SERVICE PAY SUBSIDIES

Otago Daily Times, Issue 25173, 13 March 1943, Page 4

SERVICE PAY SUBSIDIES

TAX EXEMPTION TO £4 RELIEF FOR EMPLOYERS (F.0.P.R.) WELLINGTON, Mar. 12. Two amendments were moved by the Opposition to the Finance Bill during the committee stages of the Bill in the House of Representatives to-day. Both were lost by small margins. Mr W J. Broadfoot (Oppn.. Waitomo) said he thought the maximum amount of £4 that an employer could contribute free of taxation by way of subsidy to servicemen was a little on the low side. An employer who wished to supplement the wages of a former employee should be encouraged to do so. He moved that the tax-free amount be increased to £5.

The Minister in Charge of the Land and Income Tax Department, Mr A. H. Nordmeyer. said that when the Government decided in 1939 to encourage employers to subsidise the pay of servicemen it was considered that if the amount for exemption was fixed at £4 that was all that need reasonably be done. Nothing had occurred since to justify the Government in altering its view. The maximum exemption of £4 had been in existence for three years or more, and it had not been seriously challenged. The matter would not be before the House but for a legal technicality. The amendment was lost by 27 votes to 21. Mr C. G. Harker (Oppn., Waipawa) moved a further amendment to exempt from a serviceman's assessable income moneys received by him by way of subsidy from his former employer. This was lost by 25 votes to 22. The Bill was then put through the remaining stages and passed without amendment.