Mr. McKenna proposes to raise this £79,000,000 by an addition
to the normal Income Tax of Is. 6d. in the pound. This makes the normal rate for the future 5s. in the pound. Owing, however, to the system of abatements, earned incomes up to £500 a year will pay only 2a. 3d. in the pound, while earned incomes between £500
and £1,000 will pay at the rate of 2s. 6d. After this the tax will be carried up to the maximum rate of 5s. by successive stages till £2,500 a year is reached. Beyond this sum there are no rebates, and the maximum rate prevails. On unearned incomes the new scale will begin at 3s. on incomes not exceeding £300, and will rise by steps to the maximum of 53. on incomes exceeding £2,000. The increases in the Income Tax generally are expected to produce £43,500,000. It will be seen from the data just given that for the well-to-do, even if they do not pay Super Tax, the Income Tax is to be at the rate of 25 per cent. In the case of full Super Tax payers the Government will claim very nearly half a man's income if allowance is made for his share of Customs and Excise, for the assessed taxes, Inhabited House Duty, rats, and other Govern- ment imposts, great and small. We do not complain, for war cannot be waged without great sacrifices, but it is as well to remember the enormous scale of the redistribution of property caused by the war.
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