“INJUSTICE” IN OPERATION OF TAXATION EXEMPTIONS

Press, Volume XCVIII, Issue 29009, 25 September 1959, Page 12

“INJUSTICE” IN OPERATION OF TAXATION EXEMPTIONS

iNew Zealand Press Association)

WELLINGTON, September 24. It was grossly unjust that a man who married on March 31 got a full year’s tax exemption for maintaining a “wife he didn’t have” during that year, Mr R. E. Jack (Opposition, Patea) said in the House of Representatives today. Mr Jack was speaking during committee discussion on the Land and Income Tax Amendment Bill. He criticised the clause in the bill providing that when a man marries he gets an exemption for his wife for the full year. This clause also applies to exemptions for women who have to support their husbands. Mr Jack said that a man on £5OO a year who married on March 31 got a £2B rebate. But a man who married on April 1 got nothing. Mr M. A. Connelly <Government, Riccarton) said that 18,000 people were married each year, and many would benefit from the provision. Mr J. T. Watts (Opposition, Fendalton): Not if the wife’s working. Mr T. P. Shand (Opposition, Marlborough) said the average working man would not get anything under the provision. It would only benefit a “handful of the idle rich.” “In most cases wives have been working up to when they marry and many continue working afterward, so the husband would not be entitled to the full exemption,” Mr Shand said. “Completely Incorrect” The Minister of Finance (Mr Nordmeyer) said that Mr Shand w_s completely incorrect in saying a wife’s pre-marriage income would affect her husband? exemption for her. “The wife’s pre-marriage income is not taken into consideration in fixing the exemption the husband

gets for her after marriage,” -Mr Nordmeyer said. Mr Nordmeyer said it was true if a woman worked after she married it would affect her husband’s exemption. “1 accept what the Minister says, but I still think it wrong that the Government is, in effect, giving a bonus to people who delay getting married till the end of the financial year so the husband will get the full year’s exemption tor his wife,” Mr Shand said. Child Exemption Mr Shand also criticised the clause in the bill providing for a father to get a full year's exemption for ‘a child born during the year. He said that parents of a child born on March 31 would get a rebate, but parents of a child born on April 1 would not. He said it was making tax legislation like a lottery. Mr Jack said it was anomalous that parents of a child born on March 31 got an exemption and rebate as though they had maintained the child for the previous 12 months. They received the same benefit as parents who had, in fact, been maintaining a child for the 12 months.

Mr Nordmeyer said the National Government's legislation provided that where a child died during the year the parents received the exemption tor the child for the full year. If the Opposition was to be consistent it could not object to parents getting an exemption tor a tull yeai for a child born during the year. Mr Walts said the provision giving a full year's exemption for a child who died was included because it would have caused unnecessary work if a taxpayer haa been required to put in a new return in the “sad circumstances” where a child died.