AUSTRALIA’S FINANCES

Evening Star, Issue 20634, 6 November 1930, Page 11

AUSTRALIA’S FINANCES

+ A SERIOUS DRIFT HEAVIER TAXATION NECESSARY Press Association —By Telegraph — Copyright. CANBERRA, November 5. In the course of a long statement in tbo House of Representatives to-day, Mr J. A. Lyons, Acting Federal Treasurer, disclosed a serious drift in the Commonwealth finances since the Budget was delivered last July. He also outlined the Government’s proposals for curtailing expenditure and increasing revenue. He anticipated that with the restoration of confidence and a revival of trade the deficit would be between. £8,000,000 and £10,000,000. He pointed out that with only eight months to go it would not be possible to balance the ledger during the present financial year, and the most that could bo achieved without undue sacrifice was to plan the Budget on sich a basis that when it had operated lor a full year the ledger would no balanced. The Government, ho said, intended to impose new revenue duties estimated to yield £3,100,000 annually, but the sum realisable for the remainder of this year would be only £2,000,000. Tbo income tax proposals would apply principally to income from property, such as interest, dividends, and rents. There would be a super-tax of 7J per cent, upon all incomes, including those of companies, from property, which was expected to yield £1,500,000. There would also be an increase of 5 per cent, in tho rate of tax on. incomes from personal exertion above £SOO, which would produce £160,000 additional revenue. The salaries of Federal Ministers would bo subjected to a special taxation rate of 15 per cent., and those of members of Parliament to a rate of 10 per cent. Government employees whoso salaries exceeed £725 will pay a special tax of 10 per cent., above £I,OOO 12£ per cent., and those which exceed £1,500 will pay 15 per cent. It is anticipated that this' tax will produce £60,000 in a full .year, but only £40,000 for the remainder of the current financial year. Mr Lyons said that the total taxation amounted to £4,820,000 in a full year, but tho sum expected for the remainder of this year amounted to £3,700,000. The Government hoped to make further savings and economies amounting to £1,230,000. It also intended to reduce the contribution to the sinking fund by £1,950,000. These two items represented a total of expenditure reductions,of £3,180,000 over a full year. Thus expenditure reductions and new taxation combined revealed a total benefit to the Budget of £8,000,000 for a full year. Mr Lyons said that the annual overseas liabilities of tbo Australian Governments consist mainly of interest and sinking fund, and amount to about £34,000,000, while tbo neb short term indebtedness of Australia at October 31 was £7,134,000. Declaring that the financial depression and trade dullness had been accentuated since tho financial proposals for balancing the Budget were determined four mouths ago, Mr Lyons said that there had been a serious shortage of postal receipts and claims for pensions—invalid, old age, and war pensions—had greatly increased, while the estimates for exchange on remittances to London also would be inadequate by nearly £500,000. Wool w.as now averaging. only about 9d per lb compared with Is 3d last year and Is 7d the year before. Wheat, f.0.b., Australia, was less than 3s per bushel compared with 6s last 3’ear. " ANOTHER NAIL " COMMENT BY 4 FINANCIAL NEWS.’ LONDON, November 5. The 4 Financial News’ says: 44 The news from Australia can be regarded only as another nail in tho colfin of Australian credit. Tho methods by which tho Federal caucus proposes to meet her monetary commitments is describable by only one word, ‘inflation.’ ” DEPOSITS IN BANKS DECLINE RECORDED. SYDNEY, November 5. The deposits in twenty-one trading banks in Australia declined by £5,735,542 during tho three months ended September 30. Tho advances made by the banks in the same period were reduced by £8,097,559. The total assets of these banks at September 30 were £396,378,728, and their total liabilities within Australia were £330,686,791. COMMONWEALTH BANK STATEMENT BY Mil SCULLIN. LONDON, November 5. (Received November 6, at 10 a.m.) Referring to a message from Australia indicating the possibility of the Commonwealth Bank creating a £2O, 000,000 credit for productive works, Mr Scullin said tho Federal Government and tho Commonwealth Bank could confidently bo relied on not to do anything that would weaken the position of the bank or injure Australia as a whole. INCREASED CUSTOMS DUTIES A TAX ON TEA. CANBERRA, November 6. (Received November 6, at.ll a.m.) Resolutions for an immediate increase in tho tariff on certain goods were sub mitted to tho House of Representatives Tho Customs duty on tobacco was increased to 2s 2d per lb and tho Excise duty to 2s per lb. Tea will have to bear a Customs duty of 4d per: Ih if

imported in bulk and Gd in packets not exceeding 201 b net weight. Kerosene, formerly free, now hears a duty of Id per gallon. Coffee,' chicory, rubber, cutlery, carpets, filament lamps, and a variety of other goods arc affected. Tho primage duty has been increased from 2J per cent, to 4 per cent. STATEMENT BY ASSISTANT MINISTER CANBERRA, November 6. (Received November 6, at 12.30 p.m.) Mr Fordo (Assistant Minister of Customs), in tabling the tariff increase resolutions, said that there would he no justification for asking the public to pay the whole of tho tea tax. The same applied to rubber, and the Government was confident that the oil companies would carry the Id per gallon duty on kerosene and lubricating oils. PREFERABLE TO INCOME TAX SYDNEY, November 6. (Received November 6, at 12.30 p.m.) The representative of a large importing firm is of the opinion that there will bo no immediate increase in tea or coffee prices following tho now duties, which he considered were a form of taxation preferable to income tax, and would he more cheaply collected. CARGO OF TEA BOAT’S RACE AGAINST TIME. BRISBANE, November 6. (Received November 6, at 12.30 p.m.) Tho steamer Barrabool arrived at Brisbane yesterday from India and Ceylon. When the news of the impending tea tax spread a wireless message was sent to the ship, which carried 1,000,0001 b of lea for various States. She speeded up, and in an exciting race against the clock reached port in time to enable her cargo to bo cleared before the Customs Office closed. Tho tea thus entered duty free, and the Government lost over £16,000.1