THE BUDGET.

New Zealand Times, Volume XXXIII, Issue 5438, 31 August 1878, Page 3

THE BUDGET.

TO THE EDITOR OF THE NEW ZEALAND TIMES. Sir, —In the various criticisms iu your paper on the proposed alterations in taxation* I think no notice has been taken of the JointStock Companies Income Taxation Bill, though it affects a largo portion of the community and will raise a considerable income. The Colonial Treasurer, in announcing the programme, was able to give only one excuse why a fresh burden should be laid upon companies ; he said it was a way to get at the absentee shareholders who contributed nothing to the colony’s income. He must surely have forgotten that companies are already saddled with the payment of an annual license fee, ranging up to £2OO. But fancy the logic of a Minister, who, to tax a few persons, lays an impost on the whole of the joint-stock concerns in the colony ; does it not remind one of schooldays, where the master keeps in a whole class because one unfortunate dunce cannot say his lessons ? It is doubtless desirable to tax absentees, bat their income from shares is so easily taxed by making the companies* managers or secretaries declare at stated times what portion of the dividends are payable to absentees, and hand the Treasury a percentage of that portion, that this cumbrous legislation is not needed for the purpose. Again, why tax absentee shareholders only ? There are many gentlemen deriving largo incomes from New Zealand properties, but residing elsewhere, who will not be touched. How * will Mr. W. J. Clark, of Victoria, who is a large runholder here, be reached by the proposed Act ? I am unaware what reason can be urged why a number of persons, bound together by certain rules under the Joint Stock Companies Acts, should pay a portion of their profits to the colony, while other persons carrying on the same class of business, and bound together by the clauses of their partnership deed, should escape. i

With your permission I will give a few instances of the working of the proposed Act. The Union Steamship Company have wonderfully Improved our coastal service; their boats keep punctual time and are fast and comfortable. They are engaged iu active competition in portions of their trade with Messrs. McMeckan, Blackwood, and Co., a Melbourne firm of steamship owners. The local institution is already weighted with a very heavy annual license fee. Mr. Ballance means now to take iu addition from it 1£ per cent, of its profits; while the absentee'opposition firm pays nothing to the New Zealand revenue, and I am informed that oven the liquors consumed on board McMeckan’s boats are drunk in bond, while the famous “red funnel brand” of the Union boats pays our heavy duty. The Treasurer does not seem to have got at the absentee in this particular case. A local insurance company has its shares scattered throughout the colony, held in from fives and tens to (say) fifties and five hundreds by all classes; its accumulated funds are invested here, and its profits divided and spent in New Zealand. It will have agencies in England and in each Australian capital, and its profits to the extent of about one-third to onehalf are derived from insurances outside tho colony. Tho Treasurer intends to tax the local company’s English and Australian earnings, while a foreign company having no interest with us except as regards the amount of New Zealand colonists’ money which its agents can scrape together and send away each mail, pays only on its New Zealand profits. Again, a company has just been floated to provide a small steamer for the rising district of Patea, a movement which should be assisted in every way by the Government, as it is, calculated to increase the value of Crown land, and promote settlement. Mr. Ballance’s assistance takes the shape of picking the company’s pocket of 3d. in the pound of its profits . Two Wellington institutions—the Equitable Building and Investment Company and tho Wellington Building Society—carry ou the same business of advancing money on buildings, to be repaid by monthly instalments. The former lately placed itself under the Joint Stock Companies A cts, and this unfortunate step results in its being fined iu an annual licet so fee of £SO and per cent, of its profits, while the Wellington Building Society is not only not subject to these impositions, but also by Act of Parliament is exempted from the necessity of using receipt stamps, • Surely tho Colonial Treasurer spent no time oyer the consideration of this taxation scheme, pr he would nob have fallen into such inconsistencies. . I woulk ask these joint stock enterprises do not dtraorvo tho moat cordial support

on the part of Government, taking, as they do, the savings of the people to develop the country’s resources in a manner no private capafcalist can attempt, and thus increasing the taxable income of the colony, rather than the present attempt to saddle them with an impost from which private persons or firms are exempt.—l am, &c., Shareholder.