The Individual Income Tax Payer

Horowhenua Chronicle, 7 October 1931, Page 8

The Individual Income Tax Payer

Having already staled that the imposition of further taxation on companies is not justifiable I now come to -the position of the individual taxpayer. At present his contribution by way oi income tax is the lowest in the Empire by reason of the low minimum rate at which our Act starts and the liberal exemptions he enjoys. I am not forgetting the fact that the main Budget increased his surtax from 10 per cent, to 30 per cent., |but I have pointed out that the receiver of gilt-edged income is called upon in these troubled times to bear his share of the burden. He is more concerned than any one else to see that the State remains solvent. European experience shows that in a general breakdown he suffers irretrievably more than any one else, in imposing any fresh burden it is pointed out that he should bear a share commensurate with the risks he 1 has at stake. With these aims in view I propose in order to secure the measure of assistance which it is considered indespensable, that the income tax should yield. (1) To impose a special emergency tax on unearned income of individuals equal to one-third of the income tax payable on such unearned income and to eliminate the 10 per cent, deduction at present allowed on earned incomes up to £2k)oo. (2) To include in the assessments (but only for the purpose of fixing the rate and the general exemption) all tax free income and Income taxed at the source and to remove the present discrimination on income derived from certain local body and company debentures. (3) To impose a special flat rate tax of 4d in the £1 on incomes of individuals after allowing a general exemption of £SOO.

It is estimated that the effect of these alterations with the abolition of the graduated land tax will be to increase the net yield on these items of taxation by about 230,000. The'fore'rv.ing provisions for economies, support from reserves and taxation (all additional to the,main Budget) should ?x realised, strengthen the Budget to ihe extent Of about £1,250,000. But it should be clearly realised that the scene is changing daily and estimates cannot be relied on in any degree. Tt is our duty to do our utmost to check .the drift in our public finances, but the ground is shifting from under us every day and the position may be required to be reviewed again before the end of the financial year. , ' . The proposals to meet the additional burden of £1,595,000’ are therefore as follows: — £. Economies 400,000 Reserves 350,000 Customs taxation 240,000 Income tax to cover land tax adjustment .. . . 320,000 Additional 236,000 Total 1,550,000 Reduction in amount provided in main Budget for supplementary estimates and contingencies .. 55,000 ■ Total 1,595,000