THE LAND TAX

Manawatu Standard, Volume LVIII, Issue 303, 21 November 1938, Page 6

THE LAND TAX

TOWN AND COUNTRY. WHICH BEAKS BURDEN?. THE TWO ASPECTS. (By telegraph.—Special to Standard.) WELLINGTON, Nov 21. In one of the dingiest of Wellington’s government offices the staff of the Land and Income Tax Department is now working at high pressure, receiving over a million of taxation from the graduated land tax (which is finally due before the end of November) and preparing assessments for something like nine and a-half millions of income tax, which will be payable in the new year. Although it P ro " duces the greatest proportion of the State’s revenue, this Department has certainly not received much of the benefit in the way of expenditure on its accommodation, for it uses a “temporary” wooden erection put up in a hurry during war-time over twenty years ago, and bearing all the evidence of an emergency job. One of the most discussed points about the land tax is whether the country lands carry most ol its weight. Early in its history, no doubt, the country lands were the largest contributors, but times have changed and the revival of the graduated principle by the Labour Government in 1935 has probably swung the balance against the town lands, although no definite official figures are available to corroborate this opinion. The highly valued business sites in the towns, especially those owned by large concerns having branches in many districts, make up the big figures of this tax. There has been no official analysis of the incidence of land tax for ten years, the economic depression having curtailed . many of the State’s statistical efforts. However, the present Administration is conducting a complete overhaul of taxation systems, and it is expected that during the next session of Parliament the full information regarding land tax incidence will be available. Ten years ago, when the land tax revenue was approximately the same as that of to-day, there were details available as to its sources, and the town and country proportions could be ascertained. The figures of 1928 were as follow: Country or farm lands ... £654,290 Town lands £283,709 Mixed towp and country ••• £35,942 The total yield in that year was nearly £974,000 and the country was certainly the larger contributor, but it is expected that the coming analysis will show a swing in the other, direction owing to lower country valuations and a rise in the cities. A DISAPPOINTING TAX. The revival of the graduated principle in connection with this tax proved a disappointment to the Government. Prior to 1935 the annual yield has been under half a million on the basis of a flat rate, but Labour brought the graduated scale back and the Minister of Finance estimated that this would treble the revenue. However, it only resulted in an increase of £589,000, or just over double the previous year’s' total. The revenue of 1938, of £1,038,034 showed a drop of £9OOO on the previous year, but this year’s yield is placed at £1,075,000.