TAXATION REDUCTIONS.

Dominion, Volume 6, Issue 1863, 24 September 1913, Page 4

TAXATION REDUCTIONS.

A CONCESSION TO FAMILIES.

CUSTOMS REMISSIONS. The Land and Income Assessment Bill was noxt on the Order Paper, "for consideration of report." Mr. G. W. RUSSELL (Avon) outlined tho objections to tho Bill raised by tho Opposition at earlier stages of tho session. Briefly he contended that tho Bill granted, concessions to people with comfortablo incomes, while tho Government had not brought forward any proposal to grant taxation relief to tho masses of tho people. The Prime Minister: Oh, yes,,l have! I say so now.

Mr. Russoll said that none of the Government's legislation indicated such an intention. '

Mr .Massoy: It is mentioned in tho Budget. Mr. Russell said that the Opposition would havo supported tho Bill if tho Government had coincidently brought in a Bill to grant remissions to tho masses of tho people.

A Comparison of Records. Tho PRIME MINISTER said that ho. had been somowhat amused at' tho speech of tlio member for Avon which was partly apologotic, partly an attack on tho Government and partly explanatory. Tlio lion, gentloman had expressed tlio opinion that tho members of the Reform party wero not supported by tho masses of the peoplo. lie (Mr. Masscy) had entered Parliament at tho samo timo as tho member for Avon and by tho end of tlio present Parliament would havo a record of 21 years' continuous service in tho Houso. Mr. Russell, on tho other hand, had a broken record. Therefore il followed that Mr. Russell had not, never liad had, and, ho believed, never would have, tlio support of tho masses of the peoplo. Ho did not want to make predictions as to what would happen to tho hon. gentleman in the future, but advised him, in his own interests, to drop that lino of argument. Members of tho Reform party iu general were supported by tho mass of the peoplo, and deserved that support. Tho Bill before tho Houso aimed at granting a small concession to people with families at tho bottom,of tho income tax ladder. Not only had Customs taxation remissions been promised in tlio Budget, but the Governor's Speech contained tho following reference to tho subject:—"Proposals will also bo introduced by which it is hoped that tho cost of living will bo reduced to persons of small incomes."

■ Mr. Forbes: Aro you goiug to do it this session?

The Primo Minister: -Yes. The promise would bo kopt, and would be kept during tho present session. Parliament would bo given an opportunity of roinitting Customs taxation upon tho peoplo who were least capable of paying taxation. AVas not something done Mr tho masses of tho people when tho pension ago for women was reduced to 60? Mr. Russell: It won't help a man to givo a pension to his grandmother.

Mr. Massey said that veterans' pensions and the amended scale of widows' pensions had assisted tho masses of tho people. Tho wholo aim of tho Government's legislation • was to make lifo easier for the people who carried tho burden of taxation. He advised Mr. Russell to - abandon his fault-finding stylo of criticism, and when the Government brought down a good Bill — and small as it was, the Bill before tho Houstywas a good one—give them credit for it. If tlio member for Avon disapproved of this Bill, let him voto against, it. • Ho understood that tho hon. gentleman had voted for it. Mr. Russell: I happened to be on tho steamer that night-.

Tho 'I'rimo Minister, in conclusion, repeated that Customs legislation would bo brought down this session to reduce heavy taxes now imposed on some articles. In Quest of Information. SIR JOSEPH WARD (Awarua) said that lie had been in Parliament continuously for twenty-six years. If the Primo Minister's line of argument were corrcct, then they should change places in tho House. Ho went on to state that the Minister of Finance had interjected that be hoped there would bo increases in Customs taxation. Mr. Allen: 1 don't want to lose any revonue. Sir Joseph Ward said that thero were going to bo largo increases.in Customs taxation. A Minister: No. Sir Joseph Ward said that Mr. Allen's remark had been mado in reply to a question by himself as to whether thero would bo increases. Mr. Allen: To mako up for reductions. Sir Joseph Ward said that they now had "a sort of see-saw business." He next asked: "When are wo going to liavo it, that's what I want to know?" ill'. Massey: Before tho end of the session. Sir Joseph Ward said tlrat it should have been in tho Financial Statement. Tho whole commercial community from North Capo in the Blulf would be made uneasy by what had been said that/ afternoon. There would.be a good deal of uncertainty in regard to bonding business. Mr. Allen told them to wait and see "in tho sweet, by and by." Was thero to bo a reduction in the duty on

tea. Ho was in favour of a big reduction in the duty on tobacco. A member: Why didn't you? Sir Joseph Ward: I was going 'to. The reduction of tho ago for widows' pensions, too, ho said, had been forecasted iu tho Governor's Specch of tho Ward Government.

