^{page 4 note (1)} The average of the expenditure, income, and output estimates.

^{page 4 note (2)} On the basis that the retail sales and new car registrations figures as well as the estimated movements in personal income and consumer credit are consistent with a bigger rise.

^{page 5 note (1)} Though some part of this is due to the fact that we now expect some of the recovery from the strike to be delayed into the third quarter.

^{page 5 note (2)} See Financial Statement and Budget Report, 1972-73 HMSO, page 10, table 4.

^{page 5 note (3)} A detailed comparison of our forecast with the official forecast and that of the London Business School is given below, pages 14-16.

^{page 5 note (4)} See pages 16-21 below for further detail.

^{page 5 note (5)} Financial Statement and Budget Report, 1972-73, page 28, table 17.

^{page 5 note (6)} Full details of the budget proposals are given in the Calendar in this Review, pages 70-73.

^{page 5 note (7)} House of Commons Debates, 21 March 1972, col. 1353.

^{page 8 note (1)} See National Institute Economic Review no. 59, February 1972, page 24.

^{page 8 note (2)} Public Expenditure to 1975-76. (Cmnd 4829)

^{page 10 note (1)} This forecast is also consistent with the recent survey evidence from the British Market Research Bureau and Gallup, both of which show some revival of consumer confidence.

^{page 10 note (2)} We have, in fact, adjusted the published figures for wages and salaries (table 5) in the third and fourth quarters of 1971 by -£75 million and -£100 million respectively.

^{page 11 note (1)} The allowance made on this account has been reduced from the February forecast. See Hansard, 25 April 1972, col. 224, where, in reply to a question to the Chancellor, it was stated that only £95 million was expected to be repaid in the current financial year, compared with the earlier estimate of £130 million.

^{page 12 note (1)} These prices are assumed to rise in line with costs from July onwards without any ‘catching up’ of ground lost during the initiative.

^{page 14 note (1)} Some details of which were published in The Sunday Times, 2 April 1972.

^{page 14 note (2)} This is one reason for some differences in the figures for 1971. In addition, there are some conceptual differences in the measurement of GDP and the allocation of the errors among the components of demand—this affects the figures for stockbuilding in particular.

^{page 14 note (3)} See reference in footnote ⁽¹⁾ above.

^{page 16 note (1)} If supplies of goods or services are exempted, however, this refund may not be claimed although the suppliers them selves will be free from VAT. Thus, being exemption with credit, zero-rating is much the more desirable form of VAT relief.

^{page 17 note (1)} NEDO, Value Added Tax, HMSO, London, 1971, pages 51-55.

^{page 17 note (2)} D. Dosser, ‘Taxation’, in J. Pinder (ed.), The Economics of Europe: What the Common Market Means for Britain, Charles Knight & Co. Ltd, London, 1971, chapter 9.

^{page 17 note (3)} W. A. B. Hopkin and W. A. H. Godley, ‘An analysis of tax changes’, National Institute Economic Review, no. 32, May 1965, pages 33-42.

^{page 17 note (4)} CSO, ‘Allocation of taxes on expenditure and subsidies by type of expenditure for the National Accounts’, Economic Trends, no. 205, November 1970, pages 22-32.

^{page 18 note (1)} The arguments in favour of this view were set out in National Institute Economic Review no. 56, May 1971, pages 7-8.

^{page 19 note (1)} See footnote ⁽¹⁾ page 16.

^{page 20 note (1)} Hansard, 21 March 1972, col. 1373.

^{page 20 note (2)} There may also be transitional effects on particular commodities if consumers expect price changes—that is, anticipatory buying or holding off, and this might apply to total expenditure if a general rise (or fall) in the price level were anticipated.

^{page 20 note (3)} I. F. Pearce, A Contribution to Demand Analysis, Oxford University Press, London, 1964, table 7.1.1.

^{page 20 note (4)} National Institute Economic Review no. 56, May 1971, pages 7-8.

^{page 20 note (5)} The partial shifting assumption implies, of course, that in calculating the effects of the tax changes on GDP, allowance should be made for the retention in profits of some of the SET cuts, which might lead to higher dividends or higher investment, or both.

^{page 21 note (1)} Hansard, 21 March 1972, col. 1379.