WELLINGTON NOTES.

Hokitika Guardian, 9 May 1924, Page 1

WELLINGTON NOTES.

TAXATION' AND FINANCE. (Special to “Guardian”.) WELLINGTON, May 7. A Wellington gentleman who takes an interest in public finance, but who is not attached to any of the political parties, in discussing the work ot the Taxation Commission expressed the opinion that some of the witnesses aired their grievances, others delivered themselves of text hook theories, while others again developed theories of their own. sort of home-made stufl that is very hard to digest. He did not consider that the evidence tendered so far was of much real value, in his opinion, the cause of all the Iroutile in respect to taxation is our had system of national financing. He pointed cut that Air Alassev recently announced that £1,000.000 of the surplus s:s yet undisclosed had been allocated to the .Public Works Fund, and he asks this pertinent question “would the estimates have been passed if that million was on the estimates for transfer to the Public Works Fund?” He contends that the Treasury intended to produce a surplus and the Alinistor of Finance intended to transfer n sum from the surplus to the Public Works Fund, and no doubt the Treasury officials were able to make a very shrewd guess what the surplus would amount to. for the estimates are not framed, at all events, not presented to Parliament until the financial year is five or six months old. If the .Minister of Finance and the Treasury officials, had no power to deal with the surplus, the production of “substantial surpluses” would cease, and the taxpayers would get greater benefit from closer estimating of the funds needed by the Government. to carry on the administrative work of tlie country. It is obvious that the surplus has come from the pockets of the people, whether in the form of income tax, land tax. stamp duties, customs duties or entertainment tax. “Reform your system ol finance.” remarked the gentleman in question. “and you will have the various parties competing with one another as in Britain, where at the present time there is a protest against the abolition of the M’Kenn.i duties.” BELATED BETTI!.NS.

The letter of protest addressed by the Canterbury Labour .Members ol Parliament, regarding the delay in publishing the details of the revenue and expenditure for year ended .March filst. 192-1. is. of course, merely a party move, and, therelore. insincere. Nevertheless a strong and vigorous protest is needed to wake up the Government and various departments of the Civil Service to the necessity of publishing financial information and statistics promptly. The British financial year closes on the same date as New Zealand’s year, that is .March 31. On April 2nd. or 3rd the aggregate of the revenue and expenditure and surplus of the British Treasury was published. The figures were certainly approximate, but near enough to give one a good idea of the state of the finances. Furthermore the British Budget was delivered in the House of Commons on April 2!*. that is to say that practically within four weeks of the close of the financial year, the complete details of the revenue and expenditure were known, and the estimates of the new financial year published. Here the country's finance is made the battledore and shuttlecock of parties. vith""l Hie slightest regard t" the wishes of the public. The present Government is not alone to blame ill this matter, for it is a system that has been in vogue fur many years, and it will not cease until the business people deal wirli the sithjeet intelligently nml effectively. The same delay and absolute indifference to the requirements of the public are disclosed ill respect to the export ami import figures, and the Post Office Savings Bank returns. At one time it was thought that ihe Monthly Ahstiact published l>v the Government Statistician would lie useful, but it is issued so late that it possesses scarcely any value for the business people. The Alonthly Abstract for .March has not yet made its appearance and we are well into the month of Afav. END El! WHITING A LOAN.

The New Zealand I t |or cent loan for £.5.01*0.000 has boon underwritten, and sis only a few people know what this means, the writer endeavoured to find out from financial magnates what is really meant by this. The underwriters are big financiers su'd financial institutions who in some degree specialise in this business. The underwriters guarantee the loan, and once a loan is underwritten the borrower is certain to obtain the money he requires. For their services the underwriters charge 1 per cent. Somebody lias to ho employed to secure this underwriting, and this individual m* firm charges os per cent for the service. Investors in Britain invariably take advice from tlimr hankers or brokers and subscriptions to a loan generally come through a broker who charges os per cent for kinging in the subscription. The Imnk charges os for receiving the subscription and doing other clerical work ill emitic:tion with the loan. T hen the borrower lias to pay stamp duty. This is generally compounded, and the slam” duty amounts to Iper cent. So that the total charge op a Government loan mi.li as is being issued by the New Zealand Government is 3 per cent exclusive of the cost of advertising which amounts to very little rs heavy advertising is not necessary owing to investors reiving on the advice of their brokers.