STATE FINANCES

Manawatu Standard, Volume LX, Issue 281, 26 October 1940, Page 6

STATE FINANCES

YIELD FROM TAXATION.

HALF-YEARLY STATEMENT

WELLINGTON, Oct. 26

Details of the ordinary revenue account of the Consolidated Fund for the first six months of the current financial year were announced last evening by the Minister of Finance (Hon W. Nash). Revenue for the period totalled £14,589,000, compared with £14,803,000 for the first six months of last financial vear, and total expenditure amounted to £15.207,000, as compared with £16,090,000 /or last year. After making an analysis of the figures, the Minister said they revealed a healthy position in the State's finances. He also gave particulars of the Social Security Fund and the War Expenses Account. A comparative statement of the

Other receipts 986,000 1,116,000 44 35 14,803,000 14,589,000 39 39 *'.'On the basis, of actual revenue it will be noted," explained Mr Nash, "that there has been a reduction in Customs, highways, and stamp and death duties, offset to a large extent by an increase in 'other taxation.' In compiling this year's Budget, substantial reductions "were allowed for under all headings in which a falling off is now shown, while last financial year the heading 'stamp duties' included gift and death duties, which this year are credited direct to War > Expenses Account.

"The heading 'other taxation' is mainly land and income tax in respect of which this year's Budget estimate, provided for a total increase of £3,260 000. The revenue position is more correctly appreciated by a comparison of the percentage statements, and it will be noted that on this basis the same proportion of the total revenue has been received during the first six months of this year as was received for the same period last year."

THE EXPENDITURE

As regards the expenditure, said the Minister, the total to September 30, 1940, was £15.207,000, as compared with £16,090.000 for the first six months of last financial year. Comparative details are as follows:

6,930,000 6,673,000 39 44

Annua! ; appropriations. i Social services 4,203,000 4,474,000 45 38 Other votes . 4,952,000 4,060,000 48 41

9,160,000 8,534,000 46 39

16,090,000 15,207,000 43 42

"The. first item of expenditure calling for special mention is 'debt services,' where a percentage increase of eight is shown," said Mr Nash. "This is an accounting fluctuation and arises principally from the fact that last financial year practically the whole of the amount provided tor public debt repayment was utilised at the close of the year, whereas this year a sub-, stantiai proportion of the allocation lias alreauy been applied. The percentage reduction in highways expenditure is offset largely by a reduction in the corresponding revenue item. "In total, 42 per cent, of the estimated expenditure for the whole of the present year had been expended during the first six months, as against 43 per cent, for the same period of last year.

"These results," Mr Nash added, "reveal a healthy position in the State's finances, and though with such an important item of" revenue as income tax not payable till toward the en.d of the financial year, it is somewhat premature to forecast the year's results, it is clear that both revenue and expenditure are adhering closely to the estimates, and personally 1 have every confidence that this satisfactory r>osition will be maintained. ~. SOCIAL SECURITY FUND. "Though the Social Security Fund is a separate account, outside the Consolidated Fund, it is financed to a considerable extent by transfers from the ordinary revenue account of the Consolidated Fund, and to that extent the Budget surplus or deficit for the year is atfected. For the six months ended September 30 last, the revenue received into the Social Security Fund totalled £5,627,000 compared with £4,978,000 during the same period of last year. In addition to this revenue, £400.000 has been transferred 'from the Consolidated Fund to date, as compared with £760,000 last year. The Budget estimate for such transfers for the whole of the current year was £3,200,000, as compared with £1,000,000 actually transferred last year. "On the expenditure side, during the past six months and regarding moneys advanced by way of interest as expenditure, a total of £6,101,000 had come to charge as against £4,949,000 during the first six months of last financial year. Generally speaking, it may be said that the expenditure is following the Budget estimate, while the revenue is somewhat more buoyant than was originally anticipated.

WAR EXPENSES ACCOUNT. "The war expenses account, while within the public account, is entirely self-contained and is financed by the proceeds of special taxation and separate loan 6. No comparison with the results of the corresponding period last year is -possible in this case as the war expenses account did not come into existence till the end of September, 1939. Again, regarding moneys advanced to imprestees as having been expended,the total expenditure tor the past 6ix months amounted to £8,836,000. The revenue during the period totalled £4,125,000, and borrowings (including interest-free stock of 1,098,000) totalled £4,127,000. "The total expenditure for the year, as provided for in the Budget, was £37i millions, of which it was estimated £l9| millions would be expended abroad and the balance in New Zealand. To date overseas charges amounting to only £1,239,000 have been en-

tered, largely due to delay in receiving claims.” The Minister said that full detailed accounts would be gazetted as soon as the usual audit had been completed.

revenue is as follows: — Percentage 6ix-months April 1 to to total September 50. for year. 1939. 1940. 1939- 1940Taxation-: .£ £ 40 41 5,459.000 4,571,000 55 61 Beer duty .. 540000 711.000 39 52 Sales tax .... 1,800,000 1,647.000 51 55 Highways .. 1,752000 1,360.000 58 52 Stamp dutie 1,486,000 782,000 43 47 Other 1,820,000 3,205,000 16 22 960,000 1,197,000 33 43

Perc< jntage six-n lonths April 1 to to total B September 30. for year. Permanent 19a9. 1940. 1940appropriations £ £ 40 41 Debt services 3,500,000 . 4,513,000 34 42 Highways ...1.753.000 1,294,000 58 50 Kvchange ... 792.000 766.000 46 51 Other services 835.CO0 10O,CO0 31 26