INTERNAL WAR LOAN

Otago Daily Times, Issue 24419, 3 October 1940, Page 10

INTERNAL WAR LOAN

RAISING OF £8,000,000 PROCEDURE TO BE ADOPTED “ NOT BUYING PATRIOTISM T' ; THIS TIME ” (From Our Parliamentary Reporter) WELLINGTON, Oct. 2. ■ ■“We are not. going to buy patiiotism this time,” said the Minister of Finance, Mr Nash, when .explaining in me House of- Representatives to-night tie to be adopted, for the raising of the £ 8,000,000 internal war loan. The Minister was . referring to the rate or interest paid on a compulsory war loan raised ; during the- last war and added that it was not proposed this time t issue loans free; of income tax at a high rate of-interest. He added that he ex pected to receive a. fairly large sum from the national savings scheme which would be announced shortly, ana would provide an opportunity for persons who would not have to contribute to the war loan to help the war t anas, i Referring to the £8,000,000 loan,The Minister reminded members that it would be free of interest until October I 1943, and would bear 2i per cent for the next 10 yeairs. He pointed out that the first £375 of taxable income was exempt, and - that a single man would have to have p.n income of £575 to oe required to contribute anything fo the loan. . . ~,. Mr W. S. Goosmaa (Opposition, Waikato): How many taxpayers Will that cut out? ... u . The Minister; 1 am not spi'e. but « will be a good many. „ There will certainly be no hardship on the lower levels. , : ' ■ : . Alongside the war loan, the. Minister continued, there would be a national savings scheme, details of which would probably, be announced in a week or so. It would provide for a section of the community which did not normally subscribe to any loans, and he thought the money would come in all right. Outlining the procedure to be adopted with the war loan, Mr Nash said that if the Commissioner of Taxes .noticed That there were shortages after the' closing date he would advise the "Minister, who would have a notice published in the Gazette. No names wbuld be mentioned, and if the persons- concerned then subscribed there was nothing more to worry about. If any persons felt they could not subscribe they would be able to take advantage, of a procedure which was being, worked out to provide for appeals,to a committee to be set up by the .Minister. . , , Mr S; G. Hollani (Opposition, Christchurch North): Kow will a man know (he'Gazette notice applies to him if his name is not mentioned? Mr Nash: He will know whether he Is liable or not in his income tax figures. Persons are only invited to wubscribe now. but I am sure everyone concerned will accept the invitation. Mr Holland: It's a big-stick invitation

“I am certain the money will come in.” Mr Nash said, “ because nothing has been more obvious since the war started than the desire of all sections to give of their best." Mr E. Goosman: If you are satisfied ihe money will come in why have compulsion? Mr Nash: It will be fair to everyone. I am also hopeful that tne national savings scheme will produce a fairly large sum. , Mr Holland:'ls .there any compulsion in that?

Mr Nash: No. There won’t be any compulsion anywhere if they pay. “There will be difficulties for some' of those who are to subscribe,” the Minister said later in his speech “ The question as to what can ba done to help them is now under consideration, but to the maximum that is possible the loan should be: subscribed out of current income. To the extent that this might retard production or create hardship we will take steps to help them along the way.” VOLUNTARY METHOD MR COATES’S ADVOCACY COMPULSORY SYSTEM CRITICISED iFrom Oub Parliamentary Reporter) WELLINGTON, Oct. 2. The opinion that a voluntary method should have been adopted in the raising of the internal loan for war purposes was expressed by Mr J. G. Coates (Opposition, Kaipara) during the debate on war finance in the House of Representatives to-night. He said that the Government’s proposal really amounted to a compulsory acquisition nf capital with no interest for the first three years. Mr Coates said he believed that if the people had been asked to contribute on a voluntary basis to the £8,000,000 War Purposes Loan, not only people with incomes of £585 a year and more would have to contribute, but that citizens receiving much less than that would have been glad to do so as well. The Minister of Finance (Mr W. Nash): That is to come in the national savings scheme, Mr Coates: That is rather different. Mr Coates said that for the first three years no interest would be paid on the war loan, but interest would have to be paid to the bank for accommodation, and in his opinion it would have been better to spread the interest over the whole period Bonds would be worth only £BO. The Government’s proposal might save £200.000 in the first vear, but in an expenditure of £102.000,000 that amount was hardly .worth the trouble and inconvenience it was going to cause a number of the country’s best citizens. The loan would cause difficulties for large companies and reduce the earnings of industry. A