BLEEDING THE FARMER

Bay of Plenty Beacon, Volume 4, Issue 175, 3 November 1941, Page 6

BLEEDING THE FARMER

TAX COMMISSIONER'S POLICY ARBITRARY RISING OF STOCK VALUES The light initiated by the Auckland Executive of the New Zealand Farmers' Union against the action ol' the Commissioner of Taxes in adopting a policy that involves a heavy additional burden on New Zealand farmers during the present year, is still being vigorously conducted . At the last Executive meeting a lengthy communication Avas received from the Minister of Finance, the Hon. Mr Nash, in -which he replied to the representations that had been made by the Union. In the course of his letter the said-: —■- "The writing up of values at the end. of the year resulted in additional income on Avhich social security charge Avas payable. If the additional income was 'fictitious' income it was solely because the farmers themselves made the mistake in the beginning of adopting unduly low standard values." Dealing with the action of the Government in introducing and passing Clause 25 of the Finance Bill in circumstances against which the Union had strongly protested, the Minister stated that it was introduced to remove any doubt as to the intention of legislation, and only incidentally did it validate the actibn of the Commissioner. Had the test case, stated by the Union, been j heard and a decision given against the Commissioner, it would still have been necessary to introduce a similar measure. The Minister added:— "I Avish to slate very definitely that the procedure Avas not influenced in any Avay bv the prospect of additional revenue, but Avas solely to place the valuation of livestock on a more reasonable basis. In fact, the total additional revenue Avill probably not be more than £10,000, and your estimate of £2,000,000 indicates that you were not fully acquainted Avith the manner in Avhich the adjustments Ave re made by the Commissioner and that you had very exaggerated idea of the importance of the matter." The Union Replies In the course of a full reply to I lie Minister the Executive says:— ''It is regretted that your letter does not remove any misunderstanding, and indeed it confirms my Executive in its belief that farmers luiA'c been, and Avill be, heaA'ilv penalised, and cannot possibly accept your reply as final. "Farmers and other taxpayers havo been expressly told by the Officers of the Land and Income Tax Department tliat they did not mind whether \-alues Avere fixed at a hii£h or 1 oav rate. "Your estimate of the total additional revenues as having been probably not more than £10,000 is just ridiculous, and the members of my Executive knoAV from the information which they have gained by various inquiries that there was, and .still is, a very large undeixvaluation of stock. Those Avho have bad their values raised will haA r e already paid, and those who have not will to pay either on sale or earth, or by the direct action of the Commissioner in raising their standard values, as he has poAver to do. "My Executive strongly advises farmers not to accept a continuation of IaAV standard values, as they will only pay more tax in the end. What is wanted is the right to adjust standard values Avithout being penalised in so doing." It was also contended by the Union that natural increases in herds or flocks, to Avhich the Minister applied the term "additional assets," should not be taxed when they Avere being used for the strictly capital purpose of producing more income.