THESE WILL PAY.

Auckland Star, Volume LXXIV, Issue 229, 26 September 1940, Page 9

THESE WILL PAY.

LOAN COVERAGE.

COMPANIES BIG CONTRIBUTION

People living on average incomes will not be affected by the obligation to subscribe to the war loan. Remembering that the contribution is based on the amount of income tax paid in February last, examination of an official table issued by the Minister of Finance this year reveals that only those taxpayers who had a taxable income of £380 or more when they received their assessment in 1939 will be liable to make a contribution. In reading the last sentence the word "taxable" should be given it* true emphasis. A taxpayer who, last February, paid income tax on a taxable balance of £400 received a receipt for £53 13/4. Thus, under the requirements outlined by Mr. Xash, such a taxpayer will hav.» to make a contribution of £3 13/4, since there is an exemption of £50. "Taxable balance or "taxable income,"' here referred to, is the amount remaining when all exemptions have been allowed. Statuary exemptions reduce substantially the amount of one's taxable balance. Deductions are made for children, a wife, life insurance premiums, and interest-tax payments, in addition to a personal allowance of £210. In consequence those io find out what tliey have to contribute must bear in mind that only the taxable balance remaining after a'' exemptions is affected. The fact that tho Minister lias fixed the income tax payment of last February as the basis for a war loan contribution greatly simplifies the matter, as the amount to be subscribed is exactly what was paid minus £50.

Subscribe Most Of Loan. From persons with big incomes heavy contributions will be required. Individuals or companies with a taxable balance of £20,000 will have to subscribe £9820 when allowance for the £50 exemption has been madq. A company or taxpayer with a taxable balance of £10.000 would have to subscribe £4935. On the £12.000 mark the contribution would be £5922, at £13.000. £6416, and at £15,000, £7403 would have to be lent. The latest official figures available show that 110.045 of the individuals assessed for tax a total of 45,391 were assessed for under £5 of tax. At the other end of the scale 955 individuals were each assessed for over £500 of tax, and 359 for over £1000. Even among the companies, 1244 had, in 1937*38, an assessment of under £5. Companies which were assessed for over £1000 of tax numbered 573, a little over 9.6 per cent of the total. However, their aggregate assessable income was more than £14.500,000, and their aggregate tax assessment was £4,878,000. Some 103 companies were each assessed for over £10.000 of tax and what they paid constituted 62.8 per cent of the company tax collected that year, and more than a third of the total tax assessed for all classes. From these figures it will be seen that.th 1 larger companies will make the heaviest contributions to the war loan. On the latest Year Book figures there are fewer than 43,000 people receiving between £300 and £499 per year who remain in the taxpayer class 'after the application of exemptions, and even with alterations which have been made in the incidence none of these will ba required to contribute to the war loan.