8.—6

V

advantages of a reduced rate during last year. I shall submit proposals giving greater facilities for adjustment, and anticipate that a larger number will take advantage during the current year of the concessions granted. Local authorities are also beginning to have recourse to the very liberal provisions of the Amendment Act of 1898 for granting loans for purposes of irrigation, water-supply, or water-conservation, and large sums of money have been applied for to assist the local bodies to carry out these important public works. LAND-TAX AND INCOME-TAX. In my last Budget I anticipated that, from causes which I specified, I would lose land-tax to the amount of ,£8,500 a year. This loss was, however, in part made up by enhanced valuations in certain districts, and adjusted assessments consequent thereon, the receipts being £294,200 and the estimate £290,000. When the extended authority for which I mean to ask this session in an amended Valuation Bill is granted by Parliament, under which any valuations which are too low can be raised, I do not anticipate any further decrease in the proceeds of the land-tax. The continued increase in the income-tax is satisfactory, and is a further indisputable proof that the country is doing sound business, and that its merchants as well as its farmers are in a prosperous condition. THE PUBLIC DEBT. The gross public debt on the 31st March, 1899, was £46,938,006; on the 31st March, 1900, it was £47,874,452, or an increase of £936,446 for the year. The net public debt on the 31st March last was £46,930,076, or £849,349 in excess of the net debt of the preceding year. The increase during the year of the gross debt was caused by the issue of interest-earning debentures to the amount of £619,062; by the issue of debentures for £300,000 in anticipation of the million loan authorised by the Act of last session, less £85,000 repaid on account of the loans of 1896-98; by £50,400 of debentures for sinking funds accretions; and £51,984 additional 3-per-cent. inscribed stock in consequence of various conversion operations : these items make up the increase of £936,446 already mentioned. In connection with this increase of debt it is right to mention that no less than £448,000 was caused by the issue of debentures for the purchase of lands ■for close settlement, gome very valuable blocks of land have been secured and opened up, and the interest payable upon the loan will be more than recouped to the Treasury. £115,500 was raised and paid over to local authorities, or paid away in the direct formation of roads to open up lands for sale : these moneys are also of an interest-earning character, as also £55,562 inscribed as New Zealand Consols. Thus, of the increased indebtedness about seventy-five per cent, has been incurred for purposes under which the interest was repayable by those reaping the advantage of the borrowing, and there has been no increased burden placed upon the general taxpayer; and the public, whilst reaping a collateral advantage, were in no way injuriously affected by the credit of the colony being pledged. A large parcel of debentures, amounting to over half a million, issued under " The Government Loans to Local Bodies Act, 1886," falls due on the 31st December next. Ido not propose on this occasion to convert these debentures into inscribed stock, but I shall content myself for the present with the provisions of the New Zealand Consolidated Stock Act of 1884, which enables me to renew them for a further term of years, and during their new currency the money market will probably be in a more favourable condition for a conversion operation. These are the only debentures belonging to the permanent debt which fall due during 1900-1. EEMISSION OF CUSTOMS DUTIES. The oft-repeated demand for a reduction in indirect taxation cannot longer pass unheeded, and it will be useful to compare the results of the two systems of indirect and direct taxation. Last year the contributions from the two