OUR FINANCES

Hawke's Bay Tribune, Volume XIX, Issue 220, 4 September 1929, Page 6

OUR FINANCES

BUDGET DEBATE UNFINISHED LAND TAX PROPOSALS. RAILWAYS POLICY. Wellington, Sept. 3. The Financial Debate was resumed in the House of Representatives this afternoon by Mr A. Al. Samuel (Ref. Thames), who insisted that the increase in the primage duty would be passed on by the importer to the retailer and by the latter to the consumer, and in each case it would be added plus charges. He urged increasing the duty on foreign motor cars and cinematograph films as a means of raising additional revenue. Ho alelegod that the public works of the country were being converted into relief works and he asserted that men in the Public Works, Lands and Post and Telegraph Departments were being dismissed and placed on other works. He advocated a policy of reading and metalling in conjunction with land settlement as a means of solving the unemployment problem. Mr T. W. AlcDonald (United, Wairarapa) said that the first object of the land tax proposals was to yield revenue, and the second was to break up big estates in order that people who were land-hungry would have an opportunity of taking up land. The big landowners of the country had for many years been escaping their just share of taxation. That was the outcome of the policy of the Reform party who had taken taxation off the shoulders of the big man and placed it on to the small man. He refuted a suggestion that the proposed land tax was a penal tax, and asked if the land tax of the Reform Government when applied was not a penal tax in that it was. aimed at breaking up large estates. Air AlacDonald said he agreed that there should be modification of the mortgage exemption proposals in the Budget, and he had work ed out a system which he thought would be more equitable. Under the scheme he suggested there should be complete exemption to £5OOO, and above that sum and up to £lO,OOO the proportion to be exempted should be based on the ratio of unimproved value of the land. Exemption should be allowed only on that portion that had relation to land tax and under the scale he had worked out it would entirely disappear at £14,000. “INIQUITOUS” PROPOSALS. Mr H. Holland (Ref., Christchurch North) said that the farmers of North Canterbury had urged him to use all the means in his power to oppose what they described as the “iniquitous” land taxation proposals. Air Holland went on to analyse the Budget, which, he said, bore wonderful testimony to the benefits of the Reform administration.

Air Holland congratulated the Government on its decision to complete the South Island main trunk railway. Alany of the arguments which were being advanced agaiqst the completion of this railway had been used to oppose the Arthur’s Pass tunnel, which, he said. had already more than justified its completion. Air Holland referred to superannuation, and suggested that the members of the police force did not fare well under the present scheme. The average policeman’s duties were arduous, and it might resonably be urged that the members of the force should bo entitled to superannuation after thirty-five, insteady of forty years’ service.

The Hon. T. Al. Wilford: A new bill has been partly drafted already. Air P. Fraser (Lab., Wellington Central) expressed his disappointment that unemployment insurance legislation was to be held over till next session. However, he was glad that such legislation was being considered by the Government. Mr Fraser reviewed the references to the London loan transactions, and stated that so far as he could ascertain there was absolutely nothing on the file or in tho circumstances which showed that Sir Joseph Ward had been compelled to act as he had. He had had freedom of choice and he had acted wisely. Any other incoming Finance Minister would have followed the same course. He would not have dared to have rejected the advice of those most intimately in touch with the London money market. It was undoubtedly the state of the money market (and nobody in the House of Representatives or in this country could control the money market in London) that had compelled him to select the course he had adopted. Mr Fraser added that having raised money as he had promised Sir Joseph Ward was now expected to carry out the rest of his promises. There was no excuse for his not doing so. He would not be blamed for not achieving everything at once, but the country was looking for some signs of progress. In conclusion Air Fraser asked the Prime Alinister to reconsider the increase in the primage tax, and stated that he personally preferred an increase in ordinary customs duty or in income taxation. He could not see how the increase in land tax could destroy land values. The Lab-

our party would help the Government to put the land taxation through, and it hoped that the Prime Minister would meet it in regard to the primage duty; that at least he would modify it to the extent of removing it from the necessities of life.

Mr W. H. Field (Ref., Otaki) stated that he had o-posed the Palmerston North deviation in the first place, but he had not received sufficient support, and it had been decided to undertake the work. It was therefore a matter of great gratification to him that the present Government had decided to discontiue the work, even though a largo sum of money had already been spent. Mr Field suggested that the completion of the South Island main trunk railways might very well be delayed till the finances of the country were in a more satisfactory state, and he complimented the Prime Alinister on his decision to have the route of the Alidland line thoroughly resurveyed in view of the recent earthquake. He hoped the Rotorua-Taupo railway had not been permanently abandoned. He agreed that in view of the present transport conditions serious consideration should be given to the question whether it was advisable to construct any more railways, though he considered the linking of New Plymouth with the Alain Trunk line was a task which should be undertaken. He expressed the hope that the., taxation proposals would be remodelled. At any rate, they should be substantially amended They would have a serious effect in cases not only of heavily mortgaged land, but also of heavily overvalued land. The House rose at 10.30 p.m.