would produce 4£ I millions a year, and on tobacco £5,100,000. I There would be an increase of the motor spirit duty of 3d per gallon. The patent medicine duty would be doubled, yielding a quarter of a. million. There would b>i no alteration in Tegard to beer and spirits. . Dealing with imports "which might properly be restricted by duties fop reasons of foreign exchange and restriction of luxury, he proposed an ad valoTern duty of 333 per cent, on motor-cars, motor-cycles, cinema films, clocks, watches, musical instruments, plateglass and hats yielding £1,150,000 per year. POST AND TELEGRAPH RATES. Changes in the post and telegraph rates would yield an increase of £4,975,000. The total additional revenue from Customs and excise duties for the present year-would be £25,000,000. and the total new taxation would yield £10,215,000 per year. Retrenchment Committee adopted the suggestion for the abolition of halfpenny postage and the reduction of the weight of the letter carried for Id. , There would be a higher scale for parcels post, inland telegrams, press telegrams, an increase in the poundage on postal orders, and higher telephone charges. We would treble our debt and double our taxation if the war continued. His proposals were not the last word. He urged increased personal economy. [The general rate of income tax under the Finance Act, 1914, was Is 3d, but for incomes between £160 and £300 it was Is, and for those between £300 and £500 it was Is 2d. * If the total income did not exceed £2500, the rate on the earned part (if any) of such income was : 9d if the total" income did not exceed £1000, 10£ dif not exceeding £1500, Is if not exceeding £2000, and Is 2d if not exceeding £2500. The relief in respect of children under sixteen years of age was an abatement of tax on £20 of increase for each such child. Super tax,w,as levied on incomes above £3000 at the following rates: In respect of excess above £2500 — for the first £500 of the excess 5d in pound, for the next £1000 7d in the pound, for the next £1000 9d, for the next £1000 lid, for the next £1000 13d, for the next £1000 15d, for the remainder 16d. Under the War Budget of November, 1914, the income and super taxes for 1914-15 were increased by one-third, and were doubled for 1915-16.]