The Taihape Daily Times AND WAIMARINO ADVOCATE SATURDAY, JUNE 17, 1916. THE FINANCIAL STATEMENT.

Taihape Daily Times, Volume 8, Issue 141, 17 June 1916, Page 4

The Taihape Daily Times AND WAIMARINO ADVOCATE

SATURDAY, JUNE 17, 1916. THE FINANCIAL STATEMENT.

(With which is incorporated The Tal hape Post and Waimarino News.)

The Financial Statement submitted j to Parliament last night by Sir Joseph Ward. Minister of Finance is indeed a portentious document, one that is likely to prove more interesting to all sections of the community than any that preceded it, owing to necessary provision for huge additional taxa- i tim occasioned by the war. Taken as a report and balance sheet of the post years operations It must be considered a satisfactory disclosure of accounts, but from th° people’s point. { of view—the masses—it shows that a j rather severe strain has been nut up- j rp those who. whi'e only able to make 1 ends meet have been compelled by | indirect burdens to contribute practically their mite. However, as finan- 1 oial statements' go it compares well, . despite extraordinary conditions, with j ap v <hat nave gone before. It shows | a not surplus of receipts over expen- j suture ri 1 £2.017.030; this amount be- j ing actually received. But the Minis- | ter takes the opportunity to remind j the country that the longer the war j lasts the greater will become the annual -iiy that t.be expenditure of j the past year must not be regarded as | equal to the expenditure required in years to follow. The revenue has ex- j ceded that of last year by £2.058.192, | only £900,000 of which is the result | of direct taxation of wealth, income 1 tax contributing nearly four times as much as the land tax. leaving the balance to the credit of the payer of taxes through government trading institutions. to which, of course, all contribute. There is a saving disclosed of £74.674 in administration of de-

partments. but the Minister is scarcely to be congratulated on this as it has largely been acquired in less efficiency, causing inconvenience and loss to users of departments in which these savings are largely shown. The j estimated revenue for the coming year / is £14.591.401, over two millions increase on last year’s expenditure, and the estimated expenditure is £14.390.662. One million of additional expenditure is almost swallowed in two items —the payment of interest and sinking funds on war loans, showing a arc wing increase over previous years. The question of future taxation is fairly exhaustively an f i broadly dealt with, and it contains proposals that would have no chance of acceptance

under ordinary conditions. Money for

th e conduct of the war must be had, and there is no valid reason, says the Minister, why those who have surplus moneys, largely due to war conditions, should not b e called upon to provide a portion of the capital required. Authority is asked to levy a tax of 45 per cent on excess war profits earned during the past year. So that whether the earners of such profits have spent them in paying off mortgages, or in any other way, they will have to find the 45 per cent as war tax. These war profits are to be ascertained by taking the average profits for three years previous to the war and comparing it with profits made since the war commenced. This is to be paid about March 31st next, and it is estimated to produce £2,000,000. A special income tax is to be levied on all incomes of 5 per cent. The oldstanding minimum on which income tax is levied not being disturbed, ' therefore this will not touch men receiving wages or salaries of less than £3OO. Fears are expressed that this minimum will have to be reduced in succeeding yearo if the war continues. Methods of raising necessary money by way of loan include the issue of war bonds with a currency of 25 years, bearing interest at 41 per cent., free of income tax. The export of mon•ev except for legitimate trade purposes is to be prohibited. A most important proposal i s that regulating the interest to be paid on deposits in hanking or other institutions. It is pointed out, that local bodies have apthe Minister asking to be allowed to raise loan money at a higher rate than 51 per cent. It is readily seen that such permission would leaa to lending institutions offering higher rates for deposits and so interest rates would soar to a disastrous inflation. No lending institution is to he allowed to take advantage of an'cther bv offering unfair inducement for deposits and a rate is to be fixed beyond which neither lending institution or private person will be allowed to go. Amongst the most important proposals contained in this year’s budget are: the levying of a 45 per cent tax on war profits; raising of loans bv issuing war bonds in New Zealand at 41 per cent and free of income tax; a 5 per cent special tax on all incomes over £3OO per annum; prevention of money leaving the Dominion, except legitimate trade purposes; regulation of interests; financial assistance to friendly societies; a war bonus to the public service whose pay does not exceed £315 per annum; payment of an annual bonus to beneficiares whose estates are administered by the Public Trustee;- abolition of income Tax duplication; repeal of the Mortgage tax and replacing it with an income tax on sums invested on mortgage by owners. Expenditure on public works is to be further reduced and powers pr-o psicea to borrow an additional •o 1 9 ooo.hQO fov Avar purposes, The Budget is a bulky document and Urn above only briefly touches upon the majority of its main features.