Dangers in Taxation

Manawatu Times, Volume 70, Issue 58, 9 March 1945, Page 4

Dangers in Taxation

(To the Editor.) Sir, —Your leading article of March i 7 is well worthy of close study, and I ; recommend all readers to have another ; look at it. It will be of strong per- ; sonal interest, but the national aspect i is even more important. I will not again stress rates of tax, ; nor dwell upon whether the poor or rich should pay taxes, nor in what proportions they should pay. We all know that during a war both rich and poor must pay, and pay to the limit. Per- ; sonally, I think that the limit has been : reached and passed, and that the time is overdue for a drastic reduction. We 1 are spending our very lifeblood and < mortgaging our future, and this should not, in fact, cannot, be done for one ! moment longer than is absolutely necessary. It cannot be seriously imagined by , anyone, even Mr. Nash, that individuals and corporations will be content to carry on paying at the rate of 18s and 14s 2d in the £ respectively, indefinitely. It is being done while the war is on, but is causing damage to our national economy, it must affect production detrimentally. No one will suggest that any individual keeping 2s in the £ of any enterprise will strive to produce anything that is subject to such a tax. He is doing it today from force of circumstances and from profits that are almost inevitable, and caused solely by the war, with its consequent shortage of supplies and lack of competition in labour and commodities, etc. There are signs also that workers are also affected by taxation and cost of living allowances, social security, etc. I personally know of cases where men have refused to work overtime as the net result to them is xiractically the same as on a 40-hour week plus cost of living allowances, etc. What must be realised by everyone is that we are living in an unreal world, quite divorced from the usual economic forces, but which will begin to act immediately this artificial structure created by the war is demolished, and that apjiears to be at no distant date. Before this happens we should begin to set our house in order. I would recommend readers to study the article in the Reader’s Digest of December, 1944, headed “A labour leader pleads for new enterprises.” I would ask what chance we have of creating new enterprises under present conditions. And new enterprises will most certainly be wanted of primary and secondary production and social services in order to take care of our men 1 from overseas and the workers who are employed upon war production. Who will start them with the handicaps all against them succeeding? They have to allow for the sleeping xmrtner in every enterprise, who provides no capital, runs no risk, loses no sleep, does not wear its life out working, but is always there to take the major portion of profits earned. I have in mind a prospective formation of a company in New Zealand with £IOO,OOO capital. Figure out for yourself what profit this company would require to make to pay; shareholders a modest 5 x>er cent, dividend. It was decided, and rightly, that the company simply could not make sufficient profit to pay both the taxes and the shareholders. It was a certainty, not even a possibility. I recommend The Times’ readers to spend half a hour over this leader. It is worth the time.—l am, etc., ‘ ‘ PUBLIC ACCOUNTANT. ’ 9

]n the final draft of ministerial appointments approved by the Methodist Conference, Rev. C. Eaton, at present at St. Paul’s, Palmerston North, goes to Feilding as supply. Rev. H. Spencer has been appointed to the Sanson-Ron-gotea parish and Rev. W. T. Blight, at present at Feilding, goes to Ashburton. The home missions apx>ointments include that of Rev. T. Coatsworth to the Foxton-Shannon station. The annual conference of the New , Zealand Institute of Electricians will 'be held to-morrow commencing at i) a.m. at the Royal Dutch tea-rooms-