Readers’ Opinions Letters To The Editor

Poverty Bay Herald, Volume LXIV, Issue 19372, 9 July 1937, Page 11

Readers’ Opinions Letters To The Editor

Lettors iutondod for publication should bo brief and confined to subjects of general public interest. The uaino and address of correspondents should be enclosed, not necessarily for publication, but as ovideuce of sood faith. Unimproved Value System Sir,—Allow me to give your correspondent, "Farmer," a few reasons that lead to the retention or adoption of unimproved value as a basis for taxation:

(i) Theory.-The system is based on an attractive theory which is supported by some tine, high-sounding phrases such as "Values created by the community are the property of the community and not of the individual," or "The fertility of the land is God's gift to mankind, and should be preserved to mankind." People do not realise that these values and our socalled unimproved value are two utterly different things and bear no relation one to another. The saddle is on the wrong horse. Even if they were one and the same thing, they have been bought and paid for by trie present occupier and they are his property. The theory is just another socialistic idea, fine in itself but incapable of practical application. (2) Custom.—The system was applied in New Zealand for land tax purposes many years ago when most at the land was undeveloped and much of it in the hands of the original pioneers. As a low Hat rate tax it worked well enough, but conditions changed; land became developed and changed hands again and again; the graduation principle was applied to land tax, which became heavier and heavier > Continuous rise in values bolstered up the antiquated system until J!)29, when an extra heavy demand caused its complete breakdown and exposed its inequality. A "hardship commission" had to be set up to save 400 of its victims from ruin, and finally the graduated land tax had to be abolished. Established custom, even when proved fallacious by actual results, dies hard. (3) Example.—The Government uses the system; the Government can do no wrong; therefore the unimproved value system must be right. Reasoning thus, a few counties follow the example of the Government; more counties follow them, and so on. Rising values and riding boundaries cloaked the evils of the system; falling values, abolition of riding accounts, and the recent heavy increase in rate burdens have exposed them, and a "hardship commission" is now necessary in the Cook County to rescue a fresh crop of victims. • (4) Superstition.—Under this heading I will quote part of a letter written some years ago by one of the leading authorities on taxation in the Dominion: "There are some idols too sacred to be broken; unimproved value is one of them. The political parly that set out to destroy this particular idol would be accused of (!) taxing industry and thereby discouraging improvements, (2) legislating for the speculator, (3) putting a premium on j laziness and inefficiency, and so on, all of which things the worshippers believe are prevented by the magic of unimproved value." This is just what it is, an idol or fetish, and since only one type of improvements, viz., those visible to the eye, are calculated, while the host of other costly but invisible improvements go to swell the tax burden, the idol has at the very best only one leg to stand on. Superstitious reveranee for a rickety idol, faith in a false socialistic theory, and blind adherence to worn out custom afford an answer to "Farmer's" questions, and. finally, there is the fact that few rale or taxpayers bother to examine (hi- practical effects of the system critically. The system is advertised to trap the horrid speculator. People believe the advertisement, set the trap, and get caught, themselves. Small farmers believe that the system favours them at the expense of the large farmer next door. Perhaps il does, but it they looked 20 miles away they would find plenty of large farmers who gain by it while they themselves lose. If people will only abandon superstition, disregard catch-phrases, and pin their faith to definite principle? of fair taxation, the unimproved value system will .soon give way to sometiling more in accordance will: common justice and common sense.--Yours, etc., C. 11. WILLIAMS.