TAXATION REDUCTIONS.

Press, Volume LX, Issue 18204, 15 October 1924, Page 8

TAXATION REDUCTIONS.

EFFECT ON PRICES. STATEMENT BY MR MASSEY. (SFBCIAL TO "THZ nilBI.") WELLINGTON, October 14. In the House of Representatives today Mr P. A. do la Pe'rrcllc asked the Minister of Finance whether, in view of the taxation reductions made tTiis session, he would urge banking, financial, and lending institutions to make corresponding reductions in the rate, of interest, and whether those firms benefiting by the taxation reductions should not pass them on to the consumers. Mr Massey replied that he had the best of reasons for believing that the rate of interest charged by banks on overdrafts had been lowered as a result of tbc taxation reductions made a year ago. At that time the' usual rate was 7 per cent. In the ease of the Bank of New Zealand lie had an official document in his possession showing that since last year the rate of interest had been reduced from 7 to 64 per cent., and that now 71 per cent, of its clients were being charged only per cent. Hon. J. A. Hanan: You arc referring to current accounts? Mr Massey: Yes. He added'that, as for the other part of the question, dealing with merchants, he knew that instances could be multiplied where the reductions had been passed on. He mentioned the case of the Wellington Gas Company, which had indicated to its clients that owing to the reduction in taxation it would be able to, or had been able to, reduce the price it charged for gas. The Colonial Sugar Company, too, had intimated that in the event of there being a reduction hi taxation during the present session it would be able to reduce the demand made for duty. "I know I am right in stating," said Mr Massey in conclusion, "that reductions in taxation benefit every section of tlfe community."