FINANCE BILL UNDER FIRE.

Horowhenua Chronicle, 19 August 1930, Page 2

FINANCE BILL UNDER FIRE.

VARIOUS PROVISIONS CRITICISED

THE PETROL TAX AGAIN

WELLINGTON, Last Night,

In moving the second -reading of the Finance Bill in the House of Representatives this afternoon Hon. G. W. Forbes said he thought members would realise that taxation had been adjusted as fairly and .equitably as possible. After explaining the Bill on the lines of the description given on its introduction the Prime Minister said it was just as well members should bo reminded that the recent drop in the totalisator returns was in no way due to the increased tax which had not yet been applied. Hs had been informed by a deputation from a racing club that the increase ;n the totalisator tax would result in reduced investments, but it could not be claimed that the present drop was due to that reason. He believed that at a time like the present the totalisator offered a fair fund from which a certain amount of revenue might be obtained. He did not think the majority of people w?io were in a position to cxpomLmoney on betting would object to un increase. They would lake it in a sporting spirit. He personally considered that most people were pleased after betting a pound to get back anything at all. The amusement tax was another quarter m which he thought the Government was justified, in the present circumstances to look for revenue.

In conclusion, Mr Forbes stated the Bill was estimated to produce something like £447,000 made up as follows: £ Stamp duties • 41,000 Bank note duties 50,000 Totalisator duties 100,000 Death dutiois and gift duties 45,000 Amusement tax 70,000 Film hire tax • 50,000 Sharebrokers’ fee tax .... 1,000 Land assurance fund .. .. 60,000 Interest on reparations .. .. 30,000 Opposition’s Criticism.

The leader of tne Opposition (Mr Coates) said the cry, “We must balance our Budgethad gone far and wide. It was to be achieved at all costs. The Reform party was opposed ro the Finance Bill because it imposed taxation indiscriminately. It was imposed irrespective of who was taxed or how he" was taxed and the reasons for the various forms had not been given. The •Government had simply stated it was going to impose taxation. It had tailed to cut down its expenditure and had instead put forward proposals which he considered were purely the production of the Treasury. Mr Coates added that some c-t the proposals had previously been submitted to him, but diey had then been rejected as the House should reject them to-.lay. The Bill proposed to tax undertakings while no one knew what would, bo the effect o? such taxation.

Dealing with the petrol tax he said he could not understand why the cities should not continue to receive 8 per cent. They had received 8 per cent, when the tax was fourpence, but now they were to receive only 54 per cent. He characterised this as parsimony.

Mr Coates urged the Prime Minister to include Js’6d tickets among those exempted frofii the amusement tax. He pointed out that the Is 6d seat was a very popular one and nothing should be done to impose a further strain on theatre firms which as a result of the changeover from silent to sound films were by no means in a flourishing condition. Mr Coates also objected to the .10 .per cent taxation on British sound films.

The refusal to grant £200,000 as a subsidy for local body rates was sufficiently serious to require the confirmacion of the electors. The Government said it would pay the money just the same, but it was the taxpayer who would have to pay it. Any farmer who had a motor lorry or who used petrol tor any form of conveyance by road would be helping to pay the subsidy on his own rates which had formerly been forthcoming from the Consolidated Fund.

Briefly referring to the increased totalisator tax Mr Coates contended, it would force more money into the hands of the bookmaker?.

The deputy leader of the Labour party (Mr M. J. Savage) said he thought the Government would be well advised to reconsider the matter of the petrol tax. Local bodies had not raised any objection to the principle, of the tax and so long as they accepted the principle they should be prepared ■ for the distribution of the money in the directions it was most needed. He did not think there could be any complaino about breaking an honourable arrangement, The people had voted for a change of Government and that usually meant they desired a change of fundamentals. Ho objected to the principle of the petrol tax, but since it Ayas imposed he was not greatly concerned so long as the local bodies did K.ot lose anything in.the aggregate. Referring to the film hire tax Mr Savage suggested that something in the nature of a rebate might be granted to theatres which employed a certain number of musicians. Such a rebate would amount to the protection of a New Zealand profession, Sound films were causing a great deal of unemployment among professional musicians and he thought the suggestion of a rebate was w'orthy of the serious consideration of the Minister.

Referring to the Bill as a whole Mr Savage said his greatest regret was that the Government had not taken the gloves off altogether and imposed tax-

stion in such a way as to strike those best able, to bear it. All parties favoured this principle when speaking on Hie hustings but it was hard to got a Minister to put it into effect. Indirect taxation w r as the easiest to impose and for that reason it was_ chosen instead of a direct tax on big incomes. Indirect taxation was usually passed on until it reached those people who were unable to resist it. Mr Savage said he would have preferred a straight-out tax on the incomes of banks rather than a tax on banknotes which would eventually result in that particular phase of the banks' operations being brought somewhat into disuse. Reverting to the subject of the petrol tas Mr Savage said he thought the Government might reconsider its alloea* tion. There was certainly room for a difference of opinion and it seemed unjust that there should be such a large portion for country areas compared with the share for boroughs.

After a number of members had spoken, Hon. E, A. Ransom replied. He said Mr. Coates had indicated to the House that he had brushed aside certain recommendations of the Treasury. Mr. Ransom remarked that this countrymight have been in a more happy position financially to-day if Mr. Coates had taken more notice of th» advice from the Treasury Department. The Minister said it was claimed that there had been payments from the Consolidated Fund for reading before the petrol tax was ever introduced, but he pointed out that the Government had last year expended £600,000 on reading in connection . with relief works. Ho contended that there had been a reckless policy of spending. As a result large sums had been placed at the disposal of the Highways Board. While it was not claimed that the roads constructed wore not good ones or wore unnecessary, there was, however, very little evidence that the primary producer had gained, much advantage from tlrem. His rates certainly had not been reduced. It therefore became apparent that the user of the road instead of the ratepayer should be called on to pay for the roads. The Minister declared that the £220,000 subsidy for local body rates would be paid in- exactly the same proportion as formerly. He criticised the attitude of the .Reform party during the debate on the Customs Amendment Bill and asserted that the result of its opposition to the petrol tax would mean that the outlying districts would this year be dc prived of a large sura of money which was urgently required for reading. When a full year's revenue from the petrol tax was available next year the programme of reading for the outlying districts would be laid before the House.