BRITISH BUDGET

Evening Star, Issue 20779, 29 April 1931, Page 9

BRITISH BUDGET

MR SNOWDEN'S EXPLANATION FRAMED TO MEET TEMPORARY EMERGENCY (Britisli Official Wireless.) Press Association—By Telegraph—Copyright. RUGBY, April 27. In the course of his Budget statement, Mr Snowden, referring to tho problem of finding the necessary additional revenue of £37,360,000, said that there wore tho strongest obstacles to any increase in tlio rate of taxation, as taxes which would reduce the main consuming power of tlio masses must be harmful to trade. On tho other hand, ho regarded this Budget like the war Budget, as one dealing with a temporary emergency and justifying temporary measures. Members would bo aware of the nature of tho exchange account, representing some £33,000,000 advanced as credit during tho war, to ho utilised by the Treasury for purchases in foreign exchange aud_ to finance payments for obligations abroad. Up to r nt days it was not possible to reduce the amount below £33,000,000. Now circumstances arose from The Hague agreement and tho establishment of the Bank of International Settlements. Previously we received payment of reparations aud> of instalments of French and Italian war funds in sterling, but wo had now arranged that these funds should be placed to our credit in the Bank of International Settlements in dollars, which wo could utilise in making payment of our foreign debt. These arrangements had been working for a year. It did not follow that the exchange account could be dispensed with altogether, but no doubt tho amount was excessive for present or future needs, and could bo reduced by £20,000,000. ' Mr Snowdon said ho had decided not to propose any increase in the standard rate of tho income tax, but to tide over tho period, tho concession under which the tax became payable in two equal instalments would bo modified so that tho first instalment, payable in January, would bo three-quarters. As a result the Exchequer would get an extra quarter of tho year’s tax within the present financial year, and the estimated gain would be £10,000,000. He proposed that the remaining £7,500,000 should bo raised by increasing the present rate of duty on oil from 4d per gallon to 6d, which would still have petrol no dearer than before March, and lower in price than last September. This would give him tho funds ho needed to balance tho Budget and a revenue of £803,500,000, and an expenditure of £803.366,000, giving a nominal margin of £135,000. Any drop which occurred in the finances of tho year should be met by economies. APPREHENSIONS LULLED LONDON, April 27. Brewery and tobacco shares aro buoyant, and oil shares have recovered, as tho impost on petrol is less than was expected. VIEWS OF THE CRITICS LONDON, April 27. Tho Budget is generally regarded as not sensational, hut it has xileased those who consider that an increase in direct taxation should bo avoided at all costs. Motorists, whose petrol tax is now 6d a gallon instead of Id, -ppear to be resigned to the situation. Tlio change in tho income tax collections was not foreseen, but the burden of informed opinion sees in this a big stop towards tho restoration of tho old pre-war practice of a single yearly payment. Mr Snowden’s raid on tho Dollar Securities Fund is described as a clover manoeuvre, reminiscent of Mr Churchill’s raid on the Road Fund. Mr A. M. Samuel, M.P. (Conservative), referring to it, says that Mr Snowden has succeeded in balancing tho Budget by “ robbing the money box on the mantelpiece.”

THE BRITISH PRESS LONDON, April 27, ‘The Times,’ in an editorial, says: “ The outstanding features of the Budget are its unwarranted optimism, its misplaced fertility of makeshifts, and its display of ingenuity in tax extraction instead of zeal and economy. The raiding of the Dollar Exchange will damage Britain’s exchange, while, in view of Germany’s position, it involves an unwarranted risk. The taxpayer is like the dentist’s patient who has escaped from the most painful attentions until his next visit.” —‘ Times ’ Cable. The ‘ Daily Telegraph ’ says: “ The Budget, within the limitations of Mr Snowdon’s Freetrado principles, is an eminently sensible piece of work, and recognises the ■ paramount duty to lot the taxpayer off lightly.” The ‘ Daily Mail ’ says ; “ The Budget is neither wise nor prudent, and it helps no British worker or taxpayer. The payment of three-quarters, instead of half, the assessment in January, 1932, will inflict a cruel hardship on thousands of modest homes, seriously embarrassing business.” The ‘ Morning Post ’ describes the Budget as a “ sufficient-unto-tho-day scheme. ’ It states that Mr Snowdon is trusting to Providence to escape a deficit at the end of the year, and has closed the existing gap by a process of jugglery.

Tho ‘ Daily Herald ’ approves of the Budget on the ground that there are abundant signs that the end of the worst trade depression is in sight. Tho introduction of a land values tax makes tho Budget a landmark in financial history.

Other city editors describe tho Budget as much less unsettling than was at first feared.

THE DEBATE OPENS OPPOSITION VIEWS, (British Official Wireless.) RUGBY, April 28. (Received April 29, at 11 a.m.) In the House of Commons the debate on tlio Budget, which will last several days, was opened by Mr Neville Chamberlain (who recently succeeded Mr Winston Churchill as chairman of the Conservative Finance Committee). His main criticisms of the Budget were that tho Chancellor’s Estimates were too optimistic, and that ho omitted to refer to tho Treasury liability in respect of the unemployment insurance fund or to indicate the sacrifices which ho recently declared must be made by all. He said that the proposals did nothing to stimulate trade or to give confidence to industry. Tho main feeling inspired by tho Budget was one of relief. Sir Donald Maclean (Liberal) said that on Frcetrade, economy, and the taxation of land values his party heartily supported the Chancellor. They approved of his proposals as emergency ones. LIBERALS WELCOME LAND TAX (British Official Wireless.) RUGBY, April 28. (Received April 29, at 11.30 a.m.) At the invitation of the Prime Minister the Liberal leaders—Mr Lloyd George and Sir Herbert Samuel—together with Sir Archibald Sinclair, visited Downing Street and discussed various matters assumed to be related mainly to the Budget proposals with the Prime Minister, Mr Henderson, and Mr Thomas (Foreign and Dominions Secretaries). It is understood that the Liberal Party particularly welcomes the Government's proposal for a tax on land values, although it does not come into operation until the subsequent financial year. A full statement on the project will be made in the House of Commons on Monday by Mr Snowden, LONDON STOCK EXCHANGE REACTION (British Official Wireless.) RUGBY, April 28. (Received April 29, at 10 a.m.) The principal effect on to-day’s stock markets of last night’s Budget statement has been a good demand for Britisli Government stocks, which showed a sharp appreciation. There was also a rise in sterling on the dollar exchange on the proposed withdrawal from the Exchange reserve fund. (Received April 29, at 11.30 a.m.) A general improvement on tho Stock Exchange followed tho Budget. Giltedged issues improved all round, also tobaccos and breweries. Commonwealth Stock participated in the dealings. Five per cents, ranged from £6B to £72 and sixes from £7B to £B2. The States’ issues were little changed.