DEATH DUTIES

Wairarapa Daily Times, 16 March 1932, Page 6

DEATH DUTIES

AND LAND VALUATION.

INTERESTING CASI

A case of considerable interest to farmers and of the utmost importance to executors —practically the first sheep farming case of its kind in New Zealand —has been partly heard in the Alasterton' Magistrate’s Court. The executors of the estate of the late Mr \Y. Andrew challenged the Government valuation of Otahome made for the purposes of the Death Duties Act.

Counsel for the executors, in opening his case, pointed out that it was not his purpose to challenge the valuation for rating purposes, as it was realised that any alteration for rating would have to take into consideration the whole of the surrounding properties. It was admitted that for rating puiposes it did not matter much whether a high or low standard of value was placed on land as it amounted only to a question of what rate should be levied —if the valuation were high, a low rate; if low, a high rate. On the other hand, taxation under the Death Duties Act was a capital tax amounting in this case to more than 20 per cent, and the estate therefore should not be asked to pay in abnormal times a capital tax based on valuations made some years before the present economic crisis. According to the A aluation Act, the true test wash: What is a reasonaide sale value of property at date of death? The property under discussion was a farm of 126 S acres carrying 1100 ewes, 800 hoggets, and 100 to 150 cattle. The valuers so far called on behalf of the estate were Messrs. S. -T. W. Gill, -I. A. Betts and C. Bennett. Evidence was also given by the manager, Mr W. A. King. It was admitted by all parties that it was a good farm in good heart, but the greatest difficulty was experienced in arriving at a basis of valuation. To show how impossible it is to value on present-day prices, it was stated in evidence that, after allowing for normal working expenses, including in these expenses a sum of £2 per week for a workingowner and 30s per week for one man, it was impossible to pay more than 2 per cent, on the Government valuation of £lO per acre. It was not suggested that these prices should be taken as a basis, but the absolute impossibility of predicting liow long these conditions would last would materially affect the selling price. The Crown case has not yet been heard, but counsel for the executors led all his evidence to show that the true value to-day was approximately £8 per acre. The hearing was adjourned to a date to be fixed by the Magistrate.