BUDGET SURPLUS

Southland Times, Issue 20661, 17 April 1929, Page 5

BUDGET SURPLUS

BRITAIN’S YEAR

NEARLY TWELVE MILLIONS TO SPARE

TEA DUTY ABOLISHED

SAVING TO THE PUBLIC

A surplus of £11,976,000 is anticipated by the Chancellor of the Exchequer, Mr Winston Churchill, who delivered his anxiously awaited Budget speech in the House of Commons on Monday afternoon. A feature of the Budget is the remission of the tea duty, making a reduction in the nrice

to the public of fourpence per pound. (United Press Assn. —By Telegraph—Copyright.)

Rugby, April 15. Mr Winston Churchill, Chancellor of the Exchequer, introduced his Budget to-day in a crowded House of Commons.

In regard to revenue, he said that last year Customs and Excise showed a deficiency almost entirely accounted for by beer alone. Beer showed a fall of £7,350,000. That was an Exchequer embarrassment, but not a national misfortune. The steady decline in the consumption of alcoholic liquor throughout the land was due to a change in the national habits and the growth of alternative beverages. After making,-a full allowance for trade conditions he could not estimate for more than £79,000,000 in the beer revenue this year. He estimated this year £239,500.IXIO in income tax and £81,000.000 in death duties. Owing to continued Stock Exchange activity and the flotation of new companies, stamps had yielded £2,000,000 above the estimate last year, and he estimated a further growth this year, bringing the total to £31,000,000. He estimated to receive this year £1,700,000 from excess profits duty and corporation profits tax and £55,000,000 from the super-tax. The total receipts from taxes he estimated at £674,650,000, from non-taxod revenue he expected to receive £79,290,000, making the total ordinary revenue £753,940,000. Ordinary expenditure was estimated at £741,964,000, so that he anticipated a surplus of £11,976,000. No New Taxes. No new taxes would be imposed this year. On the other hand, Mr Churchill stated, the tea duty would be immediately removed, the cost being £6,000,000. One tax for which he had been responsible was the betting tax, and it had,been more trouble than it was worth. The tax on the bookmaker’s turnover would be immediately repealed. The bookmaker in future would pay £lO a year for a certificate and in addition he would pay a license duty of £4O for every telephone installed in his office. Half per cent, would be levied also on the takings of the totalizator, which, he had been led to believe, would be a fair equivalent to the license duty on bookmakers. The yield on these levies would be £850,000 in the current year and £900,000 in a full year.

There would be 25 per cent, reduction in licenses for the retail sale of beer and spirits in view of the curtailment of hours of sale since the war. This would cost nearly £2,000,000 in a full year. Harbour dues would be reduced. Despite the abovementioned concessions Mr Churchill estimated the Budget surplus at £4,095,000. Reviewing the financial position, Mr Churchill said the period of the Government’s term of office was a chequered one. There was the industrial disaster of 1926, but after two years of quiet there had been a sensible improvement in the situation. The savings of the smallest class of investors had increased while the Government had been in power by £170,000,000. The cast of living had declined at least IS points. A symptom on which he dwelt with more confidence than on any other as indicating the general condition of the masses of the people was the increased consumption of tea and sugar. Before the Great War the British people consumed annually 6.55 pounds of tea and 81 pounds of sugar per head; last year they consumed 9.15 pounds of tea and 90 pounds of sugar. That was a record consumption of those commodities. Export Trade Improved. The balance of trade had sensibly improved the power of the community to export and invest capital abroad, thus fostering the export trade. New capital issues for home investments, which had risen from 86,000,000 in 1924 to £149,000,000 in 1928, showed a growth of about £100,000,000 over 1924. Whatever might bo the future of particular industries or particular localities, we were undoubtedly dwelling today in a more powerful, a more wealthy, and a more securely founded community than five years ago. We were steadily improving our conditions and, compared with most European countries, maintaining our pre-war level. Speaking of the gold standard and the cost of living, Mr Churchill admitted that the gold standard carried with it privations as well as reward, and his hope and faith was that the privations were minor and temporary, and the reward would be major and permanent. The producing industries, as well as the entrepot trade, had derived a lasting benefit from the resumption of the gold standard. He referred to the benefits it conferred on overseas trade which constituted a stepping stone in times of peace. As to our economic position, London, despite the sacrifices made by Great Britain during the war, had regained its solid international pre-eminence. We were still the greatest international market, and we had been able to maintain money rates lower than those which normally prevailed in New York, while bills of exchange on London, which after the war were so seriously menaced, had in the last few years regained their time-honoured position as the favourite international instrument and token of commerce. Cost of Living Declines. There had been a decline in the cost of living as a result of our allegiance to sound money. This decline of 18 points was an increase in the purchasing power of wages equivalent to the remission of £160,090,000 a year in indirect taxation. In regard to the debt operations of the present Parliament the Chancellor said the nominal deadweight of £7,598,000,000 had fallen to £7,501,000,000. The interest on the debt by the operation of the sinking fund had been reduced by £9,500,000 a year.

