CHAPTER IV.--THE FINANCIAL POSITION.

Revenue.

INCOME TAX. (continued)

  162. It will be seen that, as regards individuals, the rate payment is 6 per cent. on incomes between the exemption limit and $6,000 per annum. Income tax at the rate of 12 per cent., and also a graduated supertax, is payable on the excess of income over that figure. These rates are generally moderate compared with those in force in the United Kingdom but we think that they are as high as can reasonably be levied in the conditions prevailing in Newfoundland.

  163. Reference was made by more than one witness who came before us to the practice under which Banks and Trust Companies are required to pay a tax of 5/6 of 1 per cent. on the average amount of money on deposit and on current loans. On the whole, we do not consider that this rate is excessive.

LIQUOR PROFITS.

  164. In the seven years up to 1924, Prohibition was in force in the Dominion. It was found for many reasons that this system worked unsatisfactorily, and it was consequently abolished in 1924. Under the present arrangement the Liquor Control Board is authorized to open three stores in the City of St. John's; and if it is demanded by popular vote, at any other centre in the Island. In no case, however, has any store outside St. John's been opened. Under the system in force a person is allowed to purchase three bottles of spirits a week, but no limit is placed on the purchase of wines and beer.

  165. The following table shows, for the last eight years, (a) the sales of liquor, (b) the duties on liquor importations paid to the Customs Department, and (c) the net profit on the Board's operations, which has been transferred to the Exchequer. It should be noted that the revenue in column (4) is additional to that in column (3).

 Year  ending  31st
 January.
 Sales of  Liquor.
 Duties on  importations paid  to Customs  Department.
 Net profit on the  Board's operations  transferred to  Exchequer.
(1)
(2)
(3)
(4)
  
$
$
$
 1926
1,057,745.40
417,601.78
285,276.93
 1927
1,140,351.64
448,351.47
395,675.08
 1928
1,093,526.63
447,245.32
319,052.15
 1929
1,194,250.82
463,764.29
361,552.83
 1930
1,112,828.50
410,927.66
329,514.14
 1931
1,128,675.13
400,316.17
338,448.95
 1932
880,061.98
305,937.05
263,351.49
 1933
658,055.90
244,810.01
193,075.11
  
$8,265,496.00
$3,138,953.75
$2,485,946.68

  The decline in sales since the onset of the depression is very noticeable.

GENERAL.

  166. We have given careful consideration to the question whether there are any further sources of revenue which could be exploited, but we regret that, apart from a suggestion, which is made later in this Report,* for the imposition of a tax on unoccupied or undeveloped lands, we can see no means by which further revenue could be secured at the present time. An improvement in revenue receipts must depend, first, on improved conditions in world markets and, secondly, on the adoption and execution of a long-range policy of reconstruction for which, in existing circumstances, funds are not available. It may be hoped too that an increased revenue may be obtained from Labrador in years to come.

Saglek Bay and Fjord Saglek Bay and Fjord, Labrador, n.d.
Photographer unknown. From the album of photographs furnished to the Newfoundland Royal Commission, August 1933. Courtesy of the Centre for Newfoundland Studies Archives (Coll-207), Memorial University of Newfoundland Library, St. John's, Newfoundland.
Larger Version (45 kb)

Expenditure.

  167. The following tables show the expenditure of the Island since the War and the details of expenditure during the last three years.

EXPENDITURE SINCE THE WAR.

Year.
Current Expenditure.
Interest on Public Debt.
Railway Deficit.
Total.
  
$
$
$
$
 1919-20
7,098,211
2,148,795
1,335,107
10,582,113
 1920-21
8,938,697
2,012,719
1,758,025
12,709,513
 1921-22
6,635,335
2,492,207
953,367
10,080,909
 1922-23
6,803,409
2,748,892
593,279
10,145,580
 1923-24
7,005,880
3,016,257
6,519
10,028,656
 1924-25
6,307,961
3,128,224
358,509
9,794,694
 1925-26
6,483,461
3,381,706
743,794
10,608,961
 1926-27
6,994,623
3,538,785
617,675
11,151,083
 1927-28
6,899,003
3,841,922
444,159
11,185,084
 1928-29
7,237,883
3,894,939
387,617
11,520,439
 1929-30
7,274,512
4,159,800
380,493
11,814,805
 1930-31
8,570,805
4,328,128
709,608
13,608,541
 1931-32
7,228,815
4,731,571
339,032
12,299,418
 1932-33
6,226,279
5,113,145
214,332
11,553,774


CLASSIFICATION OF EXPENDITURE FOR THE YEARS 1930-31, 1931-32 AND 1932-33, SHOWING ALSO DETAILS OF THE ESTIMATED EXPENDITURE FOR 1933-34.

Head of Estimate.
1930-31.
1931-32.
1932-33.
1933-34
(estimated).
  
$
$
$
$
 Interest on  Public Debt and  charges for  sinking fund
4,328,128.66 
4,731,571.79 
5,113,145.28 
5,200,000.00 
 Civil Government
673,902.02 
600,496.25 
552,575.33 
584,763.00 
 Civil, Naval and  Military, and Old  Age Pensions
876,922.59 
894,994.02 
818,985.19 
817,850.00 
 Administration of  Justice
489,855.95 
443,995.13 
522,553.88 
514,584.00 
 Legislation  (Legislative  Council, House of  Assembly)
100,064.05 
70,311.98 
45,907.47 
37,952.00 
 Education
989,591.89 
735,553.36 
496,214.99 
500,000.00 
 Public Charities
1,145,179.67 
921,392.05 
786,313.49 
811,555.00 
 Agriculture and  Mines
141,495.55 
65,235.59 
140,800.62 
39,400.00 
 Marine and  Fisheries
444,018.86 
413,337.72 
272,999.75 
368,000.00 
 Roads and  Bridges
222,448.79 
124,604.37 
25,490.38 
48,000.00 
 Customs
663,711.90 
466,403.83 
560,267.87 
480,840.00 
 General  Contingencies
147,230.28 
69,176.39 
57,376.68 
50,000.00 
 Elections
--- 
37,113.95 
18,541.97 
--- 
 Posts and  Telegraphs
1,491,463.49 
1,036,200.20 
693,269.22 
712,945.00 
 Audit Act
1,184,919.75 
--- 
--- 
--- 
 Relief
--- 
1,170,000.00 
1,805,000.00 
500,000.00 
 General  Contingencies
--- 
50,000.00 
--- 
--- 
 Savings Bank
--- 
130,000.00 
--- 
--- 
 Railway
--- 
--- 
150,000.00 
400,000.00 
 Total
12,898,933.45 
11,960,386.63 
11,339,442.12 
11,065,889.00 


  * Chapter VII, paragraphs 425-427.


Image description updated May, 2004.



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