THE SUGAR-TAX—BURDEN OR RELIEF?
WHA.T are the Government going to do about the Sugar-duties ? They admitted last year, in effect, that the tax was per se a bad tax, and only justified by the imperative needs of the Exchequer during a period of financial strain. No doubt the duty has the fiscal merit of being a good " drawing " tax. Very little, if any, of the rise in prices finds its way into private pockets instead of ' into the Treasury. This, however, is its sole, though we admit a very important, merit. Looked at from every other point of view, it is an exceedingly bad and an exceedingly onerous tax. All schools of political economists agree in holding that taxes on raw materials on the one hand, and taxes on the food of the people on the other, are bad taxes, and, if possible, to be avoided. But the Sugar4ax has the "bad eminence" of combining both these objections. It is both a tax on food and a tax on raw material. Sugar plays a part in almost every meal partaken of by the richest and the poorest in the land. Not only does it enter the teacup of old age, but most forms of fancy bread and every sort of cake, from the "currant loaf" to the pound- or wedding-cake, have sugar in them in. a greater or lesser degree. It is present in the plainest as in the richest of puddings, and it is sauce to many of our meats. We eat it in the currant jelly served with mutton, bare, and venison, and in the apple sauce which mitigates the rebellious richness of pork and goose. It supplies half, or more than half, the weight of the jam at the breakfast of the well-to-do and at the poor man's tea. Save for the flavouring, it constitutes all the " sweets " and most of the chocolates of childhood. A generation or two ago sugar was regarded as merely an ornament of diet; but now all doctors recognise that it is an essential item of food, especially for the young. Without it it would not be possible to rear healthy children. The enumeration we have just made of the various forms in which sugar appears at the table illustrates also how great a part sugar plays as a raw material. It is a raw material not only in the sweet factory, the jam factory, the chocolate and cocoa factory, but also in the aerated-water factory, - the brewery, the bakery, and the biscuit works. Nor is this all. Sugar is immensely used in a vast number of manu- factured objects. To take one example only. Leather is often heavily dressed with sugar to increase its weight. A propos of this fact, Mr. Chiozza Money adds in Thursday's Daily News another example of the follies and anomalies of indirect taxation. In order to show that their leather is not faked with sugar, the Government of the Australian Commonwealth stamp leather exports with an official declaration that they contain "not more than five per cent. of crystal sugar." Certain bales so stamped were recently held back by the Custom House here as goods partly composed of sugar—i.e., confectionery —and were not released till the Sugar tax had been paid upon them.
It is unnecessary for us to elaborate the case for relief in the matter of sugar. But such relief would not only be of very great assistance to the poorest of the poor at a time when trade depression is threatened and wages are likely to be lower, but would also act as a strong stimulant to employment in very many trades. The confectioners, the biscuit-makers, the jam manufacturers, the makers of aerated waters, and the owners of chocolate and cocoa works have shown that their trades have languished owing to the increased prices which they have been obliged to charge as the result of the enhancement of their raw' material. Hence the abolition of the Sugar-tax would mean more work, and more work brought about in the best and most legitimate of ways. Unquestionably the Govern- ment ought to abolish or reduce the Sugar-tax, provided that they can do so without causing a deficit, and this they can do. It is clear from the published figures as to revenue and expenditure that the Government will have at the very least three millions available for the reduction of taxation. This would enable them with complete safety at least to halve the present Sugar-tax. What, then, forbids action so beneficial to the manufacturers, and to the people as a whole ? The answer that will be made to us by party Liberals will no doubt be something of this kind :—" You are talking nonsense in suggesting that the Government can abolish or halve the Sugar-tax. You have forgotten that Ministers will instead be obliged to raise some six millions a year more to pay for old-age pensions. Even though only a portion of this expenditure can now come into this year's Budget—the establishment of the machinery for• old-age pensions is bound to take a certain time—it is impossible in view of such extra expenditure to reduce taxation. Instead of the reduction of taxes you are maundering about, new taxation, and on a very consider- able scale, will be required."
Here, then, .is the crux. The Government have two courses before them. On the one hand, they can halve the. Sugar-taxes this year, with the prospect of abolishing them altogether in the course of the next two years, and thus do the most Liberal and democratic of acts,—that is, relieve the poor from a very heavy burden. Or they can adopt the alternative of not only refusing to relieve the people of any part of their existing burdens, but instead can very greatly add to the weight which is now pressing upon them,— in order to give to old people a dole winch in substance, though not in name, will be a quite inadequate form of indiscriminate outdoor relief to aged paupers, a sum not enough to keep them in comfort and yet enough to strangle and destroy self-help in the matter of provision for old age. Which alternative will the Government choose ? That is the question. We refuse to admit that the Govern- ment are already so hopelessly committed in the matter of old-age pensions that they cannot adopt the alternative of relief from taxation. Certain pledges were no doubt made by the late Prime Minister, but we hold that they do not bind the new Administration, unless they are deliberately endorsed by it. The Asquith Government, in spite of the fact that Mr. Asquith in his capacity of Chancellor of the Exchequer to the late Administration was committed, start with a clean sheet of paper. If they have the courage to do so, they may surely declare that after due consideration they have come to the conclusion that it would be more beneficial to the people of this country to relieve them from half the Sugar-tax than to give old-age pensions, and in doing so add very largely to the existing burden of taxation. The alternative is one which all those who desire the abolition of the Sugar-tax should press very strongly upon the Government at the coming by- elections. Every Minister who seeks re-election should be asked to pledge himself to the abolition, or at any rate the reduction, of the Sugar-tax in the coming Budget. If he refuses to give such a pledge, he should not receive the support of those who believe that what the poor of this country want is relief from taxation, and not the imposition of new burdens.
Previous page
