DANGER OF DUTY ON PROFITS

Southland Times, Issue 23181, 23 April 1937, Page 7

DANGER OF DUTY ON PROFITS

WARNING FROM BOTH SIDES OF HOUSE DEBATE ON THE BUDGET (British Official Wireless) RUGBY, April 21. The House of Commons began consideration of the Budget proposals in earnest today. Mr F. W. Pethick-Lawrence, for the Labour Party, wanted to know how the Chancellor’s plan for a national defence contribution would work in a number of ways, and expressed the hope that the Treasury had taken to heart the mistakes learned with the war time duty on excess profits. Sir Robert Home (Conservative) paid a high tribute to the Chancellor’s conduct of the nation’s finances during his period of office. He had pursued an undeviating course of resolution and rectitude with the result that the country was the envy of the world. Sir Robert, however, was critical of the proposed national defence contribution, the scope of which he thought too wide and which he feared would result in a check on enterprise. He urged that the opportunity which he believed offered should be seized for securing i trade agreement with the United States.

The Leader of the Liberals (Sir Archibald Sinclair) attacked what he described as the Chancellor’s protectionist policy and indicated that the Liberals would have preferred strict control of armament prices rather than a scheme of taxation which made the Government a partner in profiteering. Sir Alan Anderson (Conservative) said he thought a measure such as the national defence contribution was absolutely necessary when all of the people were being called upon to bear a heavy burden, although he admitted that schemes for taxing excess profits were full of difficulty and danger and generally unsatisfactory. The national defence contribution aroused immediate interest in the lobbies of the House of Commons, and all its implications are not yet fully appreciated. Discussing the project in a broadcast talk the Chancellor said:— “It is not that I consider that profits now happily being earned by trade and industry to be excessive. The depression, while it lasted, was very intense and not only did share-holders go without dividends but in many cases they lost a great part of their capital. In those circfimstances it is all to their good that they should have been able to recoup some of their losses and reequip their factories so as to be able to meet competition in the export markets.

“But now that we have to find this exceptionally large sum for defence in a comparatively short time I do not think it unreasonable to ask that businesses which are doing so much better should make a special and temporary contribution to the cost of national defence. After all, any help which they may give now will add materially to national security, which is essential to the maintenance of their prosperity.”

After declaring that the maintenance of peace was worth more than any reduction in taxation and that a strong Britain was the surest guarantee that peace would be preserved, Mr Chamberlain concluded: “Perhaps some day, when this madness of arming is over, a successor of mine may have the good fortune to be given the opportunity to remit taxation of which I have been deprived. Let us pray that day may come soon.”

BRITAIN AS WINNER OF ARMAMENTS RACE FRENCH COMPARISON WITH GERMANY PARIS, April 21. The Press considers that Britain will win the armaments race as she is drawing on her reserves at a moment when Germany has exhausted hers, but that Britain, no more than Germany, can live by rearmament, which destroys instead of creating capital.