The Dominion THURSDAY, AUGUST 12, 1920. A BOGUS APPEAL

Dominion, Volume 13, Issue 273, 12 August 1920, Page 4

The Dominion THURSDAY, AUGUST 12, 1920. A BOGUS APPEAL

A feature of the debate on tha annual taxing Bill in the House of Representatives on Tuesday was the apparent ignorance of familiar facts displayed by a number of members. Mit. W. A. Yeitch, for instance, urged the need of bringing down a measure to relieve tha poorer people and to put the burden of taxation on the rich peoplo of the country. Mn. Yeitch and other members who spoke in a similar strain ought to know, if the.Y do not, that in peoplo who by any stretch of languago can bo described as poor are in an uncxainpled degree exempt from taxation. The facts are readily accessible to members of Parliament or anyone else in tho "Year Book " and other official publications. As the incidence of taxation Is adjusted in New Zealand, direct taxes, apart from stamp, death, and succession duties, are paid only by those who own land of taxable value or are in receipt of fin incomc of more than £300 a year. The only taxes to which people of smaller means contribute' aro Customs and Excise duties. Tho only Excise, duty of any importance in this country is the impost on beer. The revenue raised last year in Customs taxation works out at an average of £4 2s. 3d. per head of European population (its compared with total taxation of £14 12s. 2d. per head), but it is very far from being true that taxation on this scale is imposed on the poorer mem.' bers of the population. _ In 1917-18, the latest year for which detailed

particulars are available, considerably more than one-third of tho total Customs revenue was derived from imports of alcoholic drinks and tobacco. Assuming that tho Bamc relative proportiou was maintained, last year's Customs revertup from other sources would work out at- £2 15s. per head of population, or very little mora than one shilling per week for each European citizen. This figure is attained by excluding only alcoholic liquors and tobacco from computation, but in actual fact a large part of the remaining Customs taxation imposes no burden on people _ of slender means. Much of it is levied on machinery and materials of industry, and a further considerable proportion on luxuries other than liquor or tobacco. It has to be considered, also, that some duties, such as the basic impost of 15 per cent, on boots, are intended to protect and foster local industry. On the whole, it is quite clear that the taxation burdens Mk. Veitch and others, profess themselves anxious to lift from the shoulders of poor people are not there to lift. The actual and well-defined tendency in this country is to throw taxation burdens more and more upon the comparatively limited number of people who pay direct taxes; and in this class of taxpayers a small proportion of the total number bear the greater part of the burden, Mr. Massey mentioned on Tuesday that 3.6 per cent, of the taxpayers paid 80 per cent, of the direct taxation. The. immense increase in direct as compared with indirect taxation since the outbreak of war is easily demonstrated. Customs taxation per head was £3 Is. 6d. in 1913-14, and £•1 2s. 3d. last year—over this period it increased, roughly, by one-third. In the same period tlie aggregate return from land and income tax and death duties increased from £1,935,473 to £11,272,601—that is to say it increased nearly sixfold. Such comparisons might readily be extended, but it is in faet self-evident that in this country people of small means are already so lightly taxed that there is at most extremely limited scope for affording them any further relief. A comparison with the position in Great Britain would show not only that Customs and Excise duties per head are somewhat heavier in that country, but that a very large proportion of those who entirely escape direct taxation in New Zealand would piy a substantial amount in'income tax if they were domiciled in the United Kingdom. As taxation is at present adjusted this country the only obvious injustice done to people of small 'or moderate means is in the matter of company taxation. Presumedly, but for war conditions, the unfair .penalty imposed on shareholders of small total income in making their dividends liable to heavy taxation—in some cases on the highest scale—would have _ been redressed years ago. There is here a genuine case for reform, and one that ought to receive attention this session. , So far as the general incidence'of taxation is concorned, however, the suggestion that sjeoplc of small means are unfairly burdened is plainly quite unfounded.