FINANCES OF BRITAIN

Manawatu Standard, Volume LII, Issue 119, 20 April 1932, Page 7

FINANCES OF BRITAIN

HEALTHIER STATE REVEALED BUDGET TAXATION CHANGES NO INCOME TAX RELIEF (United Press Association. —By Electric Telegraph.—Copyright.) (British Official Wireless.) Received April 20, 11.30 a.m. RUGBY, April 19. The Chancellor of the Exchequer, Mr Neville Chamberlain, in the House of Commons to-day, made his first, Budget statement on the financial conditions, which are far happier than those which confronted his predecessor, Viscount Snowden, a year ago. ' • At that time the country was borrowing £1,000,000 weekly to finance the Unemployment Insurance Eund, and Viscount Snowden was confronted with a large prospective deficit. Hard facts were faced, and drastic remedies were applied by Yiscount ~ Snowden in the interim Budget last December, with the result that Mr Chamberlain was to-day able to face a crowded House with the knowledge that the Budget had not only been balanced, but also had even achieved a small surplus, and that a quarter of a million more workers than a year ago had found 1 employment. The Chancellor spoke for an hour and three-quarters.

The changes in taxation would be neither numerous, nor largo, said Mr Chamberlain. “Although wo are beginning to see light between the trees, we have far to go l>efore wo emerge into smoother ways,” he added. The Chancellor announced the continuance of the concession of 12s a cwt. on home beet sugar, a revival of the duty on foreign tea of 4d a pound, and a duty on Empire tea of 2d per pound, a reduction from next January of the tax on motor cycles to 15s, 30s and £3, according to whether the engine had a capacity not exceeding 150 c.c., 250 c.c., or exceeding the latter figure. This change is to give the designers a freer hand. The Chancellor announced the appointment of a small impartial committee to inquire into the taxation of co-operative societies RESULT OF ECONOMIES. Mr Chamberlain recalled that ur.rier Viscount Snowden’s Budget, by a combination of economy and new taxation, provision had been made for a reduction of the debt of £32,500,000, and a surplus of £l, JDO,OOO. They had the satisfaction of recording that not only, had Viscount Snowden’s anticipations been fulfilled, but also had produced a small surplus of £364,000. The economies had been more than made good. FRESH CONFIDENCE IN BRITAIN.

£250,000 from the abnormal import duties, £750,000 from the horticultural duties, and £27,000,000 from the ten per cent, imports duties. The lastnamed was higlily conjectural. He would make an' order under the Imports Duties Act, based on tho Tariff Committee’s recommendations before the end of tho week. This would yield £5,000,000, but he would not disclose the commodities at present. These additional receipts would bring tho total to £764,000,000, reducing the deficit to £1,700,000. Since the Budget was balanced there had been an inward flow of liquid capital, flattering our credit, hut somewhat embarrassing to trade. CURRENCY FLUCTUATIONS. We must avoid violent currency fluctuations, for which he proposed to build up an exchange equalisation account. For this purpose he would ask the House for power to borrow £150,000,000. He could not give an assurance that this fund would finally end tho exchange fluctuations, but we would' be better equipped to maintain steadiness than in tne past. The conditions of the world ruled out tiie possibility in the near future of returning to the gold standard. NO INCOME TAX RELIEF.

