INCOME TAX.

Auckland Star, Volume LI, Issue 39, 14 February 1920, Page 6

INCOME TAX.

Xo doubt there are many people who share the view of the Te Awamutu Chamber of Commerce; that the basis of exemption for income tax should be raised fronv £300 to £400, but in our opinion revision should be downward as wet' as upward. We would lower the exemption to £200 or even a smaller figure for single mcn —with proper protection for those who have dependants. The single man does not pay nearly enough in proportion to income and opportunities for enjoying life. He pays indirect taxation, but the whole of the customs revenue in the year 1918-19, to which as a smoker, drinker, and \vearer of imported clothes he contributed, was two millions less than the income tax total. The argument that because £300 is worth less than £200 used to be. the exemption point should be raised, ie not sound, for the reason that the money collected by the Government suffers from the same depreciation.

Money has to be raised by the Govern-! ment, and income tax is. one of the easiest and fairest ways of raising it. It ie our largest source of revenue; before the war it 'brought in half a million, but last year it produced over six millions. But we agree that there should be revision of the tax, and in that process special attention should be given to the family man of moderate income. The cost of living is affecting the birthrate, which in 1919 was the lowest on record. Revision should include the recasting of all the schedules. The highest rate of taxation now takes more than a third of the pound, a levy that seriously handicaps industry, and ehould therefore not be allowed to continue long in peace time. It is in some of the intermediate grades that increases might be imposed if they are found necessary. A strong argument against narrowing the field of direct taxation is that the more payer 3of direct taxes there are the more interest there will be in national 'finance. A man ie much more concerned about paving an income tax of £•> than he is about distributing the same amount over a long period in tobacco tax.