DOMINION WAR LOAN.

New Zealand Herald, Volume LIV, Issue 16620, 17 August 1917, Page 6

DOMINION WAR LOAN.

METHODS OF INVESTING.

CERTIFICATES AND BONDS.

Numerous inquiries were made at the Auckland post office yesterday regarding the various methods of investing in the Dominion war loan, the inquirers being chiefly small investors. As was the case with the previous Dominion loan, a special war loan department has been opened in the main post office building, to the left of the main entrance. The officers of the department are now busily engaged in preparing to receive local applications for war bonds and certificates, and in organising the sub-offices in the district for dealing with applications in the country.

The war loan certificates are issued under the same conditions as was the case with the previous Dominion loan, with the exception that certificates may now be secured to mature in 10 years. On payment of 16s in cash a certificate for £1, payable in five years, will be issued, and £8 will secure a £10 certificate, payable in the same period. The price of a certificate for £1, maturing in 10 years, is 13s, and of a £10 certificate for the same period, £6 10s. The certificates are for the small investor, who will receive the same interest as the large investor. They are payable to bearer, and can, therefore, be sold or otherwise transferred. The post office will accept the custody of certificates free of charge. Post office war bonds, in one denomination of £100, are also being issued, bearing interest at the rate of 5 per cent. The currency of these bonds is 10 years, and no person may purchase more than five of them, or war loan certificates of a greater value than £500. The post office war bonds are subject to income tax, but to anyone whose income for taxation purposes is below £300, the investment is undoubtedly more advantageous than the 4j per cent, bonds. The interest on the bonds is payable halfyearly, on May 15 and November 15. The war loan per cent, bonds are issued free of income tax for a £erm of 21 years, in denominations of £100, £500, £1000, or for any larger sum required. Interest is payable half-yearly, on production of coupons, attached to the bonds, at any post office or branch of the Bank of New Zealand. If an investor desires it he may purchase inscribed stock, in which case interest will be paid by dividend warrant from the Treasury.

PUBLIC'S DUTY TO SUBSCRIBE.

VIEWS OF MR. ROBERT BURNS.

Discussing the terms of the new Dominion war loan yesterday, the president of the Auckland Chamber of Commerce, Mr. Robert Burns, expressed the opinion that it should be a matter of duty on the part of the public to subscribe to it as largely as possible. The chamber had made representations to the Government-, through the Hon. A. M. Myers, when he was Acting-Minister for Finance, that war loan bonds should be accepted in payment of death duties, and he was leased to see that £1,000,000 of the loan ad been allocated for that purpose. He thought, however, it would have been better to leave the amount open, thus having as much as possible subscribed. In Great Britain subscribers could use the war loan for the payment of death duties and of excess profit tax. The rate of interest on the present loan) and the question whether it should be free of income tax were debatable points, said Mr. Burns. Personally he thought it would have been better to have increased the interest and to have made the loan subject to income tax. This would have resulted in larger subscriptions, he thought. He was also afraid that the issuing of the loan at cent, free of income tax would have a tendency to harden mortgage rates considerably. In Auckland a substantial proportion of the money lent on mortgages was advanced by the larger institutions, all of whom would be paying income tax at the rate of 7s 6d in the £. In order to equal per cent, income tax free, these institutions would have to get over 6£ per cent, on money 'ent on mortgages. ' Another point mentioned by Mr. Burns was that in the Old Country numbers of employers assisted their employees to take up loan bonds by advancing them the necessary money, and deducting a stated amount from their wages. He thought this action should be followed here. The publicity given to the war loans in Britain and the co-operation given by the war loan associations might also be emulated with advantage. The Government had spoken of compulsory clauses in connection with the loan, and Mr. Burns considered that it would have been advisable to have giv-.-n the public the gist of that proposal when issuing the prospectus. Notwithstanding that he might not altoether approve of the terms of the loan, Mr. Burns said, it was the duty of everybody to do his utmost to make it a success. Knowing the great financial strain on Britain, it was incumbent on the people of the Dominion to do what they could to assist in relieving the strain. The chamber was quite willing to co-operate with the Government to this end.