BRITAIN'S FINANCES

New Zealand Herald, Volume LXXIII, Issue 22539, 2 October 1936, Page 10

BRITAIN'S FINANCES

With Exchequer returns for the first half of the financial year available some indication of the probable course of Britain's finances in 1936-37 can be had. Ordinary revenue is £1,891,000 less than for the corresponding part of last year. This is wholly the result of a fall in the first quarter, when there was a decrease of £7,815,000 compared with the corresponding portion of 1935-36. Thus, though income in the JulySeptember quarter has been buoyant compared with that of the previous year, it has not been sufficiently so to make up all the leeway of the previous three months. At first sight it is surprising to find income tax yield £'6,000,000 lower than in the first half of the previous year, since the Budget provided for an increase of threepence in the standard rate. However, this was accompanied Joy wider concessions to those in the lowest income categories. The instalment payable at the beginning of July affects principally those who pay on earnings, and those include a large quota of the incomes on which concessions were made. The

effect of the increased standard rate will be more apparent when the January payments fall due. It will need to be, since the Chancellor of the Exchequer expected to obtain £*21,000,000 more from income tax this year than last— 1 £12,000,000 because of the higher scale and £9,000,000 on account of improved economic conditions. An increase of £6,667,000 in the return from customs duties indicates a substantial growth in overseas trade. The higher duty on tea, imposed by the Budget, was estimated to return £3,500,000 for a full year, so any extra yield from this source cannot account for more than a part of the greater customs revenue. While it is never safe to predict the results for the year from the position halfway through its course, it can at least be said that the Chancellor's estimate has a good chance of fulfilment. The greater revenue indicated will be required to finance Britain's rearmament programme. The price for disturbed world conditions is being exacted, the taxpayer having to shoulder the burden instead of being given the relief that would have been possible in happier circumstances.