TERMS CONDEMNED

Otago Daily Times, Issue 24414, 27 September 1940, Page 6

TERMS CONDEMNED

A SPECIAL INCOME TAX MINISTER'S ARBITRARY POWERS (Per United Press Association) AUCKLAND, Sept. 26, The terms of th e War Loan were condemned as too drastic by the chairman of the Auckland Stock Exchange, Mr J- W. Frater, who said that compulsion would have an adverse psychological effect and result in considerable hardship on business and industry. Compulsion had no* been tried in any other part of the Empire so far, and was equally unnecessary here. The terms were a blow at the patriotic incentive which was strong in New Zealanders' hearts. The restriction on the death duty clause, Mr Frater said, would have the effect of weakening the market for scrip, thus -compelling holders who had to sell to accept a loss. He considered that a straight-ou loan at 2J per cent., involving £200,000 yearly in interest, would have met with a splendid response and have obviated a g"eat deal of hardship. " What has been done is, in effect, to levy a special income tax on those who, in February, 1940. paid over £SO of income tax." said Dr H; A. Cunningham, an authority on taxation. 11 was not merely a loan, because the stock received in exchange, being free of interest for the first three years, and afterwards carrying a low rate, was probably worth little more than half i's face value. That represented a serious added burden in the case of many taxpayers, particularly business people, who had been recently assessed under the new provisions relating to valuation of stock-in-trade-Dr Cunningham pointed out 'hat in the case of previous loans the taxpayers could appeal to a specially-constituted board of appeal and afterwards to a judge of the Supreme Court. It was now left f o the Finance Minister to decide whether a person had subscribed in due proportion to his means... ATTITUDE OF BANKS REASONABLE ASSISTANCE FOR SUBSCRIBERS (Per United Press Association) WELLINGTON, Sept. 26. From inquiries made locally it is learned that the banks have hot at th e moment considered what measure of assistance they will be prepared to offer those subscribers who will be compelled to take up war bonds, but it is understood that the banking system will afford all reasonable assistance and facilities to customers to enable them to subscribe.