LAND AND INCOME TAX BILL

Poverty Bay Herald, Volume XLVIII, Issue 15955, 17 October 1922, Page 6

LAND AND INCOME TAX BILL

During the debate on the Land and Income Tax Bill, Mr. Sidey found fault with the clause reducing the rate of tax on premiums in respect of insurance contracts with foreign companies not carrying on business in New Zealand. He said that lie understood' the 10 per cent, taxation at present imposed on the premiums paid to foreign insurance companies was equivalent to the present maximum taxation of New Zealand companies (8s 9d in the £). It was now proposed to reduce the maximum taxation of New Zealand companies to 7s 4d in the £. The foreign companies, under the clause ho was referring to, were to receive the benefit of a 50 per cent, reduction in taxation, while the New Zealand companies had their taxation reduced by oniy Is 5d in the £. The Prime Minister said ha resented any suggestion that he was anxious to favor foreign companies. Until last year the tax on premiums paid to companies outside New Zealand had been so small as hardly to be worth collecting. The companies at Home had protested to the High Commissioner and the reduction from 10 to 5 per cent, was proposed in consequence of advice from New Zealand’s representatives in Britain. The fact was that if they were refused any concession the companies could do tiie business in London without putting it through New Zealand hands at all. The danger was that Borthwick and Company and other big firms dealing in New Zealand meat would effect their insurance at Home, instead of through New Zealand companies.

A Reform member: They are doing it already. Mr. Massey' added that he was not quite satisfied with the clause. Hd would be reporting progress on clause 4 and would Like the opportunity of reconsidering clause 12 also. Mr. W. D. Lysnar (Gisborne) held that tho New Zealand producers or New Zealand insurers would benefit under the clause. It would encourage'Lloyd’s and other companies to do business here, and that was the only way to keep rates down here. Not so long ago the New Zealand companies were charging as much as 66s 7d. Mr. .Sidey expressed the hope that tho foreign companies would not be allowed any unfair advantage in their competition with the New Zealand companies. Mr. Massey said that it would bo his endeavor to secure that.