New Liberalism: The 1909 Budget

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New Liberalism: The 1909 Budget
Problems Solutions
Government needed to find extra £10 Raise income tax on rich
million -Paid by only 1 million wealthy people on
-Already agreed to build 8 dreadnoughts incomes over £160 a year
-Old age pensions expensive: 668,000 were -Kept 9d (nearly 4%) for each pound earned
claiming it which cost £2.5 million more on income £160-£2000
-Increased for incomes £2000-£3000 at 1s,
over £3000 was 1s2d
-Supertax on incomes over £5000
-Tax of 1s2d paid on all unearned income
e.g. rents over £700
1908: Trade Depression People with income under £500 not taxed
-More unemployment and less taxes paid on £0 for each child under 16
-Reduced government income by £6 million -Tax rate changes for less wealthy, earning
under £2000, to reduce paying more
National Insurance was expensive Increase estate duty and death duties
-Estate to be paid at death of 80,000 of
wealthiest people
Liberals were committed to free trade Land valuation (collect taxes)
-Conservatives wanted import taxes -Owners selling land pay 20% of any extra
-Each year pay 1/5d for every pound land is
worth if it hasn't been developed
Left wing Liberals and Labour wanted taxes Increase taxes on alcohol/tobacco
on land -Goes up 33% on spirits and 25% on tobacco
-November 1908: 241 Liberals and Labour
signed petition for land values to be taxed
House of Lords had masses of wealthy Cost of landlords licences increased
landowners -50% of landlords expected profits from
Non-conformist supporters wanted to
restrict or tax the sale of alcohol
Liberal Parties and votes mainly from
middle class small businesses and
professional people, wanted to keep
working class
-Didn't want to tax middle class too much
By-Election 1908 was bad with 10% swing
against Liberals
-7 seats lost


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