THE OTAGO DAILY TIMES TUESDAY, FEBRUARY 18, 1936. INCOME STATISTICS

Otago Daily Times, Issue 22808, 18 February 1936, Page 8

THE OTAGO DAILY TIMES TUESDAY, FEBRUARY 18, 1936. INCOME STATISTICS

It is not an easy matter to sift facts from the mass of income statistics contained in the Official Year Book and the latest Abstract of Statistics. Nevertheless, from the comparative tables available in those publications it is possible to glean some interesting information touching the effect of the depression years on the eai'nings of both individuals and of companies. In the first place it is informative to look at the total, receipts from income tax for the years 1931 to 1935. In 1931 the yield from this source was £4,003,606. There was an increase in 1932 —in which tax year there was a reduction of the general exemption from £3OO to £26o—to £4,447,814. In 1933 the yield dropped back by nearly a million pounds to £3,556,775, A further drastic decline was noted in 1934, when the yield, £2,961,243, was the lowest for the five-year period under review, but there was a recovery in the last tax year, to March 31, 1935, which brought the total back to £3,796,477. In the case of individuals the figures show that taxpayers with incomes of £250 or over numbered 92,350 in the year 1931-32,

but there was a decline of nearly onethird, to 66,769, in 1934-35, accompanied by a drop in the aggregate of assessable income from £46,650,000 to £33,950,000. Corresponding figures in the case of companies disclose an interesting result, -which will have been due mainly to a lowering of the general level of company earnings. In 1931-32 the number of companies which made returns of income was 3287 and their assessable income shown was £9,960,799. By 1934-35 the number of companies had increased to 3811, but the total of assessable income showed a fall to £9,518,369. When incomes are considered in relation to their size it is worth noting that individual taxpayers, according to the latest calculation, account for 98 per cent, of the aggregate assessable income in cases where the income is under £IOOO, but only H per cent, among incomes of £IO,OOO or over, which are thus almost exclusively confined to the larger trading companies. When the year 1931-32 is taken again as a basis, it is found that in that year there were 15,663 taxpayers with incomes of under £3OO, whereas the corresponding total for the fiscal year ended March, 1935, was 13,491. In respect of incomes in excess of £3OO and not exceeding £IOOO, the comparative figures, which, with negligible exceptions, are those of individual incomes, are: —

These figures, as will be seen, show a steady decline in the earnings of individual taxpayers, a decline which is also to be noted in the case of companies, and is made to appear all the more when examined in conjunction with the fact that the revenue derived by the State from income tax sources last year was approximately only half a million pounds below the total received in 1932. No better illustration could be furnished of the heavy burden which the taxpayer, whether he be in the individual or the company class, has been called upon to carry in recent years. The decreased earnings of the taxpayer have not preserved him from increased demands upon him. There was some expectation of relief last year, but the then Finance Minister did not see his way clear to grant any concession to the income taxpayer. It is to be hoped that Mr Nash will, thanks to-the Budget-balancing of his predecessor in office, find himself in a more fortunate position at the end of the current financial year, for promises of taxation reduction figured largely in the election programme of his party.

1931-32. 1934-35. Under £400 .. .. . 26,881 15,869 £400 to £500 .. .. 14,497 9,298 £500 to £600 .. 7,356 5,089 £600 to £700 .. 4,397 2,886 £700 to £800 .. .. 2,616 1,738 £800 to £900 .. 1,727 1,168 £900 to £1000 .. 1,273 891