New tax measures ‘not thought through’—M.P.

Press, 24 June 1978, Page 4

New tax measures ‘not thought through’ —M.P.

! PA Wellington. A man earning $l4O a week with three teen-age children was paying $l4 a week more in tax than a man with a child aged two, under the tax rates in the Budget, Mr R. W. Prebble (Lab., Auckland Central) told Parliament. Mr Prebble, speaking in the Budget debate, said it was wrong that a man with three teen-age children had to pay $728 a year more in tax than one with a child aged two. “It would cost at least i $4O a week to, feed and I clothe three teen-age ( children,” he said. “The Government looked at the public opinion polls and decided to hand out goodies all over the place without thinking its tax measures through.” Mr Prebble, in 20 separate questions to Government Ministers, asked how many people were employed part-time by each Government department j and v.ere earning less I than $57 a week.

He also asked if the individual departments would be raising the workers’ salaries to cover the increased tax they would have to pay after the Budget tax proposals. Mr Gordon, as Minister of State Services, replied on behalf of the other Ministers. There were 2006 parttime staff, more than 1000 of them cleaners, employed in the Public Service and earning less than $57 a week, he said. If they had no other source of income they would pay more tax under the 1978 Budget proposals. “There will be no specific wage increase for these employees to compensate them for the tax change,” said Mr Gordon. They would receive gen- . eral adjustments to pay rates in common with other State, servants. If Mrs Muldoon were to supplement the Prime Minister’s income by taking a job paying $l5O a week, she would pay the same tax as a widow with

three teen-age children under the Budget’s tax measures. The Associate Minister of Finance (Mr Templeton) was asked by Mr R. O. Douglas (Labour, Manukau) for the tax payable on a weekly wage of $l5O after October 1 by (a) A widow with three teen-age children and (b) The wife of an accountant earning $32,000 a year with no children. Mr Templeton said the amount would be $36.28 in each case. But this did not take into account that the widow would receive family benefit of $3 per child. Mr Douglas said outside the House that the apparent reference to the Prime Minister — who, fits the description in Mr Douglas’ comparison — was purely hypothetical. “1 will continue to ask questions in the House pointing out that there is no relation between people’s ability to pay and what people, are being asked to pay in the tax tables,” he said.