INCREASED RATES.

Stratford Evening Post, Volume XXXI, Issue 96, 6 December 1911, Page 5

INCREASED RATES.

(To the Editor “Stratford Post.”) Sir, —Notwithstanding the denial of the Prohibition Party, as again ap- , pearing in your issue of yesterday, that the rates would bo increased in the event of Prohibition being carried, and also of the statement made to the same effect by Mr J. Masters, Chairman of the No-license meeting, both have utterly failed in substantiating their statements and have been totally unable to produce one single shred of evidence that no such increase -would inevitably occur. From the hopelessly futile manner in which both the No-license Party and Mr Masters have attempted to deal with this most important matter, it will be obvious to every intelligent ratepayer, that neither grasps, nor even displays an elementary knowledge of local bodies’ finance, nor of the far reaching effects of the vicious doctrine that they advocate. As the matter is of vital importance to County and Borough .ratepayers it would be well to lay before them the position as it would affect us locally in a clear and definite manner, quoting absolute authorities for each statement made or proposition laid down. The Revenue derived from the Liquor Traffic was, according to the N.Z. Government Year Book, 31st March, 1911 (pages 231 and 450) as follows Beer duty, excise ... 115,368 11 4 Customs duty ... 408,552 0 0 Hotel License fees ... 49,017 0 0

Total ... ' ... £572,937 11 4 The above figures do not include the large revenue paid from the Trade /by way of (a) railway freights, (b) income tax (c) land tax on licensed premises (d) stamp duties on transfers of hotel leases and goodwills, etc., which at a most conservative estimate are set down, at £300,000 extra per annum. The No-liconse Party even does not question the accuracy of such an estimate, and it can bo seen therefor that the Trade easily supplies nearly £1,000,000 annually to the Public Revenues of the Dominion. The question which is to be considered is simply this. In the event of National Prohibition being carried, from what sources are the Government going to replace that last £1,000,000? There are two alternatives. In the first place the Revenue required might be made up by way of direct taxation upon the people in the shape of extra Customs and land taxes, or, in the second place, tiie Revenue may be raised indirectly by means of rates levied by the Local Government Bodies of the Dominion.

In the Trade Circular it'is distinctly stated that either of these two methods might be adopted, and it really makes no difference, to the man on the land, which method is adopted. If the first method of direct taxation were adopted, we know at once where wo stand. The population of New Zealand is, roughly, 1,000,000, and the revenue to be made up is, roughly, £1,000,000., That means, that every man, /woman, and child would have to pay an additional £1 in taxes yearly. For an average family of three or four ' persons it .would mean as many ppuhds per annum, if not move, as the man on the land would have to pay a proportion of the share of those : ■‘unable 1 to 'pay 1 through illness, 1 age, or poverty. ' ■ -i- " li ■ i In -the 1 '■ circular,; 1 however, ’ the second method, that of indirect taxation by way of rates, was taken as an illustration of the effects/ of No-t license, and I will endeavour, briefly, to make the position as it affects l residents in the Stratford Borough and County and Whangamomona County, quite clear. The Capital Rateable Value of the whole of the Local Government Bodies in Nfett‘Zealand is £148,265,055 as re-

gards ' the Counties, and £80,606,593 as regards 1 the Boroughs (pages 143 and 447, N.Z. Year Bobl>> 19iU). The rateable value of the County of Stratford is £1,225,873. The proportion of the £872,937 11s 4d revenue lost through Prohibition that this County would have to conwould be, therefore, in the direct' ratio that its valuation bears to the total valuations of the other Local Bodies. This works out at £f,006 as stated in the Circular. This can, of course, be easily checked by anyone in a few minutes. As the present General Rates of the County - of Stratford are £9531 (special rates are not'included) the £4006 required to be added, amounts to an increase of 42 per cent, on the present rates. Tne figures for the County of Wliangamomjona and for the Borough of Stratford are all official, and calculated exactly in the same way as those for Stratford County, but owing to their different valuations and to

the different rates struck by each, the per centages for the Borough work 1 out at ,301 per cent, increase, and for the Whangamomona County at 51 per cent, increase, and the increased raxes are as 'shown in the circular. The figures given above are all Government Returns with the exception of the amount of the rates levied. These have been obtained from the Town Clerk, Stratford, and from the Clerks to the Stratford and Whangamomona County Councils, and are, of course, open to any ratepayer of those

districts, for inspection. It might be remarked in passing, that in taking the total valuation of the Local Bodies of the Dominion, the Capital Rateable Value was taken. A good many of the Local Bodies, however, now rate on the Unimproved Value, particularly in Taranaki. As this is always lower than the Capital Value the proportion to be paid by such Counties is in a greater ratio to the total than if it were based on the

