Debate On Taxation Bill Commences In Parliament.

Star (Christchurch), Issue 18897, 23 October 1929, Page 5

Debate On Taxation Bill Commences In Parliament.

REFORM PARTY LEADERS OFFER STRONG OPPOSITION TO GOVERNMENT MEASURE.

Per Press Association. WELLINGTON, October 22. Amendments to the Land and Income Tax Act Amendment Bill were introduced by Governor-General’s message. Replying to Mr Coates, the Hon G. W. Forbes (deputy-leader of the House) explained that one of the chief alterations affected the hardship clause. Provision was made that in addition to taking a man’s financial position into consideration, the scope of the clause should be widened to include the question of the practicability of the land for agricultural and pastoral purposes. Another alteration was a minor one affecting mortgage exemption^ Replying to other questions, Mr Forbes said that the amendment to the hardship clause was designed to meet cases of men breaking in unimproved country. The question of ouitability for closer settlement and classification of land was not dealt with in the amendments. Mr Coates submitted that it was no use taking money out of a man who could not possibly improve his land. It would force him off the land. He asked if the Minister would introduce an amendment to give relief in clear cases of that kind. Mr Campbell (Hawke’s Bay) complained that no redress had been provided for a man whose property was not suitable for closer settlement. Several other Reform members criticised the amendment to the hardship clause, which they contended was totally inadequate. Mr Coates asked the Minister whether he would alter the Bill to give the Commission full powers to deal with all cases of hardship. In particular he advocated that relief should be given to a man whose property was entirely unsuitable for closer settlement.

Mr Lysnar (Gisborne) said the amendments were a pitiable result of agitation from one end of the country to the other and of requests that had been placed before the Government on so many occasions. He regretted that the Government had not made a more serious attempt to meet the position. Mr Poison (Stratford) expressed the >pinion that the Prime Minister had given some hope that he would grant urther concessions in relation to the hardship clause. Mr Poison added he was as anxious as arty man in the House to see large estates suitable for closer settlement broken up or even burst up. He would have preferred that different methods should be employed, but he thought that further widening in the scope of the hardship clause would have done much to ameliorate the position of those seriously affected by the Bill It was not a just or proper thing to increase the burden on a man whose property was not suitable for subdivision. The proposals in the amendments would not have the effect of materially ' improving the situation.

Mr Campbell said the amendment simply provided relief for unoccupied country. He thought it was a wrong principle that it should be entirely in the hands of the Commissioner whether relief should be granted or not. Mr Field (Otaki) described the amendment as ill-conceived, and added that he considered it would do more harm than good. r Williams (Bay of Plenty) said he hoped the Minister would amend the bill further in order to take the element of unfairness out of it.

Mr Jones (Mid-Canterbury) declared that the measure was so iniquitous from beginning to end that the only way to deal with it would be to withdraw it and introduce another. The hardship clause did not touch the root of the position. Mr Bitchener (Waitaki) also con tended th:,t no relief would be afforded by the amendment the Government had brought forward. Mr Linklater (Manawatu) stated that J super tax would have a serious effect on the flaxmilling industry, and he asked that some provision should be made to afford relief in that quarter. Messrs Ilall, Kyle, Young and Dickie joined in criticism of the amendment, and in an appeal that the Government should review the position. IN COMMITTEE. The preliminary stage in connection with the introduction of the amendments was disposed of at 9.10 p.m.. when the House went into Committee on the Land and Income Tax Amendment Bill. Mr Coates said the principles of taxation should be based on capacity and ability to pay, and those principles had been ignored by the Bill. In so far as a .llilllll!llllll!lilllilllllllllllllllllll||l!llllllllllll!lll]|||l!lllllilllllllllill!llilllllllltlll!lll!l

progressive tax was necessary to ensure subdivision his party was prepared to take an open-minded view of the position, but under the Government’s measure the farmer was hit whether his land was suitable for subdivision or not. The result would undoubtedly be depreciation in land values. Why farmers w r ere selected for a savage tax while other classes of the community were permitted to go free was more than he could understand.

The Hon G. W. Forbes said he die} not want to enter into an argument, because it was clear that the idea of the discussion was to delay the Bill. He contended that the view that the Commission constituted by the hardship clause would not act fairly could only be taken by men who had a jaundiced view of the proposals. The hardship clause would meet the position of men who were threatened with financial embarrassment. The Government expected men who were able to pay, to pay the tax. Every penny of revenue was required and would be required. Mr Downie Stewart (Dunedin West) said the Minister had stated that the amendment would meet all cases of hardship. Apparently he was of opinion that there was no land at present in use that could be .subjected to any hardship if the taxation proposed in the Bill were imposed. He seemed to consider that it was only where land had not yet been brought into cultivation that there was any possibility of hardship. Mr Stewart declared that there had been just as much evidence of difficulty in cases of land in full use at the present time. Mr Jones (Mid-Canterbury) asserted that the Minister’s statement had clearly indicated that all agricultural and pastoral lands would be excluded from the operation of the hardship clause. Mr Young (Hamilton) described the Bill as an unfriendly gesture to the farming industry. He did not object to income tax, whether income was de-

rived .from the land or from any other source, but the Bill proposed to impose land tax in cases where it would exceed a fair tax on income earned It was the man with heavy financial liabilities who would first be caught un der the Bill, not the man at the top He suggested to the Minister that it would be a more reasonable course to classify all lands in the Dominion of an unimproved value exceeding £14,000. select those suitable for subdivision and then apply the taxation proposals after having given proper notice to the occupiers.

Mr Samuel (Thames) said the Bill represented another confession of failure on the part of the United party, which had promised to reduce taxation but instead it proposed to imposed class taxation of this kind. The debate on the short title was continued by Reform members until 11.30 p.m., when Mr Poison (Stratford) rose to speak. “I don’t want to take part in any stonewall,” he declared. At the instruction of the chairman he withdrew the word “stonewall,” remarking that he did not propose to take part in prolonging the discussion. He contended that a great many more people would be affected by the Government’s proposals than the figures which had been given on a previous occasion by the Prime Minister indicated. He was satisfied that there would be severe hardship on a considerable number of men who were not large landholders, but actually were working farmers. He pointed out that the extraordinary variations in land values placed men of similar circumstances in different positions so far as actual payments of tax were concerned. He knew that the Minister was anxious that justice should be done to all sections of the community, and he therefore suggested that an amendment should be made that would satisfy the farming community that differentialism would disappear. Mr Nash (Palmerston) said it was unfortunate that there had to be a political fight, but he asked who was j going to stand up for the farmers unless a stand was taken up by the Reform party. He contended that the Government had shown no consideration for that section of the community. Reform members continued to speak on the short title. At 12.30 am. Mr Jordan inquired whether there was a quorum. The chairman counted members, of whom there were only nineteen present at the moment and then ordered the ringing of the bells. A number of members returned to the chamber and Mr Nash, who had been speaking, resumed and the short title was still under discussion at 1 am The short title still was under discussion at 2 a.m.