PARLIAMENT.

Manawatu Standard, Volume XLIX, Issue 248, 18 September 1929, Page 4

PARLIAMENT.

YESTERDAY’S BUSINESS.

TAXATION PROPOSALS MODIFIED.

The Land and Income Tax Amendment Bill, which was introduced in the House of Representatives yesterday, contains important modifications of the Government’s taxation proposals as outlined in the Budget. The amount of the unimproved value at which the supertax is to commence is to be £14,000 instead of £12,500 as formerly suggested, while the amount of the mortgage exemption will be £7500 instead of £SOOO.

HOUS'E OF REPRESENTATIVES. STATEMENT ON LOAN CONVERSION. Per Press Association. WELLINGTON, Sept. 17. The House of Representatives met at 2.30 to-day. Replying to Mr R. A. Wnglit, Hon. W. B. Taverner stated that the railway classification list'was in the hands of the printer and would bo available in a few days’ time. Sir Joseph Ward made a statement on the subject of loan conversion. He said that the conversion and redemption of the four per cent, stock matured on November 1 next was now practically completed and was the largest and most important financial operation in the Dominion’s experience. The stock outstanding amounted to £29,490,852. Of this sum, £5,000,000 was converted in May, 1928, on a basis of £lO4 10s new 4J per cent, stock for every £IOO of four per cent, stock, maturing 1929. The interest cost of this conversion to the State, taking into consideration the expenses of conversion and the redemption of premium over tho period of the new loan, worked out at £4 18s 3d per cent. Following on the conversion of May, 1928, further stock was purchased from the proceeds of additional sales of 4i per cent. 1947 stock, amounting to the nominal value of £572,000 of 4 per cent. 1929 stock. These private sales were made at different prices, the interest cost to the State in respect of the sales working out at approximately £4 18s per cent. In January, 1929, the sum of £12,000,000 was converted on a basis of £lO4 5s new 41 per cent, stock for each £IOO of maturing four per cent, stock. The interest cost to the State in this case amounted to £4 10s lid per cent. The Prime Minister htated further: “In addition to these transactions, public debts repayment moneys were used to the extent of £502,000. During the financial year 1928-29, moneys raised in New Zealand amounting to £1,923,500 at rates not exceeding 5J jier cent, have also been utilised in the further redemption of maturing stock. Purchases of this stock on the London market have been made from these sources from time to time as the opportunity offered and stock so purchased, amounting to £1,925,000, was bought at an average of £99 10s per cent.” Sir Joseph added that the amount of stock outstanding was therefore approximately £9,700,000. ' A further conversion, to the extent of £5,000,000, I was at present under consideration and under the terms proposed the cost to the State would be £5 7s 8d per cent, over a period of 1G years, this being five per cent .stock to mature in 1945. Including the figures relating to the conversion offer now being made, tho annual interest cost to the State on the total stock issued in conversion or redemption worked out at an average of less than five per cent. In regard to the balance of approximately £4,700,000 it was proposed to pay off the holders at maturity in cash. The Finance Minister read a cable from the High Commissioner stating: “Once again the English Press is very favourable towards New Zealand’s credit in London and the present conversion offer,” and quoting several com-, ments by leading papers. | LAND AND INCOME TAX. ' The Land and Income Tax Amendment Bill was introduced by GovernorGeneral’s message. Replying to points raised by Rt. Hon. J. G. Coates and Hon. W. Downie Stewart, Sir Joseph Ward . stated that the bill embodied the proposals outlined in the Budget, with certain variations. It provided that in cases where it was claimed that hardship was involved, and a dispute ex- 1 isted between the Commissioner of Taxes and the landowrier, a special commission, consisting of three mem- ■ bers, should consider the case. The bill further varied the amount above ; which land taxation was to be charged. : The limit, instead of being £12,500, j; would be £14,000. Another amendment to the original proposals related I to the mortgage exemption. The total amount on which it was proposed the -

exemption should be granted had been increased from £SOOO to £7500. Replying to an interjection, Sir Joseph stated that tho principle of “whichever the greater” in relation to the payment of land'or income tax was retained in tho bill. t Mr H. E. Holland (Buffer) asked when the Prime Minister proposed to . take the second reading of the bill. Sir Joseph Ward: To-morrow, s Mr Holland then suggested that tho b Prime Minister should give the bill time to go out to tho country, so that t members could obtain the views of 2 their constituents on the subject. The Prime Minister replied that the - request was reasonable. Time would be - left for the purpose that Mr Holland b had suggested and the second reading - would be taken at an early date. s Mr Coates suggested that the bill - should be referred to a select commits tee, in order that those people who ■ were likely to be adversely affected should be given an opportunity to record their objections. Sir Joseph Ward said this practice had never been followed and he could not agree to the request. He pointed out that ho had amended the proposals as the result of communications from farmers who were not “wool kings,” and in submitting this bill, he was meeting the wishes of the majority of the farmers of the country. The bill was read a first time. ANNUAL TAXATION BILL. The Land and Income Tax (annual) Bill was also introduced by GovernorGeneral’s message and read a first time. ESTIMATES CONSIDERED. Consideration of the estimates was resumed in Committee of Supply. The Department of Industries and Commerce estimate (£8301) was taken first. Hon. J. G. Cobbe, in rejilying to Mr Coates, stated that it was the Government’s policy to use New Zealand timber on all public works wherever possible. Hon. W. Downie Stewart stated that if the Minister of Industries and Commerce or the Minister of Customs were able to arrange to visit Canada or Fiji, it would probably be found possible greatly to increase the Dominion’s trade with these countries. Mr A. Hamilton referred to the ( United States Government’s increased tariff proposals and asked whether this country had made any protest against raising trade barriers against it. He thought this step should be taken if it were intended to arrange a new steamship service to the United States and Canada. Mr F. Langstone urged that a Parliamentary committee should be set up to investigate the possibilities of all our industries. Ho suggested that tho timber industry in particular was capablo of great expansion and he thought that the employment of units of labour and the development of our industries should go hand in hand. Mr F. Waite asked what was the amount which the Union Steamship Company was to receive from the Gov- i ernment as subsidy for a steamship service between tho South Island and Australia. There was a suggestion that the Government had “fallen into a hole” in its negotiations with the company. i MINISTER’S STATEMENT. I Hon. J. G. Cobbe stated in reply to Mr Hamilton that the United States protective tariffs did not apply to all goods imported from New Zealand. Seventy-four per cent, of those goods went into the United States duty free. . Mr D. Jones: That is because the duties on other goods are too high to let them in at all. Mr Cobbe agreed that the duties on some goods, including meat and wool, were high, but he repeated that there was not a tariff at all on other items. Replying to Mr Langstone, the Minister said that it was the policy of the Government to encourage all secondary industries and to aid the produc- ; tion of New Zealand goods. The amount of money invested in secondary industries in tho dominion was £62,000,000. . With reference to the point raised by Mr Waite, Mr Cobbe stated that the Government would not fall into l any hole. C

