BUDGET EXPECTED TO AID PENSIONERS, BUT NOT TAXPAYERS

Evening Star, Issue 26185, 21 August 1947, Page 6

BUDGET EXPECTED TO AID PENSIONERS, BUT NOT TAXPAYERS

(Special.) WELLINGTON, August 2!.' What is likely to be known as the “ no change Budget,'* so far as taxation is concerned, will be presented in the House of Representatives this evening by the Minister of Finance, Mr Nash. It will be the tenth Budget to be presented by Mr Nash in the House, although he has been Minister of Finance for I 2 years,- this task having been performed'for him in. his absence by the late Mr Savage in 1937, and by Mr Fraser in 1942. ‘

Mr Nash thus jereates a record as the Minister of Finance, who has prepared the greatest number of Budgets in New Zealand's political history.

In the probable absence of any considerable or general reduction in taxation, the most interesting possibility is aiv increase in most forms of social security pensions, although it is believed tliat the family benefit will not be affected. Mr Nash announced recently that any adjustment of, social benefits or war pensions, which might be necessary on account of the withdrawal or reduction of a number of subsidies, would be announced in the Budget. A further factor affecting the pensioner, as his income is fixed, is the recent wage pronouncement of the Arbitration Court, and it is likely that the Budget will provide him with some compensation in-this respect. The actual amount of such compensation is a well-kept secret, and may not even yet be settled, but it is expected to be in the vicinity of 5s a week in all cases. Public Service superannuitants may also receive some benefit. The expected increases are thought likely to synchronise with the date on which the Arbitration Court’s wage pronouncement will become effective — October 1 next—and it is believed that the removal or the reduction of subsidies on certain goods and services announced last week will also take effect on that date. REHABILITATION BIG FACTOR. Despite a saving of £4,197,090 by the removal of subsidies, factors mitigating against any substantial reduction in taxation are the fact that the Government has now spent more than £51,000,000 on rehabilitation, and that the estimated sum for social security this year will exceed £40,000,000,

Further, it is believed that the Government plans to repay to Britain a £14,000,000 loan maturing in November, ana another loan of £19,225,000, with optional maturity in. March of next year, will also be repaid. Last year the only income tax adjustment was a reduction of the surcharge on income tax from 33 1-3 per cent, to-15 per cent., and it is believed that this year the only alteration will be some relief to those ,on lower incomes in the payment of tax on unearned income. It is not likely that there will be any alteration in the sales tax or Customs duties, although last year the sales tax reductions were estimated by Mr Nash to be equivalent of a tax reduction of £7.000,000. . CIVIL SERVANTS’ SALARIES. The Budget may make some reference to adjustments in Civil servants’ salaries following the Arbitration Court pronouncement, but it is not believed that any detailed plan for making these adjustrnents will be included at this stage. * ■ Greater provision for housing, electric supply, and land settlement is.expected. Production figures over the past 10 years are likely to be reviewed by the Minister, and the point may be made that, while the. Dominion’s production of consumer goods is not as high as, in 1938-39 by 11 per cent., the total production has risen by 5 per cent. Generally speaking, it is believed that the Budget consists largely of adjustments necessary to present a balanced statement, and to place the community at large in line with the recent pronouncement, of the Arbitration Court.