LAND SUPER-TAX.

New Zealand Herald, Volume LXVII, Issue 20491, 17 February 1930, Page 12

LAND SUPER-TAX.

METHOD OF. OPERATION.

CRITICISM IN THE SOUTH.

INJUSTICE TO FARMERS.

[BS TELEGRAPH. —OWN CORRESPONDENT.]

DUNEDINi Sunday,

The manner in which the Land and Income Tax Amendment Act, 1929, is operating is causing some concern to farmers in Otago, and is being widely discussed among people dealing with financial matters. The impression seems to be general that the Act is not operating as Parliament intended, and that an injustice is being done to many farmers. The manager of a large financial institution to whom the matter was referred, said that when the legislation proposed by Sir Joseph Ward had come before the House it had been generally understood that it had two objects in view, namely, to impose an increase of land tax which would bring in more revenue, and to impose an income tax which, if in excess of the land tax as increased by the Act, would be substituted for such land tax. This income tax had been proposed to catch certain weajthy sheepfarmers who, it had been alleged enjoyed large incomes and whose land tax had been regarded as too small in proportion to the benefits enjoyed. The proposal under this heading had been evi'denced by section 12, sub-section 1, of the new Act. It had been understood by those who had folloufcd the discussions in the House that the amount of income tax assessable would be determined and, if greater than the ordinary land tax plus the specif land tax, such land tax and special land tax already' assessed would be deducted from it, and the surplus would be payable as income tax. The imposition of increased land or income tax had had another object in view, according to Sir Joseph Ward. That was to compel the larger owners of land to cut up their estates, an objectHvhich, if realised, would bring down land values and involve in its ultimate effect a further increase of taxation.

"If the Government desires to depopulate the primary producing lands," said the speaker, "it is going the best way about doing so, and the result will be disastrous and far-reaching. It is anticipated that the large number of objections that have been made will impress the commission set up and bring to an end an Act that should never have been passed. It has been repeatedly pointed out to Sir Joseph Ward that the effect of imposing too drastic a tax on the farming community will have a boomerang effect, and I look for some modification of his proposals in the near future."