Succession Duty Sought

Press, Volume CIII, Issue 30469, 17 June 1964, Page 3

Succession Duty Sought

A plea for the abolition of land tax and the substitution of succession duty for death duties was made by Mr Donald.

Few people would voluntarily work harder if their reward was taken from them —this was the reason there was no strong upsurge in primary production, he said.

Land tax produced little revenue, it was expensive to collect, and a disincentive to improvements, Said Mr Donald.

Succession duty, in lieu of death duties, would mean that the person who received the benefit paid, not the estate.

No such succession duty should be paid on any amount received during the life-time of the beneficiaries below a figure which could'be directly related to the value of an economic farm unit. This amount could be varied every five years according to new valuations. Any amount received above this received by a beneficiary during his

life-time, either by gift or will, could be taxed at pro-, gressively heavier rates. This would induce wealthy persons to break up their estates into smaller units without disrupting production. This change would, of course, have to apply to all sections of the community, not just to farmers. “Abolish death duties and substitute succession duties with a reasonable tax-free sum. then sound a clarion call to all farmers to produce more, and I feel sure they would respond and we would be amazed at the results.”

The gates would then be open for greater production in every field. This would, in turn, mean more jobs and more money for social services and education.

What happened now to a farmer who, after years of hard work, planning, risktaking and thought, substantially increased his production? On revaluation of his property, his rates and land tax went up and, as a potential estate, greatly increased death duties were in prospect. When the farmer died, half the stock and a third of the land would have' to be .sold

and a mortgage taken out on. what was left of the assets to meet death duties. The heirs could not afford fertiliser or maintenance, pastures deteriorated and land reverted to scrub.

“Every farmer has seen so many examples of this happening that many are just coasting along in low gear,” said Mr Donald.