The Budget
WE have so much admiration for the courageous spirit shown by our convalescent Chancellor of the Exchequer, and so much sympathy with anyone who holds that office, in which he has to perform tasks almost as invidious to-day as those of the public executioner, that we could find no pleasure in criticizing his new Budget. We have further a sense of relief for which we are grateful to him in spite of a consciousness that we owe the relief to Mr. Snowden's ingenuity rather than to sound finance. But those who got up on Monday expecting to go to bed with their incomes further mulcted and their tobacco costing more would be ungenerous if they refuse to say "thank you." Mr. Snowden further can justifiably appeal to the Gladstonian principle that in bad times the stimulation of trade is an even more urgent duty than the reduction of debt. He does not stimulate trade or industry by this Budget, but he can claim to have added nothing to their burdens. His one piece of extra taxation which falls on them, twopence extra on a gallon of petrol, comes at a time when the falling price will make it much easier to bear.
We record details of the accounts under "News of the Week." Here the first criticism which we must make is that Mr. Snowden seems to have yielded to his hale and reckless colleagues who will not allow the retrench- ment which he would rightly pursue. The Budget speech had, with unsupported optimism, some vague references to the work of other people, viz., the Economy Committee now sitting, in possibly reducing future expenditure, but not one word of the Government itself trying to be less spendthrift or less tyrannical tax- gatherers. Secondly, Mr. Snowden has shown himself an alarmingly apt pupil. of Mr. Churchill in his more doubtful methods, and also influenced by the expectation that he will not be responsible for the next Budget. The country is ill served by this tactical playing with its finances, whichever Party is in power. A large sum is brought in, to eke out revenue and to be spent as though it were income, from our dollar credit in New York which has been kept there to steady the exchange through our heavy debt operations. The Treasury may well consider it unnecessarily large and probably less helpful since the establishment of the Bank of International Settlements, but to withdraw £20 millions out of £33 millions at one stroke seems to us almost certain to have a bad effect on our credit abroad. The next " dodge " is directly copied from Mr. Churchill's example. The Income Tax payer is to produce, if he can, three-quarters instead of one-half of the tax at the New Year ; thus the Treasury will swallow in one financial year the money due over five quarterly periods.
There is little else that calls for criticism on purely financial principles, but Mr. Snowden's schemes into which political principles creep demand some comment. There is no question at all of finance, only of administra- tion, in his announcement that the tax collectors will in future be Civil Servants appointed by Somerset House. This has been expected and has aroused wide alarm and protest. It is characteristic of keen and efficient bureaucrats who desire centralized power. It is directly contrary to the truly democratic spirit in which we have hitherto taxed ourselves. The protests made by innumerable Local Commissioners of Income Tax have been based on general grounds, and on the particular ground that the collectors in many districts are also the Assessors. The Assessors, therefore, will be dragged by farce under the control of Somerset House. It has also been implied with some reason that the Treasury can very meanly "put the screw" on these ill-paid officers of the Local Commissioners by giving them decent pay if they will become Civil Servants, and not otherwise. Now the Local Commissioners, who give their unpaid services to the Treasury and the community, are as old as the present Income Tax, and did not come into being fortuitously : nor did their officers. We may be ground down by taxes' which an elected Parliament decrees, but through these even closer local representa- tives of ourselves we assess ourselves for payment, a privilege which, so far as we know, His Majesty's subjects alone of all peoples enjoy. It came to us with the true democratic spirit : it is to be taken from us in the true bureaucratic spirit.
Then we regret Mr. Snowden's threat of a new Land Tax. It may come to nothing. A prolonged and expensive valuation will put time against it as well as common sense. Its purpose may be defeated by the results of the valuation. It is even possible that it was not meant more seriously than the cheap words with which Mr. Snowden ended his speech, about a "private land monopoly," which he knows does not exist. There are hundreds of thousands of different ownerships of land here. We should like to see the number yet greater, and a wise Government would encourage the spread of ownership instead of picking out without any plea of justice this one form of property and penalizing it. How can ownership spread under these menaces ? Urban land may be able to support further burdens with difficulty, but agricultural land cannot. If the valuation is to be at " prairie " value, it should show a minus quantity, for taxation has already made mere land-owning an expensive burden. But, if any substantial value is attached, the proposal will work out thus : £100 worth of land will pay 100d. annually. Now the return on 1100 worth of land is in many instances nothing or less than nothing. Suppose the owner to be so fortunate as to get 2 per cent, on his capital in land ; then on this £100 parcel he will pay, in addition to all present rates and taxes, an extra 8s. 4d. on his £2. What occupying owner of agricul- tural land could face a further annual burden of 4s. 2d. in the £ ? Nothing could more drastically drive yet more land out of cultivation. Even rich land would go where the poorer land has gone. We hope that the Parliamentary Correspondent of the Times has reason for writing in Wednesday's issue that purely agricultural land will be exempt. Nothing yet said by Mr. Snowden supports this belief. Perhaps he is withholding a con- cession until a more convenient moment. To classify land in water-tight compartments is not impossible in modern Government Departments fortified by legislation against appeals, but must lead to disputes and a sense of injustice. Those who forget the waste of time, energy and temper entailed by Mr. Lloyd George's futile attempts at Land Valuation, will have a dreary lesson to learn from a new effort.
However, let us end less gloomily. The Chancellor of the Exchequer declared that he would have nothing to do with a tariff. Though he put his reasons in the most provoking way, with the least possible sympathy with those who differ honestly from him, we are glad that it is possible to put off the evil day when, as we wrote last week, we fear that the financial recklessness of the Labour Party may make a..,tariff for revenue inevitable. For the moment the power to scramble over a deficit of 237 millions even by dodges is something to be thankful fore „.
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