BANK CHARGES

Hokitika Guardian, 16 September 1930, Page 8

BANK CHARGES

PROTEST AGAINST INCREASE. CABINET TO CONSIDER MATTER. WELLINGTON, September 12. A general protest against the action of the banks in increasing the charge, for. keeping accounts and in decreasing the issue of ten-shilling notes as a result of the Government’s taxation was made by a Parliamentary deputation which waited ou the Acting-Prime Minister, the Hon E. A. Ransom, this alt noon. The Leader of-the Labour Party, Mr H. E. Holland, said the banks had Increased the charge of keeping accounts by 100 per cent. The banks had been asked to pay only a reasonable share of the taxation of the country and had retaliated by withdrawing ten-shilling notes ifrorri circulation and adding 10s a year to the charge for keeping accounts. The deputation asked the Government to secure the revocation ol that decision by the banks. The deputation was inclined to suggest that il the Government approached th.e banks with regard to the matter the banks would listen to reason, otherwise he would suggest the Government shoulo take very definite action in respect of the matter.

Mr F. Langstone (Lab., VVaimarino; said the banks were.acting under license or charter from Parliament, and Parliament could extend or restricl that license. The deputation wished the Government to tell the banks that it was not for them to fly in the face ol either Parliament or the people at a time like the present. The petrol companies had agreed to bear portion ol the increased taxation, but the banks were passing on the whole lot. The increased taxation as a result; of the note tax would amount to £IOO,OOO a year.

Mr A. Harris (R., Waitemata), Mr F. Lye (U., Waikateo), Mr J. S'. Fletcher (lnd., Grey Lynn), Mr H. G. Dick ie. (R., Patea), arid Mr'M. J. Savage (Lab,, Auckland West) gave general support to the representations.

BANKS APPROACHED. Replying, Mr Ransom he realised the position was a serious one to the general taxpayer. The Government had endeavoured to place taxation ?n a manner in which it could not easily be passed on in the case of the larger institutions because already by other systems of taxation each individual was being called on to carry what was believed to be a fair proportion. Since it had come under notice that the banks proposed to pass on the taxation the Government had asked them to give particulars of the proposals, and the banks did notify that they proposed to add 10s to the charge for accounts and to withdraw 10s notes from issue Re thought the, Government would be quite entitled to ascertain from the Associated Banks, the exact number of customers they had' so that the Government might be in a position to know whether the banks were, carrying any of the note tax or not, or whether, they were getting more from their customers than was being levied on the banks.

Mr. W. J. Jordan (Lab., Manukau) : It is accounts not customers. Some customers have several accounts .

Mr W. E. Parry (Lab., Auckland Central): Most of us have, only one. Mr Ransom said the Associated Banks had said they would he compelled to pass on the tax. They had made representations to the Government, and indicated that the tax on the note issue was. of such a character that they could not carry the charge. Mr P. Fraser (Lab., Wellington Central) : Sir George Elliot stated some time ago that the time had arrived when the banks should contemplate doing away with the charge altogether. WHAT BALANCE-SHEETS. REVEAL. Mr Ransom said one thing that impressed him was that the greater the economic stress upon the country a study of . the balance-sheets of the ban.’i during such a period did not indicate that the .shareholders had to suffer any depletion. -It was rather the other way round. He could assure the deputation its representations would have full consideration. Just how far it was possible to go was another matter. Mr Langstone had said consideration should be called on to revoke the decision to impose another 10s on accounts, but he thought the Government would require to know what the banks proposed to do in that case, whether the banks would propose taxation in some other direction or whether they would carry it themselves. If the banks decision »vns to raise the rates of interest, that might be more disastrous to the country than the present decision. OTHERS WANNT RELIEF. Not only had the banks indicated their intention to pass on the taxation but the Government had had representations from other strong financial institutions which were also disinclined to bear the taxation. Both the film producers and the insurance companies were asking that the measure of taxation upon them should be reduced, and stated that they considered the impost was higher than they should be called on to. pay. The Government had endeavoured to spread the taxation as fairly as it could over the whole community, and he thought any endeavour

on the part of the banks or others to get out of the impost and place it. on the shoulders of those already taxed should receive the .serious' consideration of the Government. The representations of the deputation would be submitted to Cabinet for consideration.