BOARD TO GO

New Zealand Herald, Volume LXXIII, Issue 22390, 9 April 1936, Page 13

BOARD TO GO

EMPLOYMENT BILL TAXATION SYSTEM ALTERED PROVISIONS ADMINISTRATION CHANGES MAIN FEATURES OUTLINED [by TELEGRAPH—SPECIAL reporter] WELLINGTON, Wednesday Abolition of the Unemployment Board and the establishment of an employment promotion fund to be administered by the Department of Labour are the main features c>f the Employment Promotion Bill, which was introduced in the House of Representatives to-day by Governor-General's Message.

It is mainly a consolidating measure, but alterations are made in the system of taxation. The most important is the fact that the provision in the main Act, which allowed sums paid as unemployment tax to be exempt from income tax is not reproduced. The bill provides that the unemployment tax shall be known in future as the employment tax, consisting of the registration levy and the employment charge, both of which at present exist under different names. However, there is no contemplation of immediate alteration in the rates of taxation for these purposes.

The administration of the bill will be substantially along the lines followed • by the Unemployment Board in its handling of the unemployment funds. The assessment, collection and recovery of employment tax are to be administered as if it was income tax. Exemption Provisions The necessity for registration of every male person over the age of 20 years as under the original Act is again stipulated. The quarterly levy and the tax on salary, wages and other income j are maintained, with no specific reference to the rate in the latter case, the quarterly levy is still to be at the rate of 5s a quarter. With regard to the payment of these taxes the only new provisions are that people leaving New Zealand before a quarterly instalment is due shall not be . held liable for the payment of that , instalment and tha> no instalments of 1 the levy shall be due after the death, of a taxpayer. Previously the levy was ; regarded as an annual charge and was charged against a decreased person's estate for the balance of the year after his death.

As .under the original Act pensioners j and Maoris are exempt from the pay- , ment of the registration levy. Other • classes where partial exemption is j granted, as in the case of hospital ' patients, are retained in the bill. An additional exemption applies to people over the age of 65 whose annual incomes do not exceed £lO4.

If any person receives payment for services rendered since August, 1931, when the emergency unemployment charge came into operation and before the present bill becomes law, an aj> portionment of the sum may be arranged for employment taxation purposes.

The Sights of the Crown' The general application of the charge on income other than salary or wages is maintained subject to the existing exemptions. However, the exemption* in respect of departure from' New Zealand and death before an instalment falls due as applied to the levy are extended to this phase of taxation. Under the existing legislation there is no authority to fix a date for the hearing of default assessments in respect of income other than salary or wagjes. The new bill provides that notice of objection to the assessment can be given within 21^days. The present provisions regarding the collection of employment tax are retained in the bill. Among the additions in this respect are clauses protecting the Crown's right to tax receipts in the event of the bankruptcy of an employer; making the amount of tax deducted bv an employer and not accounted for a charge on his real and personal property; and enabling the Crown to take action for the recovery of any tax which an employer has failed to deduct.

Administrative expenditure under the bill is to be charged first to the Consolidated Fund and not to the employment fund. However, the Consolidated Fund will subsequently be reimbursed; but only to the extent approved by the Minister of Labour and the Minister of Finance. The Position of Women During recent months there has been some agitation for payment of allowances to unemployed women. No specific provision for this porpose is made in the bill, but the Ministers of Labour and Finance have discretionary powers to extend the payment of allowances to women. The maximum allowances which may be paid to a man and his wife and dependants are also left to the discretion of the Ministers, the effect of this being to rule out the statutory limits at present existing. Since taking office the Government has maintained that a willingness to accept work is essential for the receipt of relief. A clause in the bill provides that no allowance will be paid to any • person if his unemployment is due to his refusal or failure to acfcept reasonable work which has been offered to him except with the authority of the Minister. A person must reside in the Dominion for six months before, he can qualify for relief allowances. There is power for the Minister of Public Works to carry out work on behalf of local authorities.

The penalty applicable to persons who obtain benefits by making false representations is increased from £2O to £IOO. Explanation ol Measure When the bill was introduced the Minister of Employment, Hon. H. T. Armstrong, said it was a consolidation of the Unemployment Act of 1930 and its amendments. It would continue the unemployment fund and t&e tax. Opposition Voices: Any reduction ? The Minister: No, not yet, but it will be known as the employment promotion fund. Mr. Armstrong said that under the present legislation there was a clause exempting the unemployment tax from income tax. That provision was taken out in the present bill because it was the business of the Income Tax Department to say whether the tax was to be exempt. " The bill abolishes the board and places unemployment under the control of the Labour Department and the Minister of Labour," continued Mr. Armstrong. " There are also alterations * in the administrative clauses. The position is that we want the bill on the order paper so that members can have an opportunity of studying it during the Easter recess." The Leader of the Opposition, the Rfc. Hon. G. "W. Forbes, asked whether it was the intention of the Government to dispense with the. services of the members of the Unemployment Board. The Minister: The bill provides for ' the abolition of the board only. There H is no reference to the services of members who constitute the board. The bill was. read a first time..