THE INCOME TAX CASE.

Manawatu Herald, Volume XXXII, Issue 877, 11 August 1910, Page 3

THE INCOME TAX CASE.

NEWSPAPER COMMENTS. The Otago Daily Times, commenting on the income tax case, says:— ** Mr Smith’s retirement from public life is now inevitable, but whether be should be unaccompanied in his withdrawal from the legislature is a matter upon which a certain amount of speculation may perhaps be excusable. Rumour has not hesitated to name another legislator in connection with a matter of the kind that has brought Mr Smith into disagreeable prominence. This second legislator, it is alleged, has effected a compromise with the Income Tax Department. If there is any foundation in fact for the reports which have gained currency on this point, there may be no difference between the quality of the offence committed by him and that committed by Mr Smith, Even if there is a difference, it may even be in favour of Mr Smith, and in that case there should really be two resignations from the legislature, not one only.” The Star says:—We desire to give full prominence to the Judge’s conclusion that the Hon G. J. Smith probably acted in good faith in connection with the most important illegal transactions. We are glad that Mr Smith’s evidence, which ought to have been given in the Court below, is held to warrant this expression of opinion, but at the same time it is our duty to emphasise the following additional comment; —Of course this does not exculpate the partners from the violation of the law ; they had no business to forgive a debt due by the London firm, or treat as bad without disclosing the whole transaction in their return. What they have done is to evade taxation enacted by statute, and for their so doing they must be liable, though they may have acted in good faith. Mr G. J. Smith is still a member of the Legislative Council, We have no hesitation in saying that the finding ot the Court should cause him to hand in his resignation without delay. The Christchurch Press says: — It would be idle not to recognise that the Hon G. J. Smith’s connection with the case has given it unusual interest. In fairness, therefore, it must be pointed out that the Judge expressed the opinion that he was not aware that the earnings of the firm, if the debt to Bowron Bros., of London, was forgiven, exceed that of the return. Mr Smith, in his evidence, stated that when he went Home to raise money for the company he put before the finan ciers the income tax return, showing a profit of ,£IB,OOO, instead of the balance-sheet showing profits amounting to over .£50,000. The statement was accepted by the Chief Justice as the most important evidence given for the defence. But while this is satisfactory, the fact remains that Mr Smith and his partners have rendered themselves liable, according to their counsel, to a penalty of .£SOOO. Mr Smith has been guilty of no action which would necessitate his retirement from the Legislative Council, but there can hardly be any doubt that if he were a member of the Lower House he would resign his seat, if only for the purpose of appealing to the verdict of his constituents, and through them of the country, by seeking immediate re-election. The custom, though quite illogical, has been followed by many honourable men, who have, through some misfortune, been affected by adverse verdict, and we could quite understand Mr Smith’s feelings if he wished he also could appeal to his fellowcitizens in like manner.