TAX COMPARISONS

New Zealand Herald, Volume LXXIV, Issue 22862, 18 October 1937, Page 8

TAX COMPARISONS

When the Minister of Finance, replying to the debate on the annual taxing bill last week, attempted to counter suggestions that the New Zealand taxpayer's lot compared unfavourably with that of a corresponding citizen in Great Britain, he took up a position hard to defend. Just how vulnerable it was is shown by a statement from the Associated Chambers of Commerce, published to-day. This disposes more than adequately of the general claims the Minister made. On one point the arguments it advanced can be amplified. Mr. Nash asserted that the general Government in New Zealand provided more services than in Great Britain, where, he said, education and police were paid for by local body funds. This is correct only 'up to a point. It is true j that both services are administered by the local authorities, and in some degree paid for out of the taxation they levy. In both instances, however, the Exchequer grants contribute substantially to the cost. The Home Office estimates for the current year included votes of £12,446,000 toward the cost of the police in England and Wales, and £1,209,000 for Scotland. The total, £13,655,000, may be small compared with the full amount spent on policing the country, but is not a negligible sum even in a British Budget. In the cost of education the position is even more marked. The expenditure in 1935, the latest available figure, was £92,808,000. Of this sum £48,593,000 was voted by the Exchequer, and £44,215,000 came from local rates. Thus, though education is ostensibly a service provided by the local authorities, more than half the cost is borne directly by the State. Whatever reasons there may be for the difference in taxation levels in the two countries, the differing responsibilities of the Governments do not tell the whole story.