THE UNIMPROVED VALUE.

Lyttelton Times, Volume CXV, Issue 14060, 15 May 1906, Page 3

THE UNIMPROVED VALUE.

RATING IN CHRISTCHURCH. THE OITY COUNCIL DECLINES TO EXPRESS ITS OPINION. The system of rating on the unimproved value brought forth another long'discussion at the mepting of the City Council last night. A few' weeks ago the Commirsioner of Taxes wrote to the Town Clerk, asking him to supply information as to the working of taxation on the unimproved value and its effect on land values. The information was sought at the instance of the Secretary for the Colonies. The nature of the reply was discussed at the meeting of the Council on May 1, hut the discussion was adjourned. Last night Councillor Allison moved that the following reply should be sent to the Commissioner’s letter:— “ (1) That during the time the Eating on Unimproved Value Act has heon in operation in Christchurch the colony has enjoyed a period of exceptional prespemy, which may fairly ho attributed to a succession of good seasons, development- of the colony’s principal products, including frozen meat, wool and dairy products, coupled with exceptionally high prices, and the expenditure of largo sums of borrowed money, by the Government and local authorities on.public works. (2) That this prosperity lias affected, the building trades, rents and taxation of house property, vacant sites, and land speculation to such an extent as to completely obscure any influence, by rating on unimproved value on the subjects referred to. (3) That this prosperity has attracted population ftom other parts and caused great activity in the building trades all over the colony, irrespective of the systems of rating in force in the various localities. In Christchurch it has caused an abnormal demand for dwelling-houses and other buildings, at high rents, which, in conjunction with rating on unimprovedvalue, has in some cases resulted in unduly overcrowding land with buildings, while generally rents and prices for building sites are much higher than were current before rating on unimproved value came into operation. It is estimated that house rents have increased 1 at least one-third since then, while the total increase in the assessed value of unimproved land in the city lias risen from £-2,331,242 in 1902 to £3,093,157 in 1905. The last valuation of the Central Ward was made in 1902. Present value is much higher. (4) That to© incidence of rating on unimproved value in this city has been very unequal and inequitable, it having largely increased taxation on many of the poorer class of cottagers, and of shopkeepers with current leases in business localities, while it has reduced the rates on great numbers of large dwellings. warehouses and other buildings producing rents, enabling the owners to pay the higher rates without difficulty/ In great numbers of oases the taxation imposed by the Act is neither in proportion to benefits received nor ability to pay. (5) The Council understands that the Act .was placed upon the Statute Rook to prevent the holding of land without properly utilising it, and for speculative purposes. That object has, not- been 1 obtained by its adoption in Christchurch, while it has resulted in the imposition of inequitable, and in, many oases oppressive taxation, the Council therefore thinks that other means should be provided to obtain the object referred to, and that the Act should be repealed.” He said he believed that the Government had adopted an entirely wrong course in having the new system of taxation brought into operation. In any' case, the title of the Act was a misnomer, as the improvements were taken into consideration.' Some of-the principal advocates of the Act acknowledged- that it was the thin end” of the'’ wedge of the single tax; and it would be a disastrous thing to introduce the single-tax system into this colony. Thinking people, therefore, should pause before they endorsed the iniquitous principle that had been applied in different parts of the colony. Auckland had not adopted the Act; Christchurch had. Taking the central, ward of Christchurch and comparing it with the central district of Auckland City, ho had found that from 1902 to 1906 Christchurch had added improvements to the value of £700,353, and Auckland had added improvements valued at as 1 much as £1,043,228. There were other places showing a similar result. Ho quoted cases in Sydenham ward to show that the Act operated very unjustly there. An hotel near the Triangle in the central ward had. had its rates reduced by 43.4 per cent, while another hotel close by, of the same ratable value, had its rates increased by 25 per cent, and a third, within, a stone-throw of the other two, secured a reduction .of 6i per cent. There was no justice in the Act. He could go on for a long time giving examples of injustice, but there was. no need to multiply instances. The Act did not do what- it professed to do, namelv, rate on the unimproved value, and it did not stop speculation. Ho hoped the Council would see that the Act was not equitable, and that it did oppress the poor and relieve the rich. Mr Gray had said that the proper step to take was to amend the Act. His idea was that the proper stop was to strike it off the Statute. The Mayor asked if any councillor would second the motion. After a short time had passed, Councillor Payling said that councillors seemed to be very bashful, and ho would second the motion, in order that it might be discussed. While he agreed with the principle of the motion, he thought' that it covered too ; much ground. Another motion would be moved, be understood, and he would support it. Councillor Gapes said he thought that the Act could be greatly improved. The mistake was in making the Act operate universally. It might be right in the city, but not in the suburbs. It would be a serious mistake to make the Act general. There should bo exemptions to meet the circumstances of certain people. If there was overcrowding on account of the Act, it could be easily overcome by special clauses in the Act. Mistakes must occur under that Act, “just as they would occur under any other Act of a similar nature. It would he unwise to wipe out the measure altogether. Over-rating and under-rating had always taken place. Councillor Manbire said that the rating under, the Act certainly was unfair. The roads had to be kept in order, but those who used them should find the money to maintain them. Councillor Orchard said that the principle was economically sound and desirable in practice, but he thought that it ought to be made more workable, so as to apply more equitably to lands in the suburbs. Councillor Hadfield said ho did not think that the Council should express any opinion that the Act should be repealed. That would bo going beyond the request mads by the Commissioner. 'There had been grave injustices under the Act, but that in itself did not lead to the conclusion that the Act was entirely had. It could very well be amended. The question of amendment should have been referred to the Municipal Conference. The measure could be made a.n excellent one; Ho eup-

ported the first portion of the rcsolu- 1 tions, but not the latter portion. Councillor Seagcr,said that the Council could not givea complete answer to the letter unless it had a great deal of data before it. He moved:—“That this Council considers that before any opinion can bo expressed as to the working of the unimproved land tax, it is necessary that exact data should bo compiled and placed before it. In the absence of such data, any opinion that might be expressed can have no value.” Councillor Chick seconded the amendment. Councillor Cooper said lie was sorry Councillor Allison had gone so far. He thought that the question should bo threshed out by representatives of the whole colony, at the Municipal Conference. Councillor Loughnan said he thought that the Act had been misnamed. “ Unimproved value ” under the Act seemed to him to he something very different from the ordinary interpretation of the words. Ho did nob see what the object of the framer of the Act could he unless it was to-bring about eonfusion. The results showed that the Act-was radically wrong; and as it was radically wrong, it should bo out off. He, however, would vote for the amendment, as he considered that the Council should go further into the matter. The Mayor said that his views liad been anticipated by Councillor Seager. The request, lie pointed out, was addressed to the town clerk. It was an exceedingly unreasonable request. , Ho did not see how it was possible to express an opinion until there had been a careful inquiry, which would put all the facte before the Council. He was surprised that a Government Department in Wellington should have asked the Council for so much information with such short notice. Councillor Allison replied. He said that no committee set up by the Council oould supply more information than had been given already. He could show inequalities of taxation wherever the Act operated in the colony. There was no principle in the' Act, and it should be swept away at- once. It was quite impracticable for the municipal conference to discus® the question. The amendment was an attempt to shelve the matter. He was glad that he had oome out boldly to oppose the Act. The amendment was carried on the voices. Councillor Allison moved a further amendment that the. question should be referred to the By-laws and Finance Committees for a report. Councillor Gapes seconded this amendment, but it was ruled out of order.