World News in Story and Picture

Auckland Star, Volume LXIX, Issue 106, 7 May 1938, Page 3 (Supplement)

World News in Story and Picture

An increase in the standard rate ] of income tux by Gd to 5/6 in the pound and the announcement that purchases of wheat, whale oil and sugar had already been made by the Government to ensure stocks during the early months of an emergency were the two chief points of interest in the Budget statement made by Sir John Simon, Chancellor of the Kxehequer, in a crowded House of Commons to-day. —Cable. The Budget speech is always awaited with anxiety by all members of the public. It is a country's statement of accounts. It gives an estimation of the costs of government fur the coming year and the amounts of revenue or income that are expected from different sources. It affects everyone, for everyone must contribute, to a smaller or greater decree, towards the revenue. This money is paid in taxes in one form or another. Direct taxes are paid to Government officials by individual taxpayers. Indirect taxes are paid on commodities. These taxes are collected from dealers and merchant* handling the goods in large quantities. The aniouut of the

tax is added to the price of the goode or articles when sold in shops. In New Zealand the Minister of Finance presents the Budget in Parliament. In Britain it is the duty of the Chancellor or Uie Exchequer to do so. The estimated expenditure of the British Government for this year, 1038-3!), is to be £ 1 .0:{4,. - i!)K,000, a staggering sum of money even to persons used to handling vast amounts, and you will wonder how (he Government will obtain it and how it is going to be spent. The present taxes will yield about £!)! I,4<><>.Oil". When Britain began I lie rearmament programme, provision whs made for borrowing £-100,000,000. To make up this year's deficiency in revenue 00.000.000 of ' borrowed money under the Defence Loans Act is to Ik- used. That still leaves about £30,0(10,(100 to be made up by extra taxation. Some of this will come from the increase in the income tax and there is to be Id more tax per I gallon on petrol and an extra 2d per j pound duty on tea.

HIGHER TAXES FOR BRITAIN

Meeting The Cost of Armaments

The Government of Britain considers it is justified in spending this money on armaments because of the sobering effect it will have, and already has had, on other countries. For years Britain preached a doctrine of disarmament, setting an example to the rest of Enrope by restricting her armaments. But the preparation for war went on as vigorously as ever elsewhere. There were those who were only too ready to detract from British prestige, saying that her power was decaying — that she lacked the ability to arm rather than the determination. If the piling up of weapons and equipment that will, with the perfecting of new inventions, be scrap i in the future, can prevent the destruction of life in the future, then it is a good thing. But there is a danger that it may be carried too far. The preparation for war may cause the neglect of civil and social services to the great detriment of tlie nation. In the years just before the Great War an average of about £04.000.000 was expended on defence. Now over five times that

is required, and citizens of Britain must pay increased taxes to meet the bill. "Wβ must take some proportion of the increased expenditure on our shoulders by increasing taxation now," said Sir John Simon. "By so doing we shall reduce our difficulties hereafter, and we shall show the world that the country does not quail when it faces the burden of expenditure." That may be so, but the leader of the Opposition points out that it is going to have a bad effect on trade, and that will make hardships for a large number of people. The British Government has made provision as well to purchase large quantities of foodstuffs — wheat, whale oil and sugar—to guard against a food shortage in case of a sudden outbreak of hostilities. The deals were made in absolute secrecy, so that the prices of the commodities would not rise suddenly. Five million quarters of wheat have been purchased, ami plans have been made to hold all British-grown wheat from this autumn's harvest. It is believed that Britain has bought 400,000 tons of sugar at a cost of over £2,000,000. Let us hope that there will be no sudden "emergency," for what involves Britain in trouble will most surely involve the whole Kmpire. May this marshalling of strength help to quell the quarrelsome spirit of Europe.