EXEMPTION PROM INCOME TAX

New Zealand Herald, Volume LV, Issue 16823, 13 April 1918, Page 8

EXEMPTION PROM INCOME TAX

UNDUE ADVANTAGE GIVEN. [JIT TELEGRAPH.—SPECIAL CORRESPONDENT.] WELLINGTON, Friday. The exemption from income tax of interest derived from war loan bonds was strongly opposed by Mr. C. J. Parr (Eden) m his speech on the Finance Rill to-night. This method of raising the bonds, he urged, gave a great and altogether undue 1 advantage to wealthy investors. He said that there were many cases of wealthy men realising on what "ordinarily were concidered gilt-edged securities, sach as firstclass 6 per cent, mortgages, in order to reinvest the money in war bonds. This action was not inspired by patriotism only. Sir Joseph Ward: How do you account for many of them selling their war loan bonds below par? Mr. Parr: 1 am not aware that that is to.

Sir Joseph Ward: Well, it is so. So many have been sold that I am asking the House not to count that as an investment in the war loan.

Mr. Parr said that the United Slates had abandoned the free of income tax principle, which was bound to lead to difficulties in the future. Tho bulk of the British war loan investments also were subject to income tax. He reiterated that the advantage that was afforded to the wealthy investors by the New Zealand system, as against persons of poorer means, was altogether wo inequitable.