There would be no relief to the income taxpayers this year. The voluntary scheme of employers paying tho tax and deducting instalments from the employees’ wages ought to become a permanent system. There would be no reduction in the beer tax. , . A duty was being imposed on foreign tea of 4d a pound, with a preference of 2d on Empire tea. The final would be:— Estimated expenditure ... £766,004,000 * Revenue. £766,800,000 Surplus .... £796,000 FIRST PROTECTIONIST BUDGET. MR G. LANSBURY’S COMMENT. ' RESOLUTIONS CARRIED. Received April 20, 12.10 p.m. LONDON, April 19. In the House of Commons, Mr G. Lansbury, Leader of the Opposition, following Mr Chamberlain, hoped that Sir Herbert Samuel and Viscount Snowden gloried in the fact that they were participating in Britain’s first protectionist Budget. Mr Chamberlain had admitted that we had reached the limit of direct taxation. Money, could not fall from the Heavens: it must come from the pockets of the people. There was no hope of tire restoration of trade and industry on‘a policy of economic nationalism. The only basis was national co-operation. The Budget resolutions were carried, and the House adjourned. SUGAR PREFERENCES. Received April 20, 10.0 a.m. LONDON, April 19. During the next five years the preference on imported colonial sugar will be increased by a shilling per cwt. A special supplementary preference of another shilling on a limited quantity of sugar will be allocated by the Colonial Office among the sugar-produc-ing colonies. The foreign and Dominion sugar duties are not altered. CONTINENTAL INTEREST. LONDON, April 19. Continental interest in the Budget is unprecedented owing to tho_ expected announcement of tariff duties. Numbers of business firms have sent special representatives to London and many long distance telephone calls have been booked. It is reported that Cabinet is not in entire agreement regarding the proposals, but that members have agreed to differ as before. PROVISION FOR EDUCATION. (British Official Wireless.) RUGBY, April 18. When the Minister of Education, Sir Donald Mac Lean, presented his departmental estimates in the House of Commons to-day he said that they provided for an Exchequer expenditure of £42,892,676, which showed an economy of £5,500,000 on last year. In 1906 the estimates were about £12,500,000. With sums raised from rates by local education authorities, there was about £100,000,000 for educational purposes in Great Britain —more than half the total national expenditure for the year before the war. He doubted whether there was any country m Europe to-day whose Budget contained so generous a provision for education. Regarding recent economies, Sir Donald Mac Lean said that there had been reductions under every head except teachers’ pensions and scholarships to students.

Mr Chamberlain said that the taxpayers had nobly played their part and made a magnificent response to the appeal for early payment. The Budget had been saved by the income tax and supertax payers, who had shown a sense of duty and citizenship. They had not only effected a substantial saving in the cost of Treasury bills, but also the stimulus of the example had strengthened and invigorated people in many other lands, who looked again to Britain with fresh confidence and hope in her capacity to lead the world in overcoming her financial difficulties. It was only in the past few months that some revival of trade and employment had led them to hope that the worst had passed.. HOUSE OF COMMONS CROWDED. no reductionUn BEER TAX. EMERGENCY BUDGET RECALLED Received April 20. 11.0 a.m. LONDDn, April 19. Mr Chamberlain delivered his Budget to-day. . Members left their cards, claiming seats, from midnight onwards. The House was crowded from the opening, and the galleries were quickly filled. The Prince of Wales took his seat above the clock. The women in the public galleries outnumbered the men.

Mr Chamberlain said that Viscount Snowden’s emergency Budget in the autumn of 1931 was unprecedented for a century. It was a model of sound and sano finance. . We were now £9,000,000 better off than ■ Viscount Snowden anticipated. The economies had amounted to £34,500,000 instead of the estimated £22,000,000. Reduced unemployment had aided the Exchequer. TAXPAYERS’ RESPONSE.

Continuing, Mr Chamberlain said that the remarkablo result of the emergency Budget had produced u profound impression on instructed opinion throughout the world. Customs and excise receipts were £3,000,000 above the estimate. There had been a serious and unexpected deficiency in the 'death duties, which yielded £65,000,000 instead of the estimated £83,000,000. The income tax yielded a surplus of £15,000,000 over the estimate. The magnificent response of the income taxpayers had shown a sense of duty and citizenship, for which the British people could always bo relied on in time of trouble. The year had been one of anxiety, difficulty and hardship for all classes. Taxes had to lie met out of capital. Only in the last few months had the revival in trade and employment led to tho hope that the worst was past. He anticipated that on the present basis there would be a drop of £32,500,000* in the income tax receipts as payablo on earnings in a year of unprecedented depression. We had clearly approached the limit of taxation through the income tax. The present position was that the total expenditure was £766,000,000 and the estimated revenue £731,500,000, leaving a deficit of £34,500,000. He estimated that he would receive