A Question of Origin. Mr. Nosworthy: Yes, but that was after it came out in our platform. (Laughter.) Sir Joseph Ward: Tho honourablo gentleman must not make mo lose tho thread of my discourse. Discussing a possiblo duty on motor-cars, ho said no was not opposed to a duty on motorcars, but lie was not in favour of any proposal to tax any particular class of people, simply becauso tho proposal might bo popular. Ho would,, however, vote for a considerable increase in the graduated land tax, and for a considerable reduction in tho duty on tobacco. Ho accused tho Government of having stolen tho policy of their quondam opponents, and tho Opposition now bad to help to put tho measures through. Mr. Allen: Will you help tho Land Bill through ? ■ Sir Joseph Ward said that ho would support somo of the' Bill, but ho did not beliovo it would settle tho land problem for all time. Ho was very sorry tho raising -of Customs duties had'been mentioned at all, because it would give riso to unrest and anxiety in tho commercial world. Mr. G. LAURENSON (Lyttelton) spok'o in advocacy of direct, in preference to indirect, taxation. Mr. H. G. ELL (Christchurch South) said that tho indiscreet statement of tho Minister of Financo that tho Customs duties were likely to be increased would giro rise to a great deal of uneasiness throughout tho country. Mr. Allen: I nevor said it. ■ . ]\[r. Ell said tho Government should havo refrained from making any declaration of their intentions until they worn ready to submit definite proposals to tho House.

Small Relief. Mr. J. ROBERTSON (Otaki) said that tho Government, in trying, as thoy alleged, to reduco tho burden of lifo for the people, had begun by reducing tho incomo tax under certain circumstances. This, however, affected only thoso people who wero in receipt of what might bo termed fairly conifortablo incomes, and it did not relievo tho poorer wage-earning classes. was not of opinion -that tho cost of living could ho reduced merely by tho reduction of Customs tariff. Something moro than reducing the tariff would havo to be done if the cost of living was to bo reduced materially to the poorer classes'in.the community. Ho advocated an increase in tho taxation of tho unimproved value of land, and he urged tho Government to adopt a policy of direct taxation in preference to indirect taxation through tho Customs. Mr. G. FORBES (Hurunui) said ho beliovcd in tho principlo of tho Bill and he would support it, but ho was forced to admit, ho said, that the principlo had been reduced to an absurdity. Tho Bill was only tinkering with the principlo, and tho concfcssions granted were infinitesimal, so small that it was absurd to ask the Houso to spend timo in putting such a Bill through.

A Cood Principle. Mr. G. V. PEARCE (Pateii) commented on tho extraordinary attitndo taken up by Opposition members who abused the Bill, and then finished up by saying they would support it. Ho congratulated the .Government on having brought down a Bill to givo a concession in taxation to men with families. This was an excellent principle, and ono which the late Government had nover adopted although they had been in power for 21 years. 110 hoped to see tho principlo extended. He admitted that when dealing with inbAmo tax and land tax it was not possible to roduco tho cost of living to thoMvorkng man. This might best bo dono by taking tho duty off boots and shoes. Misleading comparisons had been mado with intent to show that the lands of tho country did not pay sufficient taxation. Tho fact was that in addition to land .tax tho land owners paid probably half tho Customs taxation, and one and a half millions m local taxation to pay for tho upkeep of tho roads of the country.

Homooopathy. Mr. L. M. > ISITT (Christchurch North) said tho Bill was a homoeopathic dose of reform. He supported tho Bill, hut ho had the utmost contempt for such tiddly-winking legislation. Mr. R. M'CALLUM (AVairau) supported tlio Bill, but ho said ho recognised that it was weak and ineffective. Ho would liko to seo tho principlo of reduced taxation to people with largo families extended to apply not only to families of fivo and less, but to larger families as well.

Mr, P. C. AA'EBB (Grey) said ho had boon vory glad to hear from tho Primo Minister that -he proposed to do something to reduce the cost of living to tlio working people. He did not beliovo that tho cost of living would bo reduced by taking off Customs duties. So long as foodstuffs and necessities of lifo wero gambled in by rings in this country tho poorer people must suffer. Ho urged that the land ought to be taxed to such an extent as to secure to the State all the increased value of the land. If this wero dono thore would be no need to reduce tho'duty on boots and shoes. 1)1 his opinion, there was not ono measure before Parliament which would mako the working peoplo one bit better off.

Mr. G. WITTY (Riccarton) challenged tile statement of Mr. Pearce that tho farmer paid half the Customs taxation. None of his implements were' taxed. I-Ie was opposed to taking the duty off hoots and shoes, because ho believed wo should foster all the industries already well established in our own country. Mr. J. PAYNE (Grey Lynn) said ho was going to vote against tho Bill because he was not prepared "to take a chunk out of tho taxation" to relieve peoplo getting from £300 to £425 a year. He would liko to see relief granted to peoplo with families who were getting much less than £300 a year, and this relief could be granted in tho way of a maternity bonus or in some other way. Mr. A. H. HINDMARSH (Wellington South) thought it was high time tho Customs tariff was revised. Mr. T. BUXTON (Tomuka) said lie wished to protest against the reduction of taxation to men with comfortable incomes as being unnecessary. He believed in tho reduction of taxation to men with families, but it should ho so arranged as to benefit those who needed iioli). 0 Tho amendments were agreed to. Government Members Oppose. On the motion that tho Bill bo read a third time, Mr. J. B. HINE (Stratford) said ho had been puzzled to understand whether the members of tho Opposition were serious in their objections to tho Bill, especially in view of tho fact that they had supported tho Bill at its second reading. Ho wished to record his intense dissatisfaction with the Bill, believing as lie did that a Bill which gavo preferential treatment to ono class in tho community was wrong, and founded on i n unsound basis. If tho principle were sound why should it be limited in its application to people with incomes of from £300 to •£425 ? If tlioro was to be discrimination it should liavo been exercised first in favour of those with an ineonio of less than £,100 a year. It seemed to him that tho first duty of the Government was to provido tor an increased rcvenuo to mako concessions possible to tho poorer peoplo in the community. If an extra duty of .3d. per gallon had been imposed on beer.

