The Finances of France M. Bonnet, the new Minister of
Finance, has addressed himself courageously to the Sisyphean labour of balancing the French Budget. Short of a serious inroad into the fundamentals of Popular Front policy, expenditure cannot be seriously curtailed ; and the task is therefore one of augment- ing receipts. M. Bonnet proposes to raise customs and quota duties, railway passenger and freight rates and the price of tobacco. But his principal nest-egg is the income tax, which goes up by 20 per cent. ; and his most revolutionary measure, from the French point of view, is an order compelling the disclosure by paying agents to the revenue authorities of all coupon and dividend payments—an order which will, it is believed, stop the now general tax evasion and bring in almost as much to the Treasury as the increase in the incidence of the tax. The fundamental dilemma of French finance at the present time is to stop the flight of capital from the country and to woo back what has already taken refuge abroad ; this can only be achieved by balancing the Budget, and the Budget can only be balanced by measures which bear still more hardly on capital. Much depends on the loyalty of the French capitalist, which has not been too con- spicuous under the Blum regime. There is one bright spot for M. Bonnet. So long as the international situation con- tinues menacing, every Frenchman shrinks from the odium of provoking another internal crisis.
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