BRITAIN’S WAR BUDGET PRESENTED

Wanganui Chronicle, Volume 84, Issue 96, 26 April 1940, Page 5

BRITAIN’S WAR BUDGET PRESENTED

ENORMOUS EXPENDITURE

COUNTRY TO FIND TOTAL OF £2,667,000,000

SALES TAX; P. AND T. RATES RAISED (U.P.A. and Official Wireless) LONDON. April 23. The Chancellor of the Exchequer (Sir John Simon) presented his war Budget in the House o'l Commons. The main points arc:— A new Purchase Tax, which will he a percentage on the price of goods, paid by the retailer. An added duty on spirits, amounting to Is Sid a bottle. Added beer duty, amounting to roughly Id a pint. . Added tobacco duty, amounting to 3d ..u. ounce. A new excise duty on matches which will raise the price by Jd a box. Telephone charges raised by 15 per cont. An additional 3d on inland telegrams, but no change in overseas telegraph or telephone rates. Imperial postage raised to 2d per postcard, and 2jd for letters. Foreign postage rates raised by id. No change in postage to the forces overseas. Super-tax to be chargeable next year on incomes of £l5OO, instead of £2OOO. The standard rate of income tax, now 7s 6d in the £, to be maintained. Dividends on ordinary shares of public companies to be limited. The, issue of bonus shares to be prohibited for the duration of the war. Budgeting for £2,667,000,000, the Chancellor oi the Exchequer, Sir John Simon, announced in the .House of Commons that income tax will be at the rate of 7s*6<l in the £, as forecast in his emergency Budget last September. He previously summed up the nation's accounts for tlic last year. The country had spent £1,317,000,000, finding £1,049,000,000 out of revenue, and. was borrowing the rest —£768,000,000. He had estimated that he might have to borrow £938,000,000, so that the result was better than was expected. Regarding the National Debt, they had had to borrow noi only to cover the deficiency just mentioned, but also to find £4,250,000 for the statutory sinking fund and also £7,000,000 lor trade agreements. The National Debt of £8,163,000,000 at the beginning of the year increased to £8,931,000,000 on March 31. Sir John Simon estimated that the changes in income tax would increase the yield in a full year by £61,750,000. He proposed also to add to the existing duties on beer, spirits, tobacco, and matches. He estimated a yield in a lull year of £70,000,000 front tne increase in spirit duties and £23,000,000 as a result of the increase in the tobacco duty. Sir John Simon announced an increase in postal charges. The letter rate is to be increased by Id to 2|d, and the rate for postcards is to be raised from Id to 2d. Including the changes in poundage on postal orders and inland, telephone chaiges, £■' estimated an increased yield of £21,800,000. The new rate on matches would bring the prices oi' a box up to lid. . The Chancellor’s proposals included a new iorm ol tax, which he estimated would bring in substantial-additional revenue. He proposed to call it a “purchase tax. ’ Ihe new tax would be a percentage on the price, which would be levied al the stage when the wholesaler was selling to the retailer. It would not apply to food, or drink, or foodstuffs, whether lor human or animal consumption. ( The registered seller would charge the tax I<> the buyer and would be accountable for it. Neither the date nor the rtite had yet been fixed. The tax would put no sort ot obstacle, tn the way of export trade. The Chancellor estimated that the total contribution I rom revenue was £1,234,000,000.