THE PROPERTY TAX.

Manawatu Herald, Volume II, Issue 31, 9 December 1879, Page 2

THE PROPERTY TAX.

DEBATE ON THE BILL. Below wo give the principal speeches in the Lower House on 'he Property Assessment Hill. We are indebted to the N.Z. Time 3 for the report : — The Hon Mujor Atkinson moved the second reading of tho Kill. It was necessary that somo additional taxation should be placed upon the country. However much they might regret it, they must admit they had gone as far as they could in direct taxation. The next question then was, what proporty should be taxed F There was no doubt that there was great diversity of opinion on this question of taxation. The Government had considered the whole matter very caiv-fully, and had come to the conclusion that it would be better *o tax property directly than to tax the income derivable from property. An income tax was a proper! y tax, and something more, a" ho understood it. Tho inquisitorial nature of tho income tax was infinitely greater than that of the tax now under notice. There were many difficulties conneoted with an inooraa tax which were not connected with the present tax. With regard to the inquisitorial character of the taxes, the income tax was far more inquisitorial than the property tax. The hon. gentleman proceeded to explain the various provisions of the Bill. It had been said that certain persons escaped under the pi - sent Act, and no doubt to a certain extent this was true. The object was to adjust taxation as much as possible, and not to catch everybody. There could bo no doubt that the people of small means contributed more in proportion to the taxation of the country than rich people, but those who es caped the effects of this tax had to pay in the shape of indirect taxation. ■ There was a variety of opinion as :to what class of property should be taxed, and the Government had taken that into their most careful consideration. He denied that the Bill would not catch what was termed the unearned increment. It would do so beside.' the unearned increment of other kinds of property. The land tax at present existing would not deter the land speculator, and it was a groat injustice that a tax should be imposed which pressed so heavily on a certain section of the community. The Pro perty Bill was prepared somewhat hastily, and would therefore not be fouud to coutain so many details as it might otherwise have done. The main principle was to tax all a man possessed, save £300. Persons who were assessed would have to sustain their objections, if they made any, before a Court oil Reviewers, who, it was proposed, should be persons of high standing, unconnected with thff Government. No doubt the Bill would be improved in Committee, and Government would be very gl id to receive assistance from the House in putting tho Bill through. The Governmeufc had carefully considered the question of exemption, which had presented a good deal of difficulty, aud the Government w>>nld be glad to receive any suggestions from tho House in this direction. In moving the S3cond reading of tho l»ill, the hon. member stated that it was inteudeJ that the Mouse should meet in May of next year, and pointed out the advantages that would accrue to «he colony by raising this additional amount of taxation, as wua proposed by the Bill. Mr Ballance agreed with Major Atkinson that additional taxation was required, but disagreed with him as to the means of raising it. He would show that the Estimates were inflated, and contained a large number of bogus items. In order to discuss the question properly, they must take ia the whole financial policy of the Government, -who were to ba congratulated on their conversion from the income to tue property tax. That was an extraordinary conversion of the Premier, who was cominir rapidly round to the views of the late Government. Mr Ballance denied that the proposed tax was less inquisitorial than the income tax, and said that M tjor Atkinson saemed to have taken up the American system. He sirongly opposed the tax, which he held was unfair and unjust Under this Bill, companies which did not pay, would have to contribute as much as those which did. The mora the tax was examined, the more unfair it was found to be in this respect, being very different from the land tax, which was receiving commendation in other countries, and the country here had affirmed the justice of that tax. This change in taxation was a great evil, and he would ask the hon. gentleman w:<ore it would end? The credit of the colony depended not on one, but upon tha whole system of taxation throughout the country. The hon. gentleman objected to the exemptions made in this Bill in favor of the professional man, which were most unfair. The question arose, was thw crushing taxation necessary P He contended that it was sot. With regard to the Estimates, they migftt h"»vo been reduced by the Government to the extent of £200,000 if they had thought proper. The present condition of the