The Feilding Star. THURSDAY, JANUARY 7, 1892. The Government's Financial Proposals

Feilding Star, Volume XIII, Issue 81, 7 January 1892, Page 2

The Feilding Star. THURSDAY, JANUARY 7, 1892. The Government's Financial Proposals

As showing the opinion held at Home concerning the Land and Income Assessment Bill of the Ballance Government, we quote the subjoined extracts from the London Times, dated November 9th, 1891 :— " As the larger part of New Zealand mortgages are in English hands, there is no need to insist upon the effect which such a measuremusthave upon English capital. The general tax to which the mortgagee is made liable does not directty touch the English mortgage companies, as it will be charged in a higher rate of interest to their customers. But if the higher rate of interest combined with the graduated tax, should prove to be so heavy a burden on the land that the New Zealand landowner ceases to make his margin of profit, there will be no more custom. Mortgages already held in New Zealand will lose their value, and money for the future will go elsewhere. The uncertainty which is caused by the present condition of affairs is sufficiently illustrated by the fact that one important English company is in doubt whether tbe taxation which it may be called upon to pay will be increased next year to the extent of £15,000. Other English companies are showing very plainly the view which they take of the situation, by instructing their agents to call in all capital which can be realized. In defending the Bill the Minister of Justice urged that the mortgage system would not be endangered because the mortgagee is a man who in vestß in land not for the sake of high interest, but because he must, in many cases under legal compulsion, in other cases, especially if he lives at a distance, for the sake of good security. I Mr Beeves seemed to consider that, whatever, happened, there would always be mortgagees. He apparently forgot that if he suppressed the mortgagor there would be no place for the mortgagee. He also forgot — and this more particularly in his references to mortgagees who lived at a distance — that, though there is always money waiting to be put into land, there is no reason why it should be put into New Zealand land, if in that colony it is heavily taxed while in other colonies it goes free. # * * * It is on its merits as a practical measure likely to affect the agricultural prospects of New Zealand, and through them the probable returns of capital which is invested there, that it will be judged in this country. Viewed in this light it seems almost impossible that the effect can be anything but disastrous. Apart from facts, forcibly pointed out in the debate, that New Zealand competes in the markets of the . world with the produce of Russia and the United States and can only hold her own by growing under the cheap conditions offered on large estates at home ; apart, even, from the graduated tax, which, if it serves its purpose of breaking up tbe big estates, will presently cease to yield any revenue aud will need to be reimposed in some other form ; the general tax alone, which is to fall on all land and improvements alike, will still be so heavy that New Zealand agriculture will labour under a serious difficulty. It has been argued that the land-tax lays no heavier weight upon agriculture than the income-tax lays upon commerce. If this were the case it may be fairly asked, Why have a land- tax at all instead of a general in-come-tax ? Evidently the Government expects to raise more revenue by the imposition of a land-tax, aud there is no logical escape from the conclusion that if the new Bill becomes law land must bear a relatively enormous share in the expenses of tbe State. A penny in the pound of the capital value means an iucome-tax of Is Sd, even when the whole land is unt»ucunibered. When improvements must bo obtained from mortgage it mouuts mdefiuitely ; and that the property-tax was bad cannot be adduced by its opponents as a reason for retaining in their new tax the worst features of the old. The Bill cannot, however, pass into law this year. The amendments of the Legislative Council were of so searching a nature that the Lower House refused to recognize their own measure when ifc was returned to them, and it has been thrown out. Before the campaign caq be opened again next year opinion in the eolony will perhaps have undergone a change in respect of the advantages for which so heavy a price would have to be paid. When it is remembered that one in every 16 persons is a landholder, it does not seem creditable that a land tax of such disproportionate severity can be yoted by manhood suffrage."

TllK deputation, consisting of Mr Macarthur, M.H.R., Mr Flyger, an.d Mr Lundon, appointed at the meeting held at Birmingham a few weeks ago, waited on the Hon. Mr Ballance in connection with the completion of the main roads on theApiti Block. After the case had be6s fujjy stated Mr Ballance undertook to recommend the Minister of Lands to make a gran^ of for tlie purpose, out of the moneys Available for opening up Crown Lands undui.' the Covernment Loans to Local Bodies Act Amendment Act of 1891.