BRITAIN TO IMPOSE £15,500,000 OF NEW TAXES

Hawke's Bay Tribune, Volume XXVI, Issue 110, 22 April 1936, Page 7

BRITAIN TO IMPOSE £15,500,000 OF NEW TAXES

The Defence Burden INCOME-TAX UP Extra 3d in Pound on to Standard Rate INCREASE IN TEA DUTY SAFER BEFORE COMFORT (Bj Tolorraph—Preaa Awn.-Copyright.) (Received 22, 10.40 a.m.) LONDON, April 21. Mr. Neville Chamberlain’s Budget provides for £15,500,000 of new taxation. The Chancellor has earmarked £20,000,000 for supplementary defence votes in the current year. In announcing these measures to a stunned House of Commons he said that, though it was a bitter disappointment to have to ask for more sacrifices, safety was better than comfort. Following are the main provisions by which Mr. Chamberlain proposes to raise the extra £20,000,000 :—

1. An increase of threepence in the pound in the standard in-come-tax, estimated to produce £12,000,000. This is accompanied by small concessions to families and by an intimation that steps will be taken to prevent tax evasion. 2. A “raid” on the Road Fund for £5,500,000. 3. An increase of twopence a lb. in the tea duty on Empire and foreign. This, it is esti-

mated, will realise £3,500,000

The surplus for the past year was £3,000,000; for the current year, with the new taxation, Mr. Chamberlain budgets for a surplus of £484,000.

Crowds assembled in Downing Street for a glimpse of Ministers on the way to the House of Commons were smaller than usual. The House of Commons, however, was so crowded that members were unable to secure seats on the floor of the House and were obliged to go to the side galleries. PAST Y’EAE'S EECOVEEY. ‘ Mr. Neville Chamberlain, Chancellor of the Exchequer, rose at 3.33 p-m. He declared that the most remarkable fact

of the past year was that the surplus wa nearly £3,000,000

wonderfully demon strating the buoy ancy of revenue. Air Chamberlain proceed ed to give details o: revenue, drawing th< conclusion that then had been a genera

increase in the country’s wealth and an expansion of trade activity. The national debt was reduced by £4,500,000 and the floating debt by £51,250,• DOO. The Exchange Equalisation Account continued to show a profit. Mr. Chamberlain continued that he would not be justified in making an increase in the provision in such abnormal times for redemption of the debt, which would remain at £224,000,000. He was earmarking £20,000,000 for the supplementary Defence Estimates in 1036-7, in addition to those already published, of which > £10,000,000 was being allocated to Air force. The Army and Navy would probably require the same. The total expenditure, inclusive of supplementary votes, would be £797,597,000. BE VENUE EXPECTATION,<S. The Chancellor announced that he expected a substantial increase in revenue. He estimated income-tax at £248,000,000, £10,000,000 more than last year. He estimated customs revenue at £344,060,000, an increase of £10,500,000; surtax, £54,500,000, an increase of £3,500,000. Beer duty should increase by £1,900,000 anil tobacco by over £3,000.000. Death duties should be maintained at around £89.000,000. The total estimate of inland revenue was £420,000,000. The Post Office contribution to the revenue should be maintained at £10,750,000. llevenue from all sources would be £776.606,000, leaving a deficit of 1212291,000 -Mr Chamberlain foreshadowed • lianees in the law to prevent tax evasion, especially by those living in England transferring their property to persons abroad in such a wav as to ■ ctain control ol the property and iu•<me. and also to deal with surtax ■evasion. This legislation was expected t j produce £2.009.000 in 1936-7 and £ 1.060,000 in a ful, year. The Chancellor proposed certain in-come-tax concessions costing £1,000,009 lor the current year and £2,000,000 for the full year. The allowance fcr children would be increased from £5O to £6O. ind the allowance for married people would be raised tr«.m £l7O to £lBO. The incomes of infants aud unmarried children derived from their parents thrung'.i rducati nal trusts and other v. a s would lie reckoned as the parents’ incomes, saviqg £2,500,000. A surtax of £1 a barrel was being

imposed on beer from non-Empire countries.

Key-industries duties were being continued for ten years. In order to help the special areas, a company w-as being formed with a nominal capital of £1,000,000 to finance small businesses therein. The company would be experimental and would be limited to ten years. As a result of these adjustments the Chancellor estimated the final deficit at £20,266,000. He proposed to cover it front revenue. DEFENCE LOANS IN FUTURE. The Chancellor forecast that unless there was some agreement on disarmament the cost of defence would rise swiftly in the next few years. It was inequitable that the whole cost should fall on revenue. Part of it could properly be met from loans in future years. At present it was necessary to increase the standard rate of income-tax by threepence in the pound and to take £5.500,090 froom the Road Fund. Tea duty would be raised by twopence a pound. The estimated income would thus be £798,381,000, allowing a surplus of £484,000. The Chancellor estimated that the increased income-tax would produce £12,000,000. The tea duty would apply to both Empire and foreign and would yield £3,500,000. It was a bitter disappointment to ask for new sacrifices, but safety was more important than comfort.

The House was stunned into silence at the grim tidings The speeches following the Budget were very brief. Major Attlee, the Labour Leader, said that the financial position Was largely due to the Government’s foreign policy. The Budget would not cause enthusiasm anywhere. “It is a marked resolution to enter an extension of armaments which will land us into an abyss instead of an era of peace,” he said. It wa§ a Budget leading to war. Both Major Attlee and Sir A. H. Sinclair, who followed, complained of the increased tea duty as imposing a hardship on the masses. The usual financial resolutions were carried.