UNEMPLOYMENT RELIEF

Rotorua Morning Post, Volume 1, Issue 61, 3 November 1931, Page 3

UNEMPLOYMENT RELIEF

(Press Assn.-

SPECIAL TAXATION DETAILS OF LIABILITY FOR PAYMENT EXPLAINED STATEMENT BY MINISTER

-By Telegraph — Copyright.)

WELLINGTON, Monday. To clear up some doubts and misunderstandings as to liability for payment of the unemployment relief tax, the following statement was made to-day by the Rt. Hon. J. G. Coates, Ministef in Charge1 of Unemployment. "The payments now due by way of unemployment and relief tax can be shortly described under three heads," said Mr. Coates. (1) The quarterly instalment of 5 s payable by men only. "(2) The charge on income other than wages or salary received by men (respective of their total income) during the year ended March 31, 1931. "(3) The charge on income other than wages or salary received by women who had a total income exceeding £250 during the year ended March 31, 1931. Men's Levy "A quarterly instalment' of the levy, amounting to 5s, is now payable by all men over the age of 20 years. The only exceptions are: (1) Totally disabled war pensioners; (2) old age pensiqners and other persons in receipt of pensions under the Pensions Act, 1926; (3) Maoris, who, however, must pay if they have elected in writing to become, liable and have been approved by the Unemployment Board; (4) men who for the whole month of November are inmates of a public hospital or mental hospital, old persons institutions, or other charitable institutions; (5)> students at colleges or schools who are not receiving salary, wages or allowances; (6) men over 65 years of age whose total income for the past three months has not averaged more than £2 weekly, provided they have not obtained the Unemployment Board's approval of their becoming contributors to the unemployment funds; (7) men who, during the whole of November, are, through mental or physical disability, , unable regularly to follow any oecupation for a livelihood and whose income for the past three months has not exceeded £2 per week; (8) men who for the whole of October were registered as unemployed and ' received no income (all who have been relief workers at any time in October must pay the 5s) ; (9) men who on proof of hardship have been exempted by the Unemployment Board. "The levy was reduced on August 1, 1931, from 30s to £1 a year and men who paid the full 30s levy due in December, 1930, are required to pay only 2s 6d during the present month. In any doubtful case the contributor should take his eoupon hook to a postal money order ofliee for adjustment. Tax on 1930-31 Income "All men who are not wholly exempt from the unemployment levy ^ must now make a return of their income other than wages or salary reeeived during the year from April 1, 1930 to March 31, 1931. Sources of income that must be shown include net profits from any profession or business (including farming) ; interest (including savings bank interest credited to a personal account and including interest on taxfree war loans; dividends (although these are exempt from ordinary income tax); rents, royalties, pension, annuities, superannuation and generally all income with the exception of wages and salary. It does not include war pensions or compensation received under the Workers Compensation Act. "Every man who is liable must now mtke a declaration on form UB 55, which is to be obtained at any postal money order office. He must either give full particulars of his income (other than wages or salary) or declare that for the purpose of the unemployment tax he has sent a full declaration on form UB 55 A to the Commissioner of Taxes covering his 1930-31 income. This form must be specially furnished and is additional to the ordinary return for income tax purposes. Tax Payable "The unemployment charge is levied on two thirds of the income for last year (other than wages or salary) and amounts to 3d in the £ or more precisely Id for each 6s 8d or part of 6s 8d. One half of the charge is due to-day; the other half being due on February 1. 1932, but the whole amount may be paid now. "It must be specially noted that temporary exemption from payment of the flat rate levy of £1 per year does not affect a man's liability to pay the tax on last year's income. The only persons exempt are totally disabled war pensioners, old age and other pensioners, and Maoris who have not been specially admitted to the unemployment fund. All other men are liable to the tax on their income other than salary or wages for last year. Farmers' Liability "The farm income on which tax is payable is the net income for last year after deducting such items as interest, wages paid for farm. labour, and payments for fertilisers, foodstuffs, etc. No deduction is to be made for household expenses, nor for payments for the farmer's own services. To assist farmers in stating their income a special form (UB 58) has been printed and this is obtainable at any postal money order office. If should he specially noted that this form does not take the place of the declaration which must be made (on form UB 55 or form UB 55 A) in every case. Returns by Women "Returns must now be made on form UB 55 by women whose income from all sources for the year ended March 31, 1931, was £250 or more. No return is required from women whose income was less than £250,

The return either may show that a declaration has been sent to the Commissioner of Taxes or may set out. details of the income received. Tax at the rate of ld for each 6s 8d ispayable on two-thirds of the income other than salary or wages. As in the case of men, women may either pay one-half of the tax now and one-half in February, or they may now pay in full. "In this summary I have made no reference to the charge of 3d in the £ which at the present time is being imposed on all receipts by way of salary or wages. This was levied as from August 1, 1931, and in accordance with the law must be deducted by all employers. My statement refers to the general levy and to the tax on income other than wages or salary. A word should be added to explain why Parliament was obliged to impose what appears to be a retrospective tax on a part of last year's income. Wby Tax Retrospective "The general purpose was to impose a tax equally on all income, but for obvious reasons, it could not be at once imposed on current income except where this takes the form of wages or salary. The value of other income cannot be ascertained until the end of the year when receipts and expenditure can be totalled. It was therefore decided to levy the tax on two-thirds of last year's income from sources other than wages and salary and on one-third of tliis year's income other than wages and salary. In the result it may be taken that the effect is substantially the same as if the tax had been levied on.one year's income, but payment is spread over two or three instalments and what is a matter of no small importance, the Unemployment Board is able to receive at onee a part of the money which it urgently requires. "I have had occasion previously to mention the possibility that the unemployment relief tax might be increased from 3 d to 5d in the £. ' I am now pleased to be able to announce that so far as this Parliament is concerned it will not he necessary to propose any increase. "I trust that this statement will make clear some points in a subject that is somewhat obseure, but to assist still further, arrangements will be made during this week for the Commissioner of Unemployment (Mr. ; Maleolm Fraser) to speak briefly over the wireless and he will deal with some typical queries,"