THE BUDGET

Hawera Star, Volume XLIX, 15 August 1929, Page 6

THE BUDGET

DEBATE STILL GOING ON. TAXATION PROPOSALS. MORE CRITICISM GIVEN. (By Telegraph—Press Association.) WELLINGTON, Aug. 14. The financial debate was resumed in the House of Representatives t-o-day by Mr. A W. Hall, who said the Minister of Lands apparently considered it would be a simple matter for large landholders who might find the proposed additional taxation too heavy to dispose of portions of their land.

Mr. Hall submitted that people whose property was encumbered by heavy mortgages might find grave difficulties in the way of offering portions ol their estates for sale. If the State Advances Department was in a position to provide the money for these people to pay off outside mortgages and place their properties in such a- state that sales of portions could be freely arranged the difficulty would not then be so serious.

Replying to points raised the previous night by Mr. <l. S. Fletcher, Air. Hull said there iiad been nothing to prevent the Prime Minister from chousing not to complete the negotiations which Mr. AY. D. Stewart hail initiated for raising a £5,000,000 loan in .London. AH. Fletcher had further stated that this amount would have been absorbed by expenditure on public works and there would have been nothing left for advances to settlers and other purposes. Air. Hall replied that the obvious explanation was that Air Stewart would have borrowed locally to meet the additional requirements, as the present Prime Minister had done. This had been Reform’s policy right through—to borrow locally to relieve commitments on the London market. Mr. Hall described the Government’s, taxation proposals as illogical, unscientific, and unfair. He hoped the other promises of the Government would receive a greater degree of fulfilment than the promise of cheap money had received.

Mr. I*. Lye subscribed to the view that the primage duty would not he passed on to the consumer. He did not think it would be possible, in face of keen business competition to pass on a matter of twopence halfpenny, or even sixpence, in the £l. He read a list of articles on which no duty was paid, and expressed the opinion that even if any burden were passed- on to the worker it would be infinitesimal. He would not vote for the proposal to increase the primage duty permanently, but in the present circumstances he would support this temporary measure. Mr. Lye said he understood there; were 2200 farmers throughout New Zealand who would have to pay land or income tax, whichever wars the greater. He believed the proposals in regard to the supertax would have the effect of inducing people who had large holdings to submit land to the Government at a reasonable price, and thereby make land settlement possible. He expressed the opinion that there was no reason why the bank rate should be as high as it was at present. He’ considered the bank rate was responsible for the high rate of interest on mortgages. He thought the opportunity might have been taken during the last season, when trading had been so successful, to sell bonds with the object of forming an agricultural bank for the purpose of financing farmers. Mr F. 1 aingstone spent some . tiipe describing the proposal! for the formation of certain oonimterdial undertakings and saiid it appeared to him that, the' huge profits envisaged could 'he obtained oniiy bv exploiting the nulblie. He slggested no ooimneiT/ini concerns of the type ho had outlined should, be permit- 1 ted to operate until the Government had satisfied itself that the interests of the people were not being prejudiced. He referred to the profits made by some insurance companies, and remarked that the Government might have' looked in that direction in seeking revenue instead of iucrcasing the -pri-* m-alge duty. Mr D. .Jones said that when the iteform administration relinquished office tins country was on the high road to prosperity. * Had it poin.ti.nqed, in office there would have been lib deficit. Hesuggested it was possible, some revenue was held up that might have 'been included in last vepr’s acoountsr. , It' bad keen in the interests of the United Party to bhow that there was a- deficit,, on- it would have been the laughing stock of the country. He knew definitely that, unavoidable circumstances; had eon tri blued to the deficit. For instance, had shipping been on an ordinary footing at the end of the year £15,OQO of revenue coll ceded in April would have .been available in March. Members of the United Party had' referred to tire necessity to obtain money to. oompenaste- for last veair’s deficit., but Air Jones contended, this wps not, so. as the whole amount was charged up to the sum of nearly £3,000,000 of surplus that (bad been placed at the credit of the ConsoHidiatecl Fund. The year had actually been .started with a. clean sheet. Sir Joseph Ward : Nonsense! Mr Jones: 1 challenge the Prime Minister when he replies to tbils debate to prove that what I have said is not the case!

Mr Jones added that it was evident from thy financia'l return® for the first ci uatrter "of the year that the Prime Minister had ’ under-estimated Ms revenue 'and was budgeting!, a® ,he had formerly done, for a spectacular surplus. Mr Jones said he had la shrewd suspicion that the; idea, of giving education an agricultural bias had. originated with the Minister of Finance', who wished to have the farmers in the alight mood when the Budget had been prepared. The •Minister of Finance had said to the Minister of Ednciation, “That’s quite enough; iust refer it. to a select ciommiittee and it will be forgotten.’ ’ Tlie Budget had contained the agricultural bias Mr Jones continued, but if. had been a .bias against, the farmer. He considered it would be very diffliioult for the. farming community to recover from the blow if the Government’s taxation proposals were to go through.. The .adoption of the Government’s proposals would destroy land values, and 1 1m knew of no more 'dangerous act to New Zealand than to destroy the land values. He claimed that rich, cornmerdi'al intereiste bad been left- f-Wse while practimllv the whole bunidbu of ine.re'aisiad taxinfion had boon placed l on the former. Tim debate was adjourned and the House rose at 10.2 b p.m. until 2.30 if.in. to-morrow.