The Otago Witness

Otago Witness, Issue 746, 17 March 1866, Page 10

The Otago Witness

DUNEDIN, SATURDAY, MARCH 17.

The subjects discussed by the candidates at the various meetings held in the different electoral districts, are naturally those which must come under Parliamentary notice during the ensuing session. Little is said by any on native policy. It seems an accepted fact that no material alteration will be made on the principles on which Colonial relations with the Maoris shall in future be conducted. It is assumed that the Colony will henceforth transact its own affairs, and that as the Imperial troops will be in great part withdrawn, so the Colonial Government will in future be responsible to the Colonists and not to the Imperial Government. But the past has left a legacy of debt which must be met, and the present revenue is insufficient for the demands upon it. A Colonial debt of three millions in addition to provincial loans, is a heavy burden for a small population like that of New Zealand to bear, and unfortnnately the greater part of it has not been invested in reproductive works, but is utterly sunk. It is the price paid for the life and security of the settlers. It is idle now to regret the past. The mistakes and misgovernment of twenty years cannot bs undone; the Colony must accept its present position, and with the light of experience, by wise and prudent measures retrieve itself. For this New Zealand possesses every advantage in vast mineral resources, and in a fertile soil. All that is required is population to develop them, and as that increases the necessary revenue for meeting its engagements will naturally be more easily raised. From the partial 1 failure of the effort made by the last I Government to replenish the exchequer I by increasing the customs duties, it is plain

that duties on imports have been raised too high. * It has long been known that two effects follow the rise of price caused by the imposition of high duties — a decrease in the consumption of the taxed articles, and an increase in the quantity smuggled. Both these effects follow •with such unerring certainty, that in England it is found to anßvrer the best to reduce the customs duties to the lowest possible rate, consistently with raising a revenue ; and thus to place the article taxed within resell of a greater number of consumers, and to reduce the temptatioa to evade the payment of the duty. From the limited population of the Colony, and their generally prosperous condition, consumption could not be stimulated to any great extent by such a reduction; although, excepting in those provinces where gold mining has rendered price a matter of small moment, it is still an important consideration in families. But it is impossible to prevent smuggling where the sea board is extensive. Not all the revenue cutters of Great Britain, aided by the Coast Guard and Preventive Men, with^the army of Customs and Excise Officers, maintained for the collection of duties and the prevention of illicit manufacture, could put ft stop to smuggling when sufficient temptation was presented by enormous duties. And it is more than probable that mainly to extensive smuggling it is owing that the Colonial revenue has not increased in proportion to the additional duties imposed. A revision of the tariff, therefore, is s necessity, but it is also necessary that additional revenue should be raised by other means. Mr Stafford, in his speech at Nelson , pointed out this necessity, and hinted i at two modes, by one or both of which he proposed to effect it. He did not disguise that his leaning was towards an income tax, but he also entertained the idea of the impo-ition of stamp duties, a plan proposed in the first instance by the Weld Government, and calculated to raise a very large amount of revenue. To an income tax there are many objections. It is easy to show that although every attempt was made by the late Sir Robert Peel to graduate that proposed by him in 1842, so as to render its incidence equal upon men of small and large means alike, he failed in the effort ; the man with a small income paid it out of his poverty, and the rich man out of his superfluity. The sum may appear small that the one pays when compared with that paid by the other, but th widow's mite was a greater sacrifice than the wealth poured into the temple treasury by the millionaires of the day ; a few score pounds were not missed by them ; but she gave all she had. However desirable therefore Mr Stafford's idea may be of causing the rich of the Colony to bear their fair share of taxation, if by such means only it can be accomplished, it is of doubtful policy. The large incomes might be made to contribute large sums, but the small ones would be heavier taxed in proportion. Ten pounds a year taken from an annual ncome of two hundred pounds is productive of more discomfort than one hundred pounds drawn from an income of two thousand. But there are other objections to an income tax which render it a very undesirable mode of raising a revenue, especially in the Colony. The chief, are that it would be very difficult to assess on account of the rapidly changing circumstances of Colonial life, and that frem its inquisitorial character it would be productive of serious discontent. These two propositions are so self-evident that it is nnnecessary to enlarge upon them. Direct taxation of any description is distasteful, but it is especially so when in addition to the burden an inquiry into the monetary affairs of the individual taxed is rendered a condition of its being fairly assessed.