AUSTRALIAN FINANCE.

Waikato Times, Volume 108, Issue 18169, 6 November 1930, Page 7

AUSTRALIAN FINANCE.

DEFICIT INEVITABLE. BALANCE BUDGET IMPOSSIBLE. FURTHER TAXATION PROPOSALS. United Press Assn.—Elec. Tel. Copyrlsbi. CANBERRA, November 5. A serious drift in the Commonwealth’s finances, since the Budget was delivered by Mr Scullin on July 9, was disclosed by the acting-Fed-eral Treasurer, Mr J. A. Lyons, in a long statement in the House of Representatives to-day. He also outlined the Government's proposals for curtailing expenditure and increasing revenue. He anticipated that with a restoration of confidence and a revival of trade the deficit would be- between £8,000,000 and £10,000,000. With only eight months to go l , it would not be possible to balance the ledger during the present financial year. The most that could be achieved, without undue sacrifice, was to plan -the Budget on such a basis that when It operated for a full year, the ledger would be balanced.

Additional Imposts. Mr Lyons said the Government Intended to impose new revenue duties estimated to yield £3,100,000 annually, but the sum realisable for the remainder of this year would be only £2,000,000. New income tax proposals would apply principally to income from property, such as interest, dividends, and rents. There would be a super-tax o<f 1% per cent, upon all incomes, including those of companies, from property. This was expected to yield £1,500,000. There would also be an increase of 5 her cent in the rate of tax on incomes from personal exertion above £SOO, which would produce £160,000 of additional revenue.

Federal Ministers’ salaries would be subjected to special taxation at the rate of 15 per cent., and those of members of Parliament at the rate of 10 per cent. Government employees whose salaries exceed £725 will pay a special tax of 10 per cent.; those above £IOOO a tax of 21 per cent., and those which exceed £ISOO yill pay 15 per cent, i It is anticipated that this tax will .produce £60,000 in a ful year, but only £40,000 for the remainder of the current financial year. Mr Lyons said the total taxation proposed amounted to £4,820,000 in a full year, but the sum expected for the remainder of this year was £3,700,000. Cuts In Outlay.

The Government ' hoped to make further savings and economies amounting to £1,230,000. It also intended to reduce the contribution to the sinking fund by £1,950,000. These two Items represented a total of expenditure reductions of £3,180,000 over a full year. Thus, expenditure reductions and new taxation combined revealed a total benefit to the Budget of £8,000,000 for a ful year. Mr Lyons said the annual overseas liabilities of Australian Governments consist m'ainly o ; f interest and sinking fund, and amount to about £34,000,000, while the net short-term indebtedness of Australia at October 31 was £7,134,000. Declaring that financial depression and trade dullness had been accentuated since the financial proposals for balancing the Budget were determined four months ago, Mr Lyons said there had been a serious shortage of postal receipts, .and claims for invalid, old age, and war pensions had greatly increased, while the estimates for exchange on remittances to l London also would be inadequate by nearly £500,000. Wool was now averaging only about 9d per lb, compared with Is 3d last year and is 7d the year before. Wheat, f.o.b. Australia, was less than 3s abusbel compared with 5s last year.

ECONOMY AT AUSTRALIA HOUSE.

APPLYING THE AXE. United Press Assn. —Elec. Tel. Copyright. LONDON, Nov. 4. The majority of members of the staff- at Australia House do not even know that Mr P. E. Coleman’s drastio report is in the hands of the High Commissioner, Sir Granville Ryrie. Its contents are a well-kept secret. It is learned that the proposals include the practical abolition of the scientific and industrial research branch of which Mr F. L. McDougall is the head at a salary of £2OOO a year, though there is a probability that he will be retained in another capacity. The axe is likely to fall heaviest on those who are not civil servants, in spite of the fact that they have been for many years in the service of the Commonwealth. About 20 civil servants are employed at Australia House and they have nothing to fear. If they lose their London posts they will be sent back to Australia, but others have no reason to be so satisfied. The Financial New's says the news from Australia can only be regarded as another nail in the coffin of Australia’s credit. The mehtods by which the Federal caucus proposes to meet the country’s monetary commitments can be described by the one word “ihflation.”