TAXATION OF COMPANIES AND PROFITEERING

Dominion, Volume 12, Issue 263, 2 August 1919, Page 9

TAXATION OF COMPANIES AND PROFITEERING

Sir,—Your leading article of July SO shows plainly the unfairness of the 'present system of raxing joint-stock companies, and that I he taxation raised fro.n these companies, vi.-,., .£3,107,21!) in 1017-18. was inequitable. This unfairness is in my opinion one of the principal 'causes of the profiteering about which we all complain. Sir Joseph Ward evidently thought that he had found an easy way of raising the largo sum of i' 3.000,000, and the unfairness of it apparently did not trouble him. It is in order that they can get the threo'millions in an easy way that the Government lias winked at. profiteering, and all their -proposals to stop profiteering are so much moonshine or camouflage. It seems to me that it works out something like this: A company which before tho war showed a profit on the year's work-

ing of, Bay, ,C 30,000, pnid Us shareholders 8 !)or 'cent, interest. After the war Iho Government ttoji in and say that tliov want 7s. (id. in tho A', or, say, .£12,000. Tho company, wishing still'to pay their shareholders 8 per cent., increase- (ho pricu of their goods, and show for tho next your a profit of A' 50,000. 0 this tho (.lovenimont take A2f1,000, so that tho company still have in hand .£30.01)0 with which lo pay their former dividends. When you consider that all goods pass through several hands—tho maivufnctuwr, t.ho mcrchnnt, etc.—and that tho piocess is repeated in each case, wo need not ho surprised that tho eost of Roods has gono up by 100 and more per cent. The merchants in each town form a ring, and regulate price?, and so are able to pass along their taxation to the public, together with a little added profit. Aro we not very soft and innocent people to supposo for one minute that the Hoard of Trade were over going to be allowed to do anything?—l am, etc., W. J. TENNENT.