8.—6

VI

principal sources were: from Customs (indirect), £2,107,567 ; while the landand income-tax (direct) produced £422,456.. There can be no doubt therefore that there is considerable weight in the argument that the wage-earning classes are entitled to relief by way of reduction on the necessaries of life and such other commodities as are essential to their daily wants and requirements. The Government has now determined to make some considerable reductions in our Customs duties, but there has been some difficulty in selecting the articles upon which the remission should be made, and on this question there are wide differences of opinion, and some of these are irreconcilable. Reductions made in the prices of articles of daily consumption by a workingman and his family mean a saving in the weekly expenditure, and result practically in an increase of wages, or, more correctly, in an increase of the purchasingpower of money. I therefore propose, and that with pleasure, to take off the whole of the duties on— Kerosene, rice, salt, coffee and cocoa, mining machinery, agricultural machinery, dairy machinery, dredging machinery, engines and boilers for mining and dairying, and portable and traction engines. Further, I propose to remit half the duty on— Tea (other than that in small packages), half the duty on currants and raisins, half the duty on candles, half the duty on wax matches, leaving the duty thereafter equivalent to an average of, say, 30 per cent, on the value, and that the present duty on patent medicines of 40 per cent, shall be reduced to 15 per cent. That the present duty on drugs and druggists' sundries and chemicals shall be reduced from 20 per cent, to 15 per cent. The remissions on these heads amount to about £157,000. I had hoped to have granted remissions on other articles, but the abnormal expenditure this year under several headings does not permit me doing so. It has ever been the policy of the present Administration to maintain a strong finance, and, as the colony has prospered thereunder, it is well to be prudent, and I do not wish my name as Colonial Treasurer to be identified with a deficit. There may, in giving effect to these proposals, be a slight disturbance in one or two of our industries, and those interested may complain that their investments are prejudiced, but this cannot be allowed to weigh against what is for the public good, and the continuance of taxation which in some quarters it is alleged presses unduly on the masses. The remissions on Customs duties, as stated previously, together with concessions on railways and penny postage, are estimated to reach over £300,000 per annum. To this, after the 31st March next, must be added the reduction in the mortgage-tax, which will amount to over £25,000 per annum. REDUCTION OP MOETGAGE-TAX. For some considerable time interest on mortgages has steadily decreased. During the past ten years interest on mortgages has fallen about one-fourth : this makes the Id. in the pound on the capital value a very heavy charge. The colony has conceded conditionally J per cent, on mortgages under the Advances to Settlers Act, and \ per cent, to local bodies on loans under the Government Loans to Local Bodies Act; it is also proposed to grant conditionally a rebate of one-tenth on the half-yearly payments of rents from our Crown tenants, equal to \ per cent. : and it follows, therefore, as a matter of abstract justice that there should be some relief given by a reduction on the mortgage-tax. Many widows, orphans, and others whose living depends on this class of investment are heavily taxed, and I regret not being able to announce this remission as being immediately conceded. However, I intend to submit proposals later on in the session that from and after the 31st March next the mortgage-tax should be reduced by Jd. in the pound. PENNY POSTAGE. Parliament, during the session of 1891, passed an Act under which a penny postage within the colony could be established. From that time until the pre-