WAR LOAN

Manawatu Standard, Volume LX, Issue 256, 26 September 1940, Page 6

WAR LOAN

LOCAL ISSUE ANNOUNCED.

MINIMUM OF £8,000,000

Per Press Association. WELLINGTON, Sept. 25. Hon.-'W. Nash (Minister of 1-m----ance) announced to-night that arrangements had been completed for the issue of the war loan locally and prospectuses would be available throughout the Dominion by the end of this week.

“As has been previously indicated, the war expenditure during tiie pie* sent financial year is estimated at about £38,000,000. of which approximately half will be in New Zealand and the other half overseas, said Mr Nash “Of the amount required to be raised in New Zealand special taxation is estimated to provide £14,000 000, leaving approximately £5,000,000 to be raised] by loan. “In addition to this £5,000,000 needed for local requirements, as pointed out in the Budget, we must endeavour to raise w-ithin New .Zealand some portion of the amount required to meet the expenditure abroad, thus relieving as far as possible the drain upon the resources of the British Government.

“The present loan issue is estimated to provide a minimum of £8,000,000, but as set out in the prospectus persons who have already contributed free-of-interest loans will hiave the option of converting them into this issue, and persons who have made gifts to the war expenses account may reduce their contributions to the loan accordingly.”

ISSUE OF GOVERNMENT STOCK. The prospectus provides for the issue of Government stock which will be noninterest bearing to October 1, 1943, and will thereafter till October 1, 1953, when the principal is repayable, bear interest at 2J- per cent, per annum. The first interest payment, of £1 os per cent, will be made on April 1, 1944, and thereafter payments will be made half-yearly. Any 6tock issued to an applicant in terms of the prospectus, will be accepted at par at any time before maturity in payment of death duties in respect of the applicant’s estate. The price of issue is £IOO per cent, and is payable as follows: On Application ...... £3O per cent. On December 16, 1940, £4O per cent. On March 25, 1941, ... £3O per cent. “The loan is being raised in accordance with the provisions of the New Zealand Loans Act, 1932, whereby interest and principal are a direct charge on the public revenues of the Dominion. Applications for issue of the stock will be received by the Reserve Bank of New Zealand up to October 18 when the loan will close.”

MINIMUM SUBSCRIPTION

The Minister of Finance has indicated that for the purposes of the Finance Emergency Regulations, 1940 (No. 2) he will not regard any person as having subscribed in due proportion to bis means unless such person has subscribed to this loan i at least the amount of the income tax payable by him in respect of income derived during the year ended March 31, 1939, being the tax normally payable in February, 1940, decreased in the case of individuals by £SO and in the case of companies by £7O.

For the purposes of computing this minimum subscription, which must be calculated to the nearest multiple of £lO any income that was free of income tax in the hands of the recipient shall be deemed to have been subject to such taxation. The tax-free income which would be taken into account in this way includes dividends other than those from companies incorporated in New Zealand, interest from tax-free Government stock and from tax-free company debentures, tax-free income derived from abroad and also farming income where the land used had an unimproved value of less than £3OOO.

POSITION OF TRUSTEES

“The Trustees Act, 1908, authorises trustees to invest in Government securities, and special provisions affecting trustees are contained in Regulation 20 of the Finance Emergency Regulations, 1940 (No. '2), the effect of which is that no obligation or Rotation imposed on any trustee by virtue of any trust, instrument, or otherwise shall prevent or excuse him from compliance with any direction, notice or requirement under those regulations,” said the Minister. “Copies of the prospectus and forms of cash application will bo available within a day or two at the Reserve Bank/Wellington, district Treasury offices in Auckland, Christchurch and Dunedin, at any postal money-order offices or from members of any stock exchange in the Dominion, but neither the banks nor the stockbrokers will receive any commission for their services in connection with this particular loan.” In commenting on the issue, Mr Nash stated that while all are expected to contribute a minimum in accord with their means, the prospectus\is a general invitation to everyone to assist in tlie war efforts by subscribing as much as possible. “T hope,” he said, “that there will be a generous response to the invitation to subscribe to the loan, the proceeds of which will be used solely for equipping and maintaining our armed forces in the Dominion or overseas and other war purposes.”