INCOME TAX EXEMPTIONS

Dominion, Volume 22, Issue 265, 5 August 1929, Page 12

INCOME TAX EXEMPTIONS

Sir—l read with a considerable amount of interest the letter in to-day s “Dominion” by “Small Business, under the above heading. Not the least interesting portion pf this communication is the explanation printed under same and given to “The Dominion’ by the Commissioner of Taxes, i.e., that on incomes up to £450 the full exemption of £3OO is allowed, after which the exemption is gradually withdrawn, so that on an income of £9OO no exemption is allowable. This discloses what appears to me, and no doubt- many others, a most unfair adjustment of tax; for' we are all allowed an exemption on income of up to £3OO, after which we should rightly proceed to pay tax. At £450 per annum, however, besides the tax which is of course heavier as income is increased, the exemption begins to come off until both ends meet at £9OO with no exemption allowable. This to my mind is’no more than a direct tax on thrift, for it is the small man earning between £450 and £9OO per annum, mainly through hard work, and the process of denying himself the various luxuries of life, who is chiefly affected. There either should or should not be exemptions irrespective of income, and tax could be graded according to size of income; but surely the system whereby exemptions are made and then taken away will bear looking into by responsible bodies or persons without delay.—l am, etc., _ THRIFT. Wellington, August L