STAGGERING TAXES

Evening Star, Issue 22453, 25 September 1936, Page 6

STAGGERING TAXES

LABOUR SPENDING COUNTRY’S CAPITAL NODDLED THINKINC AND COLOSSAL BLUNDER M HUM AIIAIfiNS MVEMNENT [Fxou Ode Parlumbntaky Reporter.] ' WELLINGTON, September 24. That income tax should be paid at an earlier date than January in respect of income for the year ended the previous March was the opinion expressed by the Minister of Finance (Mr Nash) when moving the second reading of the Land and Income Tax Annual Bill, and an amending measure, in the House today. The amendment contains a clause authorising the Commissioner of Taxes to receive tax instalments in advance, •ad if there be any over-payment to make the necessary adjustments when the tax rate ia fixed. Several interjections from the Oppqsition benches snowed that the question of hardship is regarded as_ important in connection wjth the revival of the graduated land tax. The Minister agreed that there might bo anomalies, and in fact he knew of some himself. There might be cases where there was no income, though a landowner was liable for land tax, but there Was • hardship provision in the existing Act. Mr Eridean: I have never known it exercised. The Minister explained that the Commissioner had _ power to remit the tax if satisfied that there was positive hardship on the taxpayer. His opinion was that if • person liable to land tax had no income there would be Some justification for the Commissioner remitting it. Mr Hamilton: Put that in the Bill. The Minister: “NoI The Commissioner must use his powesr of analysis. He would, added the Minister, call for details from the taxpayer and determine on the evidence submitted whether relief should be given. Mr Coates: What will be the test that he has ho income for the year P The Minister: In any case where it is shown to the satisfaction of the Cammissioner that the taxpayer has suffered such loss that enforcement of the full tax will entail serious hardship, the Commissioner will remit the tax, wholly or in part. “ A Trades Hall plan, created by on© class for its own benefit,” was the description of the Government’s taxation policy by Mr Poison (Stratford), who led the Opposition comment on the Annual Taxing Bill. Labour, he declared, talked about m levelling-up policy, but in Parliament it was busy levelling down, thitugh he was convinced that the people of New Zealand, who were already becoming alarmed, would not allow all their liberty to be sacrificed at the bidding of any misguided band of theorists. He reminded the Prime Minister of bis constant pre-election ■ declarations that further taxation was out of the question, and that readjustments of taxation must not be taken to mean incro&ses. Mr Coaes: Who said that? Mr Poison ; The Prime Minister on almqst every platfotm in the country. He said it in Wellington and Stratford. Mr Schramm: God help him. Mr Poison:. Where is the , mandate to break that pledge? Where is the mandate to place a staggering burden of taxation on the country ? I would like him to. justify that breach of a solemn pledge. • The responsibility is largely that of the Minister of Finance, who dictates the policy to the Prime Minister and is strong enough to put it over. W© now know the answer to the conundrum where the money is to come from.” There was going to be more payment for the workers and record taxation for the Government, but they could not have it both ways. The sales tax remained, though it was to come off at once, while high company taxation was retained, with all its evil consequences on industry, though the Government talked of establishing new industries. In some cases the Government would appropriate more than half an iilcome. There was no justification for a graduated land tax to-day, and its effect would put thousands of acres of marginal land out of use. It would confiscate the equity of the mortgagee, without helping the farmer. Mr Langston©: How much comes from the country districts? Mr Poison: A very great deal in the past, but not much in the future. The Government’s great mistake was (he suggested) that it believed it was redistributing the wealth of the country, but it was merely spending the country’s capital, not its income.. This must end eventually, and the electors certainly never voted for Labour. CRUEL SCALE UP TO £6OO. Mr Poison, discussing the incidence of income tax under the new scale, stated that on incomes ranging : from £3OO to £6OO there would be an increase of 60 per cent., but on those from £7OO to £I,OOO there was practically no increase at all. After the £I,OOO was passed the tax went up again, and above £2,000 it rose rapidly The position relating to incomes between £7OO and £I,OOO was open to a considerable amount .©.Lgraye ,-misinterpretation in the country..: Mr Parry: What dp you mean by that? Mr Poison: I am leaving it to the imagination of the member. Take' it home and sleep on it. Mr Schramm: He is talking in parables. Mr Poison retorted that it was not his business to explain the extraordinary vagaries of the taxation, but he ventured to say the Government could not justify that gap, when the tax on smaller incomes was increased and the higher ones escaped. It suggested au excessive mixture of muddled thinking, the country on the one hand having to experience the withering effects of high taxation, and on the_ other spending its way. back to prosperity Mr Schramm: Better than starving our way back. ■

Mr Poison asked if Labour members realised where their Minister of Finance was leading them. The country would not stand for smashed pledges; and it would be a dark day for the'farmer and for industry when the Bill reached the Statute Book,