THE FINANCE BILL.

Manawatu Standard, Volume LVII, Issue 304, 23 November 1937, Page 9

THE FINANCE BILL.

authority to borrow. “NOT FROM OVERSEAS.” Per Press Association. WELLINGTON, Nov. 22. When the House resumed at 7.30 the Minister of Finance (Hon. W. Nash) moved the second reading of the Finance Bill. He said the main Bill was divided into four or five parts. One part dealt with soldiers’ Settlement, and it was anticipated that in writing off this account the total loss would be £6,820,000. It was the account only which was being done away with, not the other legislation dealing with soldier settlment. With regard to the wiping off of the State Advances account, when all the accounts were settled up there would be only a comparatively small amount to be written off. ‘ i Another part of the Bill, said Mr Nash, gave authority for the borrowing of £6,000,000 for public works. This amount was not immediately necessary, and the Government was trying to make provision for all public works during this session until the commencement of the next session, but the authority was there for the borrowing of the six millions or part thereof, if required. Mr W. P. Endean : Where will you borrow that money from ? Mr Nash: I think mostly in the Dominion, but certainly not overseas. In reply to a further interjection by Mr Endean, who said he only wished to know how the public money was being spent, Mr Nash said there was no suggestion that any money was being spent in New Zealand in anything but an open manner and it was a pity the honourable gentleman should go to Sydney and make statements in the Press that were derogatory to the interests of the Dominion. LAND TAX RELIEF. Referring to the setting up of the hardship committee, under the graduated land tax, the Minister said, it would operate for two years and deal with taxes falling due on March 31, 1937, also on March 31, 1938. It would comprise the Commissioner of Taxes, Solicitor-General, and Secretary of the Treasury. It would deal with cases where hardship existed, and the committee *» would be limited in the scope of its inquiry, and would be able to recommend to the Minister what relief It thought might he necessary. The Minister could then recommend that the relief. suggested could be granted ~ ' The Minister proceeded to deal "with the provisions in the Bill covering payment of income tax by goldmining companies, which he said paid incomo tax not on income but on profits. The Bill would enable taxes to he levied on the assets of companies which had been transferred overseas. Another clause exempted from stamp duty all transfers of houses from local authorities. It had arisen through the requirement of the Dunedin City Council, which had done splendid work in erecting houses to relieve the housing shortage and desired to transfer the ownership of the houses to private individuals. Another section increased the time during which persons in receipt of invalidity pensions might lie absent from the Dominion without forfeiting their pensions. dairy produce sales.. Dealing with the provisions in the Bill providing for payment of the new season’s price for butterfat or produce exported between July 31 and September 4 the Minister stated that the total difference would amount to £38,000. This sum would be distributed to dairy companies for distribution to farmers as soon as the Bill was passed and the accounts were in order, the next clause in the Bill dealt with differential cheese payments, the extra farthing provided for in the Bill enabling butterfat suppliers for cheese to receive an average of lid per lb more than did the suppliers of butter. The total cost of this increase would be about £165,000. Speaking of the Internal Marketing Department, Mr Nasli said the Bill would enable the department to carry on. PURCHASE OF BUSINESS. Opposition members: How much did Picot Brothers cost? Mr Nash: I think it was about £60,000 for the assets. He added that if the company had been sold on the Stock Exchange it would have brought about twice as much as the Government had paid for the company. It was one of the finest distributive organisations in the Dominion. Mr S. G. Holland: How much did the goodwill cost ? •Mr Nash: I’ll tell the honourable gentleman that a little later. -Mr Holland: We would like to know the amount for goodwill. The Minister replied that it would be advisable to have the discussion on that on the Estimates or when considering the department’s report. Members wore certainly entitled to know what the sum was and he would certainly tell them. OPPOSITION’S OBSERVATIONS. The Leader of the Opposition (Hon. A. Hamilton) said there were 40 different subjects discussed in the Bill, and he did not intend to deal with them all in his lialf-haur‘s speech that evening. He said he had been pleased to learn from the Minister that the State Advances account Was in a healthy condition. The State Advances system had worked very well in its day. Commenting on the provision in the Bill to borrow £6,000,000 for public works, Mr Hamilton said the Government was a great borrower but objected to paying interest. Why should it borrow if it did not pay interest? Mr Savage: There is nothing objecting to paying interest in the Bill. Mr Hamilton : Yesbut it is a wellrecognised plank of the Labour Party. In fact some .members of that party have intimated that ..interest will be abolished altogether.

Hon. W. E. Parry: Quite a lot of Christian people agree with that. Mr Hamilton: I think the honourable gentleman had better leave Christianity out of the discussion on this Bill. I am prepared to debate it with him at another time, but not in connection with this Bill. INEQUITABLE TAX. Mr Hamilton continued to deal with the hardship clause under the graduated Land tax. stating that the Bill carried out the Minister’s promise to set up a committee to investigate hardship under the tax. He thought it was a very conservative committee, two of its members being tax collectors themselves. He thought the graduated land tax should be abolished altogether because it was most inequitable and was 90 per cent, unjustified. Until there was a classification of land there was no justification for the graduated land tax at all. It bit companies with branches throughout the Dominion, and also large farmers whose holdings might be quite unsuitable for subdivision. A clause should be inserted in the hardship clause stipulating that the person’s ability to pay should be considered in the assessment of the tax. He thought it unwise that the committee should have to refer its decisions as to who paid the tax to the Minister. The Minister should write the' law and leave it to his officers to administer it. Mr Hamilton said he failed to see why the Minister had not put the price paid for Picot Brothers in the Bill. Mr Nash: I told the House just over £60,000. Mr Hamilton : You don’t want any suspicion about what you pay for a thing. When I was Minister of Broadcasting and we bought the broadcasting station we came straight away and told the House about it, being glad to get rid of it as early as possible (laughter). Mr J. G. Barclay said the Leader of the Opposition had criticised the graduated land tax as unjust, but a commission had been set up to deal with 2 or 3 per cent, of losses where injustice had occurred. The tax could be justified a 100 per cent, and the bulk of it was paid in the cities. ONLY FOURTEEN MEMBERS. At this juncture Mr W. J. Broadfoot rose to a point of order, drawing attention to the fact that there were only 14 members in the House and the bells were rung until the required number resumed their seats to make a quorum. Resuming his speech, Mr Barclay pointed to the fact that even after the ringing of the bells there were still only three members of the Opposition in their seats. Mr Barclay continued that the present Government was spending the money it borrowed more wisely than any previous Government had done. The Minister, he said, had dealt with the farmers both generously and fairly. How much control had the farmers over the marketing of their produce in the past? he asked. Farmers put their milk or cream cans outside their gates and a milk lorry came along and collected them. They had no more say in the marketing of their produce then than they did now, but to-day they were getting a much fairer deal than they were in the past. Mr W. J. Broadfoot said Mr Barclay’s contention that the farmer previously had little control of marketing his produce was a poor compliment to the wonderful co-operative system which had done so much to build up the dairying industry in the Dominion. The Minister’s statement regarding orthodox borrowing did not square with other statements from his party, though he thought these were intended to please the monetary reformers. The committee to investigate hardship in connection with the land tax included two officers interested in maintaining revenue and only one with judicial experience. The necessity for the graduated land tax to break up large estates had disappeared. The debate had not concluded when the House rose at 10.30.