Able political  economy

South Australian Register (Adelaide, SA : 1839 – 1900) 22 January 1867

 

THE REVENUES OF VICTORIA AND NEW SOUTH WALES.
Our eastern neighbours are working ont for the behoof of posterity a great fiscal problem. They are trying to what extent foreign trade can be oppressed without positively suffocating it. Partly for the sake of more revenue, and partly to satisfy an incoherent cry for protection, they have framed for themselves the most complicated and exacting tariffs ever attempted in Australia. These are, intended for double-bladed tariffs— the low, material part of their function, is to meet the demands of a hungry Treasury; the high moral part to diffuse amongst the people a taste for home-made slops and home-brewed beer, is well as for home-grown wheat. The moral or communistic side is the stronger, because for one thing it is more indefinite, and for another it depends more on sentiment than on reason. In the eyes of a devout Protectionist, you have no more right to argue about the social advantages of Protection than you hare to doubt the Mosaic history of creation. Both are sacred dogmas, and the best interests of society require them to be treated as such. It is doubtful, however, if protection. would be adopted by any practical community on merely social grounds. High duties could not recommend themselves on the strength of pro bono publico alone; they owe more to a latent conviction in the minds of their supporters that they will be attended by increased revenue. It is always tacitly issumed that a Treasurer has only to add so much per cent, to the tariff and he will proportionately enlarge his income; then, argues Universal Suffrage, a system which can do this, and at the same time give an advantage to the native over the foreign producer, must necessarily be a good system. The best practical refutation of the fallacy is to show that a Customs Revenue cannot be thus screwed up or down at pleasure. The fiscal side of the delusion can be exposed by means of statistics. The social side had better be left alone for half a century longer. New South Wales and Victoria have just furnished us with two very valuable sets of returns illustrative of the operation of their respective tariffs. These are the statements of their General Revenue for the past year. We begin with Victoria, as in several respects the more conspicuous subject. She has taken a long stride in advance of the other colonies towards the tempting goal of Chowdlerism. She had the numerous population and the flourishing commerce on which the experiment could best be proved. She had Ministers of ability to make success certain if it were by any means possible. Then, what has been the first year’s issue of the Protection movement in this wealthiest of Australian Colonies? A decrease in the year’s revenue of over a hundred thousand pounds as compared with 1865. The respective receipts of the two years were— 1865, £3,058,338; 1866, £2,948,429 ; deficit, £109,909. But it may be thought that the tariff has not been the exclusive cause of this; there may have been shortcomings in other departments than the Customs. In point of fact most of the other departments exhibit increases; but the gap in the Customs was so enormous as to swallow them all up, and even then there was room left for another full-sized Curtius —for an eighth part of the magnificent loan which Mr. Verdon took nine months in London, to negotiate. Taking the Customs Department separately, we find that its net deficit as com pared with 1865 is £205,011. The principal items are spirits, £51,000 ; wine, £6,000 ; ale and porter, £4,000 ; tobacco, snuff, and cigars, £13,000; tea, £7-3,000; sugar, £28,000 ; opium, £9,000 ; export duty on gold, £-20,000 ; miscellaneous, about £10,000. It will he remembered that on some of these items — tea. su«/ar. niiinni .iiul emlil ? fliA
auiy was lowered, consequently a diminution of income is to some extent reasonable; but Mr. Verdon himself did not calculate on anything half so enormous as the actual figures indicate. Still this is not the worst part of his mistake. He anticipated reductions where the duties had been lowered; but he likewise anticipated increases where the duties were wised, on soft goods in particular. But it turns out that there are no such compensating im provements. The only increase worth alluding to is on wharfage and- harbour rates, £8,000, which do not properly belong to Customs. All that Mr. Verdon can really claim is an increase of £600 on coffee and of £900 on hops— say altogether £1,500, against nearly £150,000 of remitted duties; in other words, so much revenue thrown into the gutter as a peace-offering to native in dustry. The so-called readjustment of the tariff shows as its ultimate effect a reduction on the Customs revenue of £205,000. The shades of a ruined Governor and of ruined ‘soft goods’ men may rejoice that the original authors of their misfortunes are likely soon to be overtaken in their own evil devices. A Treasurer who has never yet been able to bring his estimates within a hundred thousand pounds of the actual result — in this case he is a quarter of a million out— cannot expect to be allowed to repeat such blunders a fourth time. The recently published Revenue Returns seem to have shocked the wildest Protectionist. Already the McCulloch Ministry, alarmed at the numerous defections from their ranks, begin to forget their promise to appear agaiu before the public as Ministers in 1868. One ministerial resignation is announced, and threats of a general resignation fell freely from the Treasury benches during the first debate of the newly-opened session. The New South Wales returns appear on the surface much more satisfactory than the Victorian, and they are a perfect contrast to those of the pre ceding five years; still they are not all the New South Wales Treasurer prophesied of them. In his first Budget he undertook
To produce a surplus of about £170,000 ; but after the financial crisis in London he mollified it in his revised Budget of September last to £70,000. The actual revenue has been £2,038,000; and the total payments, including interest on debentures, Treasury all paid off, &c., amount to £2,100,000, which would indicate a balance of £62 000 to the debit instead of £70,000 ; to the credit aide. But if we exclude the transactions on debentures and Treasury bills, the total disbursements of the year would be £1,913,000, or fully £120,000 surplus. There was an essential difference in the tariff manipulation of the two colonies. The Victorians completely reconstructed theirs for theoretic reasons reducing one set of duties and raising another set; but the New South Welsh only made specific additions to the existing rates— 20 per cent on all fixed duties, with package, ad valorem, and stamp duties as an experiment The old staple articles continued to yield the main part of the revenue as before — spirits, -wine, and beer nearly one-half of the aggregate ; tea, sugar, coffee, opium, &c, about a fourth; leaving only a fourth to be drawn from the ad valorem and package duties and the Murray River Customs, which are kept in a separate account It is unquestionable that the General Revenue of 1866 was a great improvement on that of 1865 ; but an analysis of the various heads shows that comparatively little of this improvement is referable to the new tariff. The Land revenue has to be credited with an increase of £5,000, and the Murray duties with one of £25,000, chiefly arising from increased trade. The Post Office Revenue was £6,000 more than in 1865; Telegraphs, £3,500; Stamps, £32,000; Special Receipts, £10,000. Examining the Customs Revenue by itself, say for the last quarter of 1866, we observe nearly as many items of decrease as of increase. As a specimen of the former we quote wine £1,584 leas than in the cor responding quarter of 1865 ; tobacco, £3,567; tea, £8,800; sugar and molasses, £10,578 ; coffee, £1,027. The counterbalancing items of increase were spirits and beer, £4,300; malt, rice, opium, dried fruits, &c, £8,500; ad valorem duties, £25,000 ; but this last gum has to be explained by the circumstance that the ad valorem duties were not imposed till near the end of 1865. One general inference to be drawn from the New South Wales returns is that the new duties have created a considerable amount of new revenue, though not so much as was expected; but the raising af the old duties has contracted rather than increased those parts of the revenue.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s