THE COMPANY TAX.

Hokitika Guardian, 4 May 1923, Page 4

THE COMPANY TAX.

AIR HUNT’S ADDRESS TO FARAIERS.

AA’ELLINGTON, Afay 2

Tlio executive of the New Zealand Fanners’ Union was addressed yesterday bv Air AAL D. Hunt, formerly a member of the Efficiency Board, and chairman of the Taxation Committee, on the subject of company taxation. Afr Hunt said that New Zealand was tlie only country in the world in which companies paid the maximum income tax rate. AH other countr’os taxed individual incomes. The effect in New Zealand was that a company manager who had to pay 7s -Id in the pound added it to his charges, because shareholders expected the same dividends. Ten fourteenths of the shareholders in New Zealand companies were people who Individually would pay no income tax if individual taxation were introduced. Company managers could reduce their margin of profit enormously to farmers and everybody else if the taxation system were reformed. This would reduce the cost of living and also the wages fixed by the Arbitration Court.

Air Hunt pointed out that small 11 a dors paying only 2s Id in the pound were now getting the same rate cf profit as companies paying 7.s -Id and were having the time of their lives. Investors who could got 5 per cent from public body bends expected at least 5J per cent on form mortgages, but to pay them 5} per cent companies, were compelled to charge £8 12s (id per eeid, allowing for ilia 7s ■ld tax. Farmers were specially hard hit by the company fax owing to the conse(|iient difficulty of getting money. It was more important to the farmers to have the company tax reduced than the land tax. The chairman (Air G. W. l.eadley, of Ashburton) declared that this state of affairs was most ridiculous in a produefiig country. It was a most serious mat ter and farmers .should get the Prime Minister’s reason for this tax still being on the Statute Book. Unless the lax were repealed before the nioratoi iuni expired it would make it impossible for farmers to get money on mortgage and matters would be made much worse than they would be if no such tax were preventing a great deal of money being invested in broad acres. Tlie chairman mvned that a request for the repeal of the tax should be forwarded lo Mr Alassev, and this was carried.