A PLEA FOR THE FARMER.

Press, Volume LXV, Issue 19735, 27 September 1929, Page 11

A PLEA FOR THE FARMER.

MR WILKINSON" OPPOSES BILL. ADVICE TO PRIME MINISTER. [THB PBSSS Special Service ] WELLINGTON, September 36. Spirited opposition to the Government's taxation proposals was displayed ill the House of Representatives to-day by Mr C. A. Wilkinson (Ind., Egmont) during the second reading of tfye Taxation Amendment Bill. Mr Wilkinson, who supported the Government on the recent no»confidence amendment, appealed to the Prime Minister to abandon the super tax and reduce the mortgage exemption propositions, notwithstanding that he could, with the support of the Labour Party, secure the passage of the legislation. Mr Wilkinson said that one of his objections was that the taxation was to ba imposed regardless of th« prosperity of the land. In that respect he was in disagreement with the United Party. Although he considered the Prime Minister was entitled to congratulation on the concessions he had already made on the original Budget proposals, it was obvious that the proposals could be altered still further. He suggested to the Prime Minister that he should drop the super tax proposal and that he should allow the mortgage exemption to remain at the existing figure, Mr Wilkinson was strongly of opinion that if the proposals were confined to the imposition of income tax on the farmers little objection would remain to tbe Bill. ''Leave the land tax where it stands to-day," was his advice to the Government. (Reform "Hear, hears.") Continuing, Mr Wilkinson said that with the imposition of land tax and local body rates an impossible position would be eventuallv reached for the man on the land. " There should he some form of co-ordination in regard to those two of taxes in order that neeeasary and desirable adjustments could lie made. According to information he had received with re-

spect to the taxation of wheat areas in the South Island the ordinary land tax on a certain good Quality wheat farm was lis per acre, while the super tax proposed was 10s o£<i, making a total of £1 Is OJd per acre. In another instance the ordinary land tax was 7s 4Jd and the super tax was l"2s ujd. The Minister for Lands (the Hem. Mr Forbes): They are large farmers ? Mr Wilkinson: The total unimproved value is £50,000, but at the same time the tax is a high one, and amounts almost to confiscation. The Minister for Defence (the Hon. Mr Wilford): Are they suitable for subdivision * Mr Wilkinson: Some of the lands may he. Mr Wilkinson said that the hardship clause of the Bill was at the beet of no great value, and he believed that a great number of the farmers affected would not bother about petitioning for the refund under that clause. The putting into effect of the proposals might mean ruin to many farmers. Renewing his contention that the payment of income tax was the fairer way ont of the difficulty, Mr Wilkinson pointed out that at present income-tax payers were allowed to deduct the interest they paid on their mortgages, as well as five per cent, of the capital value, and he wanted to know why if that principle were accepted in regard to income tax it could not also be approved with respect to land tax. It seemed unfair to discriminate in that fashion, and to his mind the only reason for the differentiation was the desire of the Government to see land cut up. , . "I am as anxious as anybody else to see closer settlement in New Zealand, added Mr Wilkinson, "but it does not appear to me to be a fair proposition to levy heavy taxation to effect that object. Surely some better means could be devised to obtain lands fo closer settlement. Before we tax whole farming community to secure the subdivision of a few estates, th lands should be properly classified to enable the most suitable to be selected and dealt with accordingly. There seems to be no sense in taxing the whole farming community to brin 6 about a few subdivisions. In Mr Wilkinson's opinion land taxa_ tion was being imposed regardless of profit or loss —a flat tax that took account of seasons, prices, etc—whereas income tax was only imposed when profits were made. What was required for additional revenue could be demect from the general application of tax. Was it worth while, he asked, to disturb 1800 farmers to bring in the sum of £25,000? It was, in his opinion, a case of using a big hammer to crack a very small nut. Mr Wilkinson issued an appeal to the Labour Party to assist in the matter. When land taxation was before the House the Labour Party rushed in and supported the proposals regardless of the consequences. It would perhaps be a good thing for New Zealand if Labour were placed on the Treasury benches, because they would then become educated as to the necessities of the farming community. Mr M. J. Savage (Lab., Auckland West): We don't need any education on that point. Mr W D. Lvsnar (R., Gisborne): You don't want "it, that is the trouble. Mr Wilkinson said that if the Labour Party wanted to get into power they should try to conciliate the small farmers. It was unfair for them to rush in and support the imposition of taxation on farmers simply because farmers were concerned. Mr Savage: That is not what we are trying to do. Mr Wilkinson reiterated that whenever land taxation was brought up m the House it always had the unanimous support of the Labour Party. Farming was the greatest industry in New Zealand, so why should a man be taxed who was doing the work which kept everybody else prosperous? Mr H. G R. Mason (Lab., Auckland Suburbs): This is not the Labour Party's Bill. Mr Wilkinson: No, but the Labour Party is supporting it. The United Party would have no hope of putting this Bill through without the support of the Labour Party. (Reform "Hear, hears.") , T , , , A Labour member: Tou bad better be careful of your ground, t Mr Wilkinson: I am standing lair and square to my ground. Mr Savage : You will he running T6 Mr Wilkinson asked the Government whether it would suffer any lack of dignity by foregoing the proposals relating to the super tax and the mortgage exemption. There was no doubt that on a division the Government would win through in spite of opposition. It was clear, therefore, that theTe would be no loss of dignity by abandoning the Objectionable provisions. If that were done he felt sure the Prime Minister would obtain practically unanimous support for the infliction of income tax on farmers. _ The Minister for Defenee (the Hon. Mr Wilford): Whoever heard of a House being unanimous on taxation? Mr Wilkinson suggested that if additional revenue were required one method of obtaining it would be to reduce the present five per cent. on capital value allowed the business people. That exemption meant a tremendous saving to some payers of income tax, and ne quoted an example to show that if the figure were lowered to three and a halt per cent, the individual concerned in that instance would have to pay double the amount in income tax, which would not be too heavy. The matter was of such importance as to warrant an investigation, and if the proposals were dropped this year the Government would be enabled to conduct a close examination of the whole position and ascertain from official records just what effect the taxation suggested would have on the people of the country. Mr D. G. Sullivan (Lab., Avon) challenged Mr Wilkinson to quote chapter and verse to prove a single Instance upon which the Labour Party had proposed increased taxation for the tarmeTß. , • Mr Wilkinson: You have never had a chance to propose it. Mr Sullivan emphatically denied tnat the Labour Party had ever rushed in to support increased taxation on the workins farmer. That Party realised that working farmers were just as mueh workers a* manual workers or any other class of worker m New Zealand, when the Labour Party fought for workers it also fought for the working farmer It had the interest and welfare of the small farmers at heart. MR POISON'S SPEECH. OPPOSITION TO BILL. EFFECT ON LAND SETTLEMENT. [THE F2USSS Spscttl Servic« 3 WELLINGTON", September 26. Holding that the Land a©d Income Tax Amendment Bill would, if passed, result in additional burdens being imposed the working farmers of Jn«w Zealand, Mr W. J. Poison (Ind., Stratford) announced his intention, in tiie House of Representatives yeaterdav, to vote against the measure- Mr Poison sought to justify his attitude in voting for the Government against the no-confidence amendment by stating that at that time the Government

