"TURNING SCREW"

New Zealand Herald, Volume LXXIII, Issue 22538, 1 October 1936, Page 13

"TURNING SCREW"

UNEMPLOYMENT TAX ABOLITION OF EXEMPTION OTHER POINTS CONTESTED [BY TELEGRAM —SPECIAL REPORTER] WELLINGTON, Wednesday The various alterations in the existing law proposed in the Land and Income Tax Amendment Bill were again discusssed at length during the debate on the short title of the bill when the House of Representatives was in committee to-night. The Hon. A. Hamilton (Opposition —Wallace) raised the point of the abolition of exemption in respect of unemployment tax payments. In effect, he said, the Government was proposing to tax unemployment tax, which in itself was raised for a very distinct purpose. The abolition of the exemption was just an effort to turn the screw a little harder. Information as to the deductions to bo permitted on account of premiums for machinery was also sought by Mr. Hamilton. The Opposition, he said, had pressed for deductions which the Government would not allow, and it was interested to know the reasons for deductions which were made. Minister's Explanation Mr. H. S. S. Kyle (Opposition—Riccarton): They want secondary industries. They don't want the farmer. The Minister of Finance, the Hon. W. Nash, said the clause was in the bill to allow the same treatment to be given with respect to certain boot manufacturing machinery as was given in respect of talking picture apparatus. "It is a j new American principle," said Mr. W. J. Broadfoot (Opposition —Waitomo). "They sell you the machinery, but you do not own it. They give you the shadow and keep the substance themselves."

Answering another point made by Opposition members, the Minister said that under the bill any land tax paid by a lessor would be deducted automatically from the tax to be paid by the lessee. He also referred to the provision preventing deductions on account of past losses in cases where companies were taken over by new shareholders. "I think that provision is rather sweeping," said Mr. Broadfoot, in commenting on the latter point. "A lot of people may make profits on paper, but they have to pay taxes in hard cash." "A Glum Minister" "The Minister of Finance —this Minister of Taxation—is the glummest occupant of the office that the country has seen for many years," said the Rt. Hon. J. G. Coates (Opposition—Kaipara) in a general criticism of the Government's taxation proposals. A Government Member: He is all smiles. Mr. Coates: It is forced and he is a nervous man. He knows he will get it when he has to face the troops. The Minister of Finance, added Mr. Coates, had failed to take into account the representations made to him by earnest and sincere people—leaving out members of Parliament altogether—who were going to be injured by the reimposition of the graduated land tax and the increase in the income tax. Amendments Defeated There was little discussion on the clause which provides for the abolition of exemption in respect of unemployment tax. However, the Opposition called for a division on the clause, which was retained by 38 votes to 15. There was a further division on the clause empowering the Government to collect income tax by instalments, but this was also carried by the Government.

Some discussion arose over an amendment moved by Mr. Coates, which suggested the appointment of a commission to inquire and report regarding cases of hardship arising from the imposition of the graduated land tax. The amendment als*) laid down that if hardship was found to exist by the commission the Commissioner of Taxes should have power to remit the whole or part of the tax.

The amendment was lost on division by 38 votes to 15. and the bill was finally reported with only the Government amendments.

INSTALMENT PAYMENTS CLAUSE REDRAFTED THE APPOINTMENT OF DATES [by TELEGItAFH —SPECIAL REPORTER] WELLINGTON, Wednesday Minor amendments to the Land and Income Tax Amendment Bill were introduced by Governor-General's Message in the House to-day. One alteration provides that a public authority ? as well as a company, is not to be entitled to the flat rate exemption of £2lO in the payment of income tax. The clause providing for the payment of income tax by instalments has been redrafted to give it a less rigid applir cation. It is provided that several dates may be appointed by Order-in-Council and on each of them an instalment of the income tax for the year is to become due and payable. The dates may be appointed at any time, notwithstanding the fact that the Annual Taxing Bill may not have been passed. Where dates have been appointed for instalment payments the Commissioner of Taxes 'is to fix the amount of each instalment in respect of each taxpayer. Any adjustments that may be required to ensure the correst assessment of income tax in accordance with tho Annual Taxing Act are to bo made as soon as possible after the passing of | that Act.