THE IMPERIAL CONFERENCE

Taranaki Daily News, Volume LIII, Issue 332, 20 June 1911, Page 5

THE IMPERIAL CONFERENCE

BRITAIN'S OVERSEA INVESTMENTS.

INCOME TAX AND DEATH DUTIES. SHIPPING MATTERS. By OaMe—Press Association—Copyright Received 19, 10.5 p.m. < London, June 19. The Imperial Conference sat at 2 jf.m. In reply to Genera] Botha, Mr. LloydGeorge, Chancellor of the Exchequer, 6aid that Britain was the world's greatest lending country. She had three thousand millions invested overseas, and if the income tax revenue was made dependent on the amount charged in the countries where the money was invested ft would cause the imposition of another penny, and later probably another twopence on the resident of Britain. It was impossible for him to face such a contingency immediately after the great struggle of 1909-10. Regarding the exemption suggested by General Botha, the amount was small and the difficulty of administration great. It was impossible to check with accuracy these claims, and flie authorities would be compelled to accept every claimant's statement. General Botha's final suggestion, which was now advanced for the lirst time, raised a point worthy of consideration. He would ascertain the possible effect, and decide later.

General Botha hoped for early uniform legislation as to death duties in South Africa. He suggested that death duties should he charged to companies only in the country where they were registered. Mr. Lloyd-George remarked tKat the proposed' concession regarding death duties would ultimately cost the British Exchequer £2,500,000 a year. The pro vision of the Finance Act iii question was applicable to thirty-five colonies. The arrangement generally was satisfactory, although it did not appear to work well in South Africa.

Recently he invited a conference of parties interested to meet him and the Board of Trade, but the support they were prepared to give to any drastic legislation was not encouraging. In fact theie was considerable difference of opinion as to hov- fir. under proper conditions, the Sh : Conference would go, and whether the svsfpm involved an advantage or disadvantage to the country's trade. In view of the magnitude of the mercantile marine it was not easy to legislate concerning its interests, unless a considerably body of opinion was behind him, but the Government would keep the matter under consideration and watch developments in South Africa and elsewhere. 1

Mr. Bordeur said that Canada had rto serious objection to the motion, but serious injustice -fcas done, not by the Shipping Conference, but by a British insurance combine inserting a clause in their policies imposing higher premiums on ships entering British North American ports.

Mr. Pearce stated that experience had set Australians very definitely against rebates. Legislation in connection with the coastal trade had proved that suppression of rebates did not interfere with the regularity of ,the service, stability of rates, or with other matters beneficial to trade. The conference system was a distinct disadvantage to the United Kingdom.

Received 2D, 12.50 a.m. London, June 19. K the companies wanted the advantage of a British market it was only fair that the Exchequer should tax them. Mr. Malan asked if Mr. Lloyd-George would consider the suggestion of paying the difference between the colonial and the Home taxes in connection with death duties, equally with the income tax. Mr. Lloyd-George promised to consider the matter, but said it was rather a different matter.

Mr. Buxton suggested to add the following words, "in so far as such combines are prejudicial to trade." He said he must not, however, be considered necessarily as agreeing with all Mr. Graaf's arguments or his conclusions. They must look at the question from a more general standpoint. He reminded the conference, in connection with the Royal Commission on rebates in 1906, whereon the Dominions were represented, that neither the majority nor minority report made very drastic suggestions. They proposed not the abolition of rehates hut the creation of an association of those concerned, with certain powers to be conferred by the Board of T sile. The initiative for carrying out the proposals was largely left to the parties interested, but shippers, merchants, traders and manufacturers did not manifest any great desire to press the Board of Trade. One of New Zealand's resolutions regarding double income tax, also General Botha's, on the same subject and on Death Duties, were withdrawn. Sir J. G. Ward recognised, from Mr, Lloyd-George's explanation at a sub-con-ference. where the matter was fully discussed, that the proposed change was so serious as far as the British Government was concerned, as to make acceptance impossible. But it would be very advantageous if some system could be arranged to mitigate or obviate the present hardship on income tax payers. General Botha said he was disappointed there was so little progress on the question since last conference, and suggested the Motherland should exempt persons of small incomes as long as they reided in some Dominion. The position might be partly met by extending the principle embodied in the Imperial death duties legislation. If the Home Government was unable to go the whole way, he suggested that where a resident in the United Kingdom invested money in the colonies he should pay only the difference between the colonial and the Motherland income taxes. This would stimulate British investment within the Empire, and diminish the amount invested elsewhere.

1 Mr. Lloyd-George stated tliat the abolition of the double income tax would involve a loss to the British Exchequer of £-2X100,000 yearly, and the amount

would tend to increase. Tlio Royal Commission showed that, under the Shipping Conference lines, the prefeiential system operated in favor of the United States against Britain. It also disclosed the fact that the system extended to life Australian overseas trade. There was a strong agitation in Australia in favor of the Government owning tie liners steaming between Australia and Britain to prevent the producer being exploited and deprived of the profits of the market.

Sir J. G. Ward considered that South Africa had a substantial grievance. He supported the resolution though, as far as New Zealand was concerned, he was unable to agree to all Mr. Graaf's arguments. South Africa had special difficulties. New Zealand must also study the particular needs of her own people. Owing to the peculiarities of her trade and the position of rebates she could not exist but for her oversea trade. Many traders were compelled' to pay double rates on special articles of commerce. Large refrigerating steamers required for frozen meat and dairy produce, and if tramp steamers were given ordinary cargo not requiring refrigerating, double rates would have to be paid for frozen meat and dairy produce. He always insisted that the smallest producer should be placed on an equality With the largest shipper. New Zealand, on the whole, had placed her shipping business on! a satisfactory footing, but he recognised South Africa's difficulties.

Mr. Graaf declared that South' Africa intended to proceed until she obtained reasonable rates and conditions.

The resolution, as amended, was agreed to.