FARMERS AND TAXATION

Dominion, Volume 9, Issue 2797, 15 June 1916, Page 5

FARMERS AND TAXATION

COUNTRY MEMBER'S PROTEST. A. very , strong protest regarding the alleged unfairness of the incidence of, the present system of- taxation from the farmers' point of view was mado in the House, of Representatives yesterday by Mr: Nosworthy. 'Mr v Sykes:(Mastorton asked Che Minister of Finance: (1) AVhether it'is not n fact that under, the finance Act, 1915, by which farmers are, charged income tax, two men holding the same valuo of property, and the same stook and making the, sam'e profits pay the-same tax, although one may have: his. property encumbered by mortgage to its full value, ivhile the other's property is quite free? (2) Whether it is not" a fact" that a man borrowing ,£IO,OOO on overdraft and without giving any mortgage security, may ,deduct the interest paid from his income, while another who is compelled to give a mortgage sewirity for .£IO,OOO is not permitted to make any deduction in respect of iiicomo? .'.The Right Hon. Sir J. G. Ward (Minister of Finance) replied: The position, is as stated by the honourable member, but it is not peculiar to'tarrners.- Under tlio provisions of the Land and Income Assessment Act deduction is-allowed in the assessment for land tax' of the amount owing to him on mortgage, and the deduction of the interest on that' mortgage is not allowed from the assessment Of his income for income tax. To .make this latter allowance would be giving him a, double deduction. A deduction is allowed/of the interest payable on an overdraft from ,tile'assessment or income for income, tax, but no deduction is allowable in respect of such overdraft in an assessment, for land tax. Only one deduction is allowed in each case in respect of the same indebtedness. Mr. Nosworthy, in commenting on the answer given to Mr. Sykes's, question, said'that farmers had to pay . all . the forms of taxation. ■ They ball to pay land tax, graduated land tax, and super tax, and on' top of all this had to ;pay income tax. This system of taxation was most unfair to the farmers, and the unfairness was increasing instead of decreasing under the National Government. He knew dozens of. farmers who had had to' obtain overdrafts from the bank before the war, and who since the war broke out' had had to increase tliose overdrafts. The position, lie repeated, wa's most unfair, and unless justice was to be done to the farmers he was not going to continue . to,.support the National Government. A member: Vote against' the National Government! • f Mr. Nosworthy said that the incidence of taxation was unfair in Mr. Balance's time, it was worse under the Seddon Government, still worse under the Massey Government, and even more oppressive . still under the . National Government. What was wanted was a system of taxation'that was .fair and honest to the people on the land. The Prime 'Minister, in speaking subsequently, proceeded to refer to Mr. Nosworthy's' remarky , y A member: right! Walk into him. Mr. Massey said that he was not going to "walk into him.". The proper principle was to make every man pay according to his ability to pay. -That was what the Government had/aimed at. The time, might bo coming when it would bo necessary to revise the whole system of taxation. ]fe (Mr. Masse.v) thought it should be revised— (hear,, hear)—lint it Could not be done during the war.