LAND AND INCOME TAX.

Press, Volume LX, Issue 18187, 25 September 1924, Page 9

LAND AND INCOME TAX.

<Wending bill before ** HOUSE. READING DEBATE. * (stecial -° ' ,rsj: teebs.") WELLINGTON, September 24. > J» tt e 3 ouse rcscn tatives this *lrt»iß& r asse F move<l the second '"ttitSbS ot the Lan<i and Incomc - T ax .jjierimentßill. ; gefow explaining the provisions of rtfl BUI quoted the opinion of the of the Treasury of the United efgtfg tiat there was always a point ijyond vMco taxation became oppresriw. wd ° P om * diminishing re-,-iaas beyond which it could not be "jgjiad'if revenue receipts were to be; ;Satsined. There was a time when ceased to be protective, and beanie oppressive, and interfered with 'jggfoess, so that in framing any taxaIjjjalaw we should not be so solicitous » jegard to groups and particular infoiduals aa of the country as a whole. XJir Hassey proceeded to quote from AiflffiOrt of the Taxation Commission, fUeh expressed the view that the bulk rf t&e evidonce favoured doing away rift tl» e laHd-tax and adopting tho. in-Ime-tSX in its place. Personally, he jj-jiet agree with that, and he was Jtt jsklng Parliament to give effect to principle. But tho report of .»» (fcinnHSsion had done a- great deal ilj-'JMOdj an d h e believed that people IL wdersteod the meaning of a landSWwer than they did before. The ?JI*MCTJeRt was attempting to remedy «W a drawbacks of the land-tax '£B» BUl> but they could not do it all WfMt. The principal drawback was lit tbey were taxing a man who had Sjrowed money on the security of his £[k That bad been a. sore point for <£toy * l° n S y ear > an d the House would t filling to make some concession to •Ujjfortimste men whose mortgages ftta jjmost too heavy for them to SSI' Jse had stated that they were I»* to ftand by the land-tax, with Stflcations, bnt the graduated land*KjnMt s tand in the meantime. The •fflwJty about the land-tax was that Jfag 8, very high tax was paid upon '-IIiM&W values it was quite imposJttfef «»y WB, wh.etb.er possessed Jmmm et Bot > t0 wv™ a lar S, e ,._:■ : n i ts natural state, break Uy, and make a home for 0 the income-tax, ever ■ernment had come into I lone a great deal in mak- % to the small man. They neessions to men with to men who bad insured Mr Massey further cxjw nropoßal in. regard to d from lands held aB runs, or for pastoral purs intended to bring these he scope of the Bill last ring to a misunderstandjed "amendment had been said that the reductions 9 £139,643 on land-tax on income-tax. Jn Utex collected, amounted Last year it totalled . about double. The is* 9J3 was £461,994, and ,781,531, or about eight , wkieh wa3 a pretty big ullivan: What will your nptioa cost? said they would cost arrears of land and inMarch 31st last were: £337,921, income-tax 1 £730,522, Those figures aselvos, and showed that prices that had been reoduce there were many ere unable to pay their ould psk the House to class of men who had cereals in the south, andrtake to say that not one 1 ft profit last year. H-3 with great interest the ta, and was just as well he pa\v it W&B rainmg outh as though he were sy himself, the remission of the Mr Massey said that ha egarded it as unfair to ; money which he owed, posed to increase the n £4OOO to £IO,OOO, and taper off to £15,000. : Does the State lose tbftt out compensation from We cannot get compenluiog, lie said that Clause >r the collection of tho jgpect of Nativo lands pier.or the lessee, as the e. Clause 6 exempted ax war pensions paid by 9vernmcnt, and Clause 7 to meet the objectionable iad grown up of raising ;he value of stock to suit ncluding the lessening of He thought that the the BUI were in every jvament on tho existing, irexnment worked on the ; every citizen in the Id, contribute to_ tho )portion to his ability to >s;.That ought to-be tho : J hope the honourable 11 take that to - heart. wo are working on. I6S 4«SCCUTIO!r B*rosT-) . said bis difficulty in the Government's taxawas that no one could it those proposals were, ays put before the House n that it was impossible idea what their effect e was satisfied that the ijghcr incomes .was not he anticipated that men mes were going to have under this Bill. The bould be steeper, in the ually, where the growth •cities had added cnorto lands, as in the case Valley. He asked the Jr what the total reducand income tax wero to because it looked to him ggling was going on in th the reductions profirst Bill and those proBiJL As the matter stood ngly difficult to ascertain ition was, and therefore >sal was made by the 0 reduce taxation by »ne could say whether tho don of the country war- » was altogether opposed nation, and this was the s companies. If, however, be given to smaller men, incomes should be made Discussing the recomE the Taxation Commisthey were the result of They eould not be otherone had only to read the ise what confused minds of the Commission bad. Ended one thing and imitradicted it, and some ;estions were quite uninwere of no value what--0 point, however, they : "Oversea shareholders

