LAND TAX

Press, Volume LXXII, Issue 21861, 14 August 1936, Page 18

LAND TAX

TO THE XSITOX OX TEX PXXSB. Sir, —I have read with interest the Correspondence in your paper about the land tax. One of Labour’s planks was the restoration of the graduated land tax. It was naturally supposed that this meant returning to the old scale, with attendant allowances of g per cent, on land value off assessable* income for income tax purposes, and 'it was a shock indeed to find the present-proposals for steeply increasing the scale on higher holdings, and dispensing with the allowance altogether. This is most unjust. Most large holdings are mortgaged considerably and heavily rated, the owner having a moderate equity, which is first subject to rates covering the interests of local body debenture holders, and, second, mortgage interest The latter are usually more greatly interested in the income frora the property than the owner, yet they only pay usual income tax, and escape the crushing graduated land tax. If any advantage is to be given, snrely the man who stands the risk of the property and gives security to the mortgagee and debenture holder should be the one to get it , If a fair-sized estate has to be held by trustees on behalf of various beneficiaries the return is subject to extremely high land tax, but on the other hand, if the property has been sold, and some struggling owner has to provide mortgage .interest on unBaid'8 aid' purchase money, the mortgage iterest is only assessed for income tax on the respective distributions amongst the beneficiaries, so that here again the owner gets the burden of crushing land tax, and other participants m the return from the property escape

Regarding the statement that the •value of the property is communitycreated, and the Government is entitled to appropriate jpart of it, I would eay that any property is the stock of the man who buys it. just as if he "bought manufactured goods. Both may fluctuate in valuer if .they go down the owner must suffer it as best fee can. and if he has made a good Surchase it is not the usual practice «f jjeople erf our race to grudge him feels there is ■cmething it should acquire, _ the straightforward course to adopt is for it to buy it at fair_market value, as It did the Reserve _ Bank shares, and liot undermine it with class taxation. tSTours, etc, • pER CENT. ' August 13, 1936.