PROFITS AND TAXES.

New Zealand Herald, Volume LIV, Issue 16561, 9 June 1917, Page 8

PROFITS AND TAXES.

MERCHANTS' PROPOSAL.

GRADUATED INCOME TAX.

A report on the subject of taxation was submitted yesterday to the council of the Auckland Chamber of Commerce by the committee which was appointed on May 11 to go into the question. The committee consisted of the president of the chamber, Mr. It. Burns, and Messrs. J. B. McFarlane, H. W. Hudson. T. Peacock, and A. B. Robertcn. Messrs. H. C. Tewsley and G. W. Hutchinson, representing the New Zealand Society of Accountants, attended the meeting of the committee byrequest.

The committee reported that it had passed the following resolutions as its recommendations to the council :—

(1) Having regard to the progressively heavy financial commitments of the Dominion, the sub-committee is strongly of opinion that the time has arrived for devising an equitable and elastic system of taxation, based upon an acceptance of the admittedly sound principle of apportionment of the load to the relative ability of each taxpayer to bear it. (2) That the present excess profit tax is anomalous in its incidence and too limited in its scope. (3) That a graduated income tax is the simples;, fairest, and most elastic form of taxation that can be devised, and capable of yielding the largest amount of revenue win a minimum of friction. It was added by the committee thai the Society of Accountants was arranging to meet the local members of Parliament to discuss taxation proposals before the House meets, and the committee recommended that representatives from the chamber co-operate with the society at such meeting. Mr. E. Anderson said it seemed that the New Zealand excess promts tax pressed more hardly on the taxpayer in one respect than the British excess tax, as no provision was made for any loss that might occur after the war. He understood that the British tax made a provision to the effect that if the profits after the war fell below the standard an allowance would be made. If the tax was re-imposed in New Zealand a simila' clause should be inserted.

The president reminded Mr. Anderson that the committee was suggesting that the tax should be abolished. Mr. S. A. Longuet expressed surprise at the statement that a provision such as that referred to by Mr. Anderson existed in Great Britain. Mr. Anderson said the provision existed, but it was limited to one year after the war. Mr. Longuet : It would be a difficult matter for anyone in charge of a country's finances to arrange. Mr. Anderson: Well, it is done. The president said it would be advisable to put the matter before the Auckland members of Parliament at the approach in conference between them and the chamber.

Mr. H. W. Hudson remarked that there was a need for an improvement in the method of imposing taxes. The casual way in which they were levied was astonishing. The matter was of sufficient importance to warrant the appointment of a Royal Commission or a special committee of experts, whose duty it would be to submit recommendations before any new taxation was imposed. Taxation in New Zealand was certain to be heavy in the future, and an effort should be made to arrive at a scientific method of imposing it.

The president said this also was a matter that, might hi brought before the approaching conference with members cf Parliament

The report was adopted, with an additional clause to the effect that the Government be asked to insert the clause suggested by Mr. Anderson in the event of the excess profits tax beinf reimposed.