THE FINANCE BILL

Ashburton Guardian, Volume 58, Issue 37, 23 November 1937, Page 3

THE FINANCE BILL

GRADUATED LAND TAX. THE HARDSHIP CLAUSE. PURCHASE OF PICOT BUSINESS. (Abridged from Press Association). WELLINGTON, November 22. ' In the House this evening the Minister of Finance (the Hon. W. Nash) moved the second reading of the Finance Bill. He said the main Bill was divided into four or five parts. One part dealt with soldier settlement, and it was anticipated that in writing off this account the total loss would be £6,820,000. It was the account only which was being done away with, not the other legislation dealing with soldier settlement. With regard to the wiping off of the State Advances Account” when all the accounts were settled up there would be only a comparatively small amount to be written off. Another part of the Bill, said Mr Nash, gave authority for the borrowing of £6,000,000 for public works. This amount was not immediately necessary and the Government was trying to make provision for all public works during this session until the commencement of next session, but the authority was there for the borrowing of the money or part thereof as required. Mr W. P. Endean. (National, Parnell): Where will you borrow that money from? Mr Nash: I think mostly in the Dominion, but certainly not overseas. In reply to a certain interjection by Mr Endean, who said he only wished (to know how the public money Avas being spent, Mr Nash said there was no suggestion that any money was being spent in New Zealand in anything but an open manner, and it Avas a pity the honourable gentleman should go to Sydney and make statements in the press there that Avere derogatory to the interests of the Dominion. Hardship Clause. Referring to the setting up of the Hardship Committee under the graduated land tax, Mr Nash said it would operate for tAvo years and deal Avith taxes falling due bn March 31, 193 i, and also on March 31, 1938. It would comprise the Commissioner of Taxes, the Solicitor - General and the Secretary to the Treasury. It Avould deal with losses where hardship existed. The committee would not be limited in the scope of its inquiry and would he able to recommend to the Minister what relief it thought might be necessary. The Minister could then recommend that the relief suggested could be granted. The Minister proceeded to deal Avitli the provisions in the Bill covering the payment of income tax by goldmining companies which, he said, paid income tax not on income but on profits. The Bill would enable taxes to be levied on the assets of companies which bad been transferred overseas. Another clause exempted from stamp duty all transfers of houses from local authorities. It bad arisen through the requirement of the Dunedin City Council, which had done splendid work in erecting houses to relieve the housing shortage and desired to transfer ownership of the houses to private individuals. Another section increased the time which persons in receipt of invalidity pensions might bo absent from the Dominion Avithout forfeiting their pensions.

Dealing with the provisions in the Bill for providing for the payment of the new season’s price for butter-fat for produce exported between July 31 and September 4, the Minister stated that the total cbst would amount to 1 £38,000. This sum would be distributed to dairy companies for distribution to farmers as soon as the Bill was passed and the accounts were in order. The next clause in the Bill dealt with differential cheese payments. An extra farthing was provided for in the BUI, enabling buttcrfat suppliers for cheese to receive an average of lid per pound more than did suppliers of butter. The total cost of this increase would be about £165,000. Speaking of the Internal Marketing Department, Mr Nash said the Bill would enable the Department to carry on. Purchase Gost ot Picot Bros., Ltd. Opposition members: How much did Picot Brothers cost?” Mr Nash: “I think it was about £60,000 for the assets.” He added that if the company had been sold on the Stock Exchange it would have brought about twice as much as the Government had paid for the company. It was one of the finest distributive organisations in the Dominion. Mr S. G. Holland (National, Christchurch North): How much did the goodwill cost? Mr Nash: I’ll tell the honourable gentleman that a little later. Mr Holland: We would like to know the amount of the goodwill. The Minister replied that it would be advisable to have the discussion on that on the Estimates, or when considering the Department’s reports. Members certainly were entitled to know what the sum was and he would certainly tell them. The Leader of the Opposition (the Hon. Adam Hamilton) said there were 40 different subjects discussed in the Bill and ho did not intend to deal with them all in his half hour’s speech that evening. He said lie liud been pleased to learn from the Minister that the State Advances Account was in a healthy condition. The State Advances system had worked very well in its day. Commenting on the provision in the Bill to borrow £6,000,000 for Public Works, Mr Hamilton said the Government was a great borrower but objected to paying interest. Why should it borrow if it did not pay interest ?

Mr Savage: There is nothing objecting to the paying of interest in the BiH. Mr Hamilton: Ires, but it is a veil recognised plank of the Labour Party. In fact, some members of that party have intimated that interest will be abolished altogether. The Hon. W. E. Parry: Quite a lot of Christian people agree with that. Mr Hamilton: I think the honourable gentleman had, better leave Christianity out of the discussion on this Bill. I am prepared to debate it with

him at another time, but not in connection with this Bill. Mr Hamilton continued to deal with the hardship clause under the graduated land tax, stating that the Bill carried out the Minister’s promise to set up a committee to investigate hardship under the tax. He thought it was a very conservative committee, two of its members being tax collectors themselves. He thought the graduated land tax should be abolished altogether, because it was most inequitable and was 90 per cent, unjustified until there was a classification of land. There was no justification for a graduated land tax at all. It hit companies with branches throughout the Dominion and also large farmers whose holdings might be quite unsuitable for subdivision. A clause should be inserted in the hardship clause stipulating that a person’s ability to pay should lie considered in the assessment of the tax. He thought it unwise that the committee should have to refer its decisions as to who paid tax to the Minister. The Minister should write the law' and, leave it to his officers to administer it. Mr Hamilton said he failed to see why the Minister had not put the price paid for Picot Brothers in the Bill. Mr Nash ; I told the house just over £60,000. Mr Hamilton: You don’t want any suspicion about what you pay for a thing. When I was Minister of Broadcasting and we bought a broadand told the House about it. The debate had not concluded when the House rose at 10.30.