The Press Wednesday, July 9, 1930. Taxation

Press, Volume LXVI, Issue 19975, 9 July 1930, Page 10

The Press Wednesday, July 9, 1930. Taxation

The latest Monthly Abstract of Statistics gives the preliminary figures of revenue from taxation for the year ended March 31st, and it is not easy to deduce any encouragement from them in the present circumstances. By far the most buoyant of the major items, of course, was Customs revenue, which produced (tyre and petrol tax excluded) nearly a million pounds more than in the previous year. Of the others, motor-vehicles taxation yielded an increase of over £250,000 above 1929, and at a total of £1,510,790 was more than twice as productive as in 1928; land tax increased from £1,140,324 to £1,506,911; income tax increased from £3,310,877 to £3,533,764; and death duties decreased from £1,944,513 to £1,730,000. Now in realising the sr™ all surplus of £150,000 announced on April 25th, the Government had the benefit of revenue in exoess of the estimates under the headings of inoome tax, l?nd tax, Customs, and petrol and otbe?* highways taxation, while stamp and death duties fell short; but the windfalls exceeded the disappointment by roughly half 8 million pounds. Out of these facts Mr Forbes dare not frame very hopeful expectations, nor has he attempted to. He has told the public that " a shortage of £3,000,000 " has to be met, by savings or by the raising of fresh revenue, or by both means. He expects Customs revenue to be down by at least a million pounds, railway losses to reach a mil" lion and a quarter, and automatic increases in statu tox-y payments to account for another half a million pounds. The remaining quarter of a million covers an expected decline in income tax, land tax, etc., and a possible Blump in Customs revenue beyond one million. But it is a quite serious question whether income tax and land tax will not wilt even more than Mr Forbes has vaguely suggested, and death duties, which collapsed badly last year, cannot be relied on to recover and may even be still less productive. The inferenoe is that Mr Forbea'a forecast is not at all likely to have been excessively gloomy, and that tfte Government may have a harder rather than an easier duty to do than he explained at the end of May. But it is imperatively necessary that it should be done without shrinking. There are no pleasant or easy ways of doing difficult jobs well. The easy way which invites the present Government, and towards which it will certainly be prodded and toed by Labour, is the way of increasing taxation, Its course would be to effect the easier economies, protest the absolute impossibility of effecting more, shirk the rest, and make up the deficit by taxing. But the country cannot afford extra taxation. Taxation at £l3 3s 7d a head in now higher than it has been since 1921-22, while the resources out of which taxation must be paid have shrunk disturbingly. The Government must allow itself no alternative to the admittedly painful and difficult task of balancing the Budget without increasing taxation; for any alternative, laying fresh burdens on industry and production, can only achieve a temporary financial solution by making the root economic problem still harder to solve.