That Sir John Simon has produced a Budget, which, while not too drastic; branches out into practically every source of revenue, is indicative of the general desire of the Government to spread the enormous cost of war over the whole nation in a manner which will not press too heavily on any particular class. The increase of 6d. in the pound in income tax, the lowering of the level at which surtax becomes payable from £2,000 to £1,500 do not, of course, do much towards exhausting the possibilities of this form of taxation and if before the war ends the income tax reaches the imposing figure of 10s, in the pound there will be no very great surprise. The opinion of most experts appears to be that the nation can stand it, and, though it would indeed be a heavy burden, it is part of the price of victory, and at that much cheaper than defeat would prove. The outstanding fact is that the Chancellor of the Exchequer has budgetted for an expenditure reaching a total of £2,667,000,000 of which no less than £2,000,000,000 will have to be spent on the war. That the Government has been spending money with due regard to the need for the strictest economy is demonstrated by the fact that the expenditure last year was considerably less than estimated, realizing a saving of so important a sum as £116,500,000. One of the most interesting features of the figures which Sir John presented to the House of Commons was the manner in which estimates made last year had, in practically all instances, been exceeded by the actual receipts. In this connection it will be remembered that, when introducing a extraordinary Budget after the commencement of hostilities, one of the provisions which was most strongly criticised was the proposal to increase the tax on motor cars to the high figure of 25s. a horse-power. It was alleged that that was so high that the law of diminishing returns would come into operation and the Chancellor robbed of the increased revenue which he sought to obtain in that matter.
It is an interesting and important fact that the critics have been confounded in the result, for not only did the Chancellor obtain the £22,000,000 he wanted, but some £12,- 000,000 in addition. What the future effect will be upon the motor car industry of Great Britain remains to be seen, but Sir John's claim that by this increase revenue had been preserved and luxury motoring discouraged seems in the circumstances to be well founded. The increases in the taxes on spirits, beer, tobacco, etc., will undoubtedly bring it home to the man in the street that the war is something which closely concerns his pocket, but they are rightly regarded as luxuries and will undoubtedly receive all the increases in the future that the traffic will stand. Increased postal charges, and the tax upon sales by wholesalers to retailers, together with the increased tax on matches, are all indications of the manner in which every revenue producing source is being explored, and though it is apparent that Sir John has other rabbits in the financial bag, he has only produced sufficient of them to meet immediate needs. There is still a very wide margin between the estimated revenue and expenditure amounting to no less a sum than £1,443,000,000, and the problem has to be met as to how that will be provided. The suggestion of a compulsory deduction from income has been very properly rejected. It would in all probability have proved most unpopular, and in any event the times are not yet desperate enough to justify so drastic a step. The only conclusion to which the Chancellor of the Exchequer has come is that the saving, and the lending of their savings to the State by the people, is still the best method of financing the war. The results which have been obtained by these means up to the present have been more than a little gratifying, and Sir John concludes that "provided that the persistence of our people in supporting the present loans and the resolution of our people in paying Government taxes is maintained, we have nothing to fear."
The general impression to be gained from the financial provisions which have been suggested is that the Government considers that the nation is financially ina very satisfactory state of health, and that from that point of view there is nothing to warrant any anxiety as to the future. The increased postage dues were criticised by Mr. C. R. Attlee who claimed that they would not bring in a great deal of money and would irritate a vast number of people. That may turn out to be the case, but it has to be remembered that the same was said last year about the increase in motor taxation, and that has since proved to be quite incorrect. Sir Archibald Sinclair, leader of the Liberal Opposition, supported the Chancellor's proposals, pointing out that the figures which had been given were clear and eloquent proof of the power and the greatness of Britain's: resources. The manner in which these proposals were received by the House of Commons testifies to the high spirit and firm purpose with which a united Britain will continue to prosecute this war. It remains, of course, to be seen how they will be received by the country at large. The scrupulous fairness of the Budget, the manner in which the burden has been evenly spread over all sections of the nation, will serve to allay a great deal of criticism which otherwise might be expected, and it may be that the average taxpayer will remark with a sigh of relief, "Well, it might have been a great deal worse." It must not be thought for one moment that the provision of £2,- 000,000,000 for the prosecution of the war this year represents what it may cost in future years, and if succeeding Budgets prove even heavier than this one there need be little surprise. That additional burdens can, and will be shouldered goes without saying, as also that they will be borne cheerfully and loyally. The general impression to be formed is that the Chancellor of the Exchequer has produced a most satisfactory Budget, which should prove acceptable all round, and provide the essential means of prosecute ing this war to a successful conclusion.
Text read from the printed page and cleaned; old type leaves the occasional error.