NO BORROWING ABROAD

Evening Post, Issue 30, 4 August 1936, Page 10

NO BORROWING ABROAD

MAJOR PUBLIC WORKS

TAXATION INCIDENCE

There will be no provision in the Budget for new overseas loans, the policy of the Government being to raise all the money it requires within New Zealand; and on the security of New Zealand.

Provision will be made for a sum sufficient to enable the major public works already outlined to be carried out during the present financial year. It is understood that in the vicinity of £600,000 will be provided for the completion of railway undertakings, including the East Coast line, the South Island Main Trunk, and the WestportInangahua line. . ■

An outline will also be given of the Government's housing policy. Although the amount to be expended will not be specifically mentioned, it is understood that the Minister of Finance will give an' indication,, that houses will] be built as rapidly as possible, consistent with the labour and material available. '• INCOME TAXATION. ' Income taxation will be increased by means of a slee"p I graduation after a certain limit has been reached. The Government's policy, it is believed, is to reduce indirect taxation and depend more on direct taxation for its revenue, but the Budget will point out that it is impossible, within the framework of this year's Financial Statement, to bring about reductions in indirect taxation. It will also be pointed out that this problem will be tackled next year, when the Labour Government hopes to be able to present a Budget based entirely on the working out of I its own policy. This year the Govern-

ment has concentrated more on clearing the decks than giving effect to all the points in its policy.

In keeping with this attitude, the Government does^ not intend this year to alter the sales tax in any way, and there will be no modification of the existing exchange rate.

A provision is made in the Budget for a steeply-graded land tax. At present there is a flat tax of Id i nthc £, but this will now cease at the £5000 mark, and will jise to a maximum of 6d in the £ over £115,000. Apart from the desire to increase the public revenues, the object of the tax is to make sure that land is utilised, and to prevent land speculation. NEW PENSIONS SCALE. ! There will be an all-round increase of 2s 6d in the various classes of pensions, and. this, together with the new invalid pensions, will involve an addi-j tional expenditure of approximately £1,800,000 per annum. The vote for pensions, last year was approximately £3,770,000, and this year it will go up to about £5,480,000.

The Budget will also give an outline of the Government's intentions in regard to a national health scheme on a contributory basis. It is understood that the objective of the Government is to provide a minimum pension of 30s per week. Before this scheme becomes an accomplished fact there will be a full inquiry by a committee of members of Parliament.

There will be no alteration in the existing unemployment tax of 8d in the '£, and the annual levy of £1 will also remain. The Minister of Finance will deal briefly with the unemployment problem, and will lay stress on the determination of the Government to employ everybody at full-time rates,thus doing away with the existing relief and sustenance rates.

In addition, the Budget will reveal additional expenditure for social services. ,A generous amount will be provided in order to enable a scheme, of distribution of milk to school children to be put into operation.