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Northern Advocate, 31 July 1924, Page 5

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: SURPLUS ANNOUNCEMENT, j •. - i 1 i i " DEPARTURE FROM PRACTICE. - SOME SIDEY INFERENCES. (Special to "Northern Advocate.") WELLINGTON, This Day. The reluctance of Mr Massey to announce the Budget surplus was attacked by Mr T. K. Sidey (Duaedin j South), who resumed the financial de- j bate in the House yesterday* ! Mr Sidey said that for some reason «r other the Prime Minister this year ceemed rehictant to announce Ms surplus. It had been a general practice in the past for Ministers of Finance to make a public statement as to the financial position before waiting for the publication of the accounts in the -Gazette. He had gone back to 1919, in which year he was acting Minister •and made such a statement, and he found that the only years in which no suck indication had been given as to the position at the close of the financial year were the years 1320 and 1924. It may "have been only a coincidence that these two years were years of railway strikes. It was more charitable to suggest that the Minister was preoccupied in the former year with the Prince of Wales' visit and in the latter with the visit of the fleet; but «ven London was given more information than New Zealand this year, for in the "beginning- of May London was informed in the loan prospectus that the surplus for the year was over £1,500,000. The surplus was really greater than shown, because of an outstanding asset of £540/000. From this should reasonably be deducted an increase in outstanding liabilities amounting to £123,000, •but the addition of £417,000 brought the surplus up to not far short of £2,225,000. Perhaps the Prime Minister's reluctance to announce his surplus was due to his consciousness that it was too big and that he was taking too mucli money out of the pockets of the people. COST OF LOANS. On the~sul>jeet of the 1924 loan Mr Sidey said that the country was never able to obtain precise information as to the actual cost and consequently the actual rate of interest on its borrowings in London until about two years tad elapsed, deferring to the last loan, the Budget stated that the interest yield to investors was £4 14s 9d. That statement did not disclose as ' muck information as could and should "have been given. The London "Times" referring to this loan said that the running yield was £4 14s 9d and that the total average yield, allowing for the bonus payable on redemption, was £4 18s Id. When brokerage, advertising and other charges and expenses ■were added, and when the cost of administration by the Advances Office was taken into account, it was clear that this money could not be lent out by that Department at 4$ per cent, and might not even "be profitably employed at 5§ per cent. He supposed it was intended that this money would replace money available at a lower rate, and no doubt the loan from the accumulated surpluses to the Advances Office of over £2,000,000 was so employed, as it was available for lending at the lowest rates. TAXATION INCIDENCE. Mr F. J. Rolleston (Timaru), who always is listened to with attentior, delivered an interesting speech. Ho contended that no remission of taxation was justified this year.. If it were not justified last year it was not justified this year. Remissions now might mean increases later. He would not object to readjustment of taxation. Customs duties might be reduced, but what was reduced in the customs should be taken direct. It was said

that high taxation drove capital out of the country. If that were so it did not say very much for the patriotism of those who withdrew their capital, and if they did so he would like to know where they would get better terms than in New Zealand. In his view the suggestion tTmt taxation drove away capital was quite illusory. Could it be said that a tax of £220 on an income of £2220 was excessive for being freed from the menace of German domination. It was not right to ■exclude from the Taxation Commission a political economist and representatives of Labour.

Regarding the findings of the Commission with respect to company taxation, Mr Rolleston said he thought it would be a mistake to wait until 1925 or 1926 before altering the incidence and removing the injustices and anomalies. These should be removed ■without delay. If the Commissioner of Taxes were to call upon every taxpayer to send in a return of his income from , all sources the returns could be in j within a couple of months from now, | and if Parliament were sitting the •

matter could be discussed in view of the report of the Commission, it .seemed to him that it was not right to delay until, say, 1020 before altering the incidence of company taxation. Mr Rolleston added that the country would have to consMei- seriously its position in regard to borrowing if its credit were to be kept sound- He suggested that public works could be paid for out of rever/ue and that other works, if not urgent, could bo held over. This would enable a saving fco be made in rpspect to borrowing. There

• was quite enough to do in meeting the ' requirements of to-day without 'having | to meet the burden incurred by prej vious borrowing. If money were goj ing to bo borrowed continuously and i left to posterity to pay off, what ; would be the position of future genera- ; tions who would have, to meet, the debts which we accumulated for them ! and would have to pay for debts also I which had accrued before our time?