MORE DRASTIC SAVINGS

Evening Post, Volume CXV, Issue 33, 9 February 1933, Page 12

MORE DRASTIC SAVINGS

(By Telegraph.) (Special to "The Evening Post.") : AUCKLAND, This Day. The "Auckland Star" in its editorial says (inter alia):— "Given a financial situation in which the Government finds itself partly as a result of its own policy, Ministers

must be credited with, courage in putting forward new taxation proposals. They are faced with a Budgetary shortage of nine and a half millions, and they propose to raise two and a half millions by additional taxation. The I Prime Minister says that the sales tax has not arisen out of the new exchange rate, but haa been under consideration for some time. It cannot be denied, however, that there is a connection between the new taxation proposals as a whole and the higher exchange rate which has added greatly to the Budgetary deficit. It will, be contended that any largo measure of assistance to the farmer would increase this Budgetary embarrassment, but it will be claimed that a bonus system would cost less and keep more of the money in the country. This,; however, is a side issue to the present subject. The exchange has been raised and the Government has to take the consequences. It proposes to raise two and a half millions extra by a sales tax and taxes on petrol, tobacco, sugar, and gold. AI sales tax, of course, is objectionable. It will be often difficult to assess, merchants^ will have another worry added to_ their many difficulties, and it will raise the cost of living, especially to the poorer classes. If, however, the sales tax was inevitable, the Government seems to have gone the best way about introducing it. One may appreciate the Labour Party's solicitude for the wage-earner and yet regret,! that once more the party has shown no disposition to help the Government in! its difficulties. v lt is futile of Mr. Hoi- j land to talk of raising more money by imposing a graduated income tax when i the whole difficulty about income tax has been that income has Last -year the Government received in income tax 'half a million less than they had estimated, and this year the I estimate is a nillion below the 1931-32 receipts. It may be asked! whether everything possible in economy has been done by the Government. Has the best use been made of the recommendations of the Economy - Commission? One may doubt whether, even under Mr. Dqwnie Stewart the utmost effort was made, and Mr. Coates's record . suggests- that he is a better spender than saver. Unfortunately, to I the Opposition which should be keeping the Government up to the mark in this direction, economy is obnoxious. Tho country may find that the Government's new proposals, the plan of Ministers in. desperate need and therefore ready •to suggest desperate remedies, are not sufficient, and that I they will have to. be supplemented by still more drastic savings."