CRITICISM IN HOUSE.

New Zealand Herald, Volume LXVI, Issue 20323, 2 August 1929, Page 15

CRITICISM IN HOUSE.

INCREASE IN PRIMAGE DUTY.

A VOLUME OF PROTEST.

INTERESTS OF CONSUMERS.

EFFECT ON COST OF LIVING. [BY TELEGRAPH. —PRESS ASSOCIATION.] WELLINGTON, "Thursday. When tlio House of Representatives met this evening tlio galleries were well filled and almost every member's seat was occupied. The Minister of Finance, Sir Joseph Ward, was applauded when he rose to read tlio Financial Statement.

Tho reading of tho Budget occupied one hour and fifty-five minutes. Sir Josoph Ward was loudly applauded on resuming his seat.

Sir Joseph Ward then moved that the priniago duties on imported goods bo increased from 1 per cent, to 2 per cent, after August 1. Tho Hon. W. Downio Stewart (Reform

—Dunedin West) asked what amount tho Minister of Finance estimated ho would obtain by doubling the priniago duty. Sir Joseph Ward replied that as nearly as ho could judge at present it would amount to between £200,000 and £300,000. Londoß Loan Transactions.

Mr. Stowart said this was a very important matter and it unfortunately was impossible at the present moment to debato fully its merits. He realised that all customs duties must operate immo diately without giving warning to the public. He was under tho impression, however, that the commercial community had been urging that the primage duty should bo reduced. The difficulty was

that the primage applied to all goods coming into the country whether dutiable or not.

Mr. Stowart said he wished to ask the Minister oi Finance another question. Ho had not heard any reference in the Budget concerning the statement that the Finance Minister had been hampered in tho London loan transactions. Did Sir Joseph Ward propose to deal with tho matter later on in the debate? There had been a direct charge against him (Mr. Stewart) and he wanted to hear what was meant. Sir Joseph Ward replied that he would take an early opportunity during the financial debate to refer to the subject and Mr. Stewart would then have an opportunity to reply. A Question of Principle.

Tho Leader of the Labour Party, Mr. 11. E. Holland, stated that the suggestion to double the primage duty was absolutely wrong in principle. This duty was not for tho purpose of conserving any manufacturing interest or any primary or secondary industry. It was purely for revenue purposo. They had had declarations that that principle was entirely wrong. The customs tax should be for safeguarding our Own industries. When it was imposed for revenue purposes it meant a reduction in the purchasing power of tho people receiving smaller incomes. Tf the Minister obtained £200,000 from an increased primage duty it would amount to £400,000 at the very least by

the time it reached the consumer. Sir Joseph Ward stated that there was a deficit in tho revenue of £900,000 to bo made up to balance accounts at tho end of the year. In what other direction could lie "get that amount? He was hopeful it would be possible to remove the increase at tho end of tho present year. Ho contended that this increase of 1 per cent, could not be passed on to tlio consumer. It was not large enough to be collected. , T \ In reply to another remark. Sir Josepti Ward said tho land and income tax did not affect small farmers. There were 40.000 who did not come under the taxation scheme. Only the large landowncis were going to be taxed. Various Members' Opinions.

Mr A. Harris (Reform—Waitemata) stated that the increased primage duty would create eonstornationn throughout the country. The 1 per cent at present charged was passed on to the consumer, and ho was sure the additional amount would also be passed on. Mr. P. Fraser (Labour— Wellington Central) said lie regretted that tho Minister of Finance had not decided to raise tho whole £900.000 deficit by means ol direct taxation. He would have preferred an increased land and income tax to such indirect taxation as primage duty. Mr. W. D. Lvsnar (Reform—Gisborne) expressed the opinion that the proposals affecting an increased taxation of farmers would not assist the Government's

land policy. Mr. J. McCombs (Labour— Lyttelton). said lie disapproved of the increased primage duty, but said he did not suggest rejecting a customs resolution. Tho Leader of the Opposition, Mr. J. G. Coates, said he did not think any Igood object would be served by continuing the discussion at present. There would bo an opportunity to refer to the subject later. Mr. C. 11. Chapman (Labour —Wellington North), stated that ho emphatically opposed tho proposal to increase tho primago duty and would vote .against tho

resolution. Mr. W. J. Poison (Independent—Stratford), expressed tho opinion that tho action proposed by Sir Joseph Ward was a fair and reasonable tiling in tho circumstances.

Mr. T. W. McDonald (Government— Wairarapa), praised the proposal to tax large landowners. The Town and the Country. Mr. D. Jones (Reform —Mid-Canter-bury), said tho effect of tho proposal was that the cities were to bear the burden of £IOO,OO0 —representing half the increase c>f primage duty—while the farmers were called on to bear a burden of £BOO,OOO. Sir Joseph Ward stated that all farmers were exempt, to the extent of £12,500 of unimproved value of land, from paying income tax.

Mr. H. E. Holland, rising to a point of order, suggested that- the whole dis-

cussion on the land and income tax was out of order. The only point before the House was tho increase in primage duty. The chairman of committees upheld Mr. Holland's contention.

Mr. F. Langstone (Labour —Waimarino) expressed regret at the increase of primage duty. Mr. H. M. Rushworth (Country—Bay of Islands) said lie felt it his duty to protest against any taxation that would detrimentally affect the necessities of lifo and the implements of production. Messrs. 11. »S. >S. Kyle (Reform —Riccarton), W. L. Martin (Labour —Raglan) and A. M. S'anmel (Thames) spoke in terms of dissatisfaction with the proposals. Mr. C. A. Wilkinson (Independent— Egmont) supported tho view that the increased primage duty would be passed on to the consumer. Adoption of tho Resolution. Mr. J. T. Ilogan (Independent—Rangitikei) said it seemed that members were making too much fuss about an increaso that would operate for less than a year. Most of tho taxation would not fall on those who could not afford it. He gave figures indicating tho value of imports of motor-cars, confectionery, etc. Ho suggested that tho Minister of Finance could have raised the whole of tho needed amount by u tax on American goods alone. Mr. C. L. Carr (Labour —Timaru) protested against what ho termed indiscriminate taxation. He agreed with the remarks of Mr. Hogan concerning the taxon foreign goods. , Mr. I). MiDougall (Government — Mataura) appealed for tho termination of the debate. The resolution was then adopted on the voices.