SETTLEMENT LAND

Gisborne Herald, Volume LXXV, Issue 22587, 16 March 1948, Page 6

SETTLEMENT LAND

OFFERS TO STATE TAXATION DETERRENT PROCEEDS OF STOCK SALES The deterrent effect exercised by the present incidence of taxation on stock realisation, in the offering of land for settlement by servicemen, was again the subject of reference at a conference held on Saturday in Gisborne, under the sponsorship of the Gisborne Returned Services' Association. Delegates supported the principle of a remit put forward by the Tolaga Bay branch urging that revenue from the sale of stock in cases where farms were disposed of to the Government should be treated as capital, and not as income for the current year subject to heavy taxation. On behalf of the Tolaga Bay exservicemen, Mr. N- Wilson pointed out that when a farmer sold his land to the Government and then disposed of his stock the difference between his standard values and the prices received on realisation was treated as income. The taxation was levied as for one year only, and represented a heavy impost upon a farmer who had spent years building up his stock. Alternative Course One alternative course to complete remission of income tax on such revenue was to allow the seller to spread the income over a span of. say, four years instead of only one, Mr, Wilson added.

The president, Mr. J. Leggat, suggested that consideration be given to the proposal which a recent land conference in Napier had adopted in favour of treating the whole of such income as accretion of capital, in the same way as the price of the land itself. There was no doubt that the heavy taxation of stock realisation was acting as a deterrent to land-owners who might otherwise make land available for settlement. Mr. M. T, B- Hill, supporting the chairman, stated that he had on one occasion, at the instance of a former Crown lands commissioner, made a canvass of farmers who might be prepared to offer blocks for settlement purposes. He had found sentiment among the farmers almost unanimous in opposition to the Government's treatment of sale-price of stock as income. Their reply to his inquiries had been, in effect: "You tell the Minister to fix up the taxation principle first!” The conference gave its full support to the Napier proposal.