TAX REDUCTION

New Zealand Herald, Volume 82, Issue 25301, 7 September 1945, Page 7

TAX REDUCTION

AUSTRALIAN SCHEME MEW RATES OF PAYMENT (N.Z.'P.A. Special Correspondent) (Reed. 5.35 p.m.), SYDNEY, Sept, 8 The Australian Government's decision to reduce income tax by 12} per cent has been welcomed on every hand but it is felt that the reduction could have been made to apply immediately. The benefit to taxpayers of the 124 per cent cut will be only 6.1 per cent over the whole of the current year's income. This is because the cut will not operate until January 1. The contemplated reduction would result in a loss of revenue of ,£'20,000.000 for a full year. The cost this financial yea r will be £10,000,000. Under the revised scheme adopted by caucus a now total ceiling taxation rate of 16s 8d in the pound has been fixed as from January 1. Previously the tax ceiling was 18s 6d. The new rates of tax on personal earnings will start at approximately 3d in the pound on taxable income of £2Ol and will rise gradually 'to los 2d in the pound on higher than £SOOO. This rate, combined with the social services contribution, of Is 6d in the •pound, will give a total ceiling rate of 16s 8d in the pound. Workers earning £lO2 a year will pay 6d in the pound social services tax. A sliding scale tax will rise to Is 6d in the pound, but the total liability of any person for this tax will not exceed £75 a year. The social 'services tax is expected to create a fund of about £50,000,000 a year, from which all social services will be financed except old age and invalid pensions. The fund will be financed where necessary from ordinary revenue. This marks an important departure from Governmental policy that social services should be non-contributory. Persons earning less than £250 will not pay ordinary taxation, only social services tax. SCHMELING ARRESTED LONDON, Sept: 5 Max Sehmeling, former German champion boxer and paratrooper, has been arrested on a charge of disobeying Military Government orders, according to a message from the Hamburg correspondent of the London Pf' 1 - , * press. His trial is expected to take place next week,