Mr C. A. Wilkinson suggested that this country should increase the tariff on United States goods and reduce tho tariff to an equivalent extent on imports from Britain, so that the taxpayer would not have to bear any added burden. He added: “In my opinion, we should discriminate ‘against the United States, as that country has discriminated against us.” Tho Houso adjourned at 5.30 p.m., and resumed at 7.30 p.m. Mr J. S. Fletcher asked whether the supplementary estimates would inelude a sum for tho purpose of assisting secondary industries. Mr R. Semple urged that the timber industry should be reorganised and that scientific methods should be em2>loyed. Ho complained that, owing to cumbersome methods in the past, many young trees had been destroyed in the course of removing larger timber. CHAMBERS OF COMMERCE. Some Labour members criticised tho Chambers of Commerce, which they described as party political organisation. Mr W. E. Barnard, liowever, disagreed with this view, stating that at the time when ho was g V lO olcction as a Labour r']!\, ot °r n was chairman of a e Ce u and d ' d not Hnn l T °i i S all embarrassing. • • +i stated that m Ins I op nion there was no party element in the Chambers of Commerce, and Hon. view I>O ' VJUe ® tewarfc supported tins •kp.T- Eraser said that he could aeccpt the statement that Chambers of Commerce in the smaller towns wore non-party, but in the larger towns, as resolutions adopted by the chambers would show, those bodies were opposed to the interests of the mass of tho working people. Hie estimates contamed £Io for membership subscriptions to Chambers of Commerce, but Mr Fraser asked what were the powers ot the department s representatives on those bodies. Did they vote? Mr F. Lyo urged that a better trade understanding should be sought between Australia and New Zealand, and Air .IV. J. Poison suggested that Australia and New Zealand should combine to gain a more satisfactory trade relationship with the United States. Mr Polson also referred to the urgency of the dairymen’s need for bran and suggested that the Minister should endeavour to import a large quantity from Australia. The Minister, replying, said that tho department’s representative on Chambers of Commerce acted purely in an advisory capacity. They did not tako part in the discussions. Mr Cobbe srtid lie would make inquiries in regard to the importation of bran from Australia, but as there was a shortage in

the Commonwealth, he doubted that it would bo possible to secure a large quantity. The Government had not lost sight of the _ need for developing secondary industries and probably a small Parliamentary committee would be appointed to deal with the subject, He added that he did not think there was much prospect in influencing the United States in the matter of tariff barriers. Mr C. H. Clinkard said that the criticism of the methods in the New Zealand timber industry was unjustified. Conditions in this country were entirely different from those in Canada, and it would be impossible for the same methods to be employed, Mr A. W. Hall asked what was the subsidy paid by the Government for the South Island-Australia shipping service, Mr Barnard urged that steps should bo taken to prevent a large outside firm blotting out local tobacco firms, Ho asked tho Minister to inquire into to.™ a serious one. Air Cobbe, replying, stated that this appealed to be a matter in which the department could hardly interfere. SECONDARY INDUSTRIES. Mr Fletcher asked whether he was t ta j ce f rom tho Minister’s reply that the Government had decided to set up a small Parliamentary committo consider, during the recess, the w } lo le position of secondary industries, Mr Cobbe; That is so. Mr l?| e teller: That is very satisMr Cobbe stated that the subsidy f or tho South Isalnd steamer service to Australia was a matter for the Postmaster-General. He assured members that the Government had not j sight of tho importance of tho timber industry to New Zealand, Mr Poison advocated the extension 0 f trade with the East by means of direct shipping. Mr Cobbe said that the Prime Minister liad stated that, when the finances of the country had improved, consideration would be given to the possibilities of developing trade with the East. At 10.20 p.m. Sir Joseph moved that urgenej’ be accorded this cstimate. He pointed out that the House had spent tho whole day on the subject and there did not appear to bo a desire to proceed with the estimates, Ho added that if the passage of the estimates continued to occupy so much time, the question of the wisdom of the new standing orders would arise, Members indicated that if the estimate were put, it would be passed forthwith. Tho Chairman of Committees (Mr S. G. Smith) then put the motion and the vote was passed, The House rose at 10.30 p.m.