Capital Value, and their rates would be so much the greater. It would be too lengthy to pick out such instances, though to do so would place the Trade’s argument in a still better light. It would be well to point out that the chances of the lost Million pounds of revenue being collected by the Local Bodies as rates rather than by the General Government as taxes, is more probable than ever, notwithstanding the absurd denial of the Prohibition Party. Most ratepayers are now aware that the Government intends bringing down a comprehensive Local Government Bill of some 000 clauses, completely re-modelling the present system of local government, and the Prime Minister has already indicated the lines upon which such Act is going to proceed. The functions of the Councils are to be greatly extended and their finance put on an entirely different footing and system. Wo all know that during the past few months the Government has been handing out large grants to the Councils for expenditure instead of the same being expended by the Government as was formerly the case, and, indeed, this has, owing to no provision for administration expenses being allowed, become a considerable bone of contention between the Government and the Local Bodies, particularly in the back-blocks. In recasting the Local Government Act, therefore, timer is a grave probability that the Government in lion of making direct grants and undertaking the supervision cf certain works and functions that it now does, will authorise the Local Bodies to use greatly ex-

tended rating powers for loans and otlior purposes, and in such case, it is haraly necessary to say, it would ue a direct temptation, if not an irresistible one, to place in the Bocal Bodies’ hands rating powers wide enough to raise revenue for local works in lieu of Government grants and subsidies which:, oil account of the loss to the revenue, through Proiiibition, they would be disinclined to make. This danger is quite real enough to bo apparent to every observer of current Local Government affairs. The settler in Stratford County does not wish to incur the danger of having to pay what would amount to practically 42 par cent, increased rates, owing to lost liquor revenue.

The prohibition party uses a most fallacious argument respecting the £l,000,000 of revenue lost. They say that that sum would ho saved from the Public Expenditure of the Dominion owing to the alleged decrease in crime and litigation consequent on Prohibition. I would in reply, merely draw attention to two facts: Firstly, it would take at least three or four, or posibly five years, before any reduction in expenditure due to such a readjustment of the Civil Service as the Prohibitionists predict, or on account of the readjustment of Customs and other taxation whose incidence would have to ho altered, in the event of Prohibition, could be made. But, the £1,000,000 revenue lost would have to bo found INSTANTLY. Tho Public Services and works of the State could not be suspended for that period of four or five years, and each taxpayer would have to immediately pay his proportion of that £1,000,000 on account of the current expenditure for each year.

My second point is, that, in any case, it is a more equitable system that the transgressor of tho law should pay for his transgressions than that they should ho charged upon the people at large. One final word, one of the amazing, though not the less common on that account, arguments of the Prohibition Party, is that the sum of £3,000,000 is annually spent in tho Liquor Traffic of New Zealand from which there is no return, except the profit to the State of the £1,000,000 revenue derived by, way of taxation as above stated. Is there any other source of State Revenue which returns to the people of the Dominion for Public expenditure one-third of its annual total ? I think not. And as for the balance, are tho Prohibitionists so simple as to think that the workers in the Trade (malsters, travellers, cooks, porters, waiters, draymen, barmen, and the hundred and one other individuals engaged in tho Trade directly or indirectly) are 'unpaid for their services? It is to be remembered that some 11,000 persons are directly employed in the Trade, and, estimating their average wage at £2 per week they easily account for £1,100,000 of the balance of the Honor expenditure. The remaining £900,000 is absorbed in payment for wines, spirits, and beer purchased and imported, in payments to farmers for hops and malt, in railway freights, license fees and stamps, and all the numerous incidental expenses contingent upon any business concern.

It should not be- necessary to point ;out jthe simple rudiments of business and jfinance to our Prohibition friends, but,' ah it is''apparently necessary, I make no' apology for doing so.—- I am, 1 dtc., ! ii ivjiof-; 1> if u; Aik v'' , ; M., R KIRKIVOOP. . '"Stratford. 6.11.11.* P.S.—'As a concrete fact of how rates increase under prohibition, the case of Ashburton may lie cited where, ifridef “license,'" the rates stood at Is, and under no-licenso they are now Is 9d. —W.P.K.