TAXING SYSTEM

Dominion, Volume 31, Issue 140, 10 March 1938, Page 12

TAXING SYSTEM

Authority To Grant Relief i HARDSHIP CLAUSE Miscellaneous Clauses In Finance Bill Minor amendments in the taxing system are included in a Finance Bill which was introduced in the House of Representatives by Gover-nor-General’s message last night. There is no provision for any alteration in the incidence of taxation, and most of the amendments are designed to remove existing anomalies.

Special provisions are included for the assessment of income tax on companies engaged in mining for petroleum. The taxable income for anj year is to be the amount of dividends paid to shareholders in that year, but the aggregate amount of dividends has to exceed the aggregate of expenditure by the company which is regarded bj tjhe Commissioner of Taxes as irrecoverable. ... Alterations in the dates on which financial years may close are provided for in another clause. In future, any taxpayer, with the consent of the commissioner, may furnish a return for the year ending on the date of the annual balance of his accounts. The income for that year will be deemed to have been earned during the year ending March 31 nearest that date. In this connection, September 30 of any year will be regarded as being nearer to the preceding March 31. If a taxpaver adopts this practice he will not be" able to depart from it without the prior consent of the commissioner. Remission of Penalty. Power to remit the penalty on income tax not paid after a certain date is given to the Commissioner. This power is to be exercised only in cases where serious hardship would otherwise result. Explaining the clause on the introduction of the Bill, the Minister of Finance, Hon. W. Nash, said that since he had been Minister a number of, cases had occurred where persons had been subjected to a heavy charge as a result of the inability of the Commissioner to remit the penalty. In the last fortnight, through the failure of a girl to deliver a letter, a taxpayer had been forced to pay income tax penalty amounting to £25, and the commissioner had been powerless to remit that charge. The clause gave the commissioner that power, although it was subject to approval by the Minister of Finance if the amount of the remission exceeded £25. In cases of serious hardship the commissioner is to be empowered to grant relief to taxpayers. However, no amount In excess of £25 can be remitted or refunded without the approval of the Minister of Finance. The clause is designed to cover cases in which dependants may be liable for the payment of income tax due by a deceased person. Another clause defines the liability of the State Advances Corporation as mortgagee in possession of lands comprised in mortgages transferred to the corporation, and has the effect of exempting the corporation from certain land tax payments. Superannuation Subsidy. Apart from taxation matters, mis-, cellaneous clauses in the Bill provide for the payment of £200,000 from the Consolidated Fund into the various State superannuation funds. A lengthy clause deals with the modification of the apportionment of annual expenditure with respect to the Thames Hospital Board, and specifically defines the capital value of the borough of Waihi. Provision is made for granting further relief to ratepayers in the Rangitaiki Land Drainage District by fixing the the capital sum on which rates may be levied at £205,000. A further clause makes seamen engaged on intercolonial trading ships under New Zealand articles liable for tlie payment of employment tax unless they pay similar tax in another country. This provision will operate as from April 1. Authority conferred on the Reserve Bank to grant accommodation to the Dairy Industry or Internal Marketing accounts is not to be restricted by the provisions of the Reserve Bank of New Zealand Act prohibiting the granting of loans without; security. The New Zealand Dairy Board is given authority to purchase a deferred annuity for the benefit of its secretary on his retirement from the service of the board at the age of 65. The cost is given at £2575. The board is also authorised to spend £5500 on the purchase of deferred annuities for former officers. Another clause validates, a loan of £lOOO to the Y.M.C.A. for the purchase of radio sets to be supplied on easy terms to public works camps. • ♦ The Bill was read a first time.