A CONTROVERSY

Waimate Daily Advertiser, Volume XXIV, 24 March 1924, Page 5

A CONTROVERSY

QUESTION OF TAXATION. TOWN AND COUNTRY. [OTTH OWN CORRESPONDENT] WELLINGTON, March 22„ The controversy between the Prime Minister and ‘'Justice” over the incidence and distribution of taxation which is going on in several of the metropolitan newspapers has attracted much interested attention here. Though “Justice” prefers to hide his identity under a nom de plume it is recognised that he is'thoroughly conversant with the subjects lie is discussing, and in this respect every bit as well equipped as is his doughty antagonist. He invited Mr Massey to enter the lists by bluntly declaring that the Government by lightening the burdens of the big landholders and prosperous farmers at the expense of the workers was creating the very class prejudice and the very resentment between town and country it professed to d'-plpre. “A sound system of taxation,” he said, “should! not take into consideration whether the payer lives in the town or the country. All are citizens of the same Dominion, enjoying the same benefits and privileges, and should be liable for the same proportion of their incomes in taxation, no matter what occupation they follow, the spot they live in, or the source from which their income is earned.” That these ideal conditions do not exist under the present system of taxation he demonstrated beyond all reasonable doubt. He showed, among a score of instances, how a mercantile company consisting of 1000 small shareholders with an income of £lO.OOO per annum paid £lOOO in land tax and £2932 in income tax, a total of £3932, while a large landowner, typical of a number of others, earning £lO,OOO per annum paid only £lOOO per annum in land tax and not a penny of income tax. His remedy for flagrant injustices of this kind, in smaller or greater degree, was the adoption of a system of taxation that would demand from every person an amount in accordance with his ability to pay. THE PRIME MINISTER’S RETORT.

Mr Massey’s retort was a little disappointing to his friends. It seemed to be directed rather against “Justice” himself than against the facte he adduced and the theories' he propounded. “Though it contains many figures,” he said by way of preface to his denunciation of the indictment of the present system of taxation, “there are very few facts. It is evidently intended to assist in encouraging the difficulty that has beei\ created between town and country by writers of. the same type.” There were many personal' thrusts of the same kind throughout the Minister’s reply. “It would do the writer a great deal of good,” it was stated in another place, “to turn him on to a dairy farm for twelve months,, and compel , him to live on his earnings or profits, or whatever they might happen to be. An experience such as that would convert him in a short time to a better way of thinking, as it has converted many others.” Interpolation of this sort do not, of

course, help towards the solution of any of the problems involved in this controversy. Mr Massey, however, was not without illustrations -in support of his own point of view. “Just one instance occurs to me,” he said, “of ths case of a gentleman with whom I am well acquainted. His holding is something under 750 acres. It is fairly good land and in ai fairly gcod position. His land tax was paid at the proper date and. I have seen the receipt for £504, the amount handed over to the Land Tax Department. The local taxation of the property referred to is very little, short of £1 per acre. And this is only one instance out__of thousands in New Zealand, and 'it is on the industry and enterprise of such people that the writer of .the. article and others., who thinks as he dees, are probably living in ease and comfort.” That case and’ a statement by the late President Harding to the effect that a nation which neglects a.rilst the farmers would pirecipitate -industrial ■ and commercial disaster appear to have been the Prime Minister’s strong cards.

UNCONVINCED. Oil Saturday “Justice,” unconvinced and undismayed, returned to the charge. He opened by protesting against Mr Massey’s assertion .that such “stuff” as his statements of fact and his demand for equality of sacrifice ! “might be expected from a Socialist representative in Parliament” and were “just the sort of thing that, coming from representatives of the commercial community, will’ in the not'far distant future place a Socialist Government on the Treasury Benches.” He ignored the personal mote in the Prime Minister’s retort, but refused to rest under the imputation of being in sympathy with militant Socialism. “If such things did happen,” he asked, “who would be responsible? Those who are responsible for this unfair system of taxation and remissions which are antagonising thousands of people, or he who draws attention to it that it may be remedied before it is too late? The strongest sense in the British people is justice. Instinctively they will take the side of the weak against the strong and resent favors to the' rich denied the poor. If a Socialist Government comes into power .in New Zealand it will be -net because the people of the Dominion love Socialism, but because they resent injustice. There exists no greater recruiting force for Socialism than they who advocate and provide the means by which the rich may unload their just burdens on to the poor. All the Hollands and the Erasers multiplied a hundredfold would not obtain one-half the recruits to Socialism that those who deny justice to the do.” Having relieved himself of this fervid passage “Justice” returned to the sober consideration of the facts as they appeared to him. He evidently had had access to all the documentary evidence available, bad studied it carefully, and had reached very confident conclusions. BIG FARMERS AND SMALL. The burden of “Justice’s” personal complaint against Mr Massey is that while the Prime Minister has antagonised the workers in the cities by heaping favors upon the big land-owners he has persistently striven to make it appear that his concern is solely for the small farmer struggling under a load of debt and a high rate of interest, harassed . and overworked, denied all the corpforts of city life and not knowing when a bad season may throw him on the cold charity of an indifferent world. During last session of Parliament, he says, the Prime Minister put a Bill through for the special benefit of “struggling farmers” exempting all income derived from land from Income Tax. This, “Justice” maintains, proved a gift to the rich land-owners and of no value at all to the “struggling farmers,” and being challenged by the Prime Minister he produces the facts. The official figures show that six land-owners with incomes averaging £10,916 apiece were relieved of taxation averaging £3053 apiece; six with incomes averaging £7526 apiece of £2152 apiece; forty-seven with incomes averaging £5240 apiece of £570 apiece; fif-ty-five with incomes averaging £3500 apiece of £452 apiece and so on down to 2567 with incomes averaging £456 apiece of £6 apiece. The total number of land-owners who received relief of any kind was 4602, while the total number who received no relief at all was approrimately 80,000. These figures are Computed! on th® l returns for 1921-22, the slump year, and authorities have assured “Justice” that the remission will be twice as much' this year, or well on to half a million. The critic disposes of the sad case of Mr Massey’s friend with a farm of 750 acres on which he pays £504 in Land Tax with laconic precision. “The Prime Minister,” he says, “mentioned almost in tears, a poor farmer who paid £504 in Land Tax. That gentleman evidently has 750 acres of our choicest land, valued, as I work it out, at approximately ( £54 per acre unimproved value and of a capital value of anyhing around £55,000.” It certainly does not seem a case for any special commiseration. But the next word remains with the Prime Minister.