GENERAL ASSEMBLY.

Globe, Volume VIII, Issue 983, 20 August 1877, Page 3

GENERAL ASSEMBLY.

[By Telegraph.] [per press agency.] HOUSE OF REPRESENTATIVES,

Friday, August 17. THE INCIDENCE OP TAXATION

Sir George Grey resumed his speech in the evening. Native lands, he said, should be so dealt with as to assure to the Natives its full value. Public interest demanded this, rather than that speculators should make intermediate profit. Probably auction was the best system of sale. Natives thus derived great benefit, in return for which they should bear a share of the public burden. Twentyfive per cent, on all land sales would form a really colonial land revenue. Under proper administration he saw no difficulty in recouping the amount of the tax. Prom increased taxation a million a year could be added to the consolidated fund against £359,000 taken off Customs duties. Thus the revenue would be improved, while the majority of the taxpayers would be relieved and their position improved. Even the wealthy would receive an ample return for their increased contributions. The Natives would be satisfied ; settlement would be promoted; and population would be retained, instead of being driven away. If Ministers were not willing immediately to carry out such a system, he saw around him many men capable of doing so, and whom he would be quite willing to follow. He believed such a system as he sketched would ultimately be adopted as the fiscal policy of the colony. Mr Macandrew seconded the motion. He hoped the Government would accept the proposals made in such a convincing manner. In Heaven’s name let them for once throw party feeling to the winds, and adopt a system which would so greatly benefit every man, woman, and child in the colony. There was no reason why effect should not be given to the proposals immediately. He might not agree to all the details. He objected to the per centage land fund going into the colonial chest. He preferred an acreage rate, say 2s fid per acre, being made colonial revenue. Major Atkinson regretted that Sir G. Grey had accused the Government of attempting to deceive the public creditor in the financial statement. He was glad he had come out in his true colors as a leader of Opposition with a definite policy. If Sir George Grey could at once change the whole policy of the country he was the man for the country. The House could to-night choose between Sir George Grey and his policy and that of the Government. If the House preferred the former, Sir George Grey could have till Tuesday, to prepare new Government measures. The whole interest and sinking fund tins year were paid by duties on luxuries, contributions from the land revenue, and the earnings of railways. Property was also taxed by stamps £120,000. Property indeed contributed £220,000 to ordinary expenses of Government in addition to paying the cost of the public debt. He held that it would be wise to have some direct taxation, so as not to have all the colony’s eggs in one basket. It was not the poor who contributed most to taxation. He adhered to the figures lie used last year. It was very easy to say “ reduce the estimates by £100,000,” but Sir George Grey gave no indication as to how it could be done. What would the Natives say to taking 25 per cent, off their laud fund? Sir G. Grey’s estimated contribution of £350,000 from the land fund was utterly fallacious. He overlooked provincial liabilities. He would find at least a deficiency of £200,000 in his estimate of revenue from this source. The Government for years have been laboring to relieve the colony from a sinking fund, but the creditors and the Imperial Government had a voice in that matter. The chief object of the Inscription of Stock Bill was actually to do what Sir George Grey now proposed as a new idea. It was absolutely impossible to raise such a sum as Sir George Grey proposed, from either a land or property tax. To raise such a sum as was proposed a tax of 3s or 4s in the pound would bo necessary, and people woidd never submit to this. He should strongly object to a tax on land alone. At present land yielded a less return on capital than any other property. The House had to decide between Sir G. Grey and the Government, whether a change should be made this year or not. The Government had provided satisfactory finance for the country for the present year. They were quite prepared to accept Sir G. Grey’s challenge, and to stand on their proposals as opposed .to his. He challenged Sir G. Grey to show a single statement he had made in the first financial statement two years ago which remained unfulfilled. They had got the country into a condition where it could exist without further

