WELLINGTON NEWS

Hokitika Guardian, 28 June 1928, Page 4

WELLINGTON NEWS

TRADE AND TAXATION

(Special to “ Guardian.”)

WELLINGTON, June 2-3

At a meeting of the Auckland Chamber of Commerce last- week a resolution was passed urging reduction ol the present high rates of taxation, which regarded recovery both from the present stubborn depression and tlie high depression and the high percentage of unemployment, and it was added that a comprehensive investigation by the Government of methods of minimising expenditure was long overdue. Among all Chambers of Commerce in the Dominion tlie Auckland body is perhaps the most aggressive and no doubt a good deal of this is due to the fact that one of the officials of the Chamber of Commerce is a clever economist. It is doubtful, however, whether resolutions such as that referred to above have any more effect on the Government than water on a duck's hack. Something more than mere resolutions are wanted to force the Government into taking the necessary action. At the so-called Reform ' Daily, at Wellington on June 34, when the Prime Minister was the principal speaker, the latter is reported to have said: “It is interesting to note that during the sixteen years'since the Reform Party took office, 3012-13 to 1927-08—revenue exceeded expenditure by no less than £30,0(30,00(3, and accumulated surpluses aggregating .£*26,000,000• have boon applied .to debt reduction or other capital purposes, thus keeping the public debt down by that amount, and involving an annual saving of approximately one and a half millions in interest payments, which would otherwise have had to be incurred.” This is the plausible political side of the problem. hut turning th;searchlight of fiannee on the problem it presents quite a different picture. Xu sixteen years the accumulated surpluses amounted lo £20,003,060, approximately, equal on the average to £1,623,000 a year lor each of the sixteen years. Now the question i< where did this money tome from? Obviously from the pockets of the people.

And it may be asked whether it is a fair thing of tlie -Reform Government or any Government to d'.p into the pockets of the people in this shameless way.

Ou tiie showing of the Prime Minister we have been overtaxed to the extent of £1,625,0a in each of the past sixteen years, and this excessive taxation is the direct, cause of the extravagance of the Government. The Prime Minister stated that the accumulated surpluses had .been applied to debt reduction or ether capital purposes. f llic only u. 4 .c of a surplus is to reduce debt and that is acknowledged in every country. but when it is applied to "otliei capital charges” it becomes the basis of political corruption and political extravagance. If it is intended to provide for capital expenditure out of revenue, then the amount required for such expenditure should be clearly and definitely, stated so that t!r> members of Parliament as well a- iftaxpayers may know clearly vliat. iproposed. The Prime Minister further contended that by apnlving tuaccumulatod surplus to debt reduction and other capital pur .inset tlie public debt bus been kept down by that amount, involving a saving .of our and a half millions hi interest, in other words that if the Reform Government did not filch the £26. 000.000 from the pockets of the people they would have had to borrow the amount in the open market. The logical inference is that besides the expenditure of loan money the Government lias spent £26,000,000. The loans raised in London and elsewhere carry interest, but the forced loans of £28,000,000 in sixteen years provided by the taxpayers arc free of interest. Tlie principle of Reform finance is vicious, and the Minister of Finance plays the part of a politicalbandit and plays it joyfully and with the applause of the party. The excuse of the Government for thus raiding tlie taxpayers is that the money has been spent in debt reduction and for other capital purpose!-, but if that £26.600,000 had been left in the pockets of th? people it w-’ind have been spent more judiciously th.ai by the Government, and the develop-, mont of our resources would have been much further advanced than it is today. It is quite a lair thing to say that taxation is too high, for the uccumlatcd surpluses prove that, and high taxation is retarding rcoa cry. Rut 'resolutions on the n after me worthless. Seme clfii't should bo made to have 'candidates for Parliament pledged to alter the methods of finance introduced by the Reform Government, and pledged also to repeal the restrictive war legislation.