EVADING THE LAND TAX.

Marlborough Express, Volume XXXIX, Issue 225, 23 September 1907, Page 3

EVADING THE LAND TAX.

Various ingenious methods, of evadi ing the land tax have been successI fully resorted to. In fact, the Pre- ! mier stated, when speaking on the j Land and Income Tax Assessment I Bill, that the law at present is in- ' effective to deal with the serious leak- ; age of revenue caused by these tricks. On© illustration ofhow half tne legal burden can be avoided was given by the Premier. A firm's land is assessed separately, and so is the separate estate of each partner. Consequently if A owns land worth £100,000 he ( would be liable to a tax at the rate of ;20 per cent, which, not count-ing the 125 per cent increas© proposed, would ! amount to £1000. But if he gives I his son B a nominal half-share in the I estate as a partner, then A is taxed 1 on £50,000 at the rate of ten shillings, and A and B are jointly taxed on th© other £50.000 at the same rate, and so th© total tax paid is only £500. There is nothing at present to prevent a landowner -, establishing a private company of which he practically owns all the shares, and transferring half his land to the company, thus saving half the graduated tax, in the same manner as a landed proprietor who had a son to shoulder half the. responsibility. The -new Bill, as explained by th© Premier in his speech, will remedy -the deficiency in the existing law which has made evasions so easy and so extensive.—New Zealand Times.