New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1917-05-18
Methods Adopted
By Great Britain
To Finance War
About One-fourth of Total
Cost So Far betrayed
by Taxation
By PIERCE E. WILLIAMS.
American Commercial Attache.

There are three ways OF financing
war-(D by taxation; (2) by borrowing;
90 by issuing paper money. All these
methods have been employed by Great
Britain during the present war, ana
in view Of the Importance OF proper
war finance to the United States az
this time. it may be Of value to show
what proportion of the total cost OF
the war Great Britain has been aoie
TO nav by taxation; what taxes have
been the most productive; how, when
and ar what rate of interest loans
have been raised TO pay the remainder
of the cost.
First, as to taxation: In the last
peace year, namely, the fiscal year
ended March 81, 1914, the revenue OF
the British Government amounted 70
sles. 242, 900, derived chiefly from the
following sources: Customs, f3o,Aoo'-
900. or IS per cent; excise, 9O,Ooo'
or 20 per cent; estate, etc, duties
s27 1853, 900, or Ia per cent; properly
and income tax, f47,24s,o0o, or "a per
cent.
Duties and Taxes Before War.
Prior to the war import duties IN
the United Kingdom were collected on
the following articles: Tobacco, tea'
rum. brandy and other spirits, wines
currants, raisins, coffee, cocoa, choco-
late, ETC., sugar, glucose, etc, motor
spirit (gasolene), and few other ar
ticles.
Excise duties were collected on
spirits and beer. In addition, there
were some license duties and some
unimportant taxes on railway profits
end patent medicines.
The estate duty is an inheritance
tax collected out Of the estates or de-
ceased persons.
The stamp tax applies to deeds, re-
ceipts, drafts, bills of exchange, con-
tract notes, etc.
The property and income tax. until
April, 1914, wGs levied on the follow
ing basis: Earned income, where the
total income did not exceed $1,000 per
annum, at Cd. in the pound; where the
total income was between $4,000 and
$4,000 per annum, at Is. in the pound;
unearned incomes, at lis. in the pound.
A supertax was levied on incomes Of
$4,000 year. Of 3d. per pound on
amounts by which incomes exceeded
$4,000. An abatement of the tax on
$40 of income for each child living
and under sixteen years Of age was
allowed in the case of incomes under
$500 per annum.
1914 Income Tax Provisions
By the finance act of 1914 (the regu-
lar budget passed by Parliament prior
to the breaking out of the war; the
general rate of income tax was fixed at
Is. 3d., but for incomes between e160
and 5000 it was Is. and for those be
tween $500 and $500 it was Is. I'd. If
the total income did not exceed $500
the rate on the earned part of such in
come was Cd. if the total income did
not exceed 1000, 10lsd. if the total
income did not exceed 81 800, Is. if the
total income did not exceed $4,000, and
Is. I'd. if the total income did not eX-
cee0 tS,oUu.
The relief in respect to children I'M
der sixteen years of age was an abate-
ment of tax on $40 of income for each
such child. A supertax was levied on
incomes above $4,000
The first war budget was introduced
in November, 1914; the income and
supertaxes mentioned above were
doubled and the duties on beer and tea
increased.
Second War Budget
By the end Of March 81, 1915, Eng
land had been at war eight months and
the expenditures had increased $500
10000, bringing the total for all pur-
poses up to s49S,359 $50. The total
revenue raised during the year ended
March 81, 1915, was e226,694 900, an in
crease of f28,452 900 over the proceed
ing year Of peace. In other words, 46
per cent of the total cost was paid out
Of revenue. This increase was distrib-
uted as follows: Customs, f3,2i2, 900;
excise, s2,723,000; estate, etc, duties,
81 ,O23,000; income tax, f22,l50,000. 1t
will be observed that the income and
property tax was responsible for 10
per cent of the entire increase. The
remarkable buoyancy of this tax has
been demonstrated all through the war.
When, on May /. 1915, the budget
was presented to the House of Com
mons by Mr.. Lloyd George, then Chan
cellor Of the Exchequer, it was based