War Budgets.

Press, Volume LI, Issue 15393, 25 September 1915, Page 10

War Budgets.

One would like to hope. that when it comes to deal «ith the Bills necessary to give effect to these Budget proposals which are not matters of administration. the House will find itself in as right a mood as ■when it dealt with the proposed national register. The grave fault of the Budget is its neglect, indeed. its evasion, of the, principle th.it it is the business ot everyone to contribute his share of the cost of the wa». Within the past week this fault has been doubly underlined —first- by the appcarancc of fcho British "War Budget, an ( l :.xt, by the affirmation of the principle 01 >mivorsahty of obligation contained in the National Registration Bill. Mr MrKenna said that ho believed the British people wore willing and able to bear the burdens which duty bade them to bear, and he gave evidence of the sincerity of his belief by proposing eeverfe taxation to

be borno by tho whole people. Our own Minister of Finance was equally emphatic m his declaration that "all "classes of the community will desiro " to join in the neccssary sacrifices to " help tho country at this juncture," but his Budget did not reflect a belief in the readiness of all classes to do their share. Of tho £2,032.600 which our Government proposes to raise, none is to be raised by any i plain, straightforward tax which will j have a universal application liko the j British taxes on tea and sugar. That amount, in the Minister's summary, is j made up by imposts under fourteen different heads, and ten of these between them will yield loss than ft fifth of tho total —a circumstance which in itself is evidenco of a sad want of tho plaiu, hard courago of Mr McKenna's proposals. By far tho largest item is land and income tax, and it is here that tho difference between the two Budgets is most impressive. In Great Britain the rate of taxation on incomes is to bo 280 per cent, of the rate before tho war. Tho general increase proposed in New Zealand is 33 1-3 per cent. We believe that there would not be a single objection to a much more substantial increase than 33 1-3 per cent., if tho Government had followed tho British example of aiming at making tho levy as nearly universal as possible. As matters stand, tho peoplo whoso incomes are less than £300 will practically escape the payment of their share. In Great Britain, on the other hand, tho exemption line, which formerly protected incomcs of under £160, has been lowered to £130. The oost of living in liritain is not so mnch lower than in New Zealand that there should be so vast a disparity between tno limits of exemption in tho two countries. Wo fail entirely to sec why all the peoplo in this country whoso incomes are less than £300 should be allowed to enjoy free the privilego of seeing tho war partly financed by imposts on English people who6e incomes exceed £130. From the available data wo obtain contrasts liko the following, the English tax bciiys calculated at tho lowest rate (that for wholly earned incomes): — Tax Tax Income. In England. In New Zealand. £ £ e. d. 131 13 1 nil 140 2 2 0 nil 15C 3 15 8 nil 200 8 8 0 nil 1360 13 13 0 nil 300" 18 13 0 nil The disparity continues, of course, in tho case of incomes above £300. The Englishman who receives £400 a year, for example, will pay about £30, tho New Zoalander less than £4. These are figures which hardly require comment. Then there is tho English tax of a shilling,on tea, which can come in to New Zealand free. A sincere and courageous attempt to follow England's example, even at a long distance, in this and in other respects, would enable the Government to obtain all tho necessary revenue without resorting to tho many questionable devices of the New Zealand Budget. Wo do not wish to embarrass tho Government, or to be too critical of their work, but wo do hope that when tho taxing Bills come down members will ask for an explanation of tho Government's decision to follow a line so very different from that laid down by the British Government as the lino required by the fact, which affects New Zealand as much as Britain, that the Empire is at war.