The Budget estimates have been published showing an estimated total outlay comprising the following principal items: Fixed debt charges .. .. £350,000,000 Consolidated Fund services . £23,000,000 Supply Services — Army .. £40,500,000 Navy £55,800,000 Air Force £16,200,000 Civil Votes £250,500,000 The reduction in harbour duties applies only to the herring industry. The tea duty remission means a reduction in the price to the public of 4d per lb. The benefits of the derating scheme will be applied to agriculture forthwith and other industries in October. In view of the criticism that brewers, distillers and tobacco manufacturers would benefit from the derating measure designed to assist the distressed industries the increased duties imposed on the three industries would counter-balance the gains under derating. "Shameless Piece of Bribery.” Mr P. Snowden, following Mr Churchill, said the Budget was really an electioneering

speech. It was very different from what the House was led to expect, and a more shameless piece of election bribery had never been presented by any political party. The speech was in the nature of a “swan song.” If the Ministerialists thought that the Budget would be of advantage to them at the elections they were underrating the intelligence of the electors.

Mr IJoyd George said that he did not complain that it was an electioneering speech. “What I object to is the high stand Mr Churchill takes of anyone else who has an electoral purpose in mind,” he said. “He is very severe about my suggesting borrowing £200,000,000, but he, himself, spent £400,000,000 without providing anything like substantial employment. From the point of view of dealing with a grave situation the Budget is extremely disappointing.” The usual Budget resolutions were agreed to and the House rose.—British Official Wireless.

DISTINGUISHED GALLERY.

PRINCE OF WALES PRESENT.

DULL SPEECH BY CHANCELLOR

(Rec. 12.5 a.m.) London, April 16. The Budget speech was listened to by a crowded House, including the Prince of Wales, who, with others in the Peers’ Gallery, listened to Mr Churchill with interest, but the general verdict is that easily the dullest of Mr Churchill's Budgets cleverly found its way through a maze of statistics, producing the impression of a defence of the Government’s financial policy since 1924, but artistry or oratory was less conspicuous than in previous Budget efforts. Only when the Chancellor approached the final announcement of taxation changes did the audience sit up quickly'. It is evident that the only' substantial change is the abolition of the tea duty. The tax has been in existence since the times of Queen Bess and has been as much as 2/6 and even 5/-; .so there is general satisfaction at its end. The fact that entirely removed remission is not confined to the Empire is also welcomed as it means the removal of irritating customs and restrictions. There is no likelihood of the abolition changing the price of a cup of tea in tea-shops. Expedited relief for agriculturists costing £2,500,000 pleased farmer members of the House of Commons. Motorists complain of the absence of a substantial reduction in the taxation of motor vehicles, particularly as the vast majority of motor-owners are persons of moderate means. Racing men admit that the tax of a half per cent, on the takings of the totalisator is less than was anticipated. At least one per cent, was expected as this is the tax on the course at the moment. Apparently Mr Churchill is desirous of making totalisator betting as popular and as cheap as possible. —Australian Press Association. REDUCTION IN TEA ANNOUNCED. (Rec. 9 p.m.) London, April 16. Leading tea retailers announce a reduction of fourpence a pound to-day.—Aus-tralian Press Association,