NEWS FROM THE CAPITAL

Taranaki Daily News, 2 September 1927, Page 10

NEWS FROM THE CAPITAL

THE RAGU N BY ELECTION HON. R. F. BOLLARD S SUCCESSOR. GOVERNMENT LOSING NO TIME. > ■ ■ (From Our Own Correspondent.) Wellington, Aug. 29. Now that the late Mr. R. F. Bollard has been laid to rest with appropriate tributes to his personal work and his public services, the quidnuncs about Parliament House are free to speculate as to his successor in the representation of Raglan and the. disposition of the portfolio he held at the time of his death. It is fairly obvious that Ministers, notwithstanding the huge majority they still comnuAd, are particularly anxious that nothing should go wrong with tlie filling of this season. This, in the circumstances, is not unnatural. A tendency towards independence on the part of three or four members of the Reform Party manifested itself in the very flirt session after Mr. Coates came back from the constituencies with what he was entitled to regard as a “mandate from the people,” and a rebuff at the polls just now, though it would scarcely affect the relative strength of the parties at all, might seriously impair the Prime Minister's mana with the great body of the electors. To-day Mr. A. H. Waring, a farmer at Taupiri, an ardent Reforiuei and a elose friend of the late member, is being mentioned as the Government’s probable championAir. Waring, it is said, would have the support of a majority of the farmers and of many of the workers. THE MAN AND THE MINISTER. The Labour Party, so several of its representatives in the House say, has many friends in the Raglan constituency, but so far it has given no indication of its intentions in regard to tlie approaching contest, and the Government is not going to let the grass grow under its feet while Mr. Holland and his friends make up their minds. At the last general election, when Mr. Bollard went fo the poll for the first time with the kudos of ministerial rank, 4,470 votes were cast for Reform and 2,501 for Labour, Nationalists and the Country Party, leaving the sitting member with a majority of 1,609; but a new man without experience and without the clarion cries of “Coats off” and “More Business in Government and Less Government in Business,” scarcely could hope to do so well. The party in possession always has advantages, which are multiplied, of course, by a divided opposition. As for the new Minister, no appointment would be more popular than that of Sir Heaton Rhodes, who already sits in the Cabinet without portfolio, and perhaps could be persuaded to take up work for which he is particularly well adapted and equipped. The fact of his sitting in the Legislative Council would detract but little from his usefulness. COMPANY TAXATION. The Minister of Finance still maintains that the incidence of the company tax, which he admits to be illogical and unfair, cannot be ehanged without involving the State in the loss of a million a year. He ignores entirely the recommendations of the Taxation Commission on this point, and, apparently, accepts the dictum of the Secretary of the . Treasury that the same amount of money could not be obtained from au equitable system of taxation as is being obtained from an inequitable one. What tlie Minister and the Secretary seem unable to realise is that this is not a question of revenue but a question of method. They'could just as easily obtain a million more or a million less fiom one system as they could from the other. The Taxation Commission, composed of business men and experts of the very highest standing, pleaded with the authorities to put its recommendation to a safe test. If a complete change is found difficult or impracticable,” it suggested, “then a beginning should be nude by taxing individuals in respect of the dividends received by them from companies, and supplementing the revenue obtained in this way by a moderate fiat rate on all the profits of companies.” This, in effect, is the system followed by the Australian States with much more satisfactory results than are obtained in New Zealand. HOtV IT WORKS. Unfortunately the injustice of the system of collecting company income , tax in this country does not end with compelling people who would pay no tax at all, were their income derived from any other source, to pay at the maximum rate of 4s 6'd in the £L There is another effect of this rough and ready system of enforcing an inequitable system which is of even greater public concern. The companies, knowing that they must pay reasonable dividends to their shareholders or lose their capital, have not only to charge remunerative rates for their commodities and services, but also to make provision for the payment of taxation at the rate of nearly 25 per eent. upon their earnings. The inevitable results of this imposition are to discourage investment in company enterprises, particularly in those which the farmers are specially interested, and to largely raise the charges for commodities and services, as already mentioned, and so increase the cost of living. Economists all over the world have emphasised the evil effects of this vicious circle of “passing on.” and New Zealand seems to be the only country that has continued to ignore their warnings and to maintain an unfair system of taxation at the bidding of an official autocracy.