Taxes and Expenditure

CHAPTER XIV

TAXES AND EXPENDITURE

Abstract of Revenue and Expenditure.

The preceding chapters of the book give some idea of the principal sources of government revenue and also what proportion of them is spent in England.

In this chapter I propose, for facility of reference and comparison, to give a summary of government revenue and expenditure. The statistical abstract available to me is that of 1913-14, and I take my figures from it.

PRINCIPAL HEADS OF REVENUE

Expenditure

Tables have been formatted for readability.

Ingenious Way of Calculating the Burden of Taxation.

In the statistical abstract a very ingenious method is adopted to show the burden of taxation.

(a) The heads of Taxation are reduced to Salt, Stamps, Excise, Provincial Rates, Customs, Assessed Taxes and Registration. All other sources of income are omitted. The figure realised from these sources is thus reduced from over 85 millions to 27,278,680. This figure divided over the estimated population of British India brings the payment per head to 2 shillings and 2-4 pence.

It is however added that “if Land Revenue [which is not properly taxation] be added the payment per head comes to 3 shillings and 10-4 pence.”

It may be noted that receipts from opium, courts of justice, jails, railways, post office, telegraphs, canals, forests and public works are all excluded, omitting other minor heads of income.

The Growth of Army Expenditure.

In 1884-85 the total army expenditure was 170 million rupees, i.e., a little less than 57 million dollars.

In 1899-1900 it was 264 millions of rupees = 88 million dollars.

In 1909-1910 it rose to 286 millions of rupees = 95 1/3 million dollars.¹

In 1914-15 it was about 306.5 millions of rupees = over 102 million dollars (£20,434,915).

In the budget of 1916-17 22 million pounds or 330 millions of rupees or 110 millions of dollars were provided for.

As to the percentages of military expenditures to the total budgets of the different parts of the British Empire, see an article in The Nineteenth Century and After for February, 1917, by Yusaf Ali from which extracts are given in appendix (A).

The army alone absorbs the total revenue from land and more.

The Growth of Expenditure on Education.

To a total of £6,696,587 spent on education from all sources including fees and private munificence in 1913-14, the provincial funds contributed £2,436,900 (see the statistical abstract).

According to the Year Book (1915) issued by The Times of India Office, Bombay, the Government of India spent on education 2,610,000 in 1912-13. In the year 1913-14 they made a provision of 4,078,000 in the original budget, but in the revised one the figure was reduced to 3,242,000. In the budget for 1914-15 a provision of 4,000,000 was made, but in the financial statement made by the finance-member in March, 1916, it was explained that the total sanctioned was not spent and in the estimate presented by him for the next year the figure available for education was actually reduced.

It was my intention to show how much of the expenditure on the civil departments consisted of salaries paid to Europeans in India, but the latest figures available to me are those given in the Material and Moral Progress Statement for 1911-12 and they are not complete. It is stated in that report that out of the aggregate salaries of officers drawing twenty-five dollars a month (£5) or over

Europeans received……..R. 3,590,000 Eurasians " …….. 844,000 Indians " …….. 2,457,000

Of posts carrying salaries of R. 1000 a month (333⅓ dollars or £66⅔) 1721 were held by Europeans and 161 by Indians. For a comparison of the salaries enjoyed by Europeans in the service of the Government of India with corresponding officers in the United States, see appendix.

Footnotes