OPTIMISM IN BRITAIN

Sun (Auckland), Volume III, Issue 639, 16 April 1929, Page 1

OPTIMISM IN BRITAIN

Budget Reveals Recovery

TAXES OFF TEA AND BETTING

A Big Surplus Anticipated

Ilritish Official Wireless Becd. 11 a.m. RUGBY, Monday. BUDGETING for a total ordinary revenue of £753,940,000 and an expenditure of £741,964,000, the Chancellor of the Exchequer anticipates a surplus of £11,976,000. No new taxes will be imposed this year, and certain J taxes will be removed.

Mr. Winston Churchill 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, oiu not a national misfortune. The steady decline in the consumption of alcoholic liquor throughout the land was due to a change in national habits and the growth of alternative beverages. After making full allowance for trade conditions, he could not estimate for more than £79,000,000 in beer revenue this year. He estimated this year £239,500,000 in income tax, and £ 51,000,000 in death duties. Owing to continued Stock Exchange activity, and the flotation of new

companies, stamp duty 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 the excess profits dutr and the corporation profits tax, and £58,000,000 from super-tax. The total receipts from taxes he estimated at £674,650,000. * From non-taxt revenue the Chancellor said he expected to receive £79,290,000, making the total ordinary revenue £753,940,000. The ordinary expenditure was estimated at £741,964,000, so that he anticipated a surplus of £11,976,000. No new taxes would be imposed this year. On the other hand. Mr. Churchill stated that the tea duty would be immediately removed, the cost being £6,000,000. BETTING TAX TROUBLE One tax for which he bad been responsible was the betting tax. It had been more trouble than it was worth. The tax on bookmakers’ turnover would be immediately repealed. The bookmaker in the future would pay £lO a year for a certificate, and in addition he would pay a licence duty °f £4O for every telephone installed in his office. One-half per cent would be levied also on the takings of the totalisator, 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 a 25 per cent, reduction in licences for the retail sale °f beer and spirits, in view of the curtailment of hours of sale since the *ar. This would cost nearly £2.000,000 in a full year. Harbour dues would be reduced. Despite the above-mentioned concessions, Mr. Churchill estimated the Budget surplus at £4,095,000. Reviewing the financial position, Mr. Churchill said the period of the Government term of office was chequered. There was the industrial disaster of 1926. but after two years Quiet there had been a sensible improvement in the situation. The savings of the smallest class of investors bad increased while the Government bad been in power by £170,000,000. A HEALTHY SYMPTOM The cost of living had declined at least 18 points, a symptom on which he dwelt with more confidence than on any other, as indicating the general condition of the "lasses of the people. . There was an 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 a head. East year they consumed 9.15 pounds of tea «md 90 pounds of sugar. That was a record consumption of those commodities. The balance of trade had sensibly improved the power of the community to export and invest capital abroad.

thus fostering export trade. It had risen from £86.000,000 in 1924 to £149.000,000 in 1925. New capital issues for Home investments in 1928 showed a growth of about £100,000,000 over 1924. Whatever might be the future of the particular industries or the particular localities, we were undoubtedly dwelling to-day in a more powerful. more wealthy, and more securely founded community than five years ago. W r e were steadily improving our conditions and, compared with most European countries, were maintaining our pre-war level. THE GOLD STANDARD 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 minor and temporary, and the reward would be major and permanent. Trade had derived a lasting benefit from the resumption of the gold standard. Ho referred to the benefits it conferred on overseas trade, which constituted the stepping-stone in times of peace of our economic position. London, despite the sacrifices made by Great Britain during the war, had regained its solid international pi'eeminence. W*e were still the greatest international market, and w r e 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 tew years regained their time-honoured position as the favourite international instrument and token of commerce. LOWER LIVING COST There had been a decline in the cost of living as wresult of our allegiance to sound money. This decline of IS points was an increase in the purchasing power of wages, equivalent to a remission of £160,000,000 a year in indirect taxation. In regard to the debt operations of the present Parliament, the Chancellor said the nominal dead-weight of £7,598,000,000 had fallen to £7,501,000,000. Interest on the debt, by the operation of sinking funds, had been reduced by £9,500,000 a year. 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 a pound. The benefits of the derating scheme will he applied to agriculture forthwith and to other industries in October. In view of the criticism that brewers, distillers and tobacco manufacturers would benefit from the derating measure, which was designed to assist distressed industries, increa.sed duties imposed on the three industries would counterbalance their gains under derating. The expenditure side of the national accounts for the financial year which has just begun is already known. The Estimates have been published, showing an estimated total outlay comprising the following principal items, namely: 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.

MAY BE A SWAN SONG

OPPOSITION CAUSTIC IN CRITICISM “BRIBERY OF THE ELECTORS” (Australian and N.Z. Press Association) Reed. 11 a.m. LONDON, Monday. Following Mr. Churchill's speech, Mr. Philip Snowden, who was Chancellor of the Exchequer in the Labour Government, said the Budget was really ail electioneering speech. It was very different from what the House had been led to expect. 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 the Budget would be of advantage to them at the elections, they were under-rating the intelligence of the electors. Mr. Lloyd George, the Liberal leader, said he did not complain that it was an electioneering speech. "What I object to is the high moral standard Mr. Churchill takes of anyone else who has electoral purpose in mind. He was 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. This is Mr. Churchill’s fifth Budget. The members of the House of Commons invariably attend in full strength on Budget day. and all the accommodation for distinguished visitors and the general public was early allotted.