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The Property Tax., Ashburton Guardian, Volume I, Issue 31, 6 December 1879
The Property Tax.
The following letter appears in the “Otago Daily Times” : Sir, — I am not surprised at the Colonial Treasurer’s proposals for a property tax. The New Zealand Conservatives did not like the land tax. They had no desire to see the State reap any benefit from the unearned increase in the value of land. In 1878 they strove hard to get- what they termed the American all-round-system of taxation introduced This the Liberals resisted, but the Tory party having obtained the ascendancy, of course the Land Tax Act must be repealed. This is ostensibly done in the interests of the “ hard-working pioneer settler” and the “ struggling city tradesman.” Now, 1 wish to point out what this property tax means, and I shall first show how it affects the class named by the Treasurer as the “ HARD-WORKING PIONEER SETTLERS.” At present the settler pays one halfpenny in the pound on the value to sell of his land, minus £SOO, and minus all improvements. In order to encourage him the present Tory Ministry propose to charge him one penny in the pound on the total value to sell of his land,, and also one penny on the total value of all his property, minus £3OO worth. Let me take a case. A settler has 300 acres of land worth £5 per acre, excluding improvements £1.600 in all. Under the Land Tax Act he pays id on £I,OOO, or £2 Is. Bd. Under the proposed property tax, he has to pay at least double that amount for his land ; but that is' not all. He has to pay a tax on all his realised personal property as well. Suppose his improvements, including house, bam, stable, and farm buildings (£500), improvements on farm, ploughed and sown land, fencing, ditching, &c. (£1,000), are together £1,500— that would make his land, with improvements, £lO per acre, £3oooin all. Buthe has other personal property—viz., sheep, cattle, pigs, and farm implements, furniture and machinery, on a low estimate another £SOO worth of property ; and he believes in the 1 auline maxim, “ Owe no man anything,” and has no debts ; then he would have to pay on £3500 minus £3oo—that is, on £3200, and this at a penny amounts to £l3 6s. Bd. The net gain (!) to him is an extra tax of £ll ss. ! ! This is the aid the Conservative Government grants to the “ hardworking pioneer settler.” Now let me see how it affects the
“ STEUGGLING CITY TRADESMEN. I first suppose he is the freeholder of his city frontage, and I assume that ho has his building in Dunedin in oneof the beat positions. The result will be that he will have say, 83ft. frontage,at value of £7O or £IOO per foot. This is, I believe, the highest. Suppose it is £7O, then he pays a halfpenny on £2,310 minus £SOO = £lBlO, which means a tax under the present Land Tax Act of £3 15s. sd. 13ut then the Conservatives are anxious to help the struggling city tradesmen, and therefore he must pay a tax on all his property. This consists of his lands, his buildings, his furniture, and stoeb. Suppose his buildings cost him £1,500, his furniture and stock another £1,500. lam taking a struggling city tradesman, but also one who has obeyed the apostolic maxim of not getting into debt. He will be helped by being asked to pay, insead of £3 15s. 5d., the sum of £2O 17s. Cd. • How fervently must ho thank the Conservative Government for such help ? And now I leave the two classes who were so grievously burdened under the Land Tax Act —“The hard-working pioneer settler ” and the struggling city tradesman ” —to their cogitations on the help that is about to be vouchsafed to them ; and I wish to deal with the MANUFACTURE! 1 . How stands it with him 1 Whether we
iSwSRBW are Protectionists or Freetraders we
alike recognize tlie benefits, of .diversiflßP industries. The question may well-he asked, how can we best obtain them. If they are paying industries, all admit we ought to strive for them. How in local industry, then, affected ‘2 I shall take the example of a soapwork. And ,1 again, assume the soap manufacturer owns the land on which he has his ‘ ‘ works, - ” and that he too is employing his own capital, and is not in debt—or if in debt, that the debts due to him equal the debts.-he owes. I also suppose his land is, worth £3so(l—a fair, if not high value. . On this he pays a tax of a halfpenny on £3OOO, in all £0 Sis. Now what will be have to pay ' under the proposed Property Tax 2 He has buildings ings valued at £3OOO. He has also, gone to considerable expense to import machinery, on which, perhaps, he has paid a Customs’ duty, and this he has valued at £2OOO. Then he has other personal property, namely tallow and manufactured soap, worth at least £IOOO more— (in all these estimates lam taking the estimates of a small soap manufacturing concern); — and he has other personal effects, furniture, jewellery, &0., worth £3OO ; in all, property worth £9BOO, and o:i this he has to pay £39 11s. Bd., so he is aided (!) by a Conservative Government to the extent of £33 6s. Bd. His thanks will be exceedingly expressive. And how fares THE MERCHANT ?
He is a necessity in our present social life. He is the distributing machine. Is ho to be exempt 2 or does the Conservative Government look with a favoring eye on him ? First, he has to pay for his land. Let ; me assume he has a store in a good position—the value of the land on which it is built is £3000; At present he pays £5 4s. 2d. Under the fostdring care of a Conservative Government he is, however, called upon to pay a tax on his buildings, and ■ on all his personal property. This means, oh his stock. Again I suppose he is free - from’ debts or rather that the debts . dub ‘ him equal what he owes. His ‘stock is valued at £IO,OOO, and his buildat £2500. His contribution to the revenue will therefore be £63 6s. 8d! He also must be pleased that in the late' election he aided to return three gentlemen pledged to turn, out Sir George Grey and have fair and equitable taxation ! ' I have now dealt with the ALL ROUND PROPERTY TAX
as affecting the settler, the tradesman, manufacturer, and merchant.. Efow it affects other classes, and what effect deducting the “ just debts” due frofri the value of the property will have, I propose to show in another letter. Meantime, in the cup of bitterness that the classes, I have mentioned have to drink, no doubt the fact that the Auckland district is to Ixave another half a million expended, and that the secrecy of the Telegraph Office has been violated, will be drops of sweetness.—lam, &c., Robert Stout. : Dunedin, Nov. 18.
The Property Tax., Ashburton Guardian, Volume I, Issue 31, 6 December 1879
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