276
INWARD TELEGRAM
TO THE SECRETARY OF STATE FOR THE COLONIES
further 3 million is provided to meet claims of various sorts arising out of the war. If all abnormal expenditure were excluded, normal revenue would be more than adequate to balance the budget.
5.
It is expected present financial year will end with a surplus of some $16,000,000 and it is most unfortunate that events have prevented us from budgeting for a substantial surplus in 1949-50 in pursuance of our policy of building up adequate reserves. The existing surplus of approximately $500,000 would, however, be increased to 81 million if it is confirmed that the cost of the new coins may be charged to the Nickel Brass Coin Security Fund (see my telegram No.130).
6.
15104/17/1/49.
The need for additional revenus has been stressed to the Finance Committee who have tentatively agreed to the following measures for which allowance has been made in the revenue figures given above.
(a) Double duty on table waters estimated to
yield $500,000
(b) Double local postage rates estimated to
yield $350,000
(c) Increase in stamp duty on cheques and receipts to 15 cents and imposition of 1 stamp duty on import and export licences estimated to yield $650,000
(d) Imposition of fees on graduated scale for the registration of factories estimated to yield $100,000. In addition conservancy fee has been raised in order to place this service on a self supporting basis and this represents an addition to revenue of $1,200 thousand.
7.
Finance Committee strongly opposed any increase ia rates and some members at first took the view that no additional taxation at all was justified, as if al expenditure which was a fair charge against losas could be so charged there would be a substantial surplus. There is every indication that in the course of the Estimates debate one or more of the Unofficial members will attack the Budget and may even vote against it on a question of principle; namely practice of meeting capital expenditure (? and omitted) rehabilitation expenditure from current revenue. Their objection to this is that it tends, by making greater demands on revenue, to force the Government to increase taxation in their view unnecessarily. I fear that the arguments which they may put forward will be difficult to meet convincingly, except by unwelcome plea of standard Colonial practice. It can, of course, be pointed out that objections have previously been raised to crediting proceeds of land sales to revenue and that if this is done it is reasonable that some capital expenditure should also be met from current budget. However, receipts from land sales since the re-occupation only total £133 million, including the sale of one exceptionally valuable site which is not likely to be repeated, whereas 851 million has actually been spent on capital works from revenue during 1948-49 and $18 million is being provided for in 1949-50.
1
/There
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