“OTHER SOURCES” TAX

Evening Star, Issue 21091, 2 May 1932, Page 6

“OTHER SOURCES” TAX

AUTHORITATIVE READING OF ACT [From Ouk Paelumbntakt Rbpcexer.] WELLINGTON. May 1. Considerable confusion has been created over the publication of varying interpretations of the provisions of the Unemployment Amendment Act relative to payment of the emergency charge on income derived from sources other than salary <jr wages. The exact position is set out in the following statement, which has the endorsement of the Unemployment Board:— The amending Act of’ 1931 provided for payment of an emergency unemployment tax of one penny in every 6s 8d on income derived from salary, wages, and other sources. It came into operation, as far as salary and wages were concerned, on August 1, 1931. In connection with income derived from “ other sources,” the same impost was levied on two-thirds of that income as declared at March 31, 1931. This amount was payable in two instalments —the first on November 1, 1931, and the second on February 1, 1932. Provision was also made to tax at the same rata one-third of such income received during the year which ended on March >3l, 1932, and this amount was actually payable to-day. However, the amending legislation recently passed by the House repealed that provision and substituted a mandatory requirement that the increased tax—one penny for every Is Bd—shall be paid on the total net “ unearned income ” _ for the last financial year. This tax is payable in four equal quarterly instalments—namely, May 1, August I', November 1, 1932, and February 1, 1933. _ The first instalment at the new rate is payable at .the end of May—a month’s grace is given—although there is no objection to the total amount of the tax being paid in a lump sum on that date.

It is quite clear that those in receipt of “ unearned income ” will, as the result' of the amending legislation, pay in unemployment taxation a larger sum than would otherwise have been the case. In effect, they lose the opportunity of paying the old rate on a third of their income, and pay the new rate on all of it.