§ This brings the total yield from all the increases in taxation I have described to £923 million for a full year and £775 million in 1968–69. Even without the measures already announced before the 301 Budget—the increase of Corporation Tax to 42½ per cent. and the tax recoveries of the 7s. increase in the family allowance—the additional taxation announced in this Budget amounts to £766 million for a full year and £671 million in 1968–69.
§ Those figures include the proceeds of the recovery of the further 3s. increase in the family allowance. The increase itself, plus the increase in the fuel duty grant to bus operators, will add £29 million in 1968–69 to the figures of Consolidated Fund expenditure which I gave the House earlier. The net result of all these changes is thus to raise the estimated surplus to be transferred from the Consolidated Fund to the National Loans Fund in 1968–69 from £640 million to £1,386 million, and thus to reduce the National Loans Fund borrowing requirement by £746 million, from £1,104 million to £358 million.
§ The House will also be intrested to know now where we stand on the net borrowing requirement of the central Government. This year, as I have already told the House, it will be about £1,400 million. In the Letter of Intent which my predecessor wrote to the I.M.F. on 29th November last we indicated that we hoped to keep the figure for next year to a maximum of £1,000 million. The result of all the measures announced in my speech this afternoon is to reduce the estimate for next year to £364 million. Some of my hon. Friends who were very worried about the Letter of Intent will perhaps now understand what I meant when I said in December that it was not the I.M.F. that I was worried about, but the harsh demands of the situation.
§ The House will be relieved to hear that I have no more proposals to make. I have imposed heavy burdens, but I believe that I have spread them fairly and in a way best calculated not to impair incentive. Where I have been in doubt I have erred on the side of caution.
§ No Chancellor can begin to guarantee success. But I believe that I have done what is necessary here at home to give us a high chance of achieving it. There is now no rational cause for the British economy not going forward to strong success. Our exchange rate is one that makes us fully competitive. We have 302 not hesitated to take as much out of the economy as is necessary to gain the full advantages of devaluation. And we have made the necessary changes so that, after an inevitable transitional period, we shall for the first time since the war be carrying no heavier a defence commitment than the strong economies of Europe. In a rational world this should give us the firm prospect of a secure balance of payments and steady growth at home. Even in an irrational one it gives us the great advantage of being able to speak with the knowledge that our own house is in order. And the voice in which we shall speak will be one of sanity, of a determination to secure stability without deflation, of a desire for international co-operation without the sacrifice of our own essential national interests, and of a conviction that we must fashion a world monetary system for producers and not for speculators.
-
c302
- PROVISIONAL COLLECTION OF TAXES 156 words cc303-22
- AMENDMENT OF THE LAW 7,126 words