'BEATEN THE PISTOL'

Evening Post, Volume CXL, Issue 60, 8 September 1945, Page 9

'BEATEN THE PISTOL'

TAXATION CUT

AUSTRALIAN ACTION

Close collaboration existed between the Australian and New Zealand Governments, but the Australian decision to reduce taxation had let the New Zealand Government down, declared Mr. C. M. Bowden (National, Wellington West) in the House of Representatives yesterday afternoon speaking in the debate on the Land and Income Tax (Annual) Bill. He added that Australia on this occasion had beaten the pistol, and it must be very disappointing: to the Minister of Finance (Mr. Nash) that Australia should get in ahead of him.

Replying to Government interjections that the Australian taxation re-

duction would not be made until next year, Mr. Bowden said that, even so, the benefit of the reduction would be felt at once and very much earlier than would be the case in New Zealand. The reason for that was that Australia had a pay-as-you-go taxation system. There was a possibility that there might be some reduction of taxation in New Zealand next year, but the benefit of that would not be felt until payments were made in February, 1947. Even though Australia was ahead of New Zealand with a decision to reduce taxation, there were complaints in the Commonwealth that the remission should have been introduced earlier than January 1 next.

Mr. Bowden said he thought that in New Zealand this year part of the Is 6d national security tax should have been remitted in the interests of the family man. He considered also that there should be some reduction of the 33 1-3 per cent, surcharge, particularly in respect to the smaller incomes, and he would like to see the Minister remove the penal rate on unearned incomes, which operated as a discouragement of thrift. Mr. Bowden also advocated the removal of anomalies in the present schedule of taxation rates.

Referring to company taxation, Mr. Bowden said there was a tendency by Government members to regard companies as a great big octopus, whereas they consisted of individuals. He mentioned one company, which he said, had millions of pounds of capital employed but the average shareholding was £75. Mr. Bowden contended that as much as possible of a company's reserves should be left in the company to enable it to undertake the work and make the contribution it could make in the general interests of the Dominion.