DOUBLE TAXATION

New Zealand Herald, Volume LXXIII, Issue 22350, 22 February 1936, Page 18

DOUBLE TAXATION

CALIFOKNIA'S PLIGHT

WEALTHY PEOPLE LEAVING REFERENDUM TO BE TAKEN The imposition of a Stato income tax in addition to the Federal tax has already created a great deal of feeling in California, and will probably have the effect of driving ' many wealthy people away, according to Mr. L. Thornburgh, a Santa Barbara lawyer, who is a through passenger with his wife on a holiday trip by the Mariposa, which arrived at Auckland yesterday. Mr Thornburgh said the income tax was imposed as the best means of making up a, deficit in the State finances, but the double taxation had cut down incomes in such a way that people who had come from other States could not afford to maintain their usual standard of living. William Randolph Hearst, the millionaire newspaper proprietor, had left the State already on account of the high taxation, and other people would do the same unless the tax was reduced oi abolished. As originally planned, the tax was to equal one quarter of what was paid to the Federal authorities, but various exemptions allowed by them had been disallowed by the State. Arrangements had been made for a referendum to be taken on the question at the next election.

l'he policy of the Roosevelt Administration was strongly condemned by Mr. Thornburgh. "Roosevelt is a straight-out Socialist, and people in America will not stand for Socialism," he said. "I think he will go out next election, but who will succeed him I would not like to guess. There are a lot of equally good men. such as Senator Borah, who are mentioned as prospective candidates. Upton Sinclair, the author, who stood for the office of Governor of California, is being sponsored by a certain group as a Democrat candidate."

Although the repeal of prohibition has lessened the amount of crime to some degree, bootlegging still flourishes, according to Mr. Thornburgh. "Those who were operating stills during the prohibition period are continuing to manufacture liquor," he said. "By avoiding the payment of taxes, they are able to make big profits.