HC Deb 17 April 1956 vol 551 cc860-2

I now turn from ascertained facts, to estimates—from the past to the future. First, the revenue. Inland Revenue duties in 1956–57—that is the coming year—on the existing basis of taxation, are expected to yield £2,700 million, an increase of £161 million on the out-turn of last year. From Income Tax we expect to collect £2,102 million, or £159 million more than last year. This increase is due partly to the higher profits of 1955–56 which will be assessed in 1956–57, and partly to the effect in a full year of the increases in wages and salaries which have been negotiated in recent months. We expect the yield from Surtax to rise by £5 million to £144 million.

From Profits Tax we expect to receive £216 million in 1956–57 compared with £192 million last year. This increase of £24 million is partly the result of higher profits, but also reflects the increase made last autumn in the rate charged on distributed profits. Death duties and stamp duties are expected to yield £170 million and £63 million respectively. In each case there is a reduction from the 1955–56 yield, to take account of the lower Stock Exchange prices now ruling. Finally, £4 million may be expected from delayed settlements of the Excess Profits Levy and £1 million from other duties.

The revenue from Customs and Excise duties on the existing basis of taxation is estimated at £2,130 million in 1956–57, compared with an out-turn of £2,013 million last year.

Mr. Harold Wilson (Huyton)

Will the right hon. Gentleman give the total again for the Inland Revenue side of it?

Mr. Macmillan

The Inland Revenue duties on the existing basis are expected to yield £2,700 million, an increase of £161 million on the out-turn of last year.

I now come to the revenue from Customs and Excise. It is estimated at £2,130 million compared with the out-turn of £2,013 million. The principal items in this total are: tobacco, £680 million; Purchase Tax, £510 million; beer and other alcoholic drinks, £409½ million; oil, £340 million; duties under the Import Duties Act, 1932, £71 million; entertainments, £39¼ million; and betting, £27½ million. These are all estimates on the existing basis of taxation.

To this revenue must be added £92 million for motor duties, bringing the total tax revenue to £4,922 million, an increase of £283 million on the out-turn for 1955–56. From non-tax revenue I expect £268 million, or £14 million more than actual yield in 1955–56. Total revenue on the basis of existing taxation is thus expected to yield £5,190 million, an increase of £297 million on last year's out-turn.

I turn now to expenditure. I estimate the total expenditure above the line at £4,758 million, an increase of £196 million on the Budget estimate for 1955–56. The Consolidated Fund services, at £778 million, account for £79 million of this increase.

Supply expenditure in 1956–57 is estimated at £3,980 million, or £117 million above the estimate last year. Within this total—the total supply expenditure of £3,980 million—defence, at £1,499 million, is only £5 million above last year's estimate, but civil expenditure at £2,481 million is £112 million above the estimate for last year. The major item in this increase is £107 million for social services, of which national health and education account for £39 million each. Development of atomic energy will require an additional £18 million, and other items showing increases include civil superannuation, £10 million more; roads, £8 million more; police and fire services, £7 million more. On the other hand, there will be savings of £24 million on home defence.

The figure I have given for civil expenditure is based on the published Vote-on-Account. This did not, however, take account, on the one hand, of the reductions in the bread and milk subsidies which I announced on 17th February and which will save £35 million in 1956–57, or, on the other hand, of the results of the Agricultural Price Review, which were announced on 15th March and will require an additional £22 million in the coming year. Revised estimates embodying the changes will be presented shortly.