finances was due to the falling off in the land fund, but in this respect New Zealand did not stand alone. He contended that the financial statement of the Colonial Treasurer was colored from beginning to end. He condemned the other side tor the obstruction they had thrown in the way of passing the Loan Bill. Mr Macandrew said that all the minority in the House could do would bo to record its protest against the measure, which would laud the country in a great depression. They had left the old country to escape taxation, but now find they are more heavily taxed than ever. He (the Treasurer) ought to have endeavored to exhaust every means of taxation before pressing such a bill as ' that before the House. The best thing they could do would bo <o go to the vote at once, and let the responsibility rest on the proper shoulders. Mr Dick thought the matter before the House was one of great importance, and was deserving of a little more interesting debate than had been the case hitherto. For his own part he must confess that he did not agree with all the proposals of the Colonial Treasurer, who might have put v tax upon a lot of things which no*v escaped, particularly beer, which might raise £100,000 a year. The tea and sugar duties, too, should be re-imposed, and something should be charged for education, whioh would raise another £100,000. By theso means the property tax might be reduced by one-half. Altogether, he thought they should hope for a better state of things than was presented by the statement of the Colonial Treasurer. The second reading was subsequently carried bj a majority of ten. On the motion for going into committee on this Bill, Mr Macandrew said he again desired to record his protest against the Bill. Mr De -Lautour also wished to protest against the Bill. It seemed to him that they were now standing at the place where the key note of local self-government was to be struck. He could not look upon the matter as a sham, in the same light as the Colonial Treasurer, to appease the public creditor. He wished to assure the Treasurer that he should treat the measure as a real one, which should not emerge from the committee in the same shape that it went in. He hoped they would strike out the tax on personal property and improvements. He did not agree with the motion that it

was their business simply to record » aeriea of adverse votes. On the contiary, they ought to do thuir beat to nm'<e the measure as little obnoxious a* possible. Mr Roader Wood denied that, the measure was a sham Under the- present circumstances of the country, this could not be the case. They had a deficit, up to the present moment, of £1500,000, and every member of the House had admitted th»ro had been no other way of covering the deficit except by puttiug it on loan. If they did not raise taxation to meet this deficit, they would do next year what they were going t» do this. It was, therefore, the question which they had to fico, how this revenue w^s to be raised. They were a'l agreed that the money must bj realised — the question of how was a matter of detail which it was the business of the House to settle. If they imposed the tax, they must feel that it would be difficult to collect. Th it the tax was an one rous one there was no doubb,but there .vns no tax which did not press unfairly upon some section of the community, and this wight be said in regard to the tax under discussion. The goldmining companies, whioh they proposed to tax, bad done more good for the country than anything else that conld be conceived, and to place a tax upon that son rce of industry was manifestly unjust. They put their money in companies of various kinds, but often the shareholders got no returns whatever. It was the duty of the House to see if they could not evolve some thing out of the proposals of the hon. the Colonial Treasurer. Instead of property increasing of late, it bad depreciated 25 or 30 jer cent. lie would ask what chance there was for the Ministry to bring down largo reductions in the Estimates, when the Houso itself passed largo votes without alteration, and refused to allow them to be reduced. The people must come to the conclusion that the whole system of Government was too expensive, and must compel their representative] to be more economical. For his own part, he believed the Estimates could be reduced by £100,000. If the tax were reduced to a halfpenny, they would get £lt)7,000 ; then with reduced Estimates, and a beer tax, and the reimposition of the lea and sugar duties, bhey would be able to in ike np the amount ; and ho trusted they would set rowork to do this, so that' the. people should not be so hardly taxed as they would be by the proposals of tha Colonial Treasurer. Mr Moss said it was in the power of the Treasurer to raise £400,000 without bringing down this bill at all, and the mi* chiiery for this was already in the possession of the Government, while according to their own showing they would not bo able