GRADUATED LANS TAX

Poverty Bay Herald, Volume LXIII, Issue 19121, 16 September 1936, Page 2

GRADUATED LANS TAX

SHEEPOWNERS’ PROTEST V ■ ENDORSED BY CHAMBER ‘WEALTH OF INFORMATION’ tj The Government should have a wrtillli of information from the farmer and businessman explaining the dilncufties of the graduated land tax, and I do not think that we can go much further,” said the chairman, Mr. R. \Y- J. Edwards, at the quarterly meeting of the Gisborne Chamber of Commerce held yesterday afternoon in the Borough Council chambers. r l he matte? arose ■when the secretary, Mr. >' • Hamilton Irvine, read a report from a sub-committee that met members ot the Poverty Bay and East Coast Farmers ’ Union. After the decisions of the sub-com-miitee had been read to members, Mr. r.-l'olerton moved, and Mr. 11. 11. Bo Co£ta seconded, that, the letter he hejlrtilv endorsed. The motion was cafried. The protest forwarded to the Government-by-the Sheepowners’ LTifion Aits .as.follows: ■.“ The Hon. the Minister of Finance.— Further to ouv telegram of August, 11, we" desire to.repeat our formal protest amtinst the reintrodnetion of the graduated land tax for the main reason- that it “is heartily disliked by the farming community, is unsuitable to the conditions ruling in the farming industry, and that double taxation imposed against one type of capital investment is Imsound and unjust.. <3 At the same time, if the intentions of Jhe Government in regard to the tax arer unalterable, then we respectfully i’equest that an inquiry be held with a view to dote mining the most equitable basis upon which ilio tax can be assessed. DISTRIBUTION OP BURDEN “Under the system ruling prior to (be abolition of the tax by a previous Government, the burden was extremely badjv distributed. Vast areas of land quite capable of hearing-their-share 01 vhef burden escaped tax-free or almost latgfvee. while others were so grossly over-taxed as to almost- .amount to confiscation. Right through the farm lands of jtlie Dominion, the burden fell with widely differing weight as between neighbours and between one district and another. The same revenue could have been obtained without hardship to any if the basis of the assessment had been a logical one. 'Sfhe cause of the inequalities and an<shialies that occur is the system of using the unimproved valuation as the basis of assessment. While this may tie: reasonable enough where only a small flat-rate tax is io be. collected, it a condition of hopeless chaos as soon as it is desired to levy a, substantial tax, more especially, wjiere the imjjost is steeply graduated, while there arises a further complication in trying to Arrange satisfactorily for the exemption of land mortgages. ‘iThe annual conference of the New Zealand Farmers’ Union realised this in 1930. and passed a resolution rccommefiding the adoption of what was termed the. productive value of the lapd. as a basis instead of the unimproved value. Owing to the decision of thej*. then Government to abolish the graduation of the tax. the question was allowed to lapse. $ PRODUCTIVE VALUE * 4 M,

‘*\Ye are-prepared to prove that if the-' productive value, which is in effect merely andilieiL'inaiire for,' Qie„ capital value, were adopted it would be possible to jhpply the tax with scrupulous fairness over the lands of the Dominion; that it would be possible to exempt all and-to tax only the farmer’s equity in his land without the loss to the State of any revenue to which'/ it is reasonably entitled, and without the oppression of those unfortunates who are trying to farm large areas of, indifferent country overburdened with debt. We are prepared to show also that any special exemptions of any sort can then be applied without creating the anomalies or inequalities inseparable from the old system.

“We have no hesitation in assuming that it is your wish and your intention to distribute the burden of providing the revenue required from the farming community in as equitable a manner as is humanly possible, and have therefore no hesitation in asking for an investigation to that end. “We are prepared to send a delegate to Wellington at any time convenient to you to lav before you our views in greater detail. DIFFICULT YEARS “We desire to remind you that sheepfarmers have just passed through several years of extreme difficulty. In many cases the greater part, or oven the whole, of the farmers’ equity in the land lias been lost. If it is the intention of tile. Government, which we trust is not the case, not only to reimpose the heavy land tax, but also to continue with the income tax as well, then our chance of regaining some of the leeway becomes very remote, more' especially as we are also ..saddled - with increased costs of labour and material. Without the ability "to reimburse ourselves for these increased costs {lie position of many of ns becomes hopeless.

“We are satisfied that there is no intention to discriminate against the sheepfarmers as a class, still less is there any desire on otir part to evade our and proper share in the cost of financing the activities of the State. It is to the end that the burden to be placed upon our industry should be a reasonably fair one, and that it. should ■be fairly and equitably distributed, that we venture to ask for your consideration.

“Though we believe that the objection to the unimproved value as a basis for land tax applies with. equal force to city lands,' yet since we lack the special knowledge required to argue this aspect of the question, wo confine, ourselves to the aspect which intimately concerns ourselves, that is as it- applies to lands used for farming purpose.”

A copy of a letter of protest from the Gisborne Chamber of Cemmevce to the Prime Minister, the Jit. ITon. M. J. iShyage, on the graduated land tax was placed before the Cook County Council to-day, when support of the council was asked.—The council formally received the, letter without discussion.