were deserving 0 f some consideration, i-io approved of Clause 11 of the Bill, under which the Commissioner had to register unpaid land-tar against land, that was only fair to prospective purchasers. The Hon. \v\ Dowuie Stewart said it very difficult to say what Mr Wiliord's speech meant. Xo one could «ay whether he was in favour of the Bill or not. The position of the Labour Party was plain, bnt the Liberal* were wandering about in the wilderness. Mr Wilford complained that the Government's policy was brought down piecemeal, but it was obvious that all the varied proposals ooiiid not be dealt with in one niajit, or in ono Bill. Last year Mr Wilford contended that the only way to_ relieve the consumer was to reduce the taxation on companies which were passing the taxation on. How could he object to the proposals in the. Bill TChicli meant c.n all-round percentage reduction on incomes? It would tako some time to adjust the incidence or taxation on companies, as recommended by th© Taxation Commission; therefore the only immediato remedy wan an all-round reduction of thc-meomo-tax as the Government proposed. He noticed a tendency to arguo that Britain was invest in 5 too much capital in the Dominions." If this idea prevailed to-day to any great extent then we might in time to como have to rely on our own resources for our loans, but if we maintained taxation so high as to prevent the accumulation of capital we would have no resources to draw on, and that, would he disastrous. Therefore it was wise to regulate our taxation so as not touestroy accumulations of caoital until we could readjust our taxation of companies of- which Mr Wilford had repeatedly complained. The Bill was not contentious, and he expected that it would receive the unanimous approval of the House.

Mr Holland said tho concession made by the- Bill would not benefit anvotio very much. There were 00.000 kindtax payers in the Dominion, which meant, 'on the law of averages, that the remission would be> n little morn than ono pound each. He claimed that the small man would get no relief at all. Fcyty-four per cent, of thof-e having rogistered mortgages wo;dd not OOTiaiit in the least. Only those in the higher grades would get any advantage, the bulk of relief going to men whose land values wore between ten and fifteen thousand l •pounds. We h-id a huge national debt which must be met, arranged, or repudiated. No one would think of repudiation, and tho Prime "Minister's only idea, of meeting it seemed to be to 'borrow more money, which, however, only meant that our interest charges were increasing. It was a serious s matter wherefrom and when the money was to com© out of wluch those charges would be . paid. The report of the Taxation Commission wag shorn of a great deal of its value by the fact that wage-earners wero not represented on it. The Commission had suggested that a graduated landtax was no longer necessary, but in view of the large estates still existing 3JQ one could understand rrbnt the Commissioners were thinking of when they raado that statement. His general estimate of tho Bill waa that it would not afford relief to those who most needed it. Mr A. Harris said taxation had been freely passed on to consumers by merchants during the war years, and ha hoped the Government would gee that the remissions which were now being rnade woujd also be passed on to the people. Mr Sidey said the Prime Minister had set up his own Taxation Commission, and [had expressed his supreme eonfidsnee in them, but with one exception he had rejected their recommendations. There was not a single thins he was doing in this Bill that he would wot have done in any case. Ho objected to the discrimination whjch was being made against holders of .small grazing runs and pastoral licenses. If these people were to be asked to pay income-tax oil income derived from their land,' Why were not all Crown tenants treated in a similar manner? After further lengthy debate, Mr Massey reolied. He defen_dad the finding o"f the Taxation Commission, whoso members wore well informed on the subject, and had dono exceedingly goed work. He never intended Jo bo bound to nceept all their recommendations. If lie agreed with them lie would taka them up, but not otherwise. Replying to Mr Holland's argument that tho average relief would nmount to only about i£l per taxpayer, he said that small landholders did not eomo into tho calculation at all because they were exempt long ago, nor did it apply to the very large owner, but only to men with mortgages ranging from £4OOO to £IO,OOO, and to them the relief would be considerable, Referring to the alleged discrimination against holders of small grazing run and pastoral licenses, he explained that by an omission in the Act of last year these people bad been left out. That wag accidental, and the proposal in this BiU wag simply to put them be.Az to the position they Avere in prior to the war. It had been staid the Government had no taxation policy but he held there could be no permanent taxation policy, since taxation had to be adjusted from year to year as circumstances dictated. The BiU was read a second time and referre'd to the Public Accounts Committee. The House rose at 12.15 a.m.