The Press FRIDAY, AUGUST 22, 1947. Taxation

Press, Volume LXXXIII, Issue 25269, 22 August 1947, Page 6

The Press FRIDAY, AUGUST 22, 1947. Taxation

It is disregarding very little to disregard the snippet concession the Minister of Finance has made in regard to the supertax on unearned income and to say that he has given heavily burdened taxpayers no relief. Nor is it an exaggeration to say that the Financial Statement discloses no sign of any wish to relieve them, of any search for ways to relieve them, of any defence of this refusal to relieve them. Referring to the snippet, Mr Nash observed that the question of granting this had “ been given consideration ”. This is the only such reference; and taxpayers are left to wonder whether it was because no other possibilities of tax relief were considered that Mr Nash had nothing to say about them, or whether it was because he did not think it necessary to say that he had considered and rejected them, and why. The difference is not so deep as it may seem. Tweedledum, in Mr Nash’s position, would not think about reducing taxes; Tweedledee, in Mr Nash’s position, would think about it and refuse. Tweedledum and Tweedledee, in Mr Nash’s position, would neither of them feel any compulsion to explain their severity, because neither is accustomed to consider the taxpayers’ point of view or interest. It is, of course, a position in which Consolidated Fund expenditure for the current year is estimated at £2,000,000 more than last year and revenue at a figure about £3,000,000 higher again, * the provision of this wide margin for the supplementary estimates being well accounted for by the repercussions, in public expenditure, of the recent Arbitration Court decision. But this does not mean that there was no room for tax reductions; it means merely that Mr Nash accepted or made no opportunity to disinflate expenditure—the net saving on subsidies this year will be quite small —and allowed nothing at all for the resiliency of revenue when lower tax rates widen taxable margins. Men give themselves away in their choice of phrases. Mr Nash, reviewing the tax reductions he “ granted ” last year, repeatedly described the estimated result as “ a loss of “ revenue ” —as if the Treasury were sacrificing some natural right or possession when a tax is lowered. Treasury has no right to revenue beyond what is required to finance necessary and approved expenditure. When less expenditure is required and tax rates are adjusted accordingly, Treasury suffers no “loss”, sacrifices nothing, and deserves no special thanks. It is the taxpayers who lose, and non-tax-payers too, when taxation is levied beyond the mark set by their own fairly interpreted demand for public services and by efficient and economical administration. Tweedledum and Tweedledee would alike applaud Mr Nash’s sad, proud catalogue of Treasury “ losses He may be identified with either. The Minister who did not even consider any tax reductions but the tiny one he decided to “grant”, or the Minister who considered others and decided that he need neither give away any more of Treasury’s income nor explain his decision, is equally open to sharp question. The country is 33,000 short of the manpower its industry requires; and the Government does not attempt, or think of, pruning the excesses of manpower in its hugely expanded administrative system. The war is two years over, the War Expenses Account will be balanced by taking in the 1946-47 surplus and two nontax revenue items; but nearly half of the war-time surcharge on income tax remains; and not a word said about it