A.—4

358

\Oth Day.] Double Income Tax. [16 June, 1911. After a short adjournment. Double Income Tax. New Zealand. " That it is inequitable that persons resident in the United Kingdom, who, under the laws of a self-governing dependency, pay an income or other tax to the Government of such dependency, in respect of income or profits derived from the dependency, should have to pay a further tax in respect of the same income or profits to the United Kingdom ; and therefore it is most desirable that Imperial legislation should be introduced to remove the disability." Union of South Africa. " That it is desirable that an understanding be arrived at between the Imperial and Colonial Governments whereby the Imperial Exchequer, in claiming payment for income tax and death duties, should allow a deduction for payments fairly claimed for these purposes in the Colonies." Mr. HAECOURT : We might go now to the Resolution of the Government of New Zealand, and I think perhaps we might take the questions of the income tax and death duties together. Sir JOSEPH WARD : The question of death duties is brought up by South Africa. Mr. HARCOURT : Yes ; but they can probably be dealt with together. Sir JOSEPH WARD : Yes. In connection with the system of double taxation, I have had the opportunity of attending a meeting with the Chancellor of the Exchequer, and I placed the whole matter fully before that meeting; and I recognise the position, as then outlined by Mr. Lloyd George, makes it exceedingly difficult for the British Government to conform with the suggestion contained in this Resolution. In deference to the views expressed by Mr. Lloyd George to the informal Sub-Conference* at which he attended, I want to say that I recognise that, as far as the British Government is concerned, the heavy loss involved to the British Treasury makes it impossible for the Chancellor of the Exchequer to agree to it being put into operation. In our country we feel—and I suppose the other people who are here feel too—the anomaly and difficulty of the same British subject or corporation having to pay income tax twice upon the same income. Ido not want to repeat the arguments from the standpoint of double taxation as it exists in New Zealand that I placed fully before the Committee, except to say that if in the future there could be some system of mutual arrangement I should be exceedingly glad. We find it necessary in New Zealand, in order to help the people who take up the debenture stock of that country, the domicile of which is in England, to forgo the income taxation in New Zealand so as to enable them to be in the position of paying income tax once only on the same income, and that is to the British Government. That is done for a local reason, and it is a very good one from our standpoint—that is, with the object of enabling our stock to be taken up in our own country without the possibility of the same person having to pay tax twice upon the income derived from the same investment. However, I think probably if Mr. Lloyd George will be good enough to make a statement of the position, similar to what was contained in his remarks before the Sub-Conference, I think it will demonstrate that, from the position as it affects the British Treasury, my proposal cannot be accepted by him, and I need not take up the time of the Conference in again advancing my views in detail. General BOTHA : Are we taking the New Zealand Resolution alone, or the two together ?

* This refers to an informal discussion at the Treasury on Ist June.