“BROKEN PLEDGES”

Poverty Bay Herald, Volume LXIII, Issue 19129, 25 September 1936, Page 5

“BROKEN PLEDGES”

TAX INCREASES MR. POLSON’S ATTACK “LEVELLING DOWN PLAN” INCOME TAX VAGARIES “HIGHER ONES ESCAPE" (Parliamentary Reporter.) WELLINGTON, this day. A Trades Hall plan created bv one class for its own benefit was the description of the Government >s taxation policv by Mr. W. J. Poison (Nat., Stratford), who led the Opposition comment on the Annual taxing Hill in the House of Representatives last night.

Labour, he declared, talked about a levelling up policy, but in Parliament it was busy levelling down, though he was convinced that the people of New Zealand, who were already becoming alarmed, ■ would not allow all then liberty to lie sacrificed at the bidding of any misguided band of theorists. He reminded the Prime Minister of his constant pre-election declarations that further taxation was out of the question, and that readjustments of taxation must not be taken to mean increases.

The Rt. Hon. ,T. fi. Coates (Nat Kaipara): Who said that?

Mr. Poison: The Prime Minister —on almost every platform in the country. He said )t in Wellington and Stratford.

Mr. F. W. Schramm (Lab., Auckland East): God help him. “WHERE IS THE MANDATE?” Mr. Poison: Where is the mandate to break that pledge? Where is the mandate to place a staggering burden of taxation on the country? I would like him to justify that breach of a solemn pledge. The responsibility is largely that of the Minister of Finance, who dictates the policy to the Prime Minister, and is strong enough to put it over. We now know the answer to the conundrum of where the money is to come from.

There was going to be more payment for workers and record taxation for the Government, but they could not have it both ways. The sales tax remained, though it was to come off at once, while the high company taxation was retained with all its evil consequences on industry, though the Government talked of establishing new industries. In some cases, the Government would appropriate more than half the income. There was no justification for the graduated land tax today, and its effect would be to put thousands of acres of marginal land out of use. It would confiscate the equity of the mortgagee without helping the farmer. The Hon. F. Langstonc: How much comes from country districts? Mr. Poison: A very great deal in the past, but not much in the future.

The Government’s great mistake •was, he suggested, that it believed that it was redistributing the wealth of the country, but it was merely spending the country’s capital; not its income. This must end eventually and the electors certainly never voted for the Labour policy. “TALKING IN PARABLE?”

Mr. Poison, discussing the incidence of income tax under the new scale, stated that on incomes ranging from £3OO to £6OO there would be an increase of 60 per cent, but on those from £7OO to £IOOO there was practically no increase at all. After £IOOO was passed, the tax went up again, and above £2OOO it rose rapidly. The position relating to incomes between £7OO and £IOOO was open to a considerable amount of grave misinterpretation in the country. The Hon. W. E. Parry: What do you mean by that? Mr. Poison: I am leaving it to the imagination of the member. Take it home and sleep on it! Mr. Schramm: He is talking in parables.

Mr. Poison retorted that it was not his business to explain the extraordinary vagaries of taxation, but he ventured to say that the Government could not justify that gap when the tax on smaller incomes was increased and the higher ones escaped. It suggested an excessive mixture of muddled thinking, the country, on the one hand, having to experience the withering effects of high taxation, and on the other spending its way back to prosperity. Mr. Schramm: Better than starving our way back.

Mr. Poison asked if Labour members realised where their Minister of Finance was leading them. The country would not stand for smashed pledges, and it would be a dark day for the farmer and for the industry when the bill reached the Statute Book.