HC Deb 22 April 1918 vol 105 cc700-1

Now that is the position on that basis. I think the House will recognise that it is a fair estimate, but our position is really better even than these figures show. In the first place, the Inland Revenue, in their estimate of the. result of existing taxation, took no account whatever of the Excess Profits Duty, but, that duty, as I have pointed out, is expected to yield next year £300,000,000. On the assumption, which may last for half an hour, of the Income Tax remaining at 5s., the Income Tax on what is now charged to Excess Profits Duty would represent £75,000,000. Of course, that must be problematical. It depends on the state or trade and credit, but I think I am quite safe in assuming that that amount which was left out of their estimate is more than sufficient to counterbalance any possible error they have made in the estimate of existing taxation. But there are. other items. I stated on one of the recent Votes of Credit that, before the Budget came on, I should endeavour to obtain a clear list of undoubted assets of the nation to-day. I have done it. They are divided into three categories. The first category consists of balances with our financial agents, of debts due by our Allies and Dominions—not Loans, but in respect of goods or services which we have supplied to them, and where the amount is regulated as soon as the accounts can be completed—and, in addition, commodities, including foodsuffs and things of that kind which are bought to be resold. The total amount under this category is no less than. £375,000,000, and it is not taken at cost. This amount is arrived at after careful calculation as to what could reasonably be expected would be obtained from it. I think the House can safely take that as an asset upon which we can absolutely rely.

The second category of assets consists of land securities, buildings, and ships. Here, again, the calculation given to me is not at cost. It is an estimate of the amount which can reasonably be expected to be realised on sale. The estimate is a conservative one, and again I think this amount can be taken at its face value. It is £97,000,000. Then there is a third category, made up of stores of all kinds, chiefly in the Munitions Department. It includes, however, war materials, the selling value of which is doubtful. This item is taken at cost, and the figure given to me is £325,000,000. It is obvious that the Belling value under this category is very uncertain, but I think I am safe in assuming that it will be worth at least £100,000,000. That brings the total amount of assets to £572,000,000. But this calculation was made only to the end of last year. This kind of piling up of assets will be going on during the year, and estimates are made for it in the Budget. I am safe, therefore, in assuming that there will be at least an additional £100,000,000 at the end of the current year. That will mean a total of assets of this kind amounting to £672,000,000.

But there is another and a bigger item. When the Excess Profits Duty comes to an end—this calculation is made on the assumption, which I am sure will prove correct, whatever Government or House of Commons is then existing, that the duty will be allowed to go on until the end of the accounting period after peace is declared—on this assumption the total amount of income due from the Excess Profits Duty, if the War ends at the end of the current year, would be in the following and subsequent years no less than £560,000,000. But, as the Committee knows, this tax has always been treated, both by my predecessor and by myself, as one which should be adjusted, to some extent, over the whole period. It is possible, therefore, that deductions might be. necessary from that amount, but I think I am safe in assuming that we can count on additional revenue from this source of £500,000,000. This makes a total of these assets, including arrears of taxation, £1,172,000.000, or between £300,000,000 and £400.000.000 more than the total amount for which we have taken credit in the obligations of our Allies to us.