The Southland Times PUBLISHED EVERY MORNING. Luceo Non Uro. TUESDAY, JUNE 21, 1921. GERMANY’S TAXATION.

Southland Times, Issue 19256, 21 June 1921, Page 4

The Southland Times PUBLISHED EVERY MORNING. Luceo Non Uro. TUESDAY, JUNE 21, 1921. GERMANY’S TAXATION.

Some little time ago comparisons were made between the taxation borne by German citizens and that of the Allied countries, and the figures suggested that Germany enjoyed an immense advantage. These figures were widely accepted, but they have been criticised by important and careful investigators, who have put an entirely different complexion on the matter. Mr Howard Hodgkin writing in the London Spectator puts forward the explanation of the error in the calculation of Germany’s burden of taxation that it arose from basing the comparison on the present day value of the mark, which in English money is equal to about one penny. If the amount of revenue per head of population raised by taxation in Germany is calculated in English money the result would naturally be exceedingly email, but as Mr Hodgkin and the Economic Review point out, the German’s income is also relatively smaller. Mr Hodgkin’s statement on the taxes levied by the German Government is distinctly interesting. There are three annual taxes: Corporation Tax, paid by trading companies on their net income; unearned Income Tax, a fixed tax of 10 per cent, on all dividends, interest, etc., to be deducted by the paying parties; the Income Tax, subject to deductions for wife, children etc.; | incomes of up to 24,000 marks per annum pay 10 per cent., the next 6000 marks pay 20 per cent. ,the next 5000 marks a tax of 25 per cent., and so on, 60 per cent, being the maximum, which is paid on incomes in excess of 395,000 marks. Of course the purchasing power of a mark in Germany is more than it is in Britain, but assuming the mark to be worth one penny, Mr Hodgkin provides the following samples of taxation:

It will be seen from these figures, that the relation of the tax to the total income reveals a rather severe scale of taxation. In addition to these recurring taxes, the German government has an Increment Tax on the increase of all property acquired between 1913 and 1919. It is very complicated but Mr Hodgkin quotes as samples the following:

Nor is this all. The republic’s taxation legislation provides for the collection of a capital tax, rising from 10 per cent, on 50,000 marks to 64 per cent, at the maximum. The effect of this impost is shown, according to Mr Hodgkin, as follows:

The figures in the Economic Review confirm the scales set forward by Mr Hodgkin, although the comment is made that while the German legislature may pass laws imposing these taxes, it is another' thing to collect them. It is generally admitted that the big war profiteers are escaping payment, and that a large quantity of German capital is beyond the reach of the government, but the charges set out by Mr Hodgkin as a result of his investigations in Germany suggest that there are very good reasons why the possessors of money should think of removing it beyond the reach pf this legislation,

Income. Tax. Marks. £ Marks. £ 24,000 100 2,400 10 45,000 187 8,350 35 125,000 521 39,850 168 195,000 812 79,850 332 395,000 1645 189,850 791 595,000 2479 309,850 1291

Increase. Payment. Marks. £ Marks. £ 20,000 84 2,500 10 100,000 417 30,000 125 1,000,000 4175 833,000 3470

Capital; Marks. £ Tax. Marks. £ 50,000 208 5,000 20 1,000,000 4,175 244,250 1,017 10,000,000 41,750 5,417,750 22,574 100,000,000 417,500 63,917,750 266,314