LAND TAX ACT.

New Zealand Times, Volume XXXIV, Issue 5670, 2 June 1879, Page 2

LAND TAX ACT.

We recently published clauses 50 and 51 of the Land Tax Act for the benefit of our readers, which set forth, in technical language, the relative liability of landlord and tenant for the land tax. We have reason to believe that a great many taxpayers would be unable to interpret the legal phraseology of the clauses, and having asked an opinion from a legal gentleman as to his reading and application of the sections we offer the following practical illustration; —A owns a landed property valued at £IOOO (without improvements). B is a tenant of A. Rent—we understand to mean ground rent. The rack rent of the property under the Act would amount to £SO per annum. If the tenant B pays more than £SO a year we understand that the landlord is liable for the whole of the laud tax, which, in the case before us, would amount to 1000 halfpence or 41s. Bd. If the tenant B pays less than £SO per annum for his ground rent, the land tax would be divided between the landlord and tenant in the following proportions : —lf the tenant pays £25 per annum he and the landlord would each nay half the tax. If the tenant pays £37 10s. a year as ground rent he would only have to pay quarter of the land tax, and the landlord would have to pay three-quarters of the tax. By a proviso to clause 50 it is enacted that if the tenant pays less rent than the land tax amounts to, he will be liable for the whole tax. If we apply this proviso to the case before us, a tenant who paid less than 41s. Bd. rental for a piece of land valued at £IOOO would be liable for the whole tax, in addition to his rent. The department may recover the rent either from the owner or from the tenant. But if the tenant pays his landlord’s share we presume that the sum paid for the landlord by the tenant may be deducted by the latter from his rent.

The clauses are somewhat puzzling to the non-professional reader, and if the above interpretation is inaccurate we shall be glad of correction or criticism. The chief difficulty in towns will be to assess the value of the ground rent apart from the rent paid for the buildings which are erected upon the land. The ground rent of laud in towns, if there were no houses or improvements, would not be very high.