The Poverty Bay Herald AND East Coast News Letter. PUBLISHED EVERY EVENING. FRIDAY, AUGUST 22, 1879.

Poverty Bay Herald, Volume VI, Issue 870, 22 August 1879, Page 2

The Poverty Bay Herald AND East Coast News Letter. PUBLISHED EVERY EVENING. FRIDAY, AUGUST 22, 1879.

Does the Land Tax fall upon the owners, or upon the working men . That ia a question which has been very ably discussed m the Bruce Herald, and thfe answer is that the working man will suffer. " I have paid my land tax already," said a farmer to a friend of his m town not long since ; " I had no absolute need for a gardener, so I sent him out ploughing when I was taking on fresh hands, and so saved a ploughman's wages. I have pruned my own trees, and shall let my garden get shabby this year. My land tax is about _£30, and I shall save it five or six times, as my. wife offers to do Avith one ' servant. Besides this, I shall sow less grain and grow more wool by sowing turnips.". 1 We quite admit that these remarks only touch rur&l holdings ; but m towns the question only becomes a little more complicated. It is idle to attempt by simple legislation to throw upon capitalists a tax which will naturally fall on those who use capital. The tenant bears m this sense the same relation to the landlord as the consumer does to the producer, and landlords will take good care, if they can, to make the tenants pay the land tax m some shape. We do Hot wish now to condemn the tax m toto, and freely admit that there is something to be said against every tax ; but we cannot help seeing some of its fallacies, and chief amomg these is the notion that its true incidence may be affected by the intention of the Legislature. When we speak of the ultimate incidence of the tax we do not wish to be misunderstood. The facts mentioned by our contemporary, and those we have above referred to, go to indicate the indirect effect rather than the actual incidence of the tax. But whatever it may be called, the soundness or unsoundness of the view must depend upon whether it gives a true answer to the question, Who really pays the tax . The mode m which the tax is, m some measure at least, forced upon another class than those who were intended to bear it, has been illustrated as to rural holdings. In town properties it works more slowly, and m a more complicated way. In the first instance it is no doubt paid m the manner m which the law apportions it. As tenancies fall m, it will begin to fall more directly upon landlords, as tenants only offer the market value for tenements ; but m the long-run,

as this renders the building of tenements less profitable, it must check building, the effect of which is necessarily to cause tents to rise, and so throw the burden upon tenants. It might be thought that as the tax is upon land only, the tenements are exempted. This cannot be correct. But the obvious answer is that it matters not on what part of the landlord's property the tax is laid— it reduces the capital value of what m this sense may be called his stock-in-trade ; and by reducing this, those who desire to use it — i.e., the tenants — are compelled to pay more for their accommodation. The Otago Daily Times instances a fair case m enforcing direct taxation, and tells its readers what would have been the case with the Beer Tax Bill. It was thought that as this tax was too small to affect the price ofa single glass of beer materially, it must fall either upon the brewer or the publican, as the consumer would not pay 6-|d for the glass of beer for which he was wont to pay 6d. The idea was a happy delusion — the customer would cettainly not pay more money for his beer, nor would he get less beer for his money ; but the brewer and the publican, or one of them, ! would take very good care that there was less moneys worth m the beer. An anecdote having the merit of actual truth may serve to illustrate this. A German publican who lived m Wellington years ago was one day chaffed by his friends about the mode m which he had grown rich. They sneered at him as a man who had made his money out of gin and brandy and rum. " No, no," said the foreigner, " I did not make my money out of de gin and brandy and ivm — I lose i money by dem : I make my money out of de water." The exact modus operandi would have suited the beer-tax-paying publican, but only with worse results, as the benevolent legislator would surely have found that he was not only taxing the working man's glass of beer-, but that he had imposed the very worst kind of tax — a tax on health. There is no doubt but what to a great extent, the same results will follow from the imposition of the Land Tax. Certain facts are stated by the writer m the Bruce Herald confirmatory of our opinion. We know, says our contemporary, actual instances m which farmers have given notice to the men m their employ to leave, or accept a reduction of £5 per annum, or even more, "to pay the Land Tax." We know, too, that farmers have reduced hands and have worked longer hourstheniselves, avowedly with the object of paying the tax of which they have never otherwise complained. All our inquiries find answers m the same direction. We find that, quite apart from the badness of the times, retrenchments are undertaken to meet this very tax, and they have m nearly every case gone beyond what was strictly necessary for the purpose. ■< The first effect of enforcing too rigid economy is, that there is less employment for the working classes. What is wanted is, that property-holders should be made to contribute towards driving the machinery of the State without falling so heavily on the working classes, and this problem is as yet unsolved.