TAXATION A DANGER

Evening Post, Volume CXXX, Issue 129, 27 November 1940, Page 6

TAXATION A DANGER

LOCAL INDUSTRY

BLED OF ITS LIQUID GASH

(By Telegraph.) (Special to the "Evening Post.")

DUNEDIN, This Day.

At the annual meeting of the Mosgiel Woollen Company yesterday, Mr. J. S. Sinclair, chairman of the company, said that for some years past taxation had been criticised chiefly from the angle that it increased costs and retarded the velocity of business. Today, however, with the record maximum effective rate for companies (excluding excess profits tax) of 12s o|d in the £ for income, national, and social security taxes, a. very great danger to the future welfare of New Zealand businesses, and particularly industrial concerns, existed in very definite form.

"In the case of this company," Mr. Sinclair continued, "the amount of taxes payable on the profit for 1940 was four times that of 1939, and this was exclusive of contribution to the War Loan. "In effect," Mr. Sinclair continued, "this meant that the liquid cash position had to be kept at a very much higher level in order to meet this heavy drain, with the result that money would flow to the State, whereas a portion of it could and should be retained for the development and extension of industry, so essentially necessary towards providing additional employment and for the benefit of industry in this country. "Particularly necessary is this development if we are to grapple seriously with that burning question of rehabilitating returned men when the present catastrophe is ended. "In order that industry may function to its fullest it must not be unduly bled of its liquid cash."