Britain Plans Balanced Budget: Taxation Up By £53,000,000

Greymouth Evening Star, 16 April 1947, Page 7

Britain Plans Balanced Budget: Taxation Up By £53,000,000

(Recd. 10.50 a.m.) LONDON, April ,15. Britain expects to balance her 1947-48 Budget, according to the Chancellor of the Exchequer, Dr. Hugh Dalton, but largescale tax reductions are not likely. Dr. Dalton, who presented the Budget in.the House of Commons this afternoon, said that the buoyant revenue in 1946-7 brought the deficit for that period to £1.57,000,000 less than was expected. The recoil to a balanced Budget had been even quicker than expected. The deficit in 1946-7 had been only £569,030.000. “This is not a. bad starting point for today’s excursion,” he said. “Our anticipated Budget surplus is a clear sign of our internal financial strength, which all the world should note, but the surplus cannot be regarded as available for wholesale tax reductions.” Dr. Dalton said that the tax reductions would cost £84,000,0000 this year and £96,000,000 in a full year. The tax increases would bring in £106,000,000 this year and £149,000,000 in a full year. He counted on a balance of £22,000,000 on this year and £53,000,0000 in a full year, thus raising the prospective surplus this year from £248,000,000 to £270,000,000.

Dr. Dalton added that the aim should be a balanced Budget over a series of years. There was an immediate danger of inflation going beyond bounds and breaking through the various controls now established. The Government intended resolutely to adhere to the “cheap money” policy which since 1945 had saved the taxpayer about £40,000,000 a year on direct Government borrowing alone, and still more substantial benefits were, expected in the future. Modest Relief Income taxpayers would get modest relief on earned income. The relief would be increased from oneeighth to one-sixth, by lifting the maximum relief on which no taxation was paid from £l5O to £250. Duty would also be removed from fuel oil and gas oil and the purchase tax would be reduced on linoleums and similar floor coverings and some sports requisites. Excise duty on artificial silk would be repealed from May 1, which would cost £2,250,000 in a full year. The purchase tax could not be much further reduced, but silk stockings would be added to the range of tax-free utility clothing. The total customs excise tax reduc-

tions would cost £9,000,000 in a full year and £8,000,000 this year. The. total cost of the income and other tax reductions would be £96,000,000 in a full year and. £80,000,000 this year. The revenue on the existing basis of taxation would be: Customs and excise, £1,300,000,000; inland revenue, £1,676,000,000, including £1,150,000,000 from income tax. The total revenue would be £3,429,000,000, giving a prospective surplus of £248,000,000. No Tax on Betting Dr. Dalton said he had carefully considered a tax on betting and had decided it would not produce substantial revenue. He had therefore decided to look for revenue from welltried taxes.. The dependent relative allowance would be maintained at £5O, but it would not disappear until the relative’s income reached £l2O a year. The child allowance would be increased from £5O to £6O, which was the pre-war figure. These two adjustments would cost £62,000,000 in a full year and would altogether relieve 750,000 taxpayers from paying income tax. They would noticeably reduce the tax on one million others.