RETURNS FROM TAXATION

Press, Volume LXXIV, Issue 22465, 28 July 1938, Page 12

RETURNS FROM TAXATION

♦ REASON FOR INCREASED YIELD MR HOLYOAKE’S CONTENTION [From Our Parliamentary Reporter.] WELLINGTON. July 27. “The Budget admits the defeat of the Government in trying to improve the prosperity of the country above the point allowed by overseas prices,” said Mr K. J. Holyoake (National, Motuekaj, during the financial debate in the House of Representatives to-day. "If the Government, as it claims, has so increased prosperity that we are able to collect an extra £5,000,000 revenue without any increase in taxation, why docs it not increase prosperity again this year, so that w.e may have another £5.000,000 without an increase in taxation. Why have we been let down this time?” The main significance of the Budget, said Mr Holyoake, was that though revenue was expected to be lower, expenditure was higher, and the legislation that the Government had yet to bring forward would again increase the amount. The Government had in fact during the last two years, increased taxation by more than £10,000,000, in spite of many promises to the contrary The increased revenue, he said, was frequently claimed by the Government to be. due to the increased income of the people, and not to any increase in the rates of taxation: but of the increase at least £3,000,000 was directly due to increases in various taxes. "The simple fact is that the increased income is due to the increase of more than £30.000,000 in the value of exports. What the Government has done pales into insignificance beside that fact. Falling income has, however, already brought some industries to the point where they are yielding less in taxation, and therefore are less prosperous.” -Mr Holyoake instanced the goldmining industry as one which had suffered from taxation. Last year the yield from the gold export tax was down by £3381 on the previous year and the Budget showed that a further decrease of £5421 was expected. This proved conclusively that gold production was declining. “This is an opportunity for the Government to increase the production of a commodity for which there is an eager market in every country, in the world,” said Mr Holyoake. "The tax was an emergency tax, and as the emergency has passed, it is time to take it off. The tax brings in only about £IOO,OOO a year, and its removal would allow lower grade ores to be worked, with a great increase in the number of men employed. The Government, in this way, could assist one of our good industries, and one that helped very materially to bring the country back to prosperity.” Mr Holyoake made a strong plea for the tobacco farmers of his electorate, and said that had they not had an outstandingly good year from both the production and quality points of view, they would not have been able to keep going. He suggested that a reduction in the excise duty on tobacco would increase the consumption of the New Zealand article from its present figure of 19 per cent, of New Zealand consumption to 70 or 80 per cent.