CORRESPONDENCE

Hawke's Bay Tribune, Volume XIX, Issue 220, 4 September 1929, Page 6

CORRESPONDENCE

It must be distinctly understood that we are not to be identified with the opinions expressed by correspondents in our columns. TAXATION PROPOSALS. (To the Editor.) Sir,—The most outstanding feature of the Budget debate as reported by the “Dominion” occurs in a paragraph headed “The Commissioner of Taxes Explains.” Whether or not it should be regarded as an “explanation” is open to question. It is at all events a most interesting and instructive statement. I will quote the following:— “The Prime Alinister read the following memorandum on the subject from the Commissioner of Taxes: 'With reference to the taxation proposals contained in the Budget, 1 have to state that there are approximately 80,000 fanners in the Dominion of whom only about 25,000 pay either land tax or income tax. The only proposal of the Budget which will add to the number of fanners paying tax is the reduction in the mortgage exemption, this will increase the number of farmers paying land tax by about 550. Thp super tax on fanning lands will not affect any farmer whoso land is of an unimproved value less than £12,500. Small fanners will not therefore be affected. Out of the 80,000 fanners in the Dominion, only about 1,750 own land of an unimproved value in excess of £12.500. It is clear theiefore that only large holdings will be liable to the super-tax. In regard to the income tax on farmers, returns of income will be required only from farmers owning or leasing land of an unimproved value of £12,500 or over. As it is proposed to allow a deduction of the land tax and the super-tax payable, from the income tax payable it is surprising that any objection should be raised to the proposal. Any additional revenue will represent the amount by which the land tax and supeff tax fall short of the taxation at present imposed on other classes of tho community on their incomes.’ ”

I am a farmer, and I hold no brief for this section of the community where there is any desire for evasion or alleviation of their fair and just contribution to tho revenue of the country. Any farmer who is worth his salt, cannot but admit that he must shoulder his just quota-of taxation. But what is revealed by an analysis of the proposals which the Commissioner of Taxes asserts (and I assume Sir Joseph IVard concurs in the opinion expressed) leaves him surprised that any objection should be raised.

Eighty thousand farmers in the Dominion, 25,550 to pay taxes, 1,750 of the latter to be subjected to penal rates of taxation in land tax, or income tax if the latter shall happen to be the larger amount, any additional revenue derived thereby will, as the Commissioner states, “represent the amount by which the land tax and super-tax fall short of the taxation at present imposed on other classes of thq community on their incomes.” That is just the point that appears to have escaped that degree of intelligent consideration which we are entitled to expect from* our legislators. Eighty thousand farmers in the Dominion minus 25.550 to be taxed leaves 54,450 or 63 per cent, who are not to be taxed. The exemption on ordinary business or earned incomes is £3OO. Those who are required to pay under this heading comprise clerks in offices, small shopkeepers, etc., and many a man or woman in a comparatively small way, who from the claims of their families, and other reasonable causes, have little or nothing left over as the result of their year's operations. This is the class wit/i which tho Commissioner of Taxes and Sir Joseph Ward desire to see sheepfanners brought into line in order that they may be made to pay the rates of “taxation imposed on other classes of the community.” If there is any sincerity or sense in these observations,, why should 54,450 or 68 per cent, of the farmers in the Dominion be relieved from all but indirect taxation. They should pay their £5, £lO. £l5 and so on, on the same hasis as others enjoying no such privileges. It is an economic fact that the burden of taxation should be borne by all in a position to shoulder their share. United we stand, divided wo fall; and fall undoubtedly, will some, to whom the proposed increased rates of taxation will apply. Tho Commissioner expresses surprise that any objection should be raised to the proposals as' outlined above. If the Commissioner of Taxes or any politician considers these proposals to be a satisfactory method of stemming any decline in the revenue of the country, they are doomed to disappointment as no proposals more futile or devoid of foresight could well have been devised.

Sir Joseph Ward professes to aim at the elimination of the large landholder with a view to encouraging closer settlement which is sound and equitable in principle. Why labour the difficulties when existing legislation affords him the means to achieve his object in the simplest manner possible, more simple, fairer, and freer from obviously possible financial complications where heavy liabilities exist, than the penal taxation process.

What will bo the position as the successful application of this principle

develops? The 32 per. cent, who at present contribute all the taxation payable by farmers will become absorbed in the 68 per cent, who wj no taxation Talk about wizards of finance, the primary producers will produce, and the rest of the community pay the piper. That is the undeniable logic of the Budget proposals.

The unsatisfactory position at present existing will be maintained until we return to power men who will decline to place party before country, and to sacrifice all other considerations to political expediency.

I have no desire to compare tho present with the last administration. The proposals under discussion possess no discernible merit The Reform party knew what justifiable dissatis faction existed in the public mind with regard to the incidence of taxation. They ignored the writing on the wall, and their failure to evolve

and apply the obvious remedy was a decisive factor in their displacement. —I am, etc., F. J. WILLIAMS. Napier, 2/9/29.