United States Consul Connolly, reporting to our Government in 1894 and 1897, has considerable to say regarding taxation in New Zealand. He says that country excels in the matter of taxation. That in a very short time the system of taxation had been revolutionized and the incidence almost entirely changed, not only without disturbing to any appreciable extent existing interests, but with the most beneficial results. He says the income tax was most fiercely denounced as inquisitorial, destructive of the first principles of frugality and thrift—in fact all the forms of evil lurked in the shadows of the words “income tax,” and a united effort was made to resist this “iniquitous tax,” but all to no purpose. And that in 1897, after six years of experience, the more liberal and fair-minded of those who opposed the income tax frankly admitted that it is a fair and unembarrassing tax. “In New Zealand the land and income tax is now popular; it is accepted in lieu of the property tax; it is a success.” In the United States the Government is paternalistic toward banks, railroads and manufacturing interests. It loans its credit to the national bankers at most advantageous terms, but has persistently refused to favor other classes in a similar way. In New Zealand, however, in 1894, there was established a Government loan office which lends public funds to farmers, laborers, business men, etc. at low interest, and on easy terms. The security taken is on freehold, or leasehold, interest clear of incumbrances and free of any breach of conditions. The loans are on first mortgage of land and improvements. No loan is to be less than $125, or more than $15,000, and the sum of the advances to any one person must not exceed $15,000. There are two kinds of advances, fixed loans and installment loans. The first may be for any period not exceeding ten years, and the principal is due at the end of that term. The second is for 36½ years, and part of the principal is to be paid each half year. Interest in both cases is at 4½%, if paid within fourteen days of the time it is due (5% if payment is not prompt); and in the case of an instalment loan, 1% more is to be paid for the reduction of the principal.