TAXES FOR ALL

Southland Times, Issue 22362, 29 June 1934, Page 2

TAXES FOR ALL

A WIDESPREAD NET COST OF GOVERNMENT. While the national deficit has been reduced, this is not the only story told by the recently published public accounts for the year 1933-34 (says a statement by the Associated Chambers of Commerce.) The taxation figures bear silent witness to the real heroes of tlie year’s work, namely, the taxpayers—whether they have carried the tax burden as firms or companies, or as individuals paying income tax, sales tax and all the other taxes and duties, direct or indirect, visible or just as painfully invisible—who have provided the wherewithal for the conduct of the country’s affairs and the service of its debts. Four Million Increase. The amount taken by general government taxation in 1933-34 is shown as £21,487,000, which is an increase of two million on 1932-33, and an increase of four million on 1931-32. This impost is even greater than it appears, because the money has had to be provided out of a heavily reduced national income. While the national income has fallen sharply, taxation has not merely remained stationary—which would have been burdensome enough—but has risen steeply. At a time when the people needed to retain in their pockets more of their reduced earnings, they have had to pay a larger proportion of their income to provide the same tax yield as in previous years, and in addition to this, they have paid over a further four million pounds for the carrying on of the affairs of State, quite distinct from local government taxation. The taxation net has been spread so wide that small and few, if any, are the fish that have escaped it. Indeed, there are thousands of people who are coming to realize, as never before, that everybody is a taxpayer in some form or another. There are those who have thought in the past that because their wages or salaries happened to be below the income tax exemption, and because there was therefore no bill forthcoming from the income tax collector, that the cost of Government was no concern of theirs. Probably owning no property, and therefore regarding themselves as being free from encumbrances, they had for their use schools, hospitals, highways, health services and all sorts of other facilities, which they were aware cost a great deal of money, but which, in their belief, was all paid for by taxes on somebody else. They are now discovering that the cost of running the country is paid by themselves. “A Fair Cost.” By reason of Customs duties and sales tax, they are taxed on the imported articles they buy; by excise duties and sales tax they pay again to government on locally manufactured go«jds; they pay more taxes on the receipts and cheques they give, and on money they may succeed to or be given; at the grocery store, at the tobacconist’s, at bowser stations, in restaurants and hotels, even on racecourses they go on paying taxes; although unencumbered with house property, they pay taxes through their rents, otherwise the owners would not build to let; they pay taxes through their gas bills, laundry bills and fuel bills. In fact, the people have learned they are paying taxes every time they spend their money, and even when they are dead and can no longer protest, the Governments steps in and takes more taxes in the form of death duties. There has therefore grown a far better understanding of the fact chat no Government has a bottomless purse into which it may dip to pay for various expenditure and that whatever it spends it must take out of the pockets of the people. This is seen by the fact that the equivalent of half the total tax yield was needed to meet the net cost of Government departments, quite apart from debt services and other permanent charges, and the expenditure on unemployment relief. Ability To Pay. The tax bill of general and local government in New Zealand in 1932-33 was for 221 per cent of the national income. In this connection, a terse overseas observer remarks that “if that tax bill had to be paid all at one time by the taxpayer by a direct tax instead of in driblets in indirect taxes, there would be a revolution which would be recorded in history as a very snappy affair, and one remarkably effective in reducing the cost of Government.” The same observer remarks that good government at a fair cost can and will be delivered by politicians only when the people demand it, and that this will only be achieved when a majority of the people are aware that they are taxpayers, and learn to weigh the cost of their demands for government against their ability to pay the cost. There is very little evidence that real government economy is still being pursued in New Zealand. Good work has been done by the Government in this connection, but no mention was made in the last Budget of any further economy measures. So long as the people are being taxed beyond their means, and so long as industry, trade and commerce are being depressed by excessive tax burdens, there can be no end to economy in government, which is a necessity independent of vogue or fashion. The excessive cost of government must of necessity come down so as to allow early taxation relief to be granted.