present taxation, and therefore they made no apology for not proposing any. Mr Montgomery denied that the finance of Government was careful or far-seeing, as claimed by Major Atkinson. It had been delusive in the extreme, althoughnotintentionally so. The Government claimed having made a great saving. He would show the error. Instead of £123,566 being saved, £51,000 departmental liabilities had not been provided for, and £21,000 had not been paid to municipalities. He then, at considerable length, criticised the figures of the Financial Statement. No means were provided for taking up Treasury bills or paying back overdraft. He thought the Treasurer was £IOO,OOO w r rong in Ins estimate of the land fund. He believed the necessities of the country would soon force the South to give up its right to the land fund. He never took a gloomy view of the resources of the country, but he did of the system of finance, which vas imposing burdens greater almost than they could hear—far great er than necessary under a proper system of finance. Mr Stafford, at Timaru, had denounced that system as a miserable sham, but he had not stood up in the House to denounce it. Sir Geo, Grey’s speech contained the elements of a grand policy. Its principles were perfectly sound, and he hoped to see them placed on the statute book, and they would not rest till this was done. Mr Stout said no Ministry in any country had ever shown such weakness, although he disagreed with some details. The rest such as the Treasurer required was impossible. They must go on before resting. Place the burden of taxation on the shoulders which should bear it. To be asked to wait a year even for a scheme was not what the country had a right to expect. Evidently Ministers thought themselves simply a committee to carry out whatever the majority of the House wished. Mr Stout then discussed the details of the financial statement at length. The colony had really gone to the bad some £6OOO during the last year, and in the next eighteen months at least four millions more would have to be borrowed to meet liabilities. He referred to previous financial statements, from 1870 to the present time, to show the delusive nature of the Government finance. The Government either was so ignorant that it could not predict finance a year in advance, or had wilfully deceived the House and country. Thus the whole abolition policy had proved an utter failure, especially in its finance, while the Assembly was fast becoming, as predicted in 1875, a big Provincial Council, dealing with roads and bx’idges, because local bodies were unable to do so, or to promote settlement. The promises with regard to education reserves had also proved utterly delusive. Direct taxation was really an essential part of the Public Works policy, and in 1870 Sir J. Vogel had predicted it as probable within three years, yet now they were told this was not to be imposed till the public works were complete. The progress made in 1874 to abolish the provinces was simply a plot to seize on the provincial revenues, in order to keep a privileged class free from taxation as long as possible. Major Atkinson’s whole argument was to show how utterly impossible and delusive it was to do what the Board proposed the Government should do next year. He did not use a single argument to show why the House should pass Mr Bowen’s amendment, but many against it. It had a most injurious moral effect on the people to teach them that finance was a juggle and a muddle, and said that was the lesson taught by the Government. They proposed to put the provident and improvident on an equality. The uncertainty of our finance would deter capital more than any settled taxation. Property owners should take warning by the experience of Victoria. Mr Reynolds thought the Government could very well introduce a property tax this session, even if did not come into force for six or nine months, by which time machinery to collect it would be provided. He did not think the Government finance a satisfactory one for the colony, although perhaps it was unavoidable. Mr Harper, agreed with the remarks as to the financial statement and additional taxation. The matter had not been sufficiently considered, and the country not been consulted. Instead of capital being driven out of the colony, there had never been so much foreign capital invested in land as within the last two years, A property tax woidd check this. While there was a land revenue and land unsold there should bo no property tax. He did not believe the present taxation bore heaviest on industrial classes. The tax on necessaries really only amounted to 15s or 16s a head. A property tax would prevent the introduction of capital, and so reduce the demand for labour, so that the labouring class woidd feel it. most severely. It was utterly impossible to deal with the question this session. Mr Pyke said the question had been before the country for the last ten years on every hustings. Three-foimths of the members of the House were pledged to a revision of the system of taxation. The county system had forced property to contribute more than ever before to public works, but that was only a preface to what was now proposed. Many miners working in claims contributed more to taxation than many rich landowners, and such a system could not last. Customs duties, he thought, an altogether unjust and extravagant method of raising taxation. The present system of taxation was unjust to the industrious class. The House should afiirm this unmistakably, but if a twelvemonth were wanted to effect a change lie would give it. Real property was already taxed. What was wanted was to get a personal tax, which could only be done by a property and income tax. He was strongly opposed to generalisation of the land revenue, unless there was one common price for all laud in the colony. It was said that the Government last year laughed at the idea of doing away with the sinking fund when lie suggested it, but now they said it was a wise one. Events of the year had fully justified his predictions in supply last session. It was absurd for Major Atkinson to say that a shilling in the pound tax would only yield £130,000. He denied the statement that the industrial classes only contributed 16s per head to the customs. Every man, woman, and child was really taxed £3 through the customs duties. He believed the country was ripe for a change in the fiscal system. Lot Ministers appeal to the country if they had any doubt of the feeling of the country. Dr. Hodgkinson doubted the sincerity of the Government in this amendment. He supported Sir George Grey and Mr Hunter, lie disputed the accuracy of Mr Rees’ financial assertions. The balance in the Treasurer’s hands on the Ist July was a substantial reality. Mr Murray moved the adjournment of the debate. The House rose at 12.20 p.m.