Greymouth Evening Star. AND BRUNNERTON ADVOCATE. MONDAY, JULY 26th, 1920. THE FINANCIAL POSITION.

Greymouth Evening Star, 26 July 1920, Page 4

Greymouth Evening Star. AND BRUNNERTON ADVOCATE. MONDAY, JULY 26th, 1920. THE FINANCIAL POSITION.

The Prime Minister's statement in 'regard to the finances of the Dominion made during' the committee discussion of the Judicature Amendment Bill in the House of Representatives on Wednesday was not exactly reassuring. Ox course, allowance has to be made for the fact that Mr Massey's purpose in speaking was to restrain the generous ardour of members of the House who would have made much larger additions to the Judges' salaries than those the orovernment was proposing,' and o satisfy the Labour members he had done everything the resources of the country would justify him in doing towards improving the position o-f people less fortunately tuated than the occupants of the Supreme Court Bench. But 'veil after mnkin-g this allowance

we are faced by the cold fact that the wages bill of the Dominicijn iias been increased by two millions i year, and by the statement that ts nbilitv to bear this enormous nlditional burden depends upon the present prices for its produce being maintained. "He did not think it would be necessary to increase taxation to provide for the payment of the two millions this year," the summary of the Premier's remarks published in the "Dominion" runs, "and he hoped ho, might not have to do it next year. This, however, would defend on the markets for our produce, on which the whole community lived, but he feared there 'right he a drop in prices within a year or two." Tlie outlook, as it appears to Mr Massey himself, "eHainlv is not a bright one. We mav get through the current financial year comfortably enough, but that anything may happen. Meanwhile Mr Massey to recover part of the additional expenditure uDon wages and salaries by increasing the railway fares and freights and by imposing higher postal charo-es. These, up to a certain point, are simple means of raising the revenue, and

they ahvays find favour with an embarrassed Minister of Finance; but* increased railway fares and freights and increased postal charges, however Mr Massey and the rest :o£ lis may attempt to disguise the fact, are every hit as muck taxation as*are the income tax, the land tax, and Customs duties, and in their operation are apt to become a particularly vicious form of taxation. Tbe increase:! railway freights and- in a measure, at any rate, the increased postal charges inevitably will be passed on to the consumers, nine-teen-twentieths of whom belong to tho classes least able to bear any additional burden. Moreover, it must be obvious to everyone t'mt increased freights, even with the prospect of passing them onto the unhappy consumer, must discourage and that increased •ires, in the long- run, must h\sse,'i travelling. At best, these method? of raising* revenue and the increase of postal charges, are only rough-and-ready expedients for tiding over a crisis resting.on no scientific basis and offering ho;permanent solution of the financial difficulties besetting- the country. What the Dominion still wants more than anything else in its present straits is production, more production, and still more production, and yet towards this end, on which the future salvation of the country ultimately must rest, scarcely one of the measures beingcrowded upon Parliament at the present time is specially shaped. INCOME ''TAX EXEMPTION. We are very glad to £ee the Chambers of Commerce throughout the Dominion expressing in unequivoi cal terms their disapproval of the Government's proposal to exempt the salaries of members of Parlia,- ' ment and "other public officers"

from income tax. Already we have written quite frankly on this question, and we do not wish to be thought less concerned than the Chambers of Commerce, are for the dignity of thosa in 'high places, but we are impelled to say we think this concession: in the cases r>? the Supreme Court Judges and the Ministers of the Crown would have been even more illogical and" inequitable than it would have been'in the <rase of the private members of Parliament. To the average Labour member of the House, for instance, it would meant practically nothing at all; but to the Judge and the Minister it would have meant a very considerable sum. The resolution adopted by the "Wellington Chamber of Commerce, however, puts the position very fairly, though it will be noticed it evades very adroitly the mention rf Judges and Ministers. "That the Chami i I- __i .'ji. j. _„j

bet has noticed with regret and concern," it runs, "the recent decision of the Government to exempt from income tax the salaries of members of Parliament and other public officers, and is of the opinion that it is a dangerous precedent and unnecessary, and •;Ms chamber-trusts that the de<nfirn will be repeated, and that the liability for income lax should be taken into consideration when fixing the amount of remuneration.'' The gentleman who r-econded this motion suggested that the couutrv would get better representation if the salary of the private member were raised to ,£BOO a year, and we are disposed to agree with him, but the principle at stoke, in this matter is the principle of equality of sacrifice, and this is the very essence of every equitable form of taxation. There is many a struggling man in the public service, with a young family to support, paying income tax on the few pounds he receives over th*» statutory exemption, and it would be a positive scandal if the Government persisted with its proposal to make substantial concessions to Judges and Ministers and in Ifinvfi this man and his like un-

xo leave tints iu.uu auu iur« mvc unrelieved. But we have little fear of this happening'. The Government is letting it he known that its proposals are beinp- recast, and the final outcome will be larger salaries and no exemption from inp&mp tax. Had Mr Massey been less busy be would have made the right decision in the first instance.