TAXATION FIELD

Nelson Evening Mail, Volume LXVI, 18 June 1932, Page 12

TAXATION FIELD

WIDENING THE NET COLLECTION OF DATA RETURNS FROM £2OO UPWARDS COMMISSIONER'S NEW ORDER Although mi further increases in Hie rales of direct taxation are eontemplaleil liv Hie Government for this year, in forma I ion which the Taxation Department is in Hie process ol collecting raises more than a suspicion that a widening of the income tax net is one of the roils in pickle now being considered by Cabinet (states the Auckland “Star"). 'This, it is suggested in some ipiarlers, will probably lake the loi'in of a substantial lowering of the so-called statutory exemption, and it will not be surprising if the alteration is so arranged as t.o give it the effect of a bachelor and spinster lax. During tin* recent session of Parliament speculation was rife as to the possible action the Government would take in the direction of altering the present personal exemption of £2<io, and if was then freely suggested that a tax on the unmarried would lie incorporated in any such scheme. No reductions were made, but evidence is now available that the issue has not been lost sight of and that something more may be heard of it later in the vein*.

In previous years persons whose income exceeded £2f>f) were required to submit a return to the Taxation Department, notwithstanding that taxation was not payable by them by reason of special exemptions. Aeording to a printed notice at present displayed iri the Taxation Ofliee in Auckland,’and issued by the authorities in Wellington last month, returns must be made by all persons whose income exceeds £2OO. This requirement. is a highly importantone, since if will bring under the purview of the Commissioner of Taxes thousands of names which have not previously appeared on the Department’s tiles. CONFLICT INO INSTR [JOT TONS The extraordinary feature of the new ruling, however, is that it has not been given publicity, and that it conflicts with the instructions that accompany the income tax return form obtainable from post olliees. In this for-m it is definitely stated that returns are required from persons whose income from all sources exceeds £250, whereas the Commissioner has laid it down, in his latest proclamation that return must he made where the income exceeds £2OO. The discord is obviously due to the practice so favoured l>y Government Departments of printing an endless supply of forms,, the use of which has become regular. In the present instance there are doubtless thousands of No. 9 income tax returns still in circulation which contain the. £250 return requirement. Tt is understood that over 1100,000 were printed in December last.

How the Department expected the average person in recepit of £2Ol to know that be was obliged to lurnisli a return by Ist June of this year is not clear: but according to advices from Wellington much of the information sought from income receivers on this scale has already come to hand. This apparently is the result of a eirculai forwarded to companies, which stated: “For (he purpose of more completely checking personal returns this year I shall be glad if you will show salaries and wages of £2OO and over.” ft is reported that the daily mail of the Department in Wellington this month lias been exceptionally heavy and that the stall' lias been kept busily engaged in handling the additional amount of correspondence*. A NEW FIELD Tn asking for the first time tor returns from those with incomes between £2OO and £2oo, for that is the effect of the notice, the Department will become possessed of information which will enable it to survey a taxable field hitherto unexplored. A simple calculation in the light of the details returned will reveal to what extent the general taxation yield will benefit if, for example, it were ultimately, decided to lower the statutory exemption from the present figure of £2OO to, say, £220 or £2lO. Into the fold would come many who previously remained on the safety zone, and under the present rates, and even allowing for exemptions, it would appear that the ad-j ditional revenue available would be; well worth the collection. If Cabinet,! in finally adopting a course along these : lines, should also take advantage of the] opportunity to introduce a bachelor! and spinster tax, the selieme would ! conceivably provide for a lowering of the personal exemption to enable a differentiation to be made in favour of all married taxpayers. By that means bachelors and spinster would pay an additional impost. ADVANCE PAV.VENTS

As a result of the fixation of the rates of income tax during the emergency session, the assessments will be available this year much earlier Ilian in previous years, and if the Departmental machine works efficiently, there is no reason why taxpayers should not learn in two months’ time the amount they will have to jury. The issue of earlier assessments will he essential to the success of the scheme for the payment of income tax in advance instalments. Advance payments can lie made of as low an instalment as £l, and the taxpayer will he entitled to interest or discount for every complete mouth of payment. The total payments, together with the interest or discount will he deducted from the tax payable and ff there is an excess the balance will lie refunded.