PUBLIC FINANCE

Dominion, Volume 12, Issue 223, 14 June 1919, Page 11

PUBLIC FINANCE

INCREASED BURDEN OF DEBT

/ THE NECESSARY REVENUE '

Referring yesterday to tho public finance of A'ow Zealand, the chairman of 'directors of the Bank of New Zealand (Mr. H. Bcauchamp) said that a comparison of tho Tp.vemio of 1913-14 with that of 1018-19 revealed an increase of ■£1(1,122,711, equal to about 83 per cent., while tho expenditure, had increased by '.£6,847,735, equal to about 54J per cent. The surpluses during the past four years aggregated .£15,090,514, and this amouut, together with can-ied over i.i 1915, and, making a grand total of .£15,239,561 wns being 'held by the Treasury in liquid form to meet such contingencies as might arise during the next year or two. It was a splendid achievement for n, country with such a restricted population to provide so large n revenue as ,£22,352.372, equal to nearly ,£22 per capita. Tho principal soureo of tho increase, had been tho incomo tax, while the land tax and death duties had helped considerably. ■ Tho Customs revenue, .which was contributed by all classes of the community, had not increased to any extent, chiefly because, of tho extraordinary difficulties experienced in importing merchandise. The revenue obtained from Customs-and incomo tax during the past six yeais had been:— Customs Tear and Income ended excise. tax. March 31. :. ' £ £ ■ •• 1914- '3,553,785 ' 554,271. ■■ 1915 3,294,943 ..' 540,313 • 1916 -3,524,063 1,392,119 1917 4,037,628 4,262,126' 1918 3,601,383 ' 5,619,561 • 1919 4i104,015 - 6,219,33(1 "Thus it will be seen that, (luring tho financial year ended March,3l, 1919,-the moneyed / : capitalistic class, in which are inclm. 1 salaried, and professional persons, land-owners, - .manufacturers, companies, etc., contributed, in income tax alone, ,£6,219,336 out of a total revenue: of '^22,352,372 > ■• or about 28 per' cent.," said, Mr. Beauchamp. "But this does not show the true.incidence of the burden, to appreciate, which we must look to Paper B, 22, laid on the table of the-.House of Representatives last year.' In this paper, which deals'with the.income tax assessment for the year ended March 31, 1918, the following.figures are eiven in respect to income tax pavers-.—.

According to these figures, the amount , that should have been paid in the year 1917-18 waif £5,743,552, while - the amount actually received in the Treasury ,was -£5,619,561, or ,£123,021 less, this latter amount representing the sum unpaid on March 31, 1918. , "It '""will be noted' : from the figures,,,l have mentioned that 37,949 persons and companies and deceased estates paid nbout 28 per cent, of the revenue, leaving 72 per cent, to be paid by the. great majority of the-people.- If the figures could be m'oro closely analysed, tho same email number of people would be found to contribute largely to the customs and stamp duties, postal and telegraph'.re?enue, raTlway revenue, etc. A demand ior the revision of the income tax, in the direction. of alleviating the burden, is bound' to arise, for. the pressing heavily on some people.. It is to be" hoped that the' Government will be in a position to appreciably reduce, if not altogether abolish, the.special war tax imposed in 1917, and it is reasonable to' assume that this relief would be made, good by an increase in Customs revenue' when conditions become once more,nor-, mat. '■■'. ,"'"■. ■'.

"It would be useless to expect tbat Hie Treasury can manage with a much smnlr ler revenue than that collected in the past year; but there is nothing to prevent the incidence of taxation being adjusted and made more equitable. The Government must obtain, a . relatively; large revenue, because the fixed.charges have grown through tho stress of war. Thus a very laTge sum has tobe paid annually for interest and sinking fund owing ,to the debt of the country T having expanded, and there is the growing pension bill to "be met. The net debt has grown from in 1913-11 to in 1918-19. "It will be seen that, from the nature of it 3 liabilities, the State must obtain large' revenue. It seems certain that Germany will be obliged to indemnify the Allies to some, extent, and if New Zealand i 3 successful in obtaining a fair proportion of this indemnity, it will be of material assistance to this Dominion;: but in : any case, it is 'probable that no amount recoverable, under this head will be received for many, years, even supposing that thp terihe of restoration can be enforced. In the meantime, the , necessary revenue must be raised to meet at least interest obligations."

. > Ordinary Assessable incoino ,. Special income. tax. war tax, ','.-.' • ' '• • ■ Number. £■ . ■ £ £ Salaried persons .'. 8,070 3,538,730 46,199 69,860, Professional 2,537. 1,883,810. 56,975 77,607 Traders, etc' ::...;. 7,917 5,917,422 214,614 310,960 Landowners ..'............„■ ....;...... 12,548 11,,88G,958 529,062 .951,713 deceased persons' estates 2,211' 1,935,946 ,'79,111 130,564 Miscellaneous ...;.. 2,721 1,833,277 .64,745 103,969 Companies .;.....„;..... 1,945 -9,649,170 1,245,068 1,862,129 ■''-'■."■ ■' ' 37,949 36,645,373', 2,235,774 3,506,808