TAX COMMISSION.

Hokitika Guardian, 12 May 1924, Page 4

TAX COMMISSION.

[BY TKI.EOKAFK —rF.lt TRESS ASSOCIATION.] AUCKLAND SITTING. AUCKLAND, May 0. Before the Taxation Commission the policy of the large lending institutions was outlined by Air IT. P. Ivissling, general manager of the New Zealand | Insurance Company. Such institutions would welcome a change in- the system of taxation, lie said, but investors did not like continual alterations in such settled stocks as municipal or company debentures-. The present very high fate on debentures of -Is (id precluded companies such as his from investing in them. Air Justice Sim: It is the small man who invests in debentures of this kind?—lie can, because ho gets a remission if his taxation docs not come up to the maximum. To Air Hunt, witness said that high taxation seriously alfdT-tod investments in mortgages. TTis company could not lend on mortgage and pay os l'Od in the £1 because the directors objected to charging more than O.V per cent., the limit it was estimated farmers could pay. Institutions would look fur investments which would return them about o per cent. Their lighthouses were tax-free war loans expiring in 19.38 and 1039.

Ah- Weston: Supposing the limit of graduated tax us applied to company taxations could he pulled down to is fid. would you recommend any alteration in the present rate on debentures (Is fid) Do you think it advisable to increase the present rate on debentures in view of the possibility of taxation coining down to the neighbourhood of 4s 6d ?

Air Ivissling: Perhars the best way T can reply is to say that it would not tempt large institutions to invest in muniep.nl debentures, even at 3s, if thev have to pay (is lOd in the Cl. It fixes the return on investment at less than what Hie institutions could get on tax-free war bonds.

AYlien Mr Ivissling emphasised that frequent changes in the rates of taxation was prejudicing investments. Air Shirteliffe stilted it was hoped that any further alteration would lie final. AL- Shirteliffe: Do you think the uncertain values nf land have anything to <lo with the reluctance to lend on mortgage .'—Since 1021 t here has been a marked change, and lenders have changed their margins. Air Shirteliffe: AVe may say until rural lands have reached 11 stable value according to their capacity to produce borrowers will find it hard to obtain accommodation ? —A es. AL- Shirteliffe: Supposing we brought company taxation down to -Is fid would that lie suHieiont to send you hack to mortgage securities? —Acs. That would give us a rather better return than tax-free war loans, and also provided we had an assurance it would remain stable. The Commission adjourned till Monday.