AVENUES OF TAXATION

Hawera Star, Volume L, 7 August 1930, Page 7

AVENUES OF TAXATION

BUDGET UNDER FIRE EXPENDITURE ON RAILWAYS PETROL TAX DEFENDED. (By Telegraph—rresa Association.) WELLINGTON, Aug. 6. The Budget debate was resumed m the House of Representatives to-day by Mr j'3. F. Healy, who said the removal of duty from barley would! be a serious blow to growers in Marlborough, who would be placed on an. unfavourable footing in competition with Australiangrown barley. .Huge quantities of barlev were produced in South Australia, and could be landed in Auckland at .'ls 6d per bushel. Growers in Marlborough were supplying grain on contract with a. brewing firm at 5s per bushel. They would l not be able to produce barley at a lower cost than that, and if they were faced with such dangerous competition from Australia, they would have to turn their attention to • growing other cereals.

Mr Healy regretted that the flaxgrowing industry was waning, and ho trustedl the Department of Agriculture would see that this valuable industry was not lost to New Zealand. He defended the completion of the South Island Main Trunk railway, stating bo was prepared to show critics over the country. They would, after six or seven days on horseback, still be passing through good land.

Mr A. Harris said it might he argued that the South Island' Main Trunk railway should have been built several rears ago, but it could not be claimed it was desirable to-day when there was need for the curtailment of canital expenditure on railways. He declared no thanks were due to the Government for + lie removal of the nr image dutv as it had substituted 1 a surtax amounting to treble the amount of the primage on the average. He asked whether the surtax was to be a permanent increase. Everyone knew the difficulty of removing taxation once it had been imposed. The Government’s proposals were aggravating to too many sections of the community and would hit tile working man hardest of all.

postage RATE INCREASE Mr Harris advocated' increasing the duties on) beer, wines and' spirits, and supported the suggestion of Mr Stewart that air increase of the postage rate to a penny halfpenny would have been preferable 'to sonic of the methods adopted by the 'Government. lie also believed the Government should fake lotalisator fractions which, he estimated. would produce, about £40.000 annually. Racing clubs could not complain against such a course. Mr Harris said h'e favoured increased death duties, and. 'lie considered' that by the means lie had' mentioned the 'Government would have been able to obtain all the additional revenue it said it needed without harming anybody. It seemed the only people who had' esc a p-' e'd ; the Budget wore, bookmakers and publicans. IMr J. 'W. iMunro said' lie; had been impressed by the suggestion by Air ■Stewart that an increase in the postage rate, should be utilised 'toi produce revenue. He was. however, more in favour of the suggestion of Mr Harris that, duties should be increased on beer and' spirits.

'Mr Munro defended the action of the Labour Party in keeping the United Party in office, expressing the opinion that it was not the desire of the country as a whole to have a general election 1 at the present 'time. There was little to lie gained by it. 'lt was his opinion that both the Reform and Labour parties would! suffer if they were to force such a position upon the country, which' as a whole was not as much interested in what parly was in power a 9 in restoring the •economic situation. The people expected the best brains off all the parties to be applied to the solution of th'u national difficulties'.

Dealing - i vith the railways, ilr Mun.ro said in his opinion there was no possibility of their paying unless a large amount of the capital cost were transferred to the Consolidated Fund. At the present * time the railways were over-capitalised to the extent of £25,000.000 and wct expected to earn interest cm the. wholes amount.

All* D. iMciDougall defended' the increased petrol tax. die’ declared' it would' not affect one small carrier. Its effect might event he advantageous' because it would result in the replacement of motor lorries by horse-drawn vehicles. It would further enhance the market for chaff and would enable fanners to employ more men. Delivery of goods’ by lio;rse-drawit lorry would also be more economical than employing a £‘looo truck. Ilv asked what was going to ibe done with the new railway workshops if motor transport wag to be encouraged, to oust- the railways. There was nisei a danger of many railway employees being forced out of work. "What were tlie miners going to do if the railways' demand for coal fell off?

