THE AUSTRALIAN BUDGET

Press, Volume LXIX, Issue 20988, 17 October 1933, Page 11

THE AUSTRALIAN BUDGET

TAXATION REDUCED ALL CLASSES BENEFIT (F'nOM OUR OIVS COKRESPONDEKT.) SYDNEY, October 5. If anything were needed to increase the faith of Australians in their own country and in themselves, it was provided in the Federal Budget, introduced into the House of Representatives on Wednesday. Ever since the various Governments made serious attempts to place their financial houses in order, Australia has felt that it has been on the road to recovery, but from time to time there have been expressions of disappointment because so many corners had to be turned.

The taxation relief given by the New South Wales and Victorian Governments did much to restore the hopes of the people, but the amazingly generous Budget brought down by Mr J. A. Lyons, in the Federal sphere, has sent a wave of optimism throughout the country. It is something definite—a definite indication that the worst is over, that the burdens that have fallen so heavily on every class are to be lightened. Industry has taken a new lease of life; there has been a wave of buying on the Stock Exchanges, with record business in Sydney and Melbourne, and even the United Country party has been appeased and may now agree to give the Federal Government its wholehearted support. Widespread Relief. It would appear that the Federal Treasurer has forgotten no one in this most surprising Budget of his. He has restored the salaries in a limited measure of the public servants, he has increased the old age pensions, he has given returned soldiers and their dependents more liberal treatment, he has opened the way for a cheaper glass of beer, he has cut the entertainment tax, he has reduced the sales tax by 1 per cent., he has reduced the tax on income, whether from personal energy or from property, he has cut the land tax by half, he has made available a large sum for development work, he will aid the fishing inudstry, he will reduce the Customs tariff on British goods that do not compete unduly with Australian industries, he will strengthen Australia's defence. The general opinion is that he has done all he could be expected to do and more. His name will go down in history, for the reactions will be such that all must share in the prosperity he is bound to bring about. It is a fact that Mr Lyons has budgeted for a deficit; but if prosperity is restored in the manner which he anticipates there will be no deficit, and he and his Government will be rewarded for his outstanding boldness. Of course, the Labour party holds that he has erred. Its leader (Mr J. H. Scullin) savs that Mr Lyons has made a grave blunder that will undo the good work done in the past. But MiLyons does not agree. He claims that he was fully warranted, and has replied bv expressing his unbounded faith in the future of Australia. Leaders of the commercial and financial world are inclined to agree with him, for they say that the Budget is within the realms of common sense-—substantial, but not erring in trying to accomplish too much. Relief from taxation was essential to the nation, and that relief has come in no uncertain measure. Stimulating Employment. The key to the Budget is probably to be found in the statement by Mr Lvons that the adjustments in taxation were aimed at securing stimulation of employment and reduction in the burden on industry and the cost of living. It is confidently felt in many quarters that the Budget will do these things—that it will put the people in great heart, and make them realise, as they have never realised before, that their sacrifices during a very trying period have not been in vain. Scores of persons are still suffering from the depression, and are likely to go on suffering for some time. For them there is a further hope.

The Assistant . Treasurer (Sir Walter Massy Greene) said that the Budget did not go to the full length desired by the Government. It was hoped that before long there would be still further cuts in taxation, while the financial stability of the Commonwealth would be maintained at all costs. Sir Walter said that the Budget had been well received in all quarters, and the Government felt already that _ its judgment was vindicated. Particularly pleasing were the congratulations that had come from overseas. Some enthusiastic commentators had said that Australia had given a lesson to the world. Extent of Remissions. On an annual basis the remissions jn taxation will amount to £7,490,000, including £3,020,000 in direct taxation and £4,330,000 in indirect taxation. The remissions during the current financial year will be £5,440,000. It is generally understood that the remissions in the company tax and in the taxes imposed on assurance companies has been accompanied by a more or less general understanding that the benefits will be passed on. For instance, an important announcement is expected within the next few days making substantial reductions in the general interest rates of banks and insurance companies. Many of the taxation relief proposals were framed in the belief—and in some cases on the understanding—that immediate action would be taken by the financial interests affected to reduce interest rates. The average advance rates are lower in Australia to-day than they have ever been before. They are lower than the rates ruling in the early '9o's, after the bank crashes. At the same time the deposit rate at present—2 per cent.—is higher than it was in the '9o's, when the rate was as low as 1J per cent.

DAIRY PRODUCE

LONDON MARKET WEAKER j l,r:;n'EP pkk.ss association— ut electetc TIiLEORAI'II COPYRIGHT.) LONDON, October 15. Lack of enquiry has been responsible for a weakening in Australian and Now Zealand butter, somewhat surprising the market, which was attempting to hold the price of the finest grades. Little speculative demand for forward butter is expected. Cheese also is a difficult market and the withdrawal of speculative support caused further weakness. Eggs are easier, but a decline in home and Danish production is anticipated, resulting in wider distribution of colonials.