Taxation Committee.

Hokitika Guardian, 12 August 1922, Page 4

Taxation Committee.

AN INTERESTING REPORT.

WELLINGTON, August !>,

This afternoon the Prime Minister laid on the table of the House the report of the special committee recently appointed by the Government to take evidence and report upon the question of taxation in the Dominion. | Viter discussing various phases of taxation in great detail, the report | states that the committee -arrived at, unanimous decisions oh all inatteis except (a) taxation of companies, <b) earned and unearned income, (c) reduction of exemption on income tax. In the case of (a) “company taxation,” the majority favor taxation of shareholders in compnnis on their dividends and taxing companies on their undivided profits only, the change to be made at the earliest date that the finances of the country will permit. The minority favour taxation of companies direct. In regard to (1.) “earned and unearned income,” the majority favoured abandonment of the present distinction, reversing to the old system. Jhc minority favour the present system. In regard to ic) “reduetum of exemption on income tax,” the 1,,i1 ß ,r ' 1 - v favour the present exemption oi L.3UU. The minority, consisting of one member, favours the exemption of unmarried persons being reduced to £2OO. . A recapitulation of unanimous decisions and recommendations by the whole committee is set out hereunder: (a) That as a first step to reduce taxation it is imperative that further substantial economies in administration should take place, and that the public expenditure of the Dominion should be still further reduced. (ii) That in order to stimulate production and industry and lessen unemployment the scale of income taxation should be immediately revised to provide for a maximum rate not exceeding 5s in the pound. ( c ) That asystem of permitting the carrying forward of losses shoiijd be adopted. (d) That losses made in one or more directions should lie allowed as deduction from profits made in other directions.

(c That the question of double taxation be discussed with the JJriti.di authorities. (f) That interest from company and public body debentures should lie taxeil at the same rate as income from other sources. Vg) That all Government and public body trading undertakings should he subject to land and income taxes, and that the State Eire Department should he taxed on the same basis as private insurance companies in respect to overseas treaty reinsurances. •'ll) That proprietary life insurance companies should be taxed on the same basis as an ordinary trailing company. (il J'liat certain boring operations ol coal companies should be treated as working expenditure. (j) That coal-mine owners should bo treated on the some basis as sawmillors with regard to allowances for wasting assets. ■hi That the amount paid for the goodwill of a lease should he apportioned over the term of the lease and admitted as deduction' from income. I) That careful inquiry should he made as to the working of sales and turnover taxes in other countries, willi a view to ascertaining whether it is desirable to adopt either of them in this dominion, hut only sa a relief to present taxation. (in) That the super-tax on land which was levied as a war measure should lie abolished as from April Ist, 1922. -ii) That discretion he given to tinCommissioner for inland Revenue to remit the whole or part ol land lax of an occupier of rural lands, which, though worked in a proper and workmanlike manner, have not produced sufficient to pay such tax in whole or

ill p.'Ht. 1,0) Tlmt the allowance of ■"> per cent upon the unimproved value of laud lie limited to the amount of unimproved value upon which land tax is paid. •p) That all lands owned by local bodies and leased for revenue purposes shall he subject to laud tax on the same basis as privately-owned lands. <ri) That in order to stimulate produd ion and industry land tax should he levied at a Hat instead ot graduated rate, with deductions on smaller liold-

In conclusion.” stated the report, ■■we members of the committee desire to assure you that we have fully realised the difficulty of the problem set before us, and we recognise that in the limil settlement of the question you have no easy task. We hope the result of our inquiry, its presented in this report, may prove useful, and that the Government may see its way to legislate in the directions suggested.”