WHO PAYS?

Nelson Evening Mail, Volume LXIV, 17 May 1930, Page 10

WHO PAYS?

EFFECT OF HIGH TAXATION (Contributed by the New Zealand Welfare League) Socialists in arguing that a fairer distribution of wealth is necessary have a false idea that they call (to use a common expression) “take money from the pockets of the rich and hand it to the poor” in some form or other as social services, unemployment relief, shorter hours, holidays on pay and So forth. Almost all these attempts to even up wealth merely amount to expenditure which produces no return. The British Socialist Party is comfortably fixed in this belief and trade is severely handicapped—bur New Zealand Socialist Party’s platform forecasts the same ruinous policy—but in England grave doubts are entering the minds of working men that the heavier tlie burden which falls' on the employer the worse it is for the worker. REMARKABLE REPORT The general Federation of Trade Unions which next to the Miners’ Federation, is the largest body of workers in England has recently issued a report on “the effect of taxes on prices.” Mr Snowden recently said that “taxation instead of discouraging individual effort, tends to stimulate it.” The report’s comments aro that “this contention which is put forward officially, would appear to. be a dangerous one for trade unionists—it would hardly be wise for any representative of work people to suggest that a 20 per cent, reduction in wages—the standard rate of income tax is 20 per cent—would insure greater efficiency and harder work. Carried to its logical conclusion,” they continue, “this contention would mean that all incomes should be taxed out of existence and all wages reduced to zero.” .

MISLEADING THE WORKERS The report goes on to say, “however desirable it may bo to secure fairer distributions of wealth, it is fatal to national prosperity to eat up that capital which is necessary 1 to finance present arid future production. When people advise the worker, that all his insurances, pensions, housing and cdu-

cation expenditure can be extracted from capital 1 without endangering his industrial existence they arc badly .misleading him. Tho truth is that all these things and others, such as holidays on pay for municipal workers, have to be earned by the operatives in other industries. It is the industry of these operatives which produce the wealth out of which the cost of social improvement are met.” , There is much more in this report worth quoting but wc will only repeat its assertion “that excessive exactions from income and estates will weaken the individual will and power, to save”—rather than as Mr Snowden said above, in stimulating greater efforts. Finally its general conclusion is

“that excessive taxation lias psychological consequences and weakens the will to save, and resentment induces extravagance at home” or tlie removal of capital to other countries. As. our New Zealand “Labour” Party forecasts a policy involving a huge increase in taxation it would bo well for our wage earners to study this Trade Union report.