CAN THE RICH PAY FOR THE WAR? 2S

The last row of figures leaves us with theincomes out of which the increased war expendi-ture has to be met either by additional taxes orby borrowing, after allowing for what can beprovided out of existing capital. (The manner inwhich the income-group from £250 to £500 is atpresent escaping its proper share of taxes is strik-ingly brought out. They actually paid a muchsmaller proportion of their pre-war incomes thanthe lower income-group below £250, namely 7'8per cent compared with 13-4 per cent.)

The figure which we have taken in Chapter IIIfor the increased expenditure of the Governmentis £1,850 million, of which £150 million could betaken out of accruing depreciation not made goodat home and £350 million from assets and borrow-ing abroad before allowing anything for normalsaving. This leaves £1,350 million to be raised fromadditional taxes and from new savings (includingnormal savings) voluntary or involuntary.

We can rely in present circumstances on atleast £400 million of voluntary savings, even iftaxation is raised to a high level and if the proposalfor deferred income made below is also adopted.Indeed I believe that this figure is considerablybelow the most probable expectation which mightbe put as much as £150 million higher; and I amreserving this margin against errors in the oppositedirection elsewhere in the calculation. I include inthis at least £100 million accruing in the hands ofthe Government in the Unemployment Fund,Health Insurance and Pension Funds, War RiskFunds and the like; which is best regarded as