INVISIBLE TAXES

Hawke's Bay Herald-Tribune, Issue 49, 13 March 1937, Page 10

INVISIBLE TAXES

f he Average Family Bill INDIRECT BURDENS The quickening interest of the general . community in the fact that, although they may not be numbered among this year's payexs of incometax, they cannot avoid a heavy bill in indirect taxation, raises the question of the eize of that bill, says a statement by the Associated Chambers of Commerce of New Zcaland. The following table showa the averI age amount ttaid in. taxes (other than income-tax) by a family of four:-—

x Estimated. Tueri there is the matter of taxation on eompanies. The individual payer of income-tax or of indirect taxes, or of botli, is wrong if he thinks that taxation on eompanies does not afL'oct him. The recent increase in the raio of ineome taxation on eompanies (risr ing in graduations up to 7/6 in tho £ on eompanies of moderate size)) aSects

him very closely, because a company, in estimating costs, takes income-tax into account just as much as ifc does wagos and repts — it must do if it is to -pay dividends, hold and attract the capital necessary, for its operationa and coutinuo to provido employment for workers. Consequently, most of the taxation on eompanies is paid by the public in higher prices for goods and serviees. The consuming public therefore swells Government xevenues by this substantial invisible addition to the family taxation bill. Aformation now available from the Census • and Statistics D-epartment shows that of the £4,288,618 revenue from ineome-tax in 1935-36, only £1,445,316 (or 33.8 per cent.) was paid by individuals, while £2,806,823 (or65.4 per cent.) was paid by eompanies - — the small balance being paid by non-resident traders, and agents for dobenturo-holdors. (In passing, ifc is to bo notcd thafc tho Covernmenfc StatisticianJs iigures show the averago amount paid in income-tax in 1935-36 by individuals — not eompanies — was £21 14/9 per taxpayer). Thereforo, the average industrial, commercial or agricultural employee, who pays liUle or nothing in direct ' taxes, is nevertlielcss a substautial coritributor to the cost of government. If workers in general realised this truth, they would bo less complacenfc in tlie face of the rising. tide of taxatiou and public debt. The lesson to be learncd from tho present excessive taxation is that tho taxpayer cannot expect to have hia taxes redueed. and at the same timo have more money spent by Government. Public serviees cannot be given unless they are paid for. There is no beating tho tax bill. Tlie difficulty is that liighly organihed minorities demand public service — at the expe.nse of 1 the great body of taxpayers.

1928-29 1935-86 1936-37 Had £ s d ^od Indued taxes 39 G 3 43 8 3 50 17 5 Unemployment taxes — 10 0 7 10 13 11 k 39 6 3 53 8 10 x61 11 4