to collect money under the Property Assesment Bill before August next. It would be far better to amend the Laud T ix Act. Sir Georgo Grey entertained such great objections to the measure that he felt compelled to offer resistance to every stage of its progress It had been terrae 1 a Machinery Bill, but he did not understand this, as ho he held it to be a real measure. If put into operation, the greatest blow would be aimed at the colony which it had ever suffered. The Bill was aimed at every phase of machinery and labor. Taxation would fall especially on those who were not doing well, and who would be crushed into a lower rank of life There were many poor sattlers to whom the land absolutely yielded only a subsistence now. How could they tax such people as the«e ? Then there were many industries which did not give a return for several years. Under this tax every one of those industries must step, while there were other small properties and industries which would be absolutely ruined. A: any companies must be ruined at once, and property, as a natural consequence, fall greatly in value. He could not conoeive how an attempt should be made to forco such a measure on the country. It was said the object was to raise a few hundred thousand pounds, but thai sum was not Wanted this year, as it was to be taken from loan, One thing it would do: It would destroy the land tax, which had done iijury to no one, but which had been highly spoken of in other countries. People would, hesitate to buy expensive machinery. He prooeeeded to show that the tax was quite unnecessary, maintaining that the same arnouut rai;;ht be raised by other moans. The Land Tax yielded £100,000 a year, and three pence in the pound on land woul i tax the public creditor, to whom was due A' 27,000,000, to the extent of no leas a sum than £335,000. And why 6h"Uld they be allowed to escape ? There were others drawing vast incomes from this country, and spending it at Home, who also went soot free. All these things seemed 'o him to b«i impossible, so that he almost felt like speaking in : a nightmare. He was told that the measure was not to be put in foroe. Why, then, pass such a measure, and alarm tho country ? Suoh a system could never be imposed in New Zealand, und if the Bill passed it would be so mach waste paper. Let the Government bring down a property and income tax. which would not injuro any class of the community. The Bill would fall with cruel effect upon the mining industries in many parts of New Zealand — many of whic-h would have to close up their operations. Disasters must follow in the train of such a measure, and his mind was absolutely appalled at contemplating the future. He did hope the Government would consi* der what they were doing, and would see that people contrioute to the revenue in proportion to the benefits they were deriving from the country, no matter in what portion of the world they lived. He would not keep the House longer, but would simply enter his protest against the measure now before the House. Or Wallis did not intend to address the House, but after what had been said by so many members he foit it incumbent on him to say a few words. The hon. gentleman proceeded to speak at length on tho proposed new tax, which he stigmatised as unjust, one-sided, and one which would press with great severity on the people of the colony. It was equivalent to imposing a tax of fifty -four millions in England in proportion to the numbers of the population of both countries. It seemed to him to be the last straw that would break the camel's back, and he felt sure the people of Now Zealand would never submit to it. Mr M'Lean thought tho debate was pretty well worn threadbare from one side of the House. He would admit that it was a bitter pill to have to swallow this Bill, and nothing but absolute necessity would compel him to do so With regard to tho ad lress of tho member for Wanganui, he might state that it was greatly his fault that the finances were at the present time in the condition they were, while the figures of the hon. the Colonial Treasurer were absolutely correct. The Bill would have to be amended in committee, and probably when it came out it would be a much better Bill than it was now ; but the principle of the measure was a thoroughly just principle. The hon. gentleman proceeded to analyse the Bill, and to explain its precise principle. Many of the evils which at present existed in connection with our financial condition were the effeots of the late Government taking off the taxes in a most unwarrantable manner. ' It had been said that the people would not pay this tux, but he was sure th« people of this country would pay any tax to keep up their honor. The Hon. John Hall wonld not take up much of the timo of the House, because he was sure that their time could be more

