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ECONOMIC ASPECTS OF THE SOUTH AFRICAN WAR :z 19
whether the amount should be obtained by Treasury
Bills, or whether a loan repayable at a short date
should be tried. The choice has been for the latter ex-
pedient, and a loan of £30,000,000 bearing 21 per·
cent. interest, repayable in ten years' time, and issued
at 98t, has been the definite outcome of all the dis-
cussions. The issue was also very successful, the loan
from the first being quoted at about 2 premium, and
that price having bee It maintained for some time,
though lately there has been some weakness. The
circumstances were such however that almost any
method would have been successful, and nothing turns
upon small variations in what is substantially an easy
task. I t may be said also that in spite of the success
of the loan and the general favour with which it was
received exception may welJ be taken to the plan of
making the whole amount repayable upon a definite
date in the future. To fix such a date seems to be
rather a departure from sound principle, as no one can
tell whether the bill may not come due when it is in-
convenient to pay. To have retained the option of
repayment from and after ten years would perhaps
have been a preferable course. The point, however.
is not important to our finances, which are generally
so prosperous.
The new taxation has consisted of an addition of
4d. in the £ to the income tax, making the rate IS. per
£, and also of small additions to the spirits, beer,
tobacco, and tea duties. The addition to the income
tax is estimated to. yield about £8,000,000 sterling
annually, or more nearly £9,000,000, the total yield of
this tax at a shilling being now upwards of £ 27,000,000
sterling. The additions to the indirect taxes named
again are estimated to yield about £6,000,000, and
those two sums of £8,000,000 from direct taxation,
and £6,000,000 from indirect, make up £14,000,000,
which have been contributed by new taxation to the
cost of the war. The money comes in easily enough;
but the weak point of the arrangement undoubtedly is