UNIMPROVED VALUES RATING.

Observer, Volume XXI, Issue 1179, 3 August 1901, Page 2

UNIMPROVED VALUES RATING.

The Single Tax In Another Form. Next Tuesday, a poll of the ratepayers of Auckland ia to be taken on the question of rating on unimproved values or otherwise. If the poll is in the affirmative, the rating will in future be assessed on this system, whioh is a modification of the Single Tax. If in the negative, we shall remain as W6 are. This ia certainly clear enough. The average citizen, bowever, knows as muoh about rating on unimproved values as he does about the Greek alphabet or an abßtruse problem in Euclid. The Single Tax cranks, who are very active at the present moment, declare on their solemn affidavits that it will re* lieve him of his burden of taxation and shunt the load on to someone else. The thoughtful politioal eoonomiat, on the other hand, etea in it only a specious and plausible device to relieve the owners of palatial buildings and costly suburban mansions at the expense of the cottager. Take one notable case as an example. In Ponsonby Road stands a magnificent house which would let at from £2 to £3 per week. Beside it, is a cottage worth at the outset say 123 per week. Under the beneficent system whioh the Single Taxers wish to force upon us, the 12s per week cottage would have to pay equal rates with the mansion next door. In other words, the struggling owner of the cottage would have a large proportion of his paltry rent seized for rates while hiß wealthy neighbour next door- would escape almost soot free. Bating on unimproved valqes is not a system of taxing upon value of the property or the ability to pay. It is rather a system of compelling a poor man to pay as muoh as the wealthy one. It is argued by the Single Taxers that the effect of the new system would be to encourage people to build better houses. That ia right enough bo far as the capitalist is conoerned. He can afford to build better houses. But to the poor man, with whom it has been the task of a lifetime to acquire a four-roomed cottage, the new system would be grossly unfair. Take the taxation off his neighbour's maneion, and the burden must necessarily fall upon him. If he lets his oottage, the increased rates would swallow up a large proportion of the rents, and, however the taxation increases, the mansion would pay no more than the oottage. The new system will work out very undesirably in one respect. It is the pride and boast of Aucklanders that their city is not oloaely built upon, and that even small suburban residences are surrounded by fair-sized gardens. But if we place the taxation on land, and land alone, the owner of the suburban villa or oottage will no longer be able to keep his heavilytaxed garden unreproduotive, and will be compelled to build upon it, if he can afford to do so, in order to make it earn the inoreased rates. Indeed, the very prinoiple of rating on unimproved values was designed to compel closer building, with_sp_eoial regard to cities like London and New York, where land is very valuable and diffioult to get. But this closer building will neither be in the

interests of our city or oar people if we are to be compelled to do away with bur flower gardens and pack oar houses oloßely together. The principle of rating on unimproved valaeß would work oat splendidly if there was a large area of vacant land held in the city for speculative purposes. This land would then be very properly oompelled to pay its fair share of taxation towards the city improvements which give the land its additional or speculative value. But there iB not. Nearly all the land in the city is built upon now, and even if the effect were to compel the ereotion of new houses, the consequence would be a fall in rents to a prioe that would not pay owners interest on their outlay, while many of the older houses whioh are still Bervioeable would not get tenants at all. Probably the most favoured class of buildings under the new Bystem would be hotels, which are fairly taxed now according to the value of the buildings, but which would pay no more under unlimited values rating than the cottage sections or other properties by which they are surrounded. Probably this aooounts for the aotivity of the trade in the alleged ' reform.' At any rate, how can it be reasonably maintained that a £3000 or £4000 hotel property would be paying its fair share of taxation if it were assessed at the same rate as a £300 or £400 residenoe ? The support of some unthinking people has been caught for the moment by circulars issued from the Corporation offices but whioh are repudiated by Council officials, showing that on a Government valuation basis they would pay lobb under the new system than they do now. But how long would the Government valuations stand ? They have, in the majority of oases, never been appealed against, because the valuatioßß, though high, have not been sufficient to bring the owners within liability for the land tax. But the moment the city rating is based on theee valuations, appeals and reductions will be as plentiful as sparrows in a wheat paddock. How will the deficiency thus occurring be made good? By equal additions to the oottager and capitalist. And, in every increase of taxation, the cottager will be compelled to pay his own share of the rates and a considerable portion of the Fat Man' 8 share also. There is another and very serious danger in the new system. At present, there ia a limit to the rating powers of the City Council. It oannot tax ratepayers be* yond 2/- in the £. But, under the rating on unimproved values, the limit is praotioally swept away. Are the ratepayers prepared to destroy this safeguard, whioh has protected them in the past, and plaoe an unlimited taxing power in the hands of the City Counoil ? If so, they are unwise in their generation. Aa far as we can see, the new system is bo one-Bided that it has little or nothing to reoommend it. Ite advocates argue that the taxation should be plaoed solely on the land. With this, it is difficult to agree. Buildings should bear their share of taxation quite as much as land. For example, how unfair to plaoe heavy taxation on the shoulders of the suburban market gardener and allow the owner of a Princes-street mansion to escape with a rate of a few shillings. The Corporation servioes, for which the rates are levied are more necessary to the wealthy man in Princes-street than they are to the market gardener in the suburbs, and be should pay his fair share of them. However, it is for the ratepayers themselves to decide. If the humble oottager iB oontent to shoulder the burden of taxation, and allow the owner of the handsome villa or the stone mansion to escape his fair share of the load, this ia his opportunity.