Manawatu Daily Times Income Tax- Prospect of Reduction

Manawatu Times, Volume LIII, Issue 6631, 9 June 1928, Page 6

Manawatu Daily Times Income Tax - Prospect of Reduction

Honorable W. Downie Stewart, the Minister of Finance, has not yet made any definite statement on the subject, but it is rumoured in what may be regarded as well-informed circles that he is submitting to Cabinet a proposal for a reduction of the income tax during the approaching session of Parliament. The Minister, it is well known, never has looked with entire approval upon the present method of collecting the tax from companies, which not only inflicts hardship upon small investors, but also increases the cost of supplies and services. When the income tax was first substituted for the'property tax, away back in, the nineties, it did neither of these things, the amount being comparatively negligible, and neither the small shareholders nor the companies’ customers suffering to any appreciable extent. But, now, with the increased rates brought about by the obligations of the war, twenty-five per cent, of the companies profits are absorbed by the income tax, and, dividends having to be paid, the amount has to be recovered in the way just, indicated. Beginning at the Top If Mr. Stewart succeeds in bringing his colleagues to his way of thinking in this matter, Parliament may be asked to begin the reduction of the income tax in its highest graduations. No doubt such a proceeding would bring a storm of protests from people who had not examined the problem closely. They would declare that an attempt was being made to relieve the big man at the expense of the small one and that the principle of equality of sacrifice was being cast to the winds. But if they could be persuaded to look into the position at all closely they would come to realise that an equitable adjustment of the company income tax —placing it, that is, upon the same footing as the English and Australian taxes—would be a much greater boon to the individual and to the community than would a pro rata deduction according to scale. If the Minister of Finance really has this step in contemplation he should be making the public familiar with its nature now.