Italy's Budget Italy has conquered Abyssinia, poured troops and material
into Spain, and, in one form or another, conscripted the entire nation. Something, though not all, of the cost is shown in the deficit of £54,000,000 on the budget of £330,000,000 for 1939-40. Total expenditure on arms will be £114,000,000. Against the deficit, the only additional revenue provided is the proceeds of the levy on capital of businesses and industrial firms decreed last month. Direct taxation, however, may be made to yield more ; and in two big business centres, Genoa and Milan, a new system of registration is being applied as a means of preventit4 evasion. An increase may also be provided by the tax on business turnover, and revenue be found by a new issue of Treasury bonds, which at present stand above par. Conditions for such an issue are favourable. The budget deficit should not, in fact, cause difficulty in the coming year ; and indeed the Budget is described as the first step towards restoring normal finance in three years' time. The Budget, however, does not include extraordinary expenditure and revenue, which still remain a secret ; and difficulties may be expected if, as seems likely, there is extraordinary expenditure on the Colonial Empire or on arms.
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