NO INCENTIVE.

Auckland Star, Volume LXXIV, Issue 229, 26 September 1940, Page 9

NO INCENTIVE.

PLENTY FREE MONEY. BURDEN OF TAXATION. " There is no incentive for anyone to put a penny more into the war loan than they are compelled to do," said the president of the Auckland Chamber of Commerce, Mr. N. B. Spencer, this morning. Mr. Spencer saift that there was a great deal of free money for investment at the present time, and lie. considered that if the Government had brought a loan out at 2J per cent interest from the start and made it non-compulsory, it would have got all the money it wanted, and the. stock would have had a market value almost immediately. The Government would have got money that would not be put into the present loan, because people must have some, income for the next few years. They would have been prepared to take a small rate of interest to help the war effort, but could not put it into a free loan, which would have a very low market value.

Mr. Spencer said that a lot of firms had to pay income tax next February. There were manufacturing firms which had to increase expenses in the last year to make up for needs which could not be imported. Those firms, in most cases, had put their profits into the expenses of their business, and in many cases had raised overdrafts for the same purpose. They would now find it difficult tO Bubscribe to a compulsory loan with a very low market value as well as pay income tax due in February. However, if there was a hardship clause and it was administered leniently and reasonably it might help matters.