NEW DEATH DUTIES

Timaru Herald, Volume CXLVIII, Issue 21555, 18 January 1940, Page 4

NEW DEATH DUTIES

Effect On Widows and Children Huge Increases Increases ranging up to 590 per cent are made in the new rates of death and succession duties in New Zealand which have come into operation as a result of the legislation passed during last session of Parliament, states the "Auckland Star.” Gradually the public is beginning to realise that the effects of the new scales are far in excess of what was anticipated when the change was made. Beneficiaries, and particularly widows, are finding that the new rates on estates of between £7OOO and £lO,OOO, where the rise is steepe t, are at least 350 per cent higher as compared with the old, and beneficiaries of the next generation, that is, children, are discovering that increases of 75 to 100 per cent and over are not uncommon. The factors contributing to these extraordinary increases are the reduction in exemption allowed to widows and the abolition of the exemption for life insurance policies. How the scales compare is apparent from the following table:— Estate Passing to Widow (Exempt up to £5000)

It has been presumed, in compiling these tables, that the estates in each case include life insurance policies of at least £lOOO. The largest proportionate increase for widows is in that part of the scale where the rate of duty was formerly fairly light. In the second scale, relating to child beneficiaries, the increases are more evenly spread.

Net value P.C. of Old New of Estate rates rates Inc. Inc. £ £ £ 6,000 — 156 156 — 7.000 50 345 295 590 8,000 100 565 465 465 9,000 180 818 638 354 10.000 240 1,089 849 354 20,000 1,920 3,520 1,600 83 30,000 4,100 7.480 3.380 82 50,000 8,860 15,200 6,340 72 Estate Passing to Child Net value P.C. of Old New of Estate rates rates Inc. Inc. £ £ £ £ 2,000 30 64 34 113 3,000 70 144 74 106 4,000 130 256 126 97 5,000 210 373 163 78 3,000 320 616 296 93 7.000 440 775 335 ’ 76 8,000 510 949 439 86 9,000 660 1,140 480 73 10,000 740 1.333 594 80 20,000 2,220 4,053 1,833 83 30,000 7,480 3,300 82 50,000 ' ‘ 8,Sf?0 ' 15,200 6,340 72