ail extra revenue of £122,000 would have been obtained, and the extra revenue would have inado humanitarian, proposals possible. Again, he was at a loss to understand why the members of tho Opposition had spoken as they had about the Bill, and lie was curious to know whether they would vote against the Bill, ilo proposed to give them an opportunity of recording a- vote against tho Bill, because ho believed tho introduction of tho Bill was a mistake. Mr. G. J. ANDERSON (Mataura) said ho had supported the Bill at its second reading, but ho had hoped that tho Bill would bo materially altered in Committee. He very largely agreed with what tho member for Stratford had said about tho Bill, and also with what tho members for Wairau and C'hrisfcchurch North had said. He thought tho Government had begun to make concessions "at tho wrong end." Ho would vote against tho Bill at tho third reading. "But," ho said, "I am amused to hoar tho kind of humbug members of tho ether side havo been talking. It makes 1110 sick. What did they do in their 21 years of office?" "Liberal Sentiments." Mr. H. ATMORE (Nelson) said ho had much pleasuro in endorsing "tho good honest Liberal sentiments" expressed by tho member for Stratford and tho member for Mataura. Ho believed that it was wrong to give concessions to the man witli an income of £8 per week while many men wcro trying to bring up families on less than £3 a week. Mr. G. W. RUSSELL (Avon) said that members of tho Opposition would support the Bill, but did not withdraw ono bit of criticism of tho action of tho Government in giving concessions .to well-to-do people with families beforo giving relief to poor people. Not Breaking lit). Tho Hon. W. IT. MASSISY (Primo Minister), replying to a suggestion made by Mr. Russell, said that in actual fact tliero never had been a more solid party in tho Parliament of this country than tho party now behind tho occupants of tho Treasury benches. They might differ oil matters of detail, but on tho main principles of policy there was no differeuco of opinion whatever. It was just as well that members of tho other sido should recognise that fact. And tliero would bo no backing down oil tho .part of tho Government about tho proviso mado in regard to Customs taxation. Tho Government wero not going to tako a single shilling, not a single copper, from the.people that tlicy could [.ossibly do without.

Mr. W. A. VEITCH (Wangauui) said ho would support tho. Bill, believing as he did that it embodied an equitable proposal that people with families ought to he hotter treated in the mattor of taxation than those without families, .regardless of their wealth.- That principle was sound and ho heartily supported it.

The Hon. D. BUDDO said he supported the principle of tho Hill, but not tho Bill itself. Ho thought ■ tho Government had "begun, at tho wrong end."

Minister in Reply. Tho Hon. J. ALLEN, in reply, said that tho principle of tho Bill was that pcoplo with families should ho allowed a remissio'n of direct taxation at tho very lowest rung of tho direct taxation ladder. Tho lowest incomes affected by income tax' wero thoso of over . £300. He thought tho House would agreo that tho principlo of tho Bill was sound— that tho pcoplo who were populating tho country deserved consideration at tho hands of tho Government. Much, had been mado of tho statement that tho Bill was brought down before the Tariff Bill, but the Prime Minister had several times ' promised in tho Houso that a Tariff Bill would ho introduced this session by which tho duties on tho necessaries of life would bo reduced. It had boon said, also, that thero woro people in New Zealand who had incomes of £20,000. Ho challenged tho member for Christclnirch North to iiamo any single individual with a taxable income' of £12,500. Tho Bill did not affect tho cost of living except that it reduced it slightly. Ho believed that the causes of the high cost of living lay much deeper tlian tho depreciation of the valno of gold. Ho believed that the solution of the problem of how to reduce tho cost of living was to bo found only in increasing tho efficiency of tho man who produces. That was tho real bottom of tho question.. Until by education and otherwise better efficiency could be secured -there could be no reduction of tho cost of living, and efficiency was necessary both in organisation and in tho work of tho men in the industries. It was absurd to say that tho reduction of Customs duties would necessarily reduco tho cost of living. Ho agreed with tho Labour members that this would have comparatively little effect. The Bill was road a third time on tho voices. , Commercial Bank Bill. ' A Message was received from the Legislative Council stating that it disagreed with one of. tho amendments made by tho House of Representatives in the Commercial Bank of Australia Bill, namely, tho' striking out of Clause 4. Mr. A. M. MYERS (Auckland East), who is in charge of the Bill, moved that tho Houso do not insist upon the amendment. This was agreed to.