SPECIAL LAND TAXATION

Taranaki Daily News, 12 June 1930, Page 13

SPECIAL LAND TAXATION

RESULT CF HARDSHIP CLAUS'S

REMISSIONS IN MANY CASES.

PRIME MINISTER’S SUMMARY.

By Telegraph.—Press Association. Wellington, June 11. The Primo Minister has issued the following summary of the report of the commission to inquire into cases of hardship under the Income-Tax Amendment Act (19'29). All, the applicants were required to furnish written evidence in the follow-

ing form: — (a) A detailed statement of the •grounds on which it was contended that payment of the special land tax would entail serious hardship. (b) A detailed statement of income and expenditure in respect of the year ended March 31, 1929.

(c) A detailed statement of assets and liabilities as at March 31, 1929. These statements were required to bo supported by an affidavit and the certificate of" an account was required in cases where the accounts had been prepared hy an accountant. In the majority of cases the written evidence thus submitted was sufficient to enable a decision to be made, but in other* cases information for earlier years was requested; Oral evidence was also taken in a number of cases.

As the term “serious” hardship was mt defined in the statute the commissioners gave what they considered a fair and equitable interpretation to the term as applied to each individual case.' All the decisions of the commission were -unanimous.

Among the large number of grounds of objection put forward the following were most important. (a) That the ordinary land tax and special land tax payable in respect of the property was. greatly in excess of I what the income tax payable by the . objector • would have been. (b) That owing to the fact that the taxpayer’s farming operations for the year ended on March 31, 1029, had resulted in loss the special land tax as well as the ordinary land tax would ; have to be paid out of income from other sources, or out- of capital. (cj That in arriving at the special land tax no allowance had been made i for the fact that the- taxpayer’s land was subject to heavy mortgages. (d) That the taxpayer had disposed of his land prior to the passing of the Land and Income Tax Amendment Act : 1929, but after March 31, 1929. (e) That having regard to its productive capacity the unimproved value of the taxpayer’s land was too high. (f) That the taxpayer was the owner of urban lands in addition to country lands, and that the special land tax had. consequently been levied at a rate applicable to the unimproved, value of his A , ‘farm” lands. LANDS FOR SUBDIVISION.

With regard to the question whether all or any of the lands of objectors were capable of sub-division, a considerable amount of evidence was tendered, but as the order of reference did not empower the commissioners to make investigations or report as to the suitability for closer settlement of the lands under review no definite statement oii this question could be given. The main contentions put forward in respect of such lands were:— (a) That the land had already been offered to the Government for the purposes of sub-division and been declined, as being unsuitable. (b) That the land had already been sub-divided by the taxpayer and offered, for sale without success.

(c) That the taxpayer had no power to sub-divide the land owing to his having granted a least for a term of years, or to his being merely a tenant for life or lessee. (<l) That the land was high pastoral country and not suitable for sub-divis-ion, being more productive and more economically worked in large areas than if divided into smaller holdings. Six hundred and twenty-eight objections were submitted to the commissioners for consideration. Of these they recommended the cancellation of the special land tax in 309 cases and a reduction of special land tax in 109 cases. In 23 of the cases submitted they considered that the evidence tendered did not justify any recommendation for relief. In the remaining’ cases the applicants failed to furnish the evidence required or failed to appear, or withdrew their objections. The percentage’ of cases where total relief was recommended is high, and may be accounted for by the fact that these objectors comprised holders of land who were subject to heavy financial liabilities combined with other forms of hardship which called for relief. The amount of special land-tax recommended to be remitted in full was £5G,552 ’ IDs 3d, and of partial remissions £31,734 Ids Sd, making a total of £118,287 9s lid.