PARLIAMENT’S WORK

Dominion, Volume 24, Issue 225, 19 June 1931, Page 8

PARLIAMENT’S WORK

Proposals for Budget TAXATION LIMITS Finance Readjustments SINGAPORE ANNUITY (By Our Parliamentary Reporter.) Cabinet Is already busy upon the preparation of legislation for the session which opens next Thursday, and there was a practically full muster of yesterday when various questions concerning the business to be placed before the House and the contents of this year’s Budget were brought under review. Present indications are that the Budget will not be ready for presentation until well on into next month, for, because of the nature of the issues to be dealt with by the Prime Minister, and the fact that financial provisions to balance the national accounts will play an Important part in Its composition, the ■final draft will not be approved until as late as possible. Apart from this, however, there is every reason to believe that the Prime Minister will make an effort to introduce the Budget as soon as he can after the preliminary business of the session has been dealt with. Speculation has recently been directed upon the probable length of the session, and although It is Impossible to say whether a general election will be precipitated, it Is understood that the Government has not undertaken the preparation of a large legislative programme In view of the uncertainty surrounding the political situation. Bills Being Withheld. Ordinarily the session would have been a busy one, and members would have been faced with a fairly large volume of legislation. It Is understood, however, that recent developments have led to a disinclination on the part of the Government to introduce measures which might be crowded out owing to an early dissolution. One or two bills, which were fully expected to appear this year, are definitely belng^withheld In the meantime, and their. Introduction will depend on the trend of events within the first weeks of the session. Although every effort is being made by Air. Forbes to balance the Budget, he Is being faced with a particularly heavy task, how difficult, It is stated, can only be appreciated by members of the Ministry themselves. A serious attempt has been made to cut down national expenditure, but there still remains about £2,250,000 to be found by way of direct and Indirect taxation. However, Mr. Forbes is now faced with the position that Increased taxation might not yield the amount estimated. In the last financial year the Prime Minister sought £20,070,000 in taxation, excluding the unemployment levy, which was estimated to realise £600,000. Actually only £18,599,980 was collected, or £1,470,000 short of the estimate. The economic position of the country has not improved since then, and the prospects are that the law of diminishing returns will operate to the detriment of taxation receipts if a further attempt is made this year to increase taxation. It has already been shown that Customs revenue has fallen away appreciably, and there Is every likelihood that income tax, which last year came up to will not this year give returns commensurate with a further imposition, as is apparently proposed. Review of Obligations.

Judging by statements already made by him, it is the Prime Minister’s intention to base his Budgeting largely upon increased taxation yields. However, it is understood that recently Mr. Forbes has been making a further effort to cut down expenditure, and that he has made renewed appeals in the last few days to departments of State to readjust their finances in order to place as light a burden as possible upon the Consolidated Fund.

The suggestion has been made in some quarters that the position might be met by a readjustment of debt payments which ordinarily press heavily upon the national revenue. The Finance Bill No. 2 of the emergency session gave authority for £330.000 of reparation moneys to be applied to relieving the Budget, and it is practically certain that the Budget will contain the outline of a scheme for rearranging the basis of New Zealand’s payments toward the cost of the Singapore Base. The Dominion has agreed to conrtibute £1.000.000 toward the cost of the base In annua] Instalments, and approximately half of this has already been paid. It is understood that the Government has arranged to extend the remaining payments over a longer period, so relieving the Consolidated Fund to a certain extent.