New Zealand Times. MONDAY, MAY 31, 1875.

New Zealand Times, Volume XXX, Issue 4429, 31 May 1875, Page 2

New Zealand Times. MONDAY, MAY 31, 1875.

No more important question has cropped up of late than the power sought to bo exercised by Provincial Legislatures, of nullifying the action of the General Assembly, hy evading the revenue laws of the colony. In Auckland there has been a mild attempt at something of the kind, but it remained for Otago to make a serious and persistent effort to accomplish this object.

In will be in the recollection of our readers that the House of Representatives, (wisely or unwisely we do not pretend to say,) refused to abolish the export duty on gold. And this not upon one occasion only. A resolution affirming the necessity for the repeal of the gold duty was frequently moved, and as frequently rejected. The intention of the Legislature is, therefore, perfectly clear. For resons of public policy the Colonial Legislature declared that an export duty should be levied on all gold produced in, .and exported from, the colony. This did not suit the purpose of those politicians who trade on the wants and prejudices of gold-miners; and accordingly the device was hit upon of passing an appropriation ordinance through the Provincial Council of Otago, for the purpose of refunding the duty paid through the Custom-house on the gold exported from the province. Contrary to the advice of the Provincial Solicitor, Mr. Robert Stout, the Otago Gold Duty Repayment Ordinance, 1874, was introduced and passed. The Governor was advised to disallow it, on the grounds of its illegality. But the movers in this matter would not rest content. They interviewed the Colonial Secretary during his recent visit to Otago, with the view bf removing any objection the Government might raise to a renewal of the rejected Ordinance. But the Colonial Secretary would give no opinion without advice; whatever the Otago Provincial Council could legally do, of course it might do without objection from him. As this meant nothing at all, the deputation were not much the wiser after the interview; but the Colonial Secretary having promised to consult the law advisers of the Government, there was just a ray of hope left. The Attor-ney-General, who had advised the Government against the Ordinance of 1874, was now Chief Justice, and with a different law adviser there might probably be somewhat different advice. Their most sanguine anticipations have been realised. That which was illegal last year is legal this year, although the law is unchanged. His Honor the Superintendent of Otago was informed by letter on the 19 th May, that the Government had been advised “that the “ appropriation by the Provincial Legis- “ lature of Otago of a sum of money “ sufficient to refund to the miners a por- “ tion or the whole of the gold export “ duty levied on the province could not “ be held to be illegal.” Hero certainly is matter for reflection. Who is responsible for this advice I —advice at variance with that given by Mr. Attorney-General Prendergast last year, and in direct opposition to.the opinion of Mr. Robert Stout, lately Provincial Solicitor of Otago, as may be seen from his verylucid and convincing memorandum on the subject, which we reprint elsewhere. That the advice is bad in law we have not a shadow of doubt; and that it is contrary to the declared will of Parliament cannot be questioned. Indeed, it would be difficult to over-esti-mate the -importance of this question, which has cropped up, as it were, incidentally during the recess. We cannot help thinking that the Government have been wrongly advised, and we also think they acted unwisely in adopting such advice. But on grounds of public policy alone, we have no hesitation in saying that the Government have acted' in an imprudent manner. Mr. Stout has pointed out, in his memorandum, the possible consequences of the doctrine of statutory evasion, which is laid down in the Colonial Secretary’s letter. Were the opinion of the law advisers of the Government acted upon, we might have the spectacle of one part of the colony heavily taxed, and another part relieved from taxes. To quote Mr. Stout’s words: “ I understand, by the letter of the Colo- “ nial Secretary, that the Government “ have been advised that it is not illegal “ for a Provincial Legislature to vote “ public money to certain residents in the “ province, in order that they may pay a “ Customs impost. This principle being ‘ ‘ recognised, I do not see where the “ powers are to be curtailed. Should “ a Provincial Legislature determine that “ it would be beneficial for the province “to have ex, gr. all the import trade of “ the colony, it might, I presume, vote a “ sum of money to be paid to importers “ in order that goods might be imported “ at half the usual duties. Or again, “ should the Colonial Legislature decline “ to sanction a Land Bill containing pro- “ visions for speedy settlement, or such “ as the Provincial Legislature deemed “ so, the Provincial Legislature could “ vote money, purchase the lands, and “ then frame its own land laws. Were it “’to do either of these acts, it would not “ be more ‘ illegal’ than to do what the “ Colonial Government have been ad- “ vised ‘ cannot bo held to be illegal.’ “ And one might see in New' Zealand the “ strange spectacle of each province “having different Customs regulations. “ This would be granting, in my opinion, “ powers to the Provincial Legislatures ‘ ‘ which were not contemplated by the “ Constitution Act. I need not state, “ (Mr. Stout adds), that in order to “ contravene the provisions of a statute “it is not necessary to expressly “ repeal them ; it is enough that they “ are evaded.” And he sums up his remarks on this point in a few pregnant words. After expressing his inablility to understand why the Otago Gold Duty Repayment Ordinance was disallowed, seeing that the Colonial Secretary, on advice, now expresses an opinion in favor of its legality, he says : “It seems to me ‘ ‘ to amount to this—if the Provincial “ Council annex conditions, [that the gold “ should be the produce of the province “ and the duty be paid within the pro- “ vince,] the Ordinance will be disallowed, “ but if they exorcise no discretion, and ‘ ‘ leave the matter to the Executive, the “ apparent illegality vanishes, and the “ repayment becomes legal and constitu- “ tional. I do not,” continues Mr. Stout, “ attempt to explain this anomaly.” That was no part of his business. It was sufficient to indicate its existence, leaving explanation for another time and place. Now, 'as we have already said, this is one of the most serious questions that has arisen in the colony for some time past, because if the Government are right in their interpretation of the law, (and they clearly may exorcise their discretion as Mr. Stout points out, in determining •what is the law,) it is in the power of Canterbury and Otago to absorb the trade

of the colony, by the simple expedient of selling the Crown lands within their bounds and applying the proceeds to the repayment of Customs duties on imports. This is undoubtedly an extreme view of the case to take; but it is one that naturally suggests itself in these days of competition and business enterprise. But the terms of the Colonial Secretary’s letter, written expressly on advice, lead up to such appropriation. Restricting it, however, to the case in point, it is equally objectionable. The purely provincial revenue of Otago does not suffice for* its local institutions,wherefore the repayment of gold duty must be made out of laud revenue. Hence we have this state of things brought about : by an evasion of the law the Crown lands situate in one province may be sold to repay the duty, of 2s. per ounce upon gold raised within it, while the General Assembly imposes a tax of 2s. per ounce upon all gold raised and exported from every other province. The result would be ruinous to mining interests in Westland, Nelson, and Auckland 1 They could not compete on such unequal terms with Otago, which would speedily absorb, the mining population, and figure as the great, if not the only, gold producing province of the colony. We need only indicate the bearing of this question upon the great constitutional struggle that is impending. The Colonial Secretary’s letter must very greatly strengthen the hopes of the Superintendental party, by showing them to what lengths they may safely go in defiance of the law. The Government must be aware that one of the most irritating points in the whole agitation is that which arises from inequalities of taxation, and now we find them, unnecessarily in our opinion, intensifying that feeling. There is no ambiguity, however, about the law; and we take leave to think that the gross injustice contemplated by the framers of the Otago Gold Duty Repayment Ordinance will not be consummated. The intention of the law is clear. By all means let the export duty on gold be repealed, but so long as it is levied, let it fall equally upon all. ____________