COMPARATIVE WAR FINANCE

there is no certainty, but the Chancellor was able
to tell the House that the last German Vote of
Credit, which was estimated to carry them on to
June or July, brings the total amount of all their
Votes of Credit to £6200 millions, and that it is at
least certain that that amount has been added to
their War Debt, because their taxation during the
war has not covered peace expenditure plus debt
charge. Up to 1916 they imposed no new taxation.
In 1916 they imposed a war increment tax, some-
thing in the nature of a capital levy, which is stated
to have brought in £275 millions. They added also
that year £25 millions nominally to their permanent
revemie. In 1917 they added in addition £40
millions to their permanent revenue, " Assuming,
therefore, that their estimates were realised, the
total amount of new taxation levied by them since
the beginning of the war comes to £365 millions,
as against our £1044 millions. This £365 millions
is not enough to pay the interest upon the War
Debt which had been accumulated up to the end of
the year."

Mr Bonar Law then proceeded to give an
estimate of what the German balance-sheet will be
a year hence on the same basis on which he had
calculated ours. With regard to our position, he
had calculated that on the present basis of taxation
we shall have a margin of four millions at the end
of the present year if peace should then break out,
As will be shown later, this estimate of his is some-
what optimistic, but at any rate our position, com-
pared with that of Germany, may be described as