One result of the excitements of the Trade Unions Bill,
the Russian expulsion and the House of Lords crisis was that the public almost forgot the Budget, but this week they have been unpleasantly reminded of its exist- ence. Mr. Churchill was universally congratulated when he promised to simplify Income Tax and Super Tax by combining them in a single graduated tax, for which only one form need be filled up. So far it is difficult to discover any simplification. It is, on the contrary, easy to discover new complexities. It is proposed to give fresh powers of inquisition to Somerset House which would, in effect, make it possible for officials to interfere in the management of trading companies and decide how profits shall be allocated. Clause 29 authorizes the Special Com- missioners who suspect " avoidance " to impose Super Tax upon the whole year's income of a company which has placed part of its profits to reserve. This seems to us entirely indefensible. The Government ought to encourage cautious finance, not to penalize it.
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