FINANCIAL PROPOSALS.

New Zealand Herald, Volume LV, Issue 16822, 12 April 1918, Page 4

FINANCIAL PROPOSALS.

NO INCREASE IN TAXATION. WAR LOAN OF £20,000,000. COMPI'LSORY SUBSCRIPTION. EXTENSION OF PARLIAMENT. [BY TELEGRAPH—SPECIAL CORRESPONDENT ] WELLINGTON. Thursday. W. Finance Hi'l was introduced in the House of Representatives this evening. The main purpose of the Hill is to extend 1 the annual appropriations to make a postponement of '.he Parliamentary scssiun possible. No increase in Iniation is proposed. On the contrary, exemptions from the amuseI ment tax are lo he made more generous. j Admission tickets to A. mid P. .shows are 'to be free of this tax, as a'to are tickets to entertainmeits promoted by societies not conducted or established for profit, provided he profits of the society are used fur educational or sutntilic purposes or the proper purposes of the soi eiy. Power is taken ti: borrow £20 000,000 for war purposes. The death dutiis stuck total is increased hum £2,000,100 to £2,500,000. The Bill gives etlect to the proposals for compelling wealthy persons to invest in the War Loan, as outlined by I Sir Joseph Wsrd on Wednesday The I Commissioner cf Taxes may, under this i clause, take action to lonipe. any man to I subscr.be according in lis moans, and investments :u War I/ian stock purchased from an original I investor, possibly at Le'.oiv par, are ; not to be considered subscriptions. If a man fa.ls to comply w.th an order to : contr.bute, he is to be subject to a penalty I of twice the amount oi his land and illI come lax, and he will receive only 3 per J cent., instead of 4$ per cent, for his compulsory contribution. All other compulsory provisions tire repealed. Local Bodies' Loans.

Loans to local bodies are made subject to the moratorium, and Are extended accordingly at the rates at which they were originally raised. Local bodies authorised by law to invest in war loans may, ■ with the consent of the Minister for Finance, raise the necessary funds for this investment by way of overdraft. Moving the second reading of the Bill, Sir Joseph Ward explained that it contained proposals covering the whole financial requirements up to December 31 on the basis of the present expenditure. That was the usual course in casej where a special session such as the present was hold. There would be no Estimates. These would be brought down next session. The Bill also provided for 3n increased amount of unauthorised expenditure in case the provision already made should prove insufficient. No alteration in the law was proposed in connection with land tax or income tax, and the war tax was also to be the Bame as last year. The amusement tax would be amended in the direction of exempting the admission fee paid for entering agricultural and pastoral shows, patriotic entertainments and some similar forms of entertainment. So far as the war loan was concerned, provision was again made for the purchase of war loan certificates on time payments bv employers for their employees. That .ystcm had been a great success in connection with the last war loan, and he hoped it would be so on this occasion. The Bill repealed the compulsory clauses of the former Act, but it pronosed to make "financial shirkers" pay in proportion to their means. That proportion would be determined by the Commissioner of Taxer, who will report to the Minister. Once it is determined that tho compulsory clauses should bo put into operation the shirker will be penalised to the extent of double the amount of land and income tax he has to pay. He will then have to make his contribution to the loan as determined by the Commissioner of Taxc, on which he will receive only 3 per rent War loan bonds and certificates bought from others at a discount will not be allowed to count as a contribution to the loan, rtor will tho person who sold them be allowed to count them. The Government wanted fresh money, and would not turn over the same money again and again. Dominion's Borrowing, The Bill gives power to raise £20,000,000 more for war purposes. This meant that since August, 1914, authority had been given to raise £85,393,830, of which £76,000,000 was for war purposes alone. Of that amount £32,500,000 had been raised in New Zealand, exclusive of the loan provided for in this Bill. Oversubscriptions, if any, would not be returned, but would be credited to the next loan. The period in which expiring local body loans could be renewed had been extended to 12 months after the war. Another clause provided for the further extension of the life of Parliament until December 19, 1919. This was necessary because it was impossible to hold a general election between the close of next session, which would probably open in October and December 19 of'this year. The Government had carefully considered the position, and had" come to the conclusion, after consulting members, that this was the best course to take. In conclusion, Sir Joseph Ward defended the proposal to raise the loan free of income tax as he said it was impossible to raiso the money required on other terms, Mr. G. W. Forbes (Hurunui) said the Houro must give the Government money required. Personally he was opposed to loan investments being free of .income tax, but as the Minister for Finance held strong opinions on the point he was not disposed to pit his opinion against that of the Minister during the present crisis. Mr. G. V. Pearce (Patea) said ho regretted that the Minister had not seen bis way to reduce the heavy taxation imposed last year. He approved of the compulsory powers in connection with the war loan, but thought the proposals in the Bill too indefinite. The Commissioner of Taxes had an absolutely freo hand to lay down what condition:! he chose. He might take all a man had Dr. A. K. Newman (Wellington East) said the proposal to make peoplo subscribe to the loan " according to means" was unsatisfactory, because it afforded no information to the taxpayer as to how much he wns expected to contribute. In its present form the clause was most vicious, and the composition of the Appeal Board was unsatisfactory. Mr. G. Witty (Riccarton) said he did not object to providing monev for war purposes, but he protested against the waste, which, bo said, was going on in the Defence Department. Parliament should not adjourn till the House was told how the Minister for Defence had been spending the money which the House had voted. He would oppose the proposal to extend the life of Parliament. The discussion was continued until 11.25 m., wbe-i the debate was adjourned until 11.30 am. to-morrow.