THE TAXATION COMMISSION.

Auckland Star, Volume LV, Issue 116, 17 May 1924, Page 12

THE TAXATION COMMISSION.

TOWN AND COUNTRY. EFFECT OF GRADUATED TAX. IBs Telegraph.—Press Association.* WELLINGTON, this day. Sir John Findlay, in his statement before the Taxation Commission, said he favoured retention of the graduated land tax. It would be disastrous if wealthy land-ownerswere left free, in the absence of a graduated tax, to go on aggregating holdings until the amount of cultivable land available for close.* settlement was enormously reduced. The Commission should have power to reduce or remit tax where large holdings were necessary owing to the quality or charI acter of the land, but only on applicaj tion of the owner, and on proof that the I largeness of the holding was necessary i for profitable farming, and that the :area was unsuitable for closer settlement. The graduated tax was never meant to apply to city land* occupied ■for commercial or industrial purposes, and should be limited in its operation to mial lands and to aggregation of town and suburban land* held for speculative purposes. Sir John Findlay said that the Commissioner of Taxes had given evidence that the effect of partial mortgage exemption had been to greatly promote the evil of speculation and trafficking had resulted. These conclusions were significant, and could not be greatly challenged. The logical conclusion was to abolish it or substantially reduce it. Company taxation was unjust, the shareholder should be taxed on the share of the profits he took, and no tax lain on the company itself as a .company. The present company tax offended against every test of a fair progressive income tax, and chiefly against the. main one of justice. The present difference of rates for company and local body debentures had no logical justification. Both should have income arising from them regarded in the same way, and should be included in the total income in both cases of debenture holders and taxed accordingly. As to the incidence of taxation, he felt justified in- saying that the incidence of progressive taxes was largely shifted from the taxpayer upon whom they were imposed and upon whom they were intended to rest.

Evidence was given by Mr. John S. Connor, farmer, of New Plymouth, as to the "iniquity of the land tax"; Mr. R. S. Abraham, chairman of directors of Abraham and Williams, who spoke of the •injurious effect of taxation on their business; and by Mr. __ J. O'Regan, who suggested the abolition of the graduated tax and increasing the flat tax.