TAXATION OF LANDOWNERS.

New Zealand Herald, Volume LXI, Issue 18662, 19 March 1924, Page 8

TAXATION OF LANDOWNERS.

The purpose of Mr. Massey's statement regarding the taxation of the " larger landowners " in respect of their property is not clear. He speaks of getting both land and income tax back to normal as soon as possible; an observation that can apply only to the relative proportions of the two taxes, since return to prewar rates is manifestly impossible. But before the war, land tax produced very much more than income tax, and while the yield of the latter has ranged as high as sixteenfold, land taxation has little more than doubled. So far as large landowners are concerned the tax Mr, Masisey has allowed them to escape is not land tax but income tax. If it is to that question Mr. Massey refers, and there has been much opposition to the Government's policy in respect of it, his statement is no answer to the criticism, but an obvious attempt to avoid the issue. The exemption oi farmers from income tax is, in fact, indefensible. It was pressed by the Government as a concession to distressed farmers, but it did not bring any relief whatever to those whose incomes fell below the standard of substantial prosperity. As Mr. Massey says, land tax is calculated " irrespective of whether profit or loss has been made" and many small farmers who were embarrassed by the slump would have welcomed a respite from this taxation. But income tax is payable only in respect of profits above large allowances, so that the general exemption from it of farmers was a needless concession to prosperous landowners, a tantalisation of distressed farmers, and, by its inequitable character, an exasperation to all other taxpayers. The only argument in its defence that Mr. Massey has been able to discover is that before the war, farmers did not pay income tax. It is also true that before the war, the maximum rate of income tax was 2s. What justification is there for applying pre-war treatment only to landowners enjoying large incomes?