CUT IN INTEREST.

Star (Christchurch), Volume XLIV, Issue 697, 25 February 1933, Page 10

CUT IN INTEREST.

New Legislation to be Introduced. INCOME TAX AMENDMENT. ("Star” Parliamentary Reporter.) WELLINGTON, February 25. Interest reduction legislation is to be introduced by the Government on Tuesday. It will provide for a further reduction from interest payments by the Government and lofal bodies on debt domiciled in New Zealand of 2s in the £, making the total, having regard to the former legislation, 4s in the £. Though overdraft and bank deposit rates cannot be subject to legislation j as the matter is entirely within the province of the trading banks, it is understood that the Government has been again in negotiation Avith them Avith the object of bringing about reductions. Similar discussions last year resulted in overdraft rates being reduced by a half per cent in June, with the minimum rates for best accounts| fixed at 6 per cent. It is possible that next week’s legislation will provide for a less cumbersome method of deducting the 4s in the £ from the interest on Government and local body securities as the stamp duty payment involves a good deal of administrative Avork. To Help Ratepayers. The Government also proposes to make it clear to local bodies that this further relief should be utilised directly to assist the ratepayers by way of a reduction in the rate burden. The original stamp duty deduction has ment a saving to the Consolidated Fund in interest of £275,000, but if operating over the full financial year it Avould be £300,000. The new proposals raise this saving to £600,000 per annum. Local body relief is also substantial, as it is estimated that the saving will now be closely approximating £450,000 annually. Bachelor Tax. The Government also intends introducing a Land and Income Tax Amendment Bill this session, a decision making it clear to members that revision of the incidence of taxation is intended. This, it is expected, will embody the proposal previously announced to differentiate regarding the income tax of unmarried males in order to obtain more revenue from bachelors.