profitably employed in Commfcfese in making the Bill one that would suit both sides of the Hoa^e If tho Government had consulted their own oomfort, they would have tried to smooth over existing difficulties. That might have been very pleasant, but it would hare been very unpatriotic. It had been said that the tax would makt^^fl the present Government very uupopuUroNfllii That might be so or it might not, but the deficiency had been left them as a legacy by the late Government, ani the people would be the judges as to whose was the fault. He should not have the slightest fear in going to his constituents and telling them the whole story. They had been told that the taxes ought to have been struck and gathered forthwith. How utterly weak it was to speuk in such a way, when as a matter of fact the land tax had not yet been gathered. He quite agreed that whatever «ould be done in the way of economy ought to be done, but it. would not be wise for the Ministry to strike out a vote here and a vote there without first being certain that the business of the country could be well administered with such votes struck out. They could not be too careful in making sweeping reductions without a full knowledge of how the different departments could be carried on Neyt year the Govern men t would probably bo abb to come down with a considerable amount of reduction in the public expenditure. They could not say that they could in half an hour save £100,000 ; but the House might depend upon it they would effect as large a saving in the public departments as t'jey possibly could. But, with all this, there must be a deficit, which would need additional taxation, and that taxation would press fairly on all classes of the community. . (No.) If in committee any hardship could be pointed out and remedied, so much the bettor. Whatever tax they, had brought down, the other side of the House would have still complained. If the Government hud proposed an incoma tax, they would have said, " Are you going to. injure, and take away from the bma'lf incomes of M the people i" and if they had proposed ,a tax on beer the cry would have been immediately. " Oh, you must not rob a poor man of his beer." (Laughter.) He quite agreed with the hon. member wlio v Ifad preceded him, that the people of New Zeslandiyijuld pay any tax that was # fair and just, and which they found was for the good of tho colony. .If.it was found when they met the House again iv May rest that the tax need not necessarily be levied; then* there would be an end of it, but they must mako provision to meet the public or ; e.dito«\ For his own part he could only say that he should never be ashamed 6f the part He : was taking in bringing this Bill forward,* whatever the result might be,'; (Applause.) The Hon. Major Atkinson then replied at considerable length on the whole question, but particularly to the speech of the hon. tho member for Wanganui, drawing a strong contrast between the address of that hon. gentleman and his actions while ho held the office i >f Colonial Treasurer. He showed how he (the Hon. the Colouial Treasurer) had taken the only coarse he could take under the circumstances. The Government did not in any way look upon this Bill as a sham They were quite in earnest in trying to pass it, and would do their best to make it law, although they would be veryvglad to accept any improvements, though- he would inform the Opposition that no material alterations would be made that were likely to affect the principle of the Bill. The hon. member proceeded to reply to the remarks of the hon. the member for Akaroa, and completely demolished the argument \ brought forward by him. He scouted the J idea of imposing an income tax upon the --m English landholders who had advauoed so M ranch money to New Zealand, but who were hardly likely to do so any more if they had to be tixed for it. The whole tone of the debate would have been very much improved if hon. members had read the Bill before proceeding to make the extraordinary speeches which they had done. In conclusion, he asked the House to believe that the Government were quite serious iv passing this Bill, and ho hoped they would get such assistance in-committee as would make tho Bill one that would meet the requirements of the country. The motion that the Speaker do leave the. chair, in order that the' House, might go into committee, was then put, and de - olaved to be carried on tho , voices. A division was called for and resulted as follows : — Ayes. 35 ; noes 25. Ayes, 35: Adams', Atkinson, Bain, Beetham, Bowen, C'olbeck, i>iok, Fulton, Gibbs, Hall, Hirst, Hurst, Hursthbuse, Johnston, Kelly, M'Caughan, M'Lean (teller), Murray. Ormond, Pitt, Richmond, Richardson, Rolleston, Euesejl,. Sounders, Seymour, Stevens, Studhplme, Sujtton, Swauson, Trimble (teller), WaKefield/ and Wright. . : Noes, 25: Audrows, Ballanoe, Barron (teller), De Lautour, Kinn, Fisher, J. B, (teller), Fisher, J. T., George, Hamlin, _r Harris, Dislop, Hutchison, Ireland, Lundon * Macandrew, Montgomery, Shephard, Shrimski, Stewart, Seddon,Tainui, \ awhai, Thomson, Tole, and Wullis. i ;