TAXATION INQUIRY

Dominion, Volume 18, Issue 192, 9 May 1924, Page 8

TAXATION INQUIRY

COMMISSION IN AUCKLAND OBJECTIONS TO LAND TAX By Telegraph—Press Association. _ Auckland, March 8. Ihe Taxation Commission sat here to-day. Mr. J. G. Haddon, barrister and solicitor, said he objected to the land tax because it did not tax the individual according to Ina ability to pay; because it taxed the man who had no money to pay, and often actually on debts ho owed; because it was an ■rbitrary tax on one class of property, and because of the difficulty in collecting. Companies should bo treated in the same way as persons. A person or firm could not compete on level terms with companies if a company paid no income tax. No difference should be made in the taxation of incomes from debentures and from other sources, so that earned and unearned incomes could easily be grafted. There might be added a third class, as suggested by Mr. Hartly Withers, on income produced by inherited wealth or received by gift. Mr. Herbert S. Hawkins, farmer of Hamilton, and director of the Farmers’ Auctioneering Company, said that the company had to increase its net profits by 35 per cent, to provide for Government taxation. The company had three earning departments. Two were on a commission basis, and the earnings could not be increased without increasing the rates of commission. Without substantial relief the company could not carry on indefinitely. Under a nominal rate of taxation the company was able to pay itg, way and build up a very modest serve of £46,200 out of profits in twelve years, but the higher tax had gradually decreased the amounts until they actually ceased, in spite of the abnormally good trading conditions before the depression of 1921, wh’ch turned a net profit of nearly £60,000 to a substantial loss. In 1921 the net profit was £59.852, and the taxation was £27.309. In 1922 there was a loss of £1383, the taxation being £1549. Last year’s profit was £207 and the taxation £1443. No dividends were paid during the last two years. As regards his own taxation as a farmer, the land tax on 795 acres in 1912, was £4 13s. 4d.. and on 709 acres in 1920 it was £ll6 4s. In addition. income tax had been levied on portions of his gross income without reference to the net income. His net income for the past four years amounted to £235, and he paid £265 in taxation.

Mr. George Cubb ; farmer, of Puriri, urged the abolition of the land tax. He said that he paid £265 6s. Id. to the Thames County Council as rates and taxes, and £lOl in land tax on a farm, which carried 50 dairy cows. The Hon. George Fowlds gave evidence advocating tho gradual increase of land values taxation until values, apart from improvements, ceased to have any selling value and until the whole economic rent went to the community. He asserted that Customs duties pressed most heavily on the poor man. The inquiry was adjourned.