The Hawera Star. THURSDAY, JUNE 15, 1933. THE DOMINION’S ACCOUNTS.

Hawera Star, Volume LIII, 15 June 1933, Page 4

The Hawera Star.

THURSDAY, JUNE 15, 1933. THE DOMINION’S ACCOUNTS.

Delivered every evemngr by 6 o'clock in H&vvera, Manaia. Kaupokonui, Otakeho, Oeo, Pihama, Opunake, Normanby. Okaiawa, Eltham, Ngaere, Mangatoki. Kaponga, Awatuna, Te Kiri, Mahoe Lovvgarth, Ma.nutahi. Kakaramea. Alton. Hurleyville, Patea. Whenuakura, Waverley, Mokoia. Whakamara, Ohangai. Meremere, Fraser Road and Ararata. ,

The announcement of a small surplus, £4O,QOD, in the Dominion’s accounts for the year ending March 31st does not occasion surprise in the light of the statement, issued by the Minister at the end of April; nevertheless, it is gratifying to find that the country has withstood the heavy demands made upon it by taxation so well as to show an excess of £805,000 \Over the estimate of tax revenue put forward in the Budget. The financial year lias ended with the country in a in.uc.il better state than was anticipated at the beginning, when a huge deficit was forecast. This was

kept in chuck by economies to some extent, but the position has been also relieved by drawing upon reserves to the extent of £2,500,000 and by Great Britain’s postponement of the payment of £825,000 due by New Zealand under the debt funding agreement. The Government has also been assisted by an unp'oeted ‘ ‘ buoyancy of revenue” —or, in other words, anticipations of receipts from Customs • and income tax and railway revenue have been proved pessimistic. Nevertheless, signs are not wanting that the taxable capacity of the community lias reached'its limits. Income tax, which yielded £4,448,000 in 1931-32, has dropped to £3,557,000 for 1932-33,- and a Treasury estimate for the current financial year places the revenue from this ■source at £750,000 less. The ra f c ot decline in this class of revenue is grave and unless relief come this year from outside influences affecting the price level of our exports, it must occasion the Government deep concern. New classes of revenue which have not been operative over the whole of the year, sales tax and gold export duty, have yielded £38,253 and £15,635 respectively. In regard to the former it has to be remembered that the Governnmnt expected a return of £1,500,000 from this source for the current financial year. The amount returned for the seven weeks- during which the tax had been operative before the closing of accounts does not augur welt for the Government’s hopes in this connection. An interesting item on the expenditure side is the amount of £470,000, the cost over a three months’ period of indemnifying the banks against loss owing to the rise in the exchange rate; the official estimate of the annual cost in this connection was £1,000,000. Judged on the bare figures, the prospect of keeping the indemnity costs within the estimate does not appear good, but it has to be borne in mind that the exchange increase has not been in operation long enough to affect revenue returns. Economies have improved the Budget position by £112,000. This item does not represent a very impressive saving on the total expenditure. A thought-pro-voking fact which emerges from the Minister’s financial statement is the Customs revenue in its .relation to other revenue. This amounted to £6,131,414, a figure which is approximately £2,000,000 in excess of the combined land and income tax revenue. This indirect form of taxation thus provides a very appreciable portion of the country’s revenue. At present it is a subject of inquiry with the object of a downward revision; at the same time, direct taxation is definitely returning less to, the State. Heavy reductions in the tariff against British goods are being urged upon New Zealand by the primary industries and are necessitated by the Ottawa agreement, but any such reductions entail loss of revenue from indirect taxation at a time when sources of direct taxation a>re diminishing. It is certain that the financial administration of the Dominion for the remainder of the year is going to provide its anxieties, but the Government is entitled to credit for the manner in which it has thus far met the adverse conditions which have faced it since it assumed office and it is further entitled to anticipate some assistance in the future by the world-wide efforts now in progress to release trade from the grip of the “economic blizzard.”