STATEMENT BY THE PRIME MINISTER.

Otago Daily Times, Issue 14507, 26 April 1909, Page 2 (Supplement)

STATEMENT BY THE PRIME MINISTER.

, WKLUNGTPN, April 13. Npttwing iit the Chamber of Commerce t« the visiting delegate, to the conjci'eiK.'a to-night Sir Joseph Ward contiadicU'd the- statements wade by Mr -u-tl.c finruii; liiu day's csisrussions on the ' JK:1: '»„ mortgages Md graduated ];md tji.Nf::. he statement had been made, .Sir Joseph Ward sai-i, that the Governjlicnt WJ.S rosjiansible fw tiie stringency m fiio money: .miii-sct, by .sbsorbi^V^

i money. That was contrary to fact, i During the last 12 months the Govern- , inont bad only borrowed from the public Zealand between £90,000 and li- ' )epn ""solicited, whjle m the meantime tho Government, ought a very lareo sum of outside money to the Dominion. The sum they brought in and circulated ran into se\eul hundreds of thousands of pounds. i( ""lament, regarding tho ditticutty in obtaining money in New Zealand through tho Government institution, lie legretted that that, position had lieen made during the last 12 months. The ' i™t a T ' f Bl ' 8 had ! lout out in cash nearly two million r pounds. A though he had not the actual > figures, at the same time tho Govvnunftnl ad lent £250,000 K, local ' "! e tot ; 1 lerably over two millions: ■ then it had been said that the graduated , tax was imposed upon building But . he wanted to say that there was no build- , ing in any part of N« w Zealand upon , which taxation was levied bv the Government. Another statement he wanted to - contradict was that, on account of (he [ operation of the mortgage tax money was ; not coming into New Zealand. As a , matter of fact, he. had within the last, t six weeks refused Australian monoy | amounting in one sum to £250,000. which , was offered for investment in New Zealand j at 4 per cent. In addition, during the. coining month the sum of £235,000 had been arranged tor in Australia for invest - [ ment in Now Zealand at 4 per cent. 1 FURTHER DISCUSSION. i REPLY TO THE PRIME MINISTER ; WELLINGTON, April 14. The motions passed by the conference of delegates from tho Chambers of ComI merce of New Zealand respecting tho graduated and mortgage taxes yesterday 1 have caused a great deal of discussion. Sir Joseph Ward replied to some of 1 the statements at a banquet last evening, 1 but the commercial men are not satis- ' lied, and further discussion look place at the meeting of delegates this afternoon. By permission of the conference, Mr ' C. N. Kettle was giveti tho right to reply to Sir Joseph Ward. Mr Kettle said that ho had to express his regret that he was not present at the dinner. Ho had read Sir Joseph's speech, and 1 would lirst refer to the question of the graduated tax. He bad never said that the department was charging a tax on business buildings, but on land on which business premises were erected. He was glad that Mr J. Hayes (Commissioner of Taxes) had admitted that tire Advances to Settlers Office had no moro money to lend. There was no doubt that tlio department had done a. great deal of good. ■ Jiverybody was gratified for the assistance it had given settlers. He was nut speaking in any disparaging sense. Mr Kettle regretted that the Prime Minister had refused to accept a large amount of money offered to the Government for investment. The (Government could compete on moro favourable terms than the private individual, and for this reason the mortgage tax should bo removed. They had to see that further capital did not leave the country. Tho man who was investing his money in mortgages should not have to pay a higher tax than the mail who invested his money in a business. Sir Joseph Ward had stated that the Government had only borrowed £100,000 from tho public in New Zealand. During the last 10 years the national debt had increased by £20,000,000. How were they going to get that back if more capital was not invested'in the country? It was a fact that tho fall in t.lie price of wool bad contributed to the stringency in the money market. They had to remove all obstacles against "the investment of capital in fills country. Tho penalty which capital had to bear should be removed. Mr D. J. Nathan assorted that the Prime Minister did not state the facts las they were actually at the meeting, 1 and lie went on to show grounds for his contention. The great question, as tho ; speaker gathered from London advices, was not what tho penal tax amounted , y* to-dav, but what would it amount to in a few years' time. To speak about buildings, as Sir .Joseph Ward had done, was simply to draw a ltd herring across ; scent, He spoke as a friend oi the Government-. Regarding the Advances to ■ Settlers Department, he wished to say ' that they had nothing to object to in regard to the principle, but they desired > to 'emphasise that the true object of that t department was to give advances up to - £500 to small settlers, and not to come ' l?to opposition to the loan companies. | the subject was not further discussed. ; MR BEAUCHAMP'S VIEW i M AUCKLAND, April 14. , The reports of tho discussion in Wellington by tho delegates to the New Zea- . land Chambers of Commerce Conference [ on the subject of the mortgage tax and , its effect on the money market wero j brought under tho notice of Mr Harold J lieauchamp (chairman of directors of tho [ Rank of New Zealand). Mr Beauchamp , said lie was very much in accord with some of the views expressed, chiefly with | those of Mr Kettle, of Napier, to the effect that if the tax on mortgages and j debentures iveio repealed it would ho , followed by a considerable influx af capi- . tal to tho Dominion for investment. "It t will bo remembered," said Mr lieaueha.nip, i " that prior to tho imposition of that tax ( there were large mortgage and investment . companies transacting business in New I Zealand. They wero of considerable . benefit to the inhabitants of this country. , However, after the passing of the act, these companies gradually withdrew, with \ the result that the community is now , chiefly dependent upon the bants for its , financial requirements. It is," lie con- ' tinned, "the principle of double taxation that is so strongly objected to by people [ outside tjie Dominion, notably in tho [ United Kingdom, As is well known, . these people have to par the tax on all f money lent by them in the Dominion, as i well as income tax on their profits derived from their oversea investments; Representations have been made from time to ! lime to the Imperial Government to net . tlieso investments excluded from taxation, I but so far without- avail. It is for the [ reasons I have stated that I think it most desirable for the New Zealand Parliament to take into consideration the representations now being mado as to the desirableness of repealing tho tax on mortgages and debentures." °