WAGES AND INCOME

Evening Post, Volume CXV, Issue 62, 15 March 1933, Page 8

WAGES AND INCOME

(To the Editor.) Sir,—The Government Statistician has issued an estimate of the annual private individual income in New Zealand covering the period up to the end of 1932, and there are a few points calling for criticism."

The 1926 census gave the individual income to be £130,000,000 to £140,000,000. The Statistician now estimates it at £100,000,000 —a drop in money income in six years of between 30 and 40 million pounds. The 414,000 wages earners have lost approximately 13 million pounds per annum in wages and also in purchasing power. No wonder we have an army of unemployed. The emergency tax towards unemployment as applied to all wages earned, when compared with exemptions allowed earned incomes and private incomes, is most unjust. Workers earning less than £2 per week should be totally exempt from such a tax. This is the case in New South Wales. Assessable income in 1930 was-£06,218,962 and taxable income £32,800,131, over 50 per cent, less, and the total revenue amounted to only £4,003,606. Incomes that could bear a fair share of the national financial burden are allowed exemptions, and -wages which are below the bread and butter line are fully taxed. In the first eight months ot the emergency tax, from wa"es £490,000 was collected, and from income £220,000 or over 50 per cent, less from income than from wages. The estimates in the Budget submitted to Parliament by Mr. Forbes on October 4 1932, and providing for unemployment take the lion's share from wages as follows:—From levies, £400,000; from n»e *??',w, £ 1 >400-°«>; income tax, £16^000 Consolidated Fund

Wages paid 40 per cent, more unemployment tax than income, and income is the largest and strongest, fund to draw from. It the 100 million pounds estimated individual income was only taxed equal to the impost imposed upon wage

earners, the unemployed fund would benefit to the extent o£ two million pounds per annum more than it now receives. If exemptions for children can be given persons with incomes from £300 to £400 per annum, and for insurance premiums and widowed mothers as well, why not givethe same right to workers who only earn £2 lCs per week, which is the average 'wage given on a national wage bill of £00,000.000 divided between 414,000 workers.—l am, etc.,

JOHN TUCKER, President, Wellington Trades and Labour Council.

[Evidently the correspondent has misunderstood the Statistician's estimate and is riot fully acquainted with the conditions of wages and income taxation. Of the £100,000,000 estimated private income £63,500,000 is wages (including salaries), and £25,500,000 is "other income." The latter class includes the incomes of nonsalaried professional men (doctors, -lawyers, architects, and others)* traders, farmers, manufaeturers.^and also income derived from interest and dividends. The £11,000,000 remaining comprises pensions, undistributed company profits, "other" income of women and Maoris, and earnings of juveniles. Individuals who pay income tax also pay the waste tax and receive no exemptions for children, or insurance. These income-tax payers contribute a substantial part of the total shown as derived from wages, as there is no distinction between salary and wages. The only classe* of individual income exempt from the wage taxation are £20 a year other than salaries or wages for women, pensions (not including superannuation), relief pay, domestic servants' wages, and some minor groups. Companies do not pay wage tax on their profits, but when the profits are distributed as dividends the shareholders must pay.— Ed.] ' '