There has been little serious criticism of these changes in taxation except that many people, who seem to regard the penny post as a kind of fetish, have expressed regret that the postal rate of the letter should be raised to 1-1/2 d.  This addition seems to me to be merely an inadequate recognition of the depreciation of the buying power of the penny and to be fully warranted by the country’s circumstances.  Either it will bring in revenue or it will save the Post Office labour, and whichever of these objects is achieved will increase the country’s power to continue the war.  The extra penny stamp on cheques has been rather absurdly objected to as being likely to increase inflation.  Since the effect of it is likely to be that people will draw a smaller number of small cheques, and will make a larger number of their purchases by means of Treasury notes, the tax will merely result in the substitution of one form of currency for another, and it is difficult to see how this process will in any way increase inflation.  Other arguments might be adduced, which make it undesirable to increase the outstanding amounts of Treasury notes, but in the matter of inflation through addition to paper currency, it seems to me that the proposed tax is entirely blameless.  The increase of a shilling in income tax and super-tax produced a feeling of relief in the City, being considerably lower than had been anticipated.  It is hardly the business of the Chancellor of the Exchequer in this most serious crisis to produce feelings of relief among the taxpayers, and it seems to me a great pity that he did not make much freer use of these most equitable forms of taxation, having first made arrangements (which could easily have been done) by which their very severe pressure would have been relieved upon those who have families to bring up.  Death duties, again, he altogether omitted as a source of extra revenue.  His proposed luxury tax he has left to be evolved by the wisdom of a House of Commons Committee, and has thereby given plenty of time to extravagantly minded people to lay in a store of stuff before the tax is brought into being.

Space will not allow me to deal fully with the Chancellor’s very interesting analysis of our position as he expects it to be at the end of the financial year on the supposition that the war was then over.  He expects a revenue then of L540 millions on the present basis, making, with the yield of the new taxes in a full year, L654 millions in all, without including the excess profits duty, and he expects an after-war expenditure of L650 millions, including L50 millions for pensions and L380 millions for debt charge.  It seems to me that his expectation of after-war revenue is too high, and of after-war expenditure is too low.  He says that the estimates have been carefully made, but that they include “a recovery from the absence of war conditions,” but surely the absence of war conditions is much more likely to produce a diminution