had outlined its policy in * jpsnornl way only. • Mr Poison said he tame into the House very anxious to promote land settlement,* recognising as he did that dealing with that important question in a progressive manner was a great ■■ problem upon which the prieperity and j development of New Zealand depended. ! He had always been a supporter ol j closer land settlement and had preached that doctrine from one end of the f oountry to the other, because he be- j lieved it was essential if the Dominion | were to progress. He realised that. ; some compromise was necessarv and j that he would have to work with those who disagreed "with him in some respects, and with those whom be disagreed with in some respects. He had made up his mind that no matter what happened it was his duty to stand by the farmers in an endeavour to bring about increased prosperity and to withstand any efforts that might be made to impose additional burdens upon their backs. While he gave credit to the Prime Minister for many ol the things he was endeavouring to do, Mr Poison said he was compelled to say that the Bill would not §ati?fy him. Ho made that statement, with a great deal of reluctance and regret, because he knew that the Prime Minister was honest in setting out to do what was beet in the interest of the country. In spite of all the figures quoted by Sir Joseph ( Ward and of all the things that had been said, the proposed legislation was not going to increase settlement. It was going to add to the cost of working the land, and. therefore, would ultimately reduce, in&tead of increase, the demand for land. Mr W. E. Parry (Lab-, Auckland Central): Oh, give us the facts. Mr Poison said he believed, and had always believed, in the bursting of large estates suitable for settlement. He was willing to agree that something more should be done than had already j been done in that respect. As a mat- j ter of fact, the country demanded that . those estates should be cut up. He was not prepared to support what amounted to a dual tax on the farmer. He believed that to tax a farmer in that way was to tax the tools of his trade, as it were. Mr Poison said that in the election manifesto of the United Party, to which to a very considerable extent he had agreed, no reference was made to increased land taxation, other than the bursting up of large estates. There was nothing about a reduction of mortgage exemption, or the imposition of a primage duty. He was prepared to agree, and had agreed, to the introduction of a primage duty as a reasonable way of collecting money to meet a temporary position only. He was prepared to agree to taxation on large estates suitable for closer settlement, but he was not prepared to add to the burdens of the working farmer. Therefore, he was unable to support the Bill. "For the life of me I cannot understand why, if the figures quoted by the Prime Minister are correct, and if his statement that £25,000 only of extra revenue will be collected, from the mortgage taxation, as compared with the system he intends to abandon is also correct," said Mr Poison, "he does not dispose of the whole and put the system back where it was before. He is going to f&ke £3,000,000 from the pockets of the big men, of whom there are only 1400 in New Zealand. I am satisfied that the proposal amounts practically to a confiscation of those estates. It is a verv serious thing to pass legislation : of that kind, no matter how small the j section affected- I admit that a very ( small section will be affected by the j steeping of the graduated land tax, , and I am quite prepared to agree to j a steeping, but I am not to | agree to what amounts to confiscation, j If the Prime Minister had gone baikto the old mortgage exemption, he would have rid himself of a very great deal of opposition. There is a strong objection, however, to the reductiom on the mortgage exemption. Mr Poison said he had been consulted by hundreds of farmers during the last few weeks. He had had resolutions from one end of the country to the other, and it was useless to say that they had emanated from one particular section. - , Mr Parry : They have been wrongly informed. Mr Poison said that the farmers were standing as one man in their objection to an increase in the land to*. They might be wrong or they might not. He was not going to argue that. (Reform laughter.) He wished to make the definite statement that the farming community was objecting to the increase in the land tax. j Mr Parry: They are wrong Mr Prison eaid it had been suggested that those who opposed the land tax should have walked into the opposite lobby when the recent no con&denee motion was before the House. Thai would have been a ridiculous thing to have done. (Reform and Labour laughter.) The Government at that time had only outlined its policy in a general way. Mr Poison said he was not going to torn the Government down at that point on the whole of its Budget because he disagreed with scuta of its land proposals. He hoped to sopport the Government in many of the treasures that were for the good of New Zealand. Now that the Taxation Bill was before the House, it would ksw to be amended considerably before ho could agree to it. Ho was hoping that it was not too late vet and that the pressure that was being brought to boar would result in the Bill being made more acceptable to the community, to which it was not acceptable at the present time. Mr Party: There'll be a big fight if they do. Mr Poison said that ho hoped reasonable counsel* would prevail and that the Bill would be modified. He had been subjected, ho said, to a good deal of misrepresentation. It had boon stated from the Reform benches that he had been a traitor to his fellowfarmers, because in coming into th« Houee as an Independent no did not vote the Government oat at the first opportunity. He resented that charge very much indeed. Mr Parry: It's having the desired effect. Mr Poison said that an inaneado had been made, hot it was doe to aa unfortunate ruling by the Chairman of Committees that he bad not—

