That was the reaction of many Bermudians yesterday to Finance Minister the Hon. David Saul's seventh Budget.

Dr. Saul boasted that his Budget measures would raise an extra $35 million while sparing "the little man''.

And Bermudians, braced for a barrage of tax hikes after weeks of warnings about new Airport costs, breathed a collective sigh of relief.

"The taxes on the surface do not appear to be blatantly targeting the small man, as they usually do,'' said Shadow Finance Minister Mr. Eugene Cox.

"It seems as if they're tightening up some of the loopholes, and going after some of the big money earners, which is a step in the right direction.'' Mr. Robert Rego, president of the Bermuda Chamber of Commerce, said general business feeling about the Budget was one of "relief''.

The burden of new taxes was "spread across a full spectrum'' of society, he said.

Dr. Saul said the Budget was a gentle one as Bermuda emerges from the recession, designed to avoid inflation and protect tourism.

But it was not just the two major banks -- who saw their licence fees hiked by $250,000 to $1 million each -- who felt pain from the Budget, which details current account spending of $390.4 million for 1995/96, up 8.

0 percent over last year's original spending estimate.

In combining the hospital levy and employment tax, Dr. Saul demonstrated that one and one does not always equal two. The combined payroll tax of 11.5 percent will cost employees earning $40,000 an extra $200 a year, or 0.5 percent, off their pay cheques.

Despite Dr. Saul's denials, "income tax is here, and alive and well in the Budget'', Mr. Cox told The Royal Gazette . Government revenues are to total $426 million -- up nearly ten percent from last year's original estimate.

While Dr. Saul said that land taxes had been left alone, along with popular Budget targets like alcohol and fuel, Mr. Rego pointed out that the cancellation of a prompt payment discount meant an effective five percent land tax hike for most property owners -- on top of the five percent hike in last year's Budget.

Visitors and residents alike will pay an extra $5 each time they leave the Island.

Smokers will pay an extra 20 cents for a package of cigarettes.

There will be small but as yet unspecified hikes in the licence fees paid by Bermuda motorists.

The Island's liquor and tobacco merchants will be slapped with new $10,000 fees for their "bonded warehouses'' which allow them to avoid upfront payment of Customs duties, a spokesman said. And Bermuda's gasoline companies will have to pay $25,000 for each of their bonded warehouses.

Bermuda's professionals -- including nurses, engineers, architects, and doctors -- will be hit with new fees ranging from $50 to $2,500.

"It is only fair and reasonable that they pay a fee for the benefit that goes with a closed shop,'' Dr. Saul said. Hoteliers saw the six percent hotel occupancy tax extended from applying only to the "rack rate'', to covering additional charges like room service and telephone calls.

While Customs tariffs were reduced for children's clothing, electric motorcycles, and some other items, the creation of a new 15 percent tariff rate meant hikes on duty for a few items, like miscellaneous food preparations.

A mortgage loophole that was costing Government revenues on stamp tax was closed. Non-Bermudians will be taxed for capital gains on property sales. And new fees were introduced for corporate services provided to exempt companies.

While giving grudging approval to the tax hikes outlined, The Progressive Labour Party's Finance spokesman slammed the Budget for not doing more for the unemployed and others "still hurting'' from the recession.

And the Chamber, while describing the Budget as "fair'', said it should have contained more that would help improve Bermuda's competitiveness.

The accounting firm Deloitte & Touche said the Budget was "accurately described as presenting an investment in the Country's future''. But its success would depend on "whether the forecast upturn in tourist numbers and visitors' expenditure is achieved, together with 2.5 percent inflation, relatively low wage settlements, and an increase in business confidence''.

It was a Budget driven by the impending takeover of Airport operations from the US Navy on June 1. Of the $35 million in new revenues that were needed, 60 percent were related to the Airport, said Dr. Saul, who made a point of thanking the Americans for running the facility at no charge for nearly 50 years.

An extra $430,000 is budgeted to bring the Tynes Bay Incinerator to full staff, and new funds were approved for Parliamentary salaries, Education, hospitals, insurance, the Registrar of Companies, Police, the Small Business Development Corporation, and the Labour Ministry's training arm.

Otherwise, "Government departments have been advised that they must redouble their efforts to work within established budgets,'' Dr. Saul said.

After using $75 million in borrowing last year to retire $55 million in matured loans, Bermuda plans to borrow another $75 million this year to help fund major capital programmes like the school restructuring, Dr. Saul said.

In two to three years Bermuda may want to raise its statutory borrowing limit to $200 million from $185 million, but Government borrowing will still not exceed ten percent of the Country's gross domestic product, Dr. Saul said. Nor did he expect that additional borrowing would cost the Country the AA1 Credit rating awarded by Moodys rating service last year.

The following are highlights of Government's 1995-1996 Budget. *** Revenue: $426.1 million, up 9.2 percent on 1994-1995. Current account expenditure: $390.4 million, up 6.8 percent. Borrowing: Government will borrow a further $75 million for capital projects this year, in addition to the $75 million borrowed in 1994-1995. Parliamentary salaries will be increased by 27.9 percent over two years, with a 13.6 percent raise this year and the balance paid with effect from April 1, 1996. Departure Tax will be raised from $15 to $20. Payroll taxes: Employment Tax and Hospital Levy will be combined into one payroll tax. The total payment by employers will be 11.5 percent of a wage or salary, of which a maximum of four percent can be withheld from the employee.

Professionals: Registered members of professions will be charged an annual licence fee ranging from $50 to $2,500 a year. Capital gains tax: Non-Bermudians selling local property will pay a 10 percent tax on the financial gain from the sale. "Sin taxes'': The tax on cigarettes will be raised by 20 cents per packet. No increases for alcohol or gasoline. Bank licences: The two large banks will pay an annual licence of $1 million, up from $750,000; Commercial Bank will pay $150,000, up from $100,000. Hotel Occupancy Tax: Hotels will be required to pay tax based on the cost of all goods and services instead of the flat room rate.