“Minister To Blame” For Present Taxation Burden

Press, Volume XCIX, Issue 29315, 21 September 1960, Page 10

“Minister To Blame” For Present Taxation Burden

[Specially written for "The Press” by Sir WILLIAM SULLIVANI

Everyone is agreed that there must be taxation. “It was as true,” said Mr Barkis... “as taxes is. And nothing's truer than them,” as Dickens wrote in “David Copperfield.” But it is also true that everyone who pays taxes today is appalled at the burden which Mr Nordmeyer has placed on the people’s shoulders, in both direct and indirect taxes. What sticks in the gizzard is his arrogant assumpetion that he alone knows best. No-o-ne should blame the bureaucrats for the unfair and frequently iniquitous tax anomalies. The Minister is to blame first and his party second for permitting him to do what he is doing. Could anything be more wicked and indefensible than forcing the self-employed, for example, to pay income tax in advance and to impose a 10 per cent, penalty for non-payment by the due date? Not only does the State get its hands on this money, but it is able to use it in whatever way it wishes, but when it. comes to paying back money wrongly 1 exacted, in cases where the provisional income was not reached, the State doesn't pay any interest.

Economists like the late Lord Keynes considered that no government could impose taxation in excess of 25 per cent, of the total private income without creating Serious inflation, yet in New .Zealand 30 per cent, or fts in ttye £ of the people’s total earnings is being taken. In many, cases individuals pay ■up to 13s 6d in the £'. . . ' j , , The consequence is that the costs of, production are rising steeply and our primary producers are faced with the possibility of < being priced out of world markets. Excessive taxation must be passed on to the consumer in the form of higher prices, thus creating a higher cost structure, and to attempt to remedy the effect on primary industry by subsidies merely adds to the costs and the. burden the taxpayer is already carrying.

“Incentive Dampened” What is more harmful, however, is the effect which this excessive taxation is having on the people. Incentive has been dampened. Bankruptcies •- are increasing. Businesses which should be thriving are going to the wall. There is often talk of ploughing back but how can this be done when the State takes the lion’s share? Many ask is it worthwhile. Meanwhile, State expenditure is soaring and the Government goes on producing wild-cat schemes like the Nelson railway. Gopd heavens, if that, railway is justified, then the Gisborne-Taneatua line is threefold justified, but

nobody today, • would seriously advocate that.

Bad though the situation is, I believe we’ll have a few more such costly vote-catching schemes produced between now and November. The worst feature of this sort of thing is that there was no popular demand for the Nelson railway, ■any more than there was a demand for the increase in the family allowance in 1958. When people have to be bribed to vote for a party then good government becomes a fantasy and democracy a farce. There was a time when it was political practice to mount a beer barrel on a cart and dispense free drinks to win votes. That was quite properly banned by law. But what is the difference between getting the voter drunk on beer and getting him bemused on promises? Disillusionment comes when he wakes up and the tax gatherer comes round. ’. “Lost Respect”

I don’t like to hear my fellow New Zealanders speaking as they do of Parliament and politicians, but I can’t blame them. They have lost the respect their fathers had for the Parliamentary institution, and the people to blame are those who conjure up costly schemes and, With honeyed words, beguile the voters and mask, the fact that everything has to be paid for. . “Nothing is for nothing, ' Nothing is for free; I’ll look after you, Jack If you’ll look after me.” That is the situation today, except that the Government doesn’t emphasise the first two lines of the verse. Electors should be on guard for future promises, and have no truck with the party that bids for votes.