THE NEW TAXATION.

Lyttelton Times, Volume LXXIX, Issue 9988, 17 March 1893, Page 5

THE NEW TAXATION.

[Special to Dress association.] LONDON, March T 5. The debenture holders of the Wel-lington-Manawatu Railway Company complain of the non-exception of their debentures from the operation of the new taxation in New Zealand as a breach of agreement by the Government. [Per Press Association.] DUNEDIN, March 16. 11 At the meeting of the Kempfchorne, Prosser Company, the Chairman, referring to the new taxation, said Government taxation is far too heavy on a manufacturing Company like ours, which creates employment for so many people. We have paid this year in taxation a large proportion of our net earnings, besides heavy Municipal and County rates. The " dead set ” which the Legislature has made on joint stock Companies, which are merely co-operative industrial concerns, is a puzzle to business men, who may be excused if they incline to tho belief that a political tyro has had a trifle too much say in the legislation of recent years. Doubtless the pendulum will swing back shortly and bring with it common sense. Wo say distinctly that we shall decline to be ranked among the " social pests,” so called. We are Liberal to the backbone, as all our customers know, and demand only a fair field and no favour. There is another tax which; although it does not seriously affect this Company, should nob be allowed to pass while wa are on the subject of taxation. I refer to tho tax on Company debentures. You will remember that Parliament, in its wisdom, passed aa Act imposing fresh taxation on debenture capital, compelling those Companies which had' issued debentures to pay the tax, but giving them power to deduct the amount from the debenture-holder when paying him interest. Wo borrowed money in London at 5 per cent, mostly from tbe Company’s own constituents and friends, and, pursuant to this Act, we should deduct tho tax from the coupons; but your Board, feeling strongly the injustice of the imposition, outside the question of ita legality as affecting contracts entered into out of tho Colony, has resolved to pay the tax out of the Company’s funds, and I will ask you to sanction ita action as a right thing to do in the circumstances. This attempt on the part of the Legislature to raise revenue by special taxation of moneylenders and mortgagees is surely founded on the most surprising ignorance of the ordinary Mwa governing financial dealings. It is vain to think that in this species of taxation you roach the pockets of capitalists; in the long run, most assuredly, the tax is paid by the unfortunate debtor, who is doubly punished because of his necessities. I would reverse this policy, and grant special encouragement* to all people who bring money into the country.