HEAVY INCREASES

Wairarapa Times-Age, 12 February 1943, Page 4

HEAVY INCREASES

IN AUSTRALIAN INCOME TAXATION BRINGING IN ADDITIONAL £40,000,000 A YEAR. NATIONAL WELFARE SCHEME. (By Telegraph—Press Association—Copyright) r (Received This Day, 20.45 a.m.) CANBERRA, This Day. Heavy increases in income tax and the establishment of a national welfare scheme were provided for in measures outlined by the Federal Treasurer, Mr Chifley, in the House of Representatives. The new taxes will yield an additional £40,000,000 a year. The present exemption of £156 is to be reduced tof, £lO4. Personal exertion rates are to commence at 6d in the pound on £lO4 and rise to a maximum of 18s 6d in the pound on the excess of income over £5,000. Property rates have also been substantially increased. In many of the middle income groups the taxation rise is as high as fifty per cent'. Australian salary and wage earners at present pay a year’s income tax in forty weekly instalments. Under the new taxation scale, payments in the great majority of cases increased from their present figure and will be made every week of the year. A single person receiving £5 a week, who is now paying in taxation 9s a week for forty weeks of,,the year, will in future pay 15s a week for "52 weeks of the year. But a married man with two children will remain on a weekly taxation rate of 2s. The taxation rises sharply. A person without dependents, receiving £lO a week, who formerly paid £2 Is in each of forty weekly taxation payments, will now pay £2 15s for each week of the year. A married man with two children on the same salary, who formerly paid 2s a week for forty weeks, will now pay 33s for 52 weeks. PENSION & OTHER BENEFITS. Money raised by the new taxation, apart from meeting war needs, will help to implement a national welfare scheme, which will be developed in stages, reaching fulfilment after the war. Points of the scheme to be introduced immediately are: — (1) A twenty per cent increase in the standard basic rates for full war pensions. (2) A new eight weeks maternity benefit to mothers of 25s a week in respect of new births, and at more liberal maternity allowance. (3) Funeral benefits for old age and invalid pensioners. The full scheme of national welfare includes medical, hospital and dental services, child and maternal welfare and unemployment relief. The unemployment benefits are expected to be brought forward within six months and the sickness benefit scheme within nine months. The Government will finance the national welfare fund from July 1 by an annual grant from general revenue of £30,000,000, or a sum equal to one-fourth of the total annual income tax collections from individuals, whichever is the lower. The fund’s balances will be used during the war to meet war expenditure. The new taxation is regarded as “heavy enough to make one wince,” to quote an editorial in the “Sydney Morning Herald,” but it is accepted as necessary. The main opposition to the new taxation arises from Australia’s heavy cost of living increase, which has been so steep that the pound now is worth five shillings less than before the war. Some commentators attack the Government for failure to introduce compulsory loans as an additional corrective to the menace of inflation.