FARMERS AND INCOME TAX

Dominion, Volume 22, Issue 262, 1 August 1929, Page 11

FARMERS AND INCOME TAX

Sir, —There are in the writer's district many wealthy landowners who are making twenty thousand and up to fifty thousand a yhar profits, yet these men under the late Government have been exempt from paying income tax. lam told, though, that these wealthy farmers pay land tax. Yes. so does fEe writer. I pay the two taxes —why does the wealthy farmer not pay the two also? We have a very wealthy squatter not far from the writer’s home who is at present spending upwards of £20,000 on a new residence, and about another £lO,OOO in England on furniture. lam told that the £20,000 he spends on his residence is deducted from his land tax. Is this correct, and, if so, why am I not exempt for the cost of a new motor shed I put up on my land? I am anxious to know if the present Government intends to carry on this unfair system, by penalising the small business man and exempting the large farmer.—l am, etc., S.B.M. July 25.

[The Commissioner of Taxes, to whom a copy of the above letter was referred, replied as follows: —“Although the _ farmer pays land tax only, and the business man both land tax and income tax, the latter is allowed an exemption of 5 per cent, of the capital value of his land, which off-sets the land tax paid. “Land tax is assessed on unimproved value so that improvements effected do not either increase or decrease the amount payable. An efbmption for mortgages is allowed, which ceases as soon as the unimproved value of his laud reaches £15,000.”]