INABILITY TO PAY,

Star (Christchurch), Issue 16543, 29 September 1921, Page 2

INABILITY TO PAY,

FARMERS REQUEST TO GOVERNMENT. A proposal t*hat the Government should postpone the collecting: of land tax till a future date, adding interest in the meantime at current rates, and to issue Treasury bonds as legal tender for the amount not collected, wn** discussed at yesterday’s meeting of the North Canterbury executive of the Farmers’ Union. The matter was brought up bv Mr I). Bates, who said it was an unfortunate fact that a great number of fanners were either unable to pav, or were having great difficulty in paving their land tax this year. In his noinlon it was contrary to tho principles of taxation for farmers to have to nav land tax when they had no incomes to pay it out of. and he thought the executive should urge that the Government should postpone collecting tho tax in cases of hardship and add interest at current rateß for tho -period it was unpaid. There seemed no doubt that great pressure would be brought cm the Government to reduce expenditure and Parliament might see fit to reduce the honorarium of members and possibly to reduce the number of members. It was absurd that, the country should have to pay so much for its legislation. He desired to move :—“ That in view of the fact, that a large number of fanners have made no profit during the past year and are nnoblo to pay their land tax this executive of th© North Canterbury Farmers’ Union strongly urge the Government to take into consideration (for thoso who are unable to make immediate payment) postponement till a future date with interest in the meantime at current rates added, and in order to embarrass the administration as little as possible thereby, we suggest that the Government issue Treasury bonds for the amount and make the same legal tender.” Continuing, Mr Bates explained that the last part of his resolution referred to a method of banking, wherebv the Government could finance the country without embarrassment- The Government would only be doing what the bankers were already doing, and would also make a lot of money out of the credit. He did not doubt that his proposal would b© opposed strenuously, but he would like to point out that if the collection of land tax, amounting to three million pounds, was postponed for twelve months, and bore interest during that period at 5 per cent, the Government would collect an additional £1 50,000 of revenue, and would thus by helping the farmers also help itself. TV. J. Heney, who seconded the motion, sa id . .he understood the intention was that if a farmer could pay his laud tax ho should pav it- It was only farmers who were unable to pav their land tax who would b© able to take advantage of the proposal. Mr Bates agreed with this view. Mr . W. Mulholland suggested that the mover should diride his resolution into two parts, He did not like the idea of the Government making money out of tho printing press. It might lead the country into serious difficulties.

The chairman (Mr W. A. Banks): How would the proposal work if the second part was taken away ? Hie Government must have money to carry on with.

Mr Mulholland : We could ask the Government to postpone collecting land fax but to collect the income tax.

The chairman: But the Government must have money now. Mr Bates’s suggestion is that the Government post pono the land tax and yet get monev straight away. Mr Mulholland: If the Government make th© bonds legal tender and issue them as money, it becomes dangerous. We have gone as far as it is safe to go in issuing bank notes at the present - Mr Bates replied that he was not disposed to divide his motion, because if that was done there was no hop© of getting either adopted. The land tax was the first mortgage on a-nv freehold and the Government would have ample security and could not log© il : it issued the bonds. The bonds would be worth their money because of the surety behind them.

Mr Mulholland: But why make the notes legal tender ? Mr Bates: Because th© Government must b.'ue the money at once and that is the only way to do it.

The chairman said something of tbe sort outlined by Mr Bates was needed to help the farmers. But after all it was only a suggestion, and they could only forward it as such to the Dominion Executive and to the Government. It was well known that many fanners were right up against it and could not pay their land tax. r Jbe motion was carried, Mr Mulholland dissenting.