UNEXPECTED LEGACY

Evening Post, Volume CXX, Issue 8, 9 July 1935, Page 17

UNEXPECTED LEGACY

TRADE UNIONS' SURPRISE

OVERDUE TAXATION

Consternation has been caused among union secretaries at the Sydney Trades Hall, states a Sydney newspaper, by the receipt of advice from the Government that they must pay arrears of taxation, amounting to a considerable sum, under the child endowment legislation introduced by the Lang Government. This is regarded as a legacy of the Lang Labour legislation.

It is said that the majority of unions, including the Australian Labour Party, are involved, and that many of them will have difficulty in meeting their liabilities, owing to the low state of their finances.

Although the child endowment legislation was introduced by the Lang Government in 1927, few unions paid the tax, the general belief being that they r ,were, .exempt. When they were asked by the Commissioner of Taxation in 1932 for an explanation why they had not lodged any returns for the period 1927 to 1931, there was general dismay.

Following special meetings .of the Union Secretaries' Association, a series of deputations waited on the Taxation Commissioner and the Government.

It was not until last week, however, that the unions were finally advised by the Assistant Treasurer (Mr. Spooner) that they were liable and would have to pay the arrears.

In their representations to the authorities, union leaders contended that, as the unions were not bodies carrying on business for trade or profit, they should be allowed the exemptions granted to charitable institutions. It was also claimed that the union dispersed such charitable funds as unemployment payments, funeral payments, and sick payments. Action was taken against the unions by the taxation authorities under section 3 of the Family Endowment Act, 1927, as amended, which read: An employer is defined as meaning any person, firm, company, or corporation . ; employing persons whether on behalf of himself or itself or any other person. The point was immediately raised whether the unions were liable, in view of the fact that they employed, at least, a secretary, and, in^nost cases, typists, organisers, and sometimes paid presidents. In response to a request by the unions, the present Government sought the advice of the Crown law authorities, and were informed that the unions definitely came within the scope of the section. . The United Australia Party and the Unity Country Party, besides other organisations, also took legal advice whether they were liable under the Act, and when they found the law against them, promptly paid the tax. It is expected, however, that a number of the unions will now ask for a liberal extension of the time in which to pay. Some unions met their payments, even under the Lang Government's regime, and other unions have since paid their arrears.