STATE VALUATION METHODS

Dominion, Volume 35, Issue 285, 31 August 1942, Page 4

STATE VALUATION METHODS

No doubt the Chief Justice (Sir Michael Myers) found it a painful duty to condemn the valuation policy adopted bythe Stamp Duties Department in the case of the Feilding hotel estate. The niattei. however, is one in which an important question of principle ami administrative policy is involved, and in drawing attention to it the Chief Justice has performed a public service. The facts, as set out in his judgment, show that in assessing the. value of this particular estate for the purpose of levying death duties the Commissioneroi Stamp Duties placed the value of the licence' and goodwill at i«uuo, and claimed this amount notwithstanding a later valuation of ibUW made for the department by an expert agent. He followed this course because—according to his statement to. the Court —he expected to have negotiations for a settlement.'. As the Chief Justice remarked, this, to say the least, was not fair. It meant that the Commissioner was bolding to an inflated assessment and leaving the administratrix of the estate to challenge it in a legal action. In other words the administratrix in this case was obliged to appeal to the Court in order to secure the benefit of a reduced valuation obtained by the department itself. Such a disclosure is highly disturbing, and the public is entitled to know whether the policy was one adopted-inadvertently in an isolated case or represents the customary attitude of this or other departments. I his question is prompted by the Chief Justices remark that in a previous case he bad occasion to condemn the course, taken by the Commissioner of Stamp Duties. When assessment of value is made for State departmental, puiposes there should be no question of fixing a fictitious figure as a basis for bargaining. The introduction of such a practice would simply mean that every assessment would be suspect,, and perhapslooked upon, as a preliminary move in a legal contest. The unfairness and impropriety of this becomes very apparent when it is realized that in a great many cases the administrator of an estate might be inclined to hesitate before incurring the cost of a legal action tor the sake of a relatively small reduction of payable duty—a reduction which could conceivably be more- than outweighed by the legal expense involved. State valuations as a rule are inclined to be maximum valuations for taxation purposes just as those of estate administrators are likelv to be minimum valuations. Valuation is a matter of opinion in which exjjerts seldom agree. But there is a. vast difference between a maximum valuation based on an expert, opinion and an inflated assessment of value, made, or held to, in anticipation of challenge. The State should be above such a ruse or gambit, Jest public faith in its dealings be shattered-and the courts overloaded with expensive appeals,. Above all things the obligation. rests on public servants to carry out their duties with strict impartiality and fairness. It is not the business of a tax-collecting department to extort as much as possible from the public but to do what is fair and just under the law to all concerned.