THE WAR TAXES

Evening Star, Issue 23620, 5 July 1940, Page 12

THE WAR TAXES

WRONG INCIDENCE SUGGESTED INSURANCE ON PROPERTY A SUBSTITUTE [From Ocr Parliamentary Reporter.] WELLINGTON, July 4. Contending that the incidence of taxation was wrong, Mr Holland, in the House of Representatives last night suggested that the guiding principle in taxation should bo that the nearer the bread line the less pressure there should he on the individual. He urged the Minister of Finance to take into account the hardship that increased taxation would impose on those with low salaries. He suggested that those under £2 a week, should not pay any of the increased tax, and that those above that figure should) pay on. a graduated scale in relation to their wages. He urged also that the Minister of Finance should exempt thrifty people from a penal tax when they had . reached the age at which they would! retire. Too much thought had been given to the militant workers—the watersiders, the miners, and the men on public works. ■ If those on a lower salary sca]e were relieved the money would have to be found in some other way, and he offered a suggestion for the . consideration- of the Government. His suggestion was war insurance. Insurance was collective protection of property. _ Owners insured their properties against fire, and merchants insured their goods during traiisit. .War insurance, would apply oh the same principle to all property that was being protected by forces in the-field. The men in the fighting forces were protecting everything New Zealanders had, and he suggested that it. would not be too much to ask property owners to pay one penny in the £ on equities in all property. For example, a property, worth £IO.OOO, with a; mortgage of, £7,000, would pay insurance at the rate of 3,000 pennies from the, owner and 7,000 pennies from the mortgagee. They would! both pay a premiupi for the protection their equities received, The same would apply to factories and to the goods in them. He estimated that about £4,000,000 could be raised from the property and goods protected by the fighting forces for New Zealanders. ■

Mr Barclay interjected that the. Government had considered such taxation, and it would only return £2,000,000. .Some would claim that the proposal was a capital levy. Mr Holland said it, was not a capital levy, but a premium paid for protection given. No one would suggest that fire or marine insurance were capital levies, but they were both levied on the proportion o£ property insured. There could be safeguards against hardship. Mr Holland! concluded by saying that he was not putting forward a complete plan, but merely a suggestion. It was an alternative, that the Government should-consider so that the burden on lower incomes could be reduced.