THE MORTGAGE TAX

Dominion, Volume 9, Issue 2812, 1 July 1916, Page 10

THE MORTGAGE TAX

Sir.—Umlev the heading of "A Flaw in the Act, or a Fly iu the Ointment," I wrote, the letter-stoned "Onlooker" that appeared iu yesterday's Dojiimiox, hopin;; to throw some light upon Hie n. canine of tho expression "No provision for exemption of mortgages' from bnd tax." I belie.vn I did not make myself sufficiently clear and explicit to the oidiiiurily intelligent reader, and so I r.sk you to Kindly allow this letter to pppear in your columns. Although the subject has asain been mentiound by Minister of Ilimiee, in the House of Parliament, all trie in.-iml.crs seem to lmva calmly and innocently allowed themselves to lie led along an erroneous issue of contention. Not one member grasped the real point of issue, viz., "Why should there be exemption of mortgages from land tax at Rll?" i'sot "that the deficiency in revenue could not be made good ;f exemption of mortgages from land lax were provided for in the new Bill unless tho special mortgage lax were restored." I maintain, and am about to prove, that. 110 one, villus? perhaps he who laboured under a prejudiced mind, cculd reasonably support a measure tr-nt vould involve tho restoration of the. mortgage tax because provision had not been lrado for exemption of morlgajies land 'tax. I ask, with nn uncertain voice, llow could aiiy Government conscientiously entertain h pvopjsnl to legislate for the express benefit of any particular class of borrower, so as to discourage and penalise individual thrift, at 'the c>pyuso of the revenue of the countrv ? To charge* full land tax to the nan who, perhaps, through a thrifty, diligent, and steady career attained 'he distinction of being ablo to pay cash for his land, and make a reduction of about Hirec-fifths of land tax to the man of careless and wasteful habits, who borrowed someone else' 3 money to buy land with, and then to finally restore the mortgage tax ' that would discourage investment <f rspital in the Dominion, and seriously check its prosperity, in order to obtain revenue conceded to the man of the '.a'-elcsc and wasteful _ habits, would "be discouraging thrift with a vengeance. Why should a Government offer any of its revenue as a, sop to borrowers of capital on mortgage? As another instance, let iu assume there were .two men each with a capital of ■Elooo in .the bank. One bought land worth ,£IOOO for cash, and the ether bois rowed vSGOO'to buy similar land, and ill' frosted his own money flsewher rt , Ibe second man would be the miner by r.na penny iu the £ unon .£6OO per annum. All land tax should be estimated upon the revenue that ought to he obtained from'.tbo land os at. the. ilato gf assessment.- Tho owner, who is alwava the controller, should be held liable for. the. tax. .It-is absurd to say : 'iint tho mortgagee controls the land."' He does not* control,, it. unless he. becomes tha owner. Tho mortgage tax is rdmittedly not a desirable tax under any asnect, fio wo come, fo the true poiut' of issue ngain, viz., "Why nrovide for exemption of mortgages from land tax?"—T am, etc.. n - P. BEEVES." Wellington, June 30, 191 G.