EXCESS PROFITS TAX AMENDMENTS

Waikato Times, Volume 127, Issue 21242, 12 October 1940, Page 6

EXCESS PROFITS TAX AMENDMENTS

One of the reasons why the Government should allow the representatives of the people to “ argue ” on war-time financial measures was demonstrated in the House of Representatives on Thursday, when an important amendment was made to the Excess Profits Tax Bill. Had that measure been promulgated by Order-in-Council, for instance, serious injustice might have been done to one section of the community. As it was, the Opposition in the House detected the flaw and the Minister very properly consented to the insertion of an amendment. Such instances show the value of following democratic procedure whenever possible.

The original Bill provided that incomes for the purposes of the excess profits tax should be based on the incomes for the three previous years. The objection promptly arose that in any or all of those years a farmer or a group of farmers might have suffered severely from many causes, so that their incomes could not fairly be regarded as normal. On return to normal conditions the income might by comparison have seemed decidedly in “ excess.” The objection has been overcome by the insertion of a provision that if a taxpayer’s income for any of the three stipulated years has been substantially reduced by reason of pestilence, flood or adverse climatic conditions, these factors can be taken into consideration by the commissioner, who may fix an appropriate normal income accordingly.

Another amendment allows additional assets obtained during the year to be taken into account, such as, for instance, newly-born stock. Heavy responsibility will still rest upon the Commissioner of Taxes or the committee to be appointed to deal with appeals against assessments. Consequently the composition of that committee is a matter of particular interest. By the very nature of the measure, appeals are almost certain to be numerous, and it is essential if justice is done to all that the committee should be composed of men competent to reach a decision on the merits of each case and free from any suspicion of political or theoretical bias. Mr Adam Hamilton has suggested a business man, a lawyer and a farmer. Whoever they may be they will be faced with an unenviable task.