REVISION OF TAXATION.

New Zealand Mail, Issue 933, 17 January 1890, Page 28

REVISION OF TAXATION.

On the very justifiable assumption that there will be a substantial surplus at the 31st March next, on the

financial year’s operations, speculation is already rife as to tbe probable disposal of that anticipated balance to the good. It may of course be objected that tins is just a little like “ counting the chickens before they are hatched.” Those who are already planning the destination of the expected surplus may be reminded that / “ The man that once did sell the lion’s akin .... While the beast lived was killed with hunting him,” and may be warned to beware lest after they have comfortably dealt with tbe coming surplus, no surplus should come. There is no doubt that those who may have discussed this question would come in for a good deal of “ chaff,” and would be the butt of innumerable small witticisms if the surplus should nut “come off” after all. But they may, without imprudence, run this small risk. So far as human foresight can penetrate the near-at-hand future there seems a virtual certainty, not only that there will be a surplus, but also that it will be of sufficient amount to warrant some appreciable easing of the fiscal burdens which at present rest upon the shoulders of the New Zealand colonists. We expressed, in a former article, the opinion that the estimate put forth by one member of the. House, viz,, £250,000, was somewhat over-sanguine. Some very competent judges, however, believe that the surplus will approach £200,000. It is true that these brilliant expectations have been slightly discounted by the inexplicably disappointing results of the December Customs, and by the comparatively insignificant icfiuence exercised upon both the Customs the railway revenue by the Dunedin Exhibition. Nevertheless there is still plenty of time to make up for past shortcomings, and it may reasonably be expected that tbe current quarter will be a seas.ou of fiscal leaps and bounds.” It is clearly advisable that the disposal of the surplus should bo publicly, though provisionally, discussed, in order that Ministers may be made aware of the taxpayers’ wishes with regard to the direcuon which any reduction of taxation, if this be feasible, should take. Various suggestions have already been made on this head. Some members of both Houses have naturally a good deal to say on the subject, especially those who give a general

support to the Government. All the different proposals will doubtless receive full aod careful consideration. The decision to be arrived at is a very important one in its influence on the future fortunes alike of the Ministry and the country. It will be a great blessing to the country to be relieved of a portion ot its present taxation. It will be a great advantage to the Government to be able to go to the constituencies with a proposal for lightening the public burdens, instead of having to apologise for the necessity of increasing them But the full value to the tax payer of the reductions which it is hoped will be possible, and the extent to which the fact of reduction will benefit the Ministry by which it is carried into effect, will depend very largely upon the manner in which this is done. One idea seems to be that all sorts of little decreases should be made here, there, and everywhere. Th's,we have reason to believe, will not find favour generally. A prevalent feeling is that a good big reduction in one or two items, which will be felt by everybody as an appreciable relief, would be both a wiser policy and one much more grateful to the majbrity of taxpayers. Three large items at once suggest themselves. First, there is the Pro-perty-tax. Property holders are disposed to contend that the Propertytax is an impost of a special character, and should be treated like the Incometax in Eugland—decreased whenever the public finances will permit this to be done, and only raised in cases of financial emergency Others hold an opposite view, and urge that the tax ought to be regarded as a legitimate permanent charge on all property as its fair contribution toward the cost of government. Based on the former theory a proposal will probably be made to lower the Pro-perty-tax by a farthing, or the eighth of a penny, in tbe pound. An abatement of a farthing would involve the sacrifice of nearly £90,000 of revenue which is collected with ease, cheapness and certainty, and which is paid only by those who possess £SOO worth of property clear of all debts. It is quite possible, in view of the irrational un. popularity which attaches to this tax in Auckland, that a reduction may be made as a sop to the property owners before the general election, but many capable judges are very firmlv conviuced that it would be a mistake to disturb tbe present penny tax. They maintain that while this remains unaltered it is understood by everybody, and duly allowed for in all transactions with regard to property, on which it thus becomes a permanent recognised charge, whereas while it is constantly being changed about, moved up and down, increased and diminished, nobody knows one year what it will be next year, and so all property transactions have to be conducted subject to this unknown and uncertain factor. It is a question to be carefully thought out whether it would not be much better in the long run for property itself, that this tax should stay unaltered at its present simple rate of a penny in the pound. It has been the uncertainty that has alarmed capital. Once make it clear that the uncertainty is to be replaced by certainty, and then all calculation can be made upon a definite and assured basis.

Another suggestion is that the duty on either tea or sugar, or both, should be repealed, according to the amount of revenue which the surplus will enable tho Government to dis pense with. The sugar duties last year brought in £103,000 (in round numbers) and the tea duty £78,000. The two thus represent over £IBO,OOO of revenue. This year they will probably yield nearly, if not quite, £200,000. Undoubtedly to repeal either or both of these duties would be a highly popular step, and in the circumstances would perhaps be justifiable, although only on the distinct understanding that they must be re-im-posed in case of any future financial stringency due to over-borrowing or other extravagance. The Colonial Treasurer in his Budget of I§BB intimated plainly that he held sugar iu reserve in case further fiscal straits might e.orapel him to double the present small duty qf a halfpenny per lb j by yrhich, at any time of iS pinch,” he could have been sure of raising another £IOO,OOO or thereabout. The duty might be removed altogether—-provided, of course, that the surplus is large enough to warrant it—and in the event of a future period of financial stress it would be' always available. The same might be said of the tea At

sixpence per lb it will bring in about £BO,OOO this year, and this tax, like that on sugar, is felt by all, but more by the poor than the rich. In discussing this matter it must not be overlooked that there is the so-called “Primage” duty of one per cent on all imports, to be dealt with. That was originally imposed for two years ouly, and was estimated to yield £58,000 per annum. It is possible that this may be the first impost relinquished, although being an easilycollected' and widely-distributed tax, which hits nobody very hard, it is just one of those sources of revenues which Colonial Treasurers are always reluctant to abandon. We suspect that if a 'plebiscite were taken on this point the popular vote would go in favour of retaining the primage duty and the penny property-tax, and of reducing or abolishing the duty on tea or sugar, or both. S' rrr