UNIMPROVED RATING

Evening Star, Issue 21811, 29 August 1934, Page 3

UNIMPROVED RATING

BENEFIT TO THE WORKERS e> SILVERSTOHE ADVOCATES SYSTEM Claiming that the workers of Dimodiu would pay about £40,000 per year less in rates if a change to unimproved value rating were effected, Cr M. Silverstone addressed a small audience in the Kaikorai Presbyterian Church Hall last night on the subject of ‘ Rating on Unimproved Values.’ Mr H. E. Wells occupied the chair. It was just a little over three years since the first rating poll on unimproved value was taken in Dunedin, said Cr Silverstone, some 5,000 people voting on that occasion. The poll was defeated by over 2,000 votes. At that time the wage and salary earners and the small business people did not realise the importance of the rating question. More than half of the people of New Zealand were rated on unimproved values, and they were none the worse for it. There were three systems of rating—on capital value, on annual value (the system in operation in Dunedin at the present time), and on unimproved value. He then outlined the method of striking the rates under the 'present system, and stated that under the unimproved system any improvements to properties wbre not taken into consideration, the basis of the rating being on the value of the land on which a building stood. In Dunedin the value of the land was £5,500,000 in round figures. “ The City Council has not one penny piece for any new works in the city,” he declared. “If you wanted‘a uew light on one of your streets, the council would not have the money to pay for it. At the present time the rate is struck when it is found how much is required to carry on.” One hundred and sixty-seven local authorities in New Zealand were rating on unimproved values, which meant that over 57 per cent, of the population was rated under this system. Reverting to the system of rating in force here today, he went on to say that the owners of over 15,000 dwellings of from one to six rooms were heavily taxed, but they would be the ones who would benefit if thev voted for unimproved rating. He dealt with the case of one worker who paid £ll 13s 4d in rates. This man was earning about £4 a week, of which the Government took 4s in wages tax. This left him with about, £3 16s, so was it fair that he should be made to pay three weeks' wages in rates ? The town clerk had drawn up a report, giving some thirty-six examples of how rating on unimproved values would pan out for the citizens, but he did not go far enough with his report —his area was restricted. The rating books would have given him 12,500 examples. While the report showed that there would be big reductions in,the rates on some buildings, it did not say how much some of the blocks ot land in the city would bring in. Out of the illustrations given only one man paid £6 15s in rates, but this man would need to pay only £3 15s on unimproved ratRating on unimproved value left out all improvements on the land. To tax a man on his labours was wrong; it discouraged industry. Under the new valuation the land in Dunedin would be worth not far short of £11,000,000, and the system would also be an encouragement to improve. When the value was made it would stand at that particular figure for seven years. Illustrations of what unimproved value rating would mean to the working man were given by the speaker, who painted out that in thirteen years the value of the land and improvements of rateable property in Dunedin was something like £9,000,000. Assuming that unimproved rating were carried, and the first year’s rates had to be struck on the 1921 valuation (£13,332,000) there would be big reductions in the rates the working metf would be required to pay. “ Why should not those who are living on the fat of the land contribute their fair share to the burden of the nation?” he asked. “ Why should the worker pay? Everything is in the interests of the capitalistic class and the landowners, and the worker is _ the philanthropist who pays. A poll is to be 'taken on September 11. Between now and then tremendous advertisements will oppose the unimproved system, but do not be misled.”

ADVOCACY BY THE MAYOR The mayor (the Rev, E. T. Cos) advanced the campaign aiming at the replacement of the system of municipal rating on capital values by the system of rating on the unimproved or land values a stage further by an address in the North-cast Valley Town Hall last night. The chair was occupied by Mr 0. M. Moss, and there was a fair attendance of ratepayers. For the most part the mayor covered the same ground as he did at his first meeting in Mornington, his chief contention being that under the unimproved system the rating was based upon ability to pay, and was advantageous to the greatest number of ratepayers. He further maintained that if the system were adopted in Dunedin the building trade would be stimulated as the result of owners of land being forced to put their land to better use. Slum areas would gradually disappear, and enterprising business men would improve and increase the size of their buddings without any fear of an increase in rates.

His Worship said that tho question was asked, “ How can we ascertain how tho ratio will be distributed under the change of system?” According to the latest copy of the Year Book, from which all of his figures were drawn, the rates required on the annual value (£1,110,283) at 4-5 d in the £ were £245,186. On the unimproved value (£5,538,085) the sum of £245,176 would be raised by a levy of 13jSd in the £. Under the present system, said the Mayor, North-east Valley paid £15,890 in rates, but under the unimproved system the sum of £12,604 would be paid, meaning a reduction of £3,286, or equivalent to 20 per cent. The central area, which had an unimproved value of nearly £4,000,000, would _ be required to pay £153,906, as agamst tho present payment of £131,752. This would mean an increase of approximately 15 per cent., and he asked who was better able to pay this difference than banking, insurance, shipping, stock and station, and warehouse establishments. many of which were national organisations and could not possibly pass on to the consumer the increased charges. No doubt some of the smaller businesses and shops would have increased rentals to pay, but the_ danger of household commodities being increased in price as a result was counteracted by the presence of stores in tho suburbs which would be enjoying comparatively low rentals. The stock argument of opponents to unimproved rating concerned the ques-

tion of ability to pay. It was contended by these people that it would be unfair for a man building a £I,OOO home on a section of equal value to the man who could afford to erect a £5,000 homo, as this building enjoyed a greater share of the municipal services. Mr Cox maintained that that argument was hypothetical, in that it could apply only in isolated cases. The general tendency, from his observations, . was that a man generally built a home in accordance with the value of the section.

When asked how old the unimproved valuation of Dunedin was the Mayor said that the last Government valuation was taken in 1921, and that it would take at least three years before a fresh valuation was completed. If unimproved system were adopted the rating would be based on the last valuation, and as that was taken in boom times ho was unable to see why the total valuation should have altered. Further questions by Cr J. L. IM‘lndoe and others were answered, after which the speaker was accorded a vote of thanks.