Write Down Stock Without Penalty Is Farmers’ Right

Northern Advocate, 8 October 1941, Page 4

Write Down Stock Without Penalty Is Farmers’ Right

“Iniquitous,” was the description given at the quarterly meeting of the Whangarei Sub-Provincial Executive of the Farmers’ Union yesterday, of the position imposed upon farmers by the necessity of writing up stock values for taxation purposes. “Does the objection come in the first declaration of values?” asked Mr O. Adlam, who said that he had, In the first instance, placed on his stock what he considered to be a reasonable value. When the unemployment tax had been first introduced farmers had had to pay tax and were officially told to put a nominal value on their stock, the essential point . being that any value so fixed should be kept constant, the acting-secretary (Mr R. Fairburn) stated. Now'stock was required to be written up at market values. Where a man had originally put a low price on his stock, the writing up would create an entirely false “paper” income on which the farmer could be taxed. Taxed On False Income Thus a man who, in compliance with official directions, had written down his stock values, now faced the prospect . of being penalised if he complied with requirements of the Commissioner of Taxes and , wrote up his stock to market value. “We want the right to state the true value of our stock without being penalised,” said Mr Moore. “The man who valued low in the past gained no benefit over the man who valued high." The farmer with low stock values had only two courses open to him; to allow his prices to remain as originally stated and take the risk of facing

heavy taxation if he should sell up his farm, or to write up the stock to true value and appeal to the Commissioner of Taxes for permission to do this without penalty. “Farmers’ stock is among their capital assets and should not be taxed,” said Mr Moore. “It is not a farmer’c stock-in-trade in the same way as a tradesman has goods.” The matter was being handled by both the Auckland and Dominion executives. Farmers’ Right Mr F. Slmmonds: There is no doubt but that we should have the right to write up our values without penalty. Mr Adlam: The valuation of stock should have no influence on income and fluctuations of stock value should not be classed as income. It is necessary to be exacting, though. Farmers are not taxed in some directions, whereas other businessmen have to pay all the way. Mr Moore; That statement will not meet with general agreement. Mr H. E. Hewlett: The principle should be that the man is taxed on what he sells, not on what he. buys. A contrary policy would have a depressing effect on the market and would lead ultimately to less taxation being collected.