BUDGET DEBATE

Hawera Star, Volume XLIX, 16 August 1929, Page 9

BUDGET DEBATE

LATE EDITION

, y TAXATION PROPOSALS. MR. McCOMBS DISAPPROVES COMPANY TAX. AIR K. S. WILLIAMS STATES CASE FOR LAND-OWNERS

(Bv Telegraph—Press Assoc law. ri.) WELLINGTON, Aug. .16. The Hon. J. G. Oobbe, eominning the financial debate in the House this morning, said it was not the intention of the Government to harass small farmers. Its desire was to increase the number of farmers and enable young men to earn a decent living on the land. If the Government did not carry out that policy soon, some other Government would) and perhaps in a more drastic manner than was at present proposed. M.r Cqbbe asserted that Reform members were using the increase in the primage duty as a stalking horse. Their real objection to the Budget was the proposal to increase tax on the large, landholdings. The Government’s land settlement scheme was designed to absorb the people who were’ at present. out of work, "out there was always, the possibility that there would still be oases to be dealt with and he hoped that before Jong an unemployment insurance would be in operation in the Dominion. The Government would or fall by its policy of closer land settlement. He agreed that there were ' many properties that, were not suitable for very close sub-division and in such cases a thousand acres or even more ‘ were necessary for each farm, hut that was no reason why such land should: be held in blocks" of ten thousand acres or more.

A LABOUR VIEW. Mr McCombs said that Mr Jones had stated that; diefiioit could be paid out of the Consolidated Fund, yet some speaker had’ raised objection tq the tanners paying their tax out of isu-r----pfirs profits from preceding years. Mr McCombs considered that Sir Joseph Wardl was oil sound lines in budgeting for a surplus so that he could take a. larger portion of the revenue money for public works. A Reform member’ had suggested something in the nature of a hardship clause in connection with the proposed new land taxation. Mr AleCombs remarked that there had been a hardship clause in connection with the public service salaries cut, but the Reform administration had not allowed it to operate in one instance, end now they were asking for a hardship clause for large squatters. Referring to a case in which, it had been claimed tine reduction of the amount of mortgage exemption would impose hardship on the landholder, Air AlcCombs said it. was not the taxation, but the interest bill that was this man’s diffiouly. His morgages actually exceeded unim-

proved value of the laud and if it. even--7~ tuated that the nominal owner could l ■ not pay the land tax, then the. real owners, the people holding the mortgages should have to pay it. It was unfair that this valuable property should escape paying tax because the individual occupying it had mortgaged so heavily. Air AlcCombs expressed . opposition to the company tax, which he said was. not a fair method. It taxed the profits of the concern as a whole, but was often the means of enabling individuals to escape the taxation they' should justly bear. He did not suggest a. complete and immediate abolition of company tax, but, until some adjustment had been made in this direction the Government could, not consider ai supertax on incomes. Oboe, however, that this anomaly ha.il been removed it. might be possible to take such a step. Air. McCombs suggested that the Government should abolish the primage duty, and in fact provide the free breakfast table it had promised. He thought the Prime ATinister could raise plenty of revenue by a super-tax on dutiable goods, and, in particular, he added an increased duty on beer.

MR. Iv. S. WILLIAMS ON LAND TAX

Mr K. S. Williams stated that as a land-owner lie had not the slightest objection to paying his fair share of taxation, if the object of the proposed increase was to raise more money which might be necessary. So long as it was fairly distributed he personally would raise no opposition. But if the object of the increased taxation was to break up estates, he would like the Government to consider one or two points. He presumed that it was the first duty of any Government desiring to increase the productivity of the country to bring in undeveloped land. This consisted principally of two classes, bush land and open land partially covered with manuka, fern growth and native shrubs. When any such / .dand was brought under a development scheme care should be taken to see " that settlers were placed in a position to be able to continue on the land. Lor instance, in the case of the pumice lands an important aspect was to get in manures quickly, and from that point of view the continuation of the Rotorua—Taupo railway would have been justified. In reply to an interjection, he said he did not consider the construction of a good road would be equally satisfactory. Hoads would be costly to construct, and maintenance, in view of the heavy loads which it would be necessarv to carry over them, would be difficult and costly. Mr. Williams added that it seemed to him to be sidetracking the issue to refer to the Rotorua—Taupo railway as a branch line. Referring to his main point, lie said lie thought the Government should first bring in suitable undeveloped land, and when that supply had been exhausted it should then turn to loss developed lands at present in use. He did not think it would be fair to impose a penal tax on land that was not suitable for subdivision. The Government, furthermore, should hesitate to impose a penal fax unless it considered the properties under consideration could be used to the greater advantage of the Dominion generally'. The House adjourned at I ]>.m