TAX LIABILITY.

Auckland Star, Volume LXIV, Issue 237, 7 October 1933, Page 18

TAX LIABILITY.

UNEMPLOYMENT LEVY

ESTATE OF G. D. GREENWOOD.

appeal by trustees,

(By Telegraph.—Press Association.)

WELLINGTON, Friday.

Argument was heard before the Court of Appeal to-day on the question whether the estate of a deceased person i« subject to the emergency unemployment charge imposed by the Unemployment Amendment Acts of 1931 and 1932. The appellants were the trustees of tho estate of George Dean Greenwood, sheepfarmer, who died on Au<nist 28, 1932, having large estates at Teviotdale, near Amberley. During the year ended February 28, 1932, deceased derived an income other than salary and wages of £25,003, the unemployment charge thereon being dulv paid. On May 21 and on August 4 the testator paid quarterly instalments of the annual charge of 20/. The executor* claimed that all liability to pay further instalments ceased on the death of the testator on August 28, 19:;2. The Crown contended that the executors were liable to pay both the quarterly ' instalments of the annual charge of 20/ that would have been payable by testator in November, 1932, and in February, 1933, had he lived; and also the unemployment emergency charge on income received by the testator from April 1 until August 29, 1932, the date of his death.

Trial Judge's Decision. The appellants disputed the contentions of the Crown on tlio grounds that the charge was purely a personal tax and could be collected only from persons who remained alive when any instalment became due. In view of the importance of the question the trustees, with the consent of the Crown, applied to the Court by originating summons to have the questions determined. Mr. Justice Ostler, the trial .Tudge, held with some hesitation that the estate was liable for both the annual levy and the charge on income. The trustees appealed from this decision. Mr. I'. B. Cooke, opening the case for the appellants, stated that although only approximately £650 was involved in the present appeal the question was one of considerable importance to executors and trustees. He submitted that the assessment year for the emergency unemployment charge of Id in every 1/8 of income imposed by section 13 of the Unemployment Amendment Act, 1932, did not begin until April, 1933,

although the charge covered income received prior to that date. As deceased was not alive at the date of the commencement of the assessment year there was no liability to pay the charge on income which deceased had received prior to his death in 1932.

Counsel submitted further that as there was no provision imposing unemployment charges upon estates of deceased persons for income arising therefrom the trustees were not liable.

Case for the Crown. 'The Solicitor-General, Mr. A. Fair, K.C.. for the Crown, submitted, that the object of the Unemployment Amendment Acts of 1931 and 1932 was to impose upon every person not specifically exempted a statutory liability to pay an annual levy of 20/. This liability did j not consist of an obligation to pay a number of separate charges imposed every quarter, but of one charge which the person liable could pay at one time or in quarterly instalments. If any person died before all instalments had been paid his estate still remained liable for the other instalments as they became due.

With regard to the emergency unemployment charge of 1/ in the pound the Crown contended that the charge attached to income as soon as it was earned, although the tax might not he payable until the succeeding year. If a person receiving income died before the tax had actually been paid his estate was nevertheless liable for the charge and his executors could be sued for it.

After hearing Mr. Cooke in reply the Court reserved its decision.