Mr Speaker pointed out that the member was not in order i* r»fem»g to the Chairman of Committee*. ■ Mr Poison did sot ponw the poiat. He irwt on to say that h® wae opposed to a tax on mortgage*. Be to amazed to hear the proposal made seriously by a me.nber of the Labonr Party that »uch a tax ahoold be impoied. The mortgagee waa taxed already. Why should the very means o< land settlement be taxed* It w*a not a reasonable or fair thing to do. He had eought for years to stimulate land settlement, and he wms not going to do anything inside or outside the Hoom that would inerease the burdens of the farmers. Why the erase in New Zealand for a land tax? It was an idea that had gone out many years ago. It was quite out of date. Manv of the Dominion's competitors removed all taxation from land. He did not know whether the Prime Minister was aware of the fact that not a single State in America had a land tax. There was no land tax in Canada, in the Argentine, and several other countries. Recently the land tax in Great Britain had been removed, and that in one of the most Conservative countries on the faee of the earth. "We have 18,000 reasons why there should be no barden on the farmer*." declared Mr Poison. "We have 18,000 miles of *ea between us and o«r s*stonier at the other end of the earth. 1 agree with a pood <ieal of what hj»« bee a said in opposition to the Bill to

aight. Maay asaS hnw «* to bt tini 11 rut«d a»te): N«< aar- _ "That i» «whe * »*«■* iaspra****. rtnMlfrPibM. ■*» * ** enapttara wa ta»* »• **?•?* i* Um MBO7. Ttay •*» all faimara. W« an faia* «• Ff •» increased bariea ®a thaw* w** *" gradaatioa ia tha M *■" l «*• tio* ia tta •artsfa®* **' wwoM taw* pw*«n*4 W —f ***, paryoae a«M«T*d fey a fia4aatt«t ■»* tax riw®." iQvnw* fmr ti# Imw wmmb*T that wM ** *m«e**4 wmSmr *• Ttr'md fropo*li m •* Boiget mm "* was jadfcwd t» »>u*k w ** T* thug wrwa* iriti «ta *s*p«e f— *p€ »y the Poaawiw ®* **«• a; Busbar of f«*«" a®wt»4. T*e «**• of tta ta»tw« prwycwals aafeitabJy b« ta n*ar« i»l ■ *a*aa thn erwite » sitaatwa. wWk w»«M B »t hj« kelpfai ta uj aeetiaa *? **- coou&tfflity.