BRITISH' BUDGET

Evening Star, Issue 17958, 3 May 1922, Page 7

BRITISH' BUDGET

TAXATION REDUCED. THE GOVERNMENT’S AIM. TO STIMULATE TRADE. Proia Association—Bv Telegraph—Copyright. LONDON, May 1. Sir Robert, Horne (Chancellor of the F/Xchequer) presented tho Budget in a crowded House. Ho pointed out that during the first quarter of tho year tho greatest industrial trouble that Britain had over known had iswept over tho country, causing inevitable unemployment, and a loss. of revenue. That they had met those dis.tro.ssor- without worse calamities testified eloquently, he said, to the country’s gotmdnefs and tho solidity of its financial position. Tho vear'a revenue had totalled £1,124,880,000, which was £91,000,000 below the estimate. Tim expenditure was £1,079,189,000, leaving £456,695,000 for debt redemption. It was remarkable, that in such a year tho income tax and l the super tax should together have yielded £399,000,000. Tho excess profits duty yielded £122,000.000, but repayments absorbed £92,000,000 of this. The improved value oi tho pound sterling was tho first proof of ourpayment of external debt. During tho year the internal debt had boon reduced from £1,270,000,000 to £1,029,000,000. Tho Chancellor estimated the coining year’s expenditure at £910,000,000,. consisting of £063,408,000 for Consolidated Fund charge.? and £526,601,000 for special services. 'On tho existing basis of taxation, he estimated that the revenue would be £946,600,000, leaving a ourplus of £46,500,000, excluding any provision for (ho redemption of debt. He had always treated tho possibility of receipts from Germany as windfalls. In respect to the corporation profits tax, tho exemption period for which had expired on December 31, ho propored to extend the exemption for three years. . If, was proposed to reduce tho basis for the assessment on agricultural land from double tho annual value to the annual value, and on land not being used for agricultural purposes it was proposed to revert to tho pro-war assessment basis—namely, on one-third of the annual value. These changes would reduce the income tax yield by £2,150,000. Tho payment of Hie arrears of tho excess profits duty would he spread over five years. The postal rates would bo reduced to Ud on letters, Id on post-cards, and -id oii printed papers. The new rates would operate from May 31. The telcpnone charges would also be reduced. Those items together would reduce tho Post Office revenue by £6,500,000. Ihe above concessions would reduce the surplus to £33,300,000. , t Unemployment, was breaking tac hearis and embittering the lives of hundreds ot thousands oi people, nnd the unparalleled depression was still with us; but thoro were hopeful signs of a revival. The magnitude of tho burdens of tho British taxpayers had won admiration throughout the world, but he thought that the present circumstances justified tho giving of some stimulus to trade in the shape of not continuing the policy of debt redemption, apart from the interest falling duo to America, which it was proposed to meet. Therefore, it was proposed, to devote the surplus to the reduction of tax-, ation. The income tax would be reduced by Is and the tea duty by 4d a pound from May 15, involving remissions also on coffee, cocoa, and chicory. These reductions would leave the fob lowing figures: Revenue, £910,773,000. Expenditure, £910,069,000. Surplus, £706,000. —A. and N.Z. Cable.

DISCUSSION IN HOUSE

LONDON, May 1

In tho House of Commons, Air Asquith, in discussing (he Budget, declared Out Uio surplus of £58,000,000 ought really to have been earmarked for tho reduction of debt only. The excess of tho revenue over the expenditure justified the remission of taxation, and not tho suipius ■which had been artificially produced. Sir .Robert Horne was indulging in a great gamble. Air .Asquith said he would bo surprised u the estimate of the Supplementary Estimates was not doiuilcd during tho year. Air J. K. dynes (Labor) welcomed the reduction of tl’ie tea duty. He declared Hurt the way to encourage, trade was to reduce the taxation on firms and corporations, and increase the taxation on individuals. Ho disapproved of such substantia! concessions to tho agricultural interests, and advocated a graduated levy on .accumulated wealth. Sir Frederick Banbury described tho suspension of the sinking fund as the beginning of a. bad policy. He urged' further economies.

Ah- K. Hilton Young (Financial Secretary to tho Treasury), in reply, said that the reduction of Is on, tho basic, rate of the income tax did not mean, that all the income tax would be reduced by that amount. An- explanation of how the reduction would operate would bo issued later.

Tho customary resolutions were passed, and the debate, was adjourned.—A. and N.Z. Club.

VARIOUS OPINIONS.

LONDON, Mav 2,

The Budget was variously received 1 in tho lobbies J and outside Parliament, but on tho whole it created a. favorable impression. There is a certain amount of crilif-'kn about the suspension of the sinking fund on, the ground that the conditions are not ready for it, but th<?ro_ is a strong 'counter-opinion in financial circles that Llre-a.t Britain has hitherto made undue sacrifices for tho redemption of debt, and that it is unfair and fatal to British trade to continue the repayment at such speed. The retention of the heavy war tax on boor has been criticised on the ground that a reduction would lead to a, greater consumption, and therefore increase the aggregate yield of tho tax. It is contended., on the contrary, that an additional consumption- is not wanted. The question remains the pivot of a sharp controversv.

A more important claim is that the income tax ought to bo extended 1 to the onoperative societies, whose turnover was 11420,000,000 during 1921. The possibilities of extracting revenue from the pari-mutuel have been commented on, and the Australasian, methods of exploiting racing for the purposes of revenue have been mentioned approvingly. The pari-mutuel is gaining in popularity in England, and it is pointed out that it could produce n, progressive relief to the general taxation. The induction of the income, tax, the inland postage, the duty on tea, and the concessions to agriculturists are generally approved; and satisfaction is universal that Sir Robert Horne has deferred the scheme for the funding of pensions’ obligations, though it is the opinion in Ministerial circles that this will possibly ho necessary in 1923.—A. and N.Z. Cable.