Grants From Income Tax Opposed

Press, Volume CIX, Issue 31908, 8 February 1969, Page 42

Grants From Income Tax Opposed

(New Zealand Press Association)

WELLINGTON, February 7. The Minister of Finance (Mr Muldoon) said today he was not attracted to the idea of increasing income tax in order to make grants to local authorities.

He was commenting on a statement made by the president of the Municipal Association of New Zealand, Mr P. Tait, who suggested that direct grants from the Government from income tax was the only means of raising additional finance for local bodies.

Mr Tait said in Auckland last night that where the central Government collected about 40 per cent of its income from indirect tax, local government had no other means of finance than rates. The only way for local bodies to , get additional finance would be grants as of right from the Government for essential services. “It is the object of the Government at the present time to keep a tight hold on Government spending, and it is always the object of the present Government to keep direct taxation as low as possible,” said Mr Muldoon. “I note that Mr Tait has said that New Zealand localbody rates are not high by world standards, and this is hardly consistent with a request for direct financial aid from the central Government. “I emphasise that any additional aid from the Government can only come from the pockets of the taxpayers, and I am not enthusiastic about any substantial increase in taxation at this time.”