A BUDGET OF JUSTICE

Hokitika Guardian, 1 August 1930, Page 8

A BUDGET OF JUSTICE

,NOT RUNNING FOR SHELTER

LAND TAX REVISION EXPLAINED

WELLINGTON, July 29. “This has been described by the Opposition as the ‘Black Budget,’ but I say it, should go down as the Budget of Justice, because it aims at placing taxation on the shoulders of those ajble to bear .it,” declared the Hon. E. A; Ransom, Minister of Lands, in the House to-night, in replying to Mr Coates’s criticism of the Financial Statement.

The Minister said the Budget laid down the principle of equal sacrifice for all, a doctrine preached by the Reform 'Party, but never practised by it yet. : When the. Government enunciated that i principle the Budget was hailed as I the Black Budget.

’ A Reform member: Some of the tax-, payers are black and blue. , j The Minister referred to the over- ! sea trade position, mentioning that it, i1i2,000,000 less favourable this year, than last year, and touched on the lowering of the excess of deposits j over advances in the banking returns, i Operations for the year which ended ; on March 31, 1929, disclosed that dej posits exceeded advances by £8,986,000 but for the last financial year the exj cess was reduced by £326,000. Where

did this huge sum circulate? asked the Minister. The primary producer or the industrialist had. not benefited materially. Had it gone into circulation farmers could have spent more on improvements, industry would have been developed, unemployment would have considerably diminished. “I have it on very reliable authority,” declared Mr Ransom, “that last .year no less a sum than £10,000,000 went from New Zealand to Australia for investment. On.more than one occasion last year, prices of shares quoted on the Australian Stock Exchange, particularly bank shares, definitely

hardened as a result of New Zealand capital being sent there for investment.”

Dealing with another aspect of tlie proposals of the Budget, the Minister said the statement had been made by the president of the New Zealand Stock Exchange Association that it was iniquitous that the investor should be called upon to, pay stamp dntv at both ends on the transfer of shares in oversea companies. The Minister, said he was of opinion that it would be an excellent thing for New Zealand if such transfers were taxed not. only at both ends, , but in the middle as well. (Laughter.)

NOT RUNNING FOR SHELTER

“To meet the Budget shortage the position has to be faced courageously,” declared Air Ransom, “and let me say it is not the intention of this Government to run for political shelter in times of difficulty or to stand still because it is a minority Government. (Hear, hear.) It intends to stand up to the position and to do what it believes to be in the interests of the whole Dominion, what will place tlie finances on a sound footing. We are going to face the position and our responsibilities. ' (Hear, hear.)

The Minister denied that in carrying that policy into offect .it was the intention of, the United Government to cut salaries or dismiss , men. Mr Coates had made, it clear from his amendment that > the Government could expect no co-operation in the present difficult period from the Reform Party. It had been suggested that the Government might have avoided increasing taxation, but that could only have been effected by once again allowing the policy of drift to go on—a policy the Reform Party would foster—by using up accumulated surpluses.”

FAIR CONSIDERATION FOR FARMERS.

; It had been suggested that farmers received small measures of assistance from the Budget proposals, but an ordinary examination of the Financial Statement would show • that the primary producers had been given particularly, fair consideration.

The Minister admitted that the super land tax had been unscientific and had proved incomplete, and holding that’it was unwise to continue any system of taxation that it felt could be improved upon, the Government had repealed the super tax.

The Minister here made the point that while the Reform Party had condemned the super tax, how long had that same party while in power retained the system of remission of income tax to wealthy farmers? A member: All! that’s the point. i,ne Minister said that notwithstanding the protests .made year after year against such an inequitable system, the Reform Party , had , never repealed it. With the United Government, however, it was a case of.,repealing an incidence of taxation when it was found it was not entirely correct and businesslike.

Mr Coates: Yes. You wobble all over the place.

MORE REVENUE THAN NECESSARY. Tanoring the interjection the Mini.s- - l«r proceeded to deal with tariff matters, claiming that the Government's policy was As clear as daylight. In the first place it provided for trade within the Empire atad preference to,

British products. Secondly it gave reasonable protection to New Zealand industries, and thirdly it produced revenue. It was not denied that revemie was .wanted. Everybody knew that the Government was forced into the position of seeking additional revenue to carry on the affairs of the Dominion The House had ,been told that some of the Dominion’s industries should go by .lie board,, but ; the-Minister invited the Opposition to nominate which industries. Surprisingly enough, in face of that view, Mr Coates had wound up his speech with an appeal for support of. local manufactures. It must be recognised that at some stage in every industry it had. not been a sound proposition. If the, ground had Ijeen cut from under it in that .stage what industries would there ,be •in New Zealand to-day ?

LIMITATIONS OF LAND TAX

Mr Ransom went on to demonstrate that the Government’s reduced exemption proposals in respect of land tax would not prejudice the majority of farmers. There were only about 4000 farmers in New. Zealand whose unimproved valuation exceeded £7500. The exemption point, an unimproved value of £7500, would, .suggest the Minister, represent a capital value of £IO,OOO and a selling value of about £12,000, and it was fair to assume that farmers who bought farms at £12,000 would escape the operation of the income tax proposals. He could, not see how dairy farmers would have to pay because 100 acres bought at £l2O would be within the exemption total, and even 400 acres at £3O would similarly, be exempt. Sheep farmers owning 800 acres purchased at £ls, and 2000 at £6 an acre, would escape, and mixed farming country at £25 an acre would escape up to 480 acres, while 600 acres of land of £2O acre value would also be outside the new proposals. It was estimated that the yield ol land and income tax would be the same as at present but, added the Minister, the tax' would be more equitably distributed.