10% INCREASE IN FRENCH TAXES PROPOSED: BUDGET CRITICISED

Gisborne Herald, Volume LXXV, Issue 22821, 16 December 1948, Page 5

10% INCREASE IN FRENCH TAXES PROPOSED: BUDGET CRITICISED

PARIS, Dec. 14

The Prime Minister, M. Queuille, outlining the 1949 Budget to the National Assembly’s finance commission, proposed an all-round 10 per cent tax increase.

He said that the ordinary Budget would be balanced at £1,179,000,000, but there would also be a special Budget of £580.000.000 for capital investment and war damage. Heavy as are the tax burdens, the French Budget is criticised on the following points: 1. Insufficient economies. 2. No provision for putting the management of nationalised industry on a self-sufficient basis. 3. Insufficient credits earmarked for reconstruction and equipment.

4. The unsatisfactory state of the military estimates, which will be considered* separately in January. Business circles fear that another stage of acute financial difficulties will soon be reached. The anticipated difficulties are reflected in a new rise in gold prices and foreign currencies. The black market rates for dollars rose to 534 as against 497 a fortnight ago. Tire sterling rate was 1540 against 1280 on December 1. The official sterling rate in 1062. French industrial activity for (lie first six months of 1948 reached the index figure of 114 against the basic figure of 100 for 1938, reported the French Planning Commissioner, M. Monnet. This indicated progress greater than that of many foreign countries, including Britain, Belgium and Sweden, but he warned the nation that its recovery had been based on foreign aid.

stops, our living standard will crumble if that aid has not been replaced by the product of our labour.”

M. Monnet said that France’s export tonnage rose by 36 per cent, but in terms of world prices their value had fallen by 15 per cent. In consequence, there was a dollar deficit of 890,000,000.

M. Monnet added: “We are living above our means. When American aid