33.
13
Now I would be the first to admit that the outturn for 1974-75 could be below or above my estimate of a
$21 million surplus. The Finance Branch will monitor revenue carefully and try to take steps to trim expenditure during the year to avoid a deficit, for an avoidable deficit at these very high levels of expenditure would be undesirable on both fiscal and economic grounds. should those revenue heads which are
But
sensitive to the
level of economic activity in the current fiscal year show signs of producing yields above our expectations then this will not mean that this year's tax increases were, after all, unnecessary for, clearly, additional resources are going to be needed in the three year forecast period.
34.
Let me now deal, Sir, with each of the three suggested substitutes for my outline package of proposals for the three forecast years: my honourable Friend Mr. Sayer suggested that further thought be given to better collection of taxes within the existing tax framework. can assure him that both the Commissioner of Inland Revenue and I are in complete agreement with him.
I
The references
in my budget speech to the need for strengthening the investigation powers and the penalty provisions of the Inland Revenue Ordinance are directed to this very end. So, in a way, are my proposals regarding the ambit of the profits tax charge, because these will do little more than repair a framework which has received a severe battering over the years from the lawyers and accountants in our midst. should, however, sound a warning that there is a limit to the amount of additional revenue which can be raised by these
several means.
I
35.
My honourable Friend Mr. P.C. Woo suggested that
He more emphasis should be placed on indirect taxation. rightly eschews those indirect taxes which would affect the cost of living and would readily concede, I presume, that we
must remain a free port.
So we are left with excise
duties on such luxuries as liquor and tobacco and sales taxes
It is true that, on locally consumed durable consumer goods.
/even.....