AL)MINISTR ATH)N OF SAMOA. • Mr AlcDqugall defended the increased amusement tax. He said it might be a good tiling if pool' people were discouraged from wasting money on pictures. The money might be more profitably spent in buying food and clothing. Ho strongly criticised the despatch of warships and armed men to Samoa. He remarked that militarism would never he a '.successful policy in Samoa and he ; condemned the attempts of the Reform Paitv “to bring the natives to heel”

Mr C. E. McMillan asked whether Air McDougall was aware that the actions in Samoa to which lie had taken exception had been those of the United Party. Referring to Hon. E. A. Ransoms' speech. Air McMillan said the Minister had 1 stated it was the poliev of the Government to prevent “drift,” hut lie had not shown that there was anything in the Budget to achieve such an aim. There was nothing that would assist primary production or tend to promote a return to prosperity. It gave no encouragement to the people to go on to the land, nor did it encourage those already on the land to increase production. The House was told that the petrol tax was to assist backbloeok settlers by providing good roads, yet the Government’s withdrawal of grants, subsidies and other savings affecting these neoole amounted to £541.000. Tn return thev were to ret £450,000 from the petrol tax. leaving them £OI.OOO worse off In addition they would hr paying a largo share of the petrol tax themselves. Air IT. T Armstrong said it would hr easy for the Government to save pome thing like £500.000 in defence expenditure. Instead of maintaining a comic onera system of hoy conscription it would he better to spend money ou disabled returned soldiers and tlieir dependents.

Mr Armstrong said the Budget did not offer any hope of solution of the unemployment problem, while on the other hand it disclosed many ways in which the burden oil the working man would be increased. He. believed 11,000 men could be employed on the South Island Main Trunk railway work alone. /He had heard strong opposition to the j completion of this work, hut he pointed out that the same arguments had I been raised against the construction of (the railway from Christchurch to the | West Coast, which had fully justified itself. He submitted that if the general manager were instructed to make the New Zealand railways pay ho could do so, but it> would lie a had business proposition for the country. It would drive the primary producers off the land altogether. The railways policy should he to provide efficient services at a reasonable cost, and if there were any losses on the operations it should he naid from the Consolidated Fund. He did not believe the Bail wav Commission would he able io tell the general manager anything he did not already know. The whole thing was a waste of time. Hon. A. J. Stall worthy said it had been stated there was nothing in tho Budget to provide for unemployment. Members would remember that special legislation had been introduced. to meet this nositiou, and he hoped it would provide a sound remedy. The Minister said the leader of the Opposition had referred to a “black” Budget. Perhaps black was a. fitting eolour to assume after If> years of Reform ad : minist' - ation. Others had described the Budget as "red,” “yellow.” and "blue.” and the only alternative to the theory that the critics were! colour-blind was that it was a. rainbow Budget. The Minister added tliat in +be Biblical sense the rainbow was a sign of promise, and be- trusted that; 1., the political sense the Budget was also a sign of promise embracing a change from the black times of the! past.

POST OFFICE SURPLUS

■ Bcplving, to the suggestion by Mr D 1 Jones tliat the surplus of the post olhc< i account should be employed to mee losses in other departments, Mr Stall worthy said it had to be realised thai the time might come when there would be full need for all the reserves thai the post office could accumulate. H( pointed out that the suggestion tliai the. railways would be seriously challenged by other forms of transport would not have been entertained, som< years ago. It- was likely there would be developments challenging the status ol the telegraph system. The time mighi come when as a. result of the progress in radio invention everybody would carry both receiving and transmitting sets as commonly as watches were carried nowadays. Mr K. S. Williams said lie thought Mr .Stallworthy had found the right mime lor the Budget. As he understood the meaning of “rainbow” it indicated that although there was going to be a Hood not everybody would be washed away. It would be a- relief for the people to- learn that although there was to be a Hood of taxation some of them would survive. Dealing with the petrol tax, Mr Williams- said while he realised that move money was required for roads he did not think it was sound policy to raise a. large sum from one section of the community and then place it in the Consolidated Fund for the use of all and sundry. He did not think motorists would object to the tax if it was clear it- was going to be used for roads-. The debate wys adjourned and the House- rose at midnight.