Rating on Unimproved Values.

Taranaki Daily News, Volume XLVII, Issue 7764, 16 March 1905, Page 2

Rating on Unimproved Values.

ADUKUSS ItV Allt I'. .J. O'KtXiA.\. The lloor of the Thealre l*o,\a! was well tilled on Wednesday nigh I. when Mr I'. J. O'lteguu diiivciv.' ail ud I less advocating the adoption of the system of rating on unimproved land values. The chair was taken by the Muyor, who in liis opening remarks explained that Mr O'lieg-.m lia;l been invited to give all address by those who had the movement in hand, ile (The Mayor) onity regretted one thing, ami tliut was that the ratepayei s had not more time in order to discuss the question thoroughly. ih qUCS". ioil was lllsl lliKOi... I ..Annus a great surpiis,- in :.| ~. ... as attt ttJilig a. wceti.i., in . . .1 willi the nn'. i ... when the petition to le.\ (■ ;l j,n | was llrst put in liis hands, tin I as soon as the proper number of signatures oi bona lide ratepayers were attached he had had to gel it advertised. liis , ling all a on.; liad been that the i..alter lia.l luii been suilicienily discussed. No douitl Mr O Jtegan, wlio was an authoti'y on , ' subject, would do much to enlighten them on the question. ilr O'ltegvin, who was well received, said it gave him great pleasure to visit tile inteiwttown of New I'lymouth. lie was ing. and, he might add, historic glad to 11 mi they were going lo have a po',l on the question of unimproved values because lie fell pertectly sure, that the citizens could do nothing that would s 0 conduce to the prosperity of the district as to adopt this system, of taxation. He had seen in t'he press that it was inadvisable or inopportune • force this iquestion, and that ait'ho.ig'li the principle might be, and undoubtedly was, sound enoug.li, it i was hardly applicable to the town ol New I'lymouth ; also that in dealing with the, question as it applied to this particular district it was inadvisable to lo 0 k upon it from the standpoint u ( general principles 1 . It was bis conviction that it was quite impossible to deal with this 'question apart from genera 1 principles. The first consideration with him—he knew no'lisp'ecial condilions of •New Plymouth— was whether the rating on unimproved values was right or wrong. For the last li'teen years ho had been a strong „<!- locate for rating , m unimproved values and the tax on land values generally. If ,t was only a 'question of whether Hrown Would paymore or less than Smith he uoulii be siorry indeed to pnrficlputc in this campaign. ile assured them however, that the. principle raised I, I '"'. . whol, ' l 'luewtion Of taxation, winch, although uninteresting and ; unpopular. „s a subject had been too long neglected. Taxation on land values involved the greatest 'incstion of social and poetical re Jorm. The underlying principle was' : t,lat '<■ Should not be in the power oi money—(with this sen"l™' . »;«« «»>-e they would all r V - ° lol:k >'l> hind. (Applause.) --and was thj store-house to which 1 • Ti'id !! H> " atu, ' ift ""d , h- said without reserve that (ho , poorest member of the community ,hud as ROO( i „ I|K ., U , () tlu> ]urilorn, d d C °,'\ nt T ns u,e richest and I l.«t Ti He maintained should ht i"}™"' 0 "" 1 cons i<'iil"iition wo I * r V " cu, ' Uvin • I ," frL ' cted ' ln,t whether it would conduce to the prosperity of w Prided that the lime would come when the people would wilder why thex tolerated so ng a system which penalised a man j mprovements and there•J the conununitv. (Appluuse.) They maintained 'that what « man made out of his labour and industry belonged to him and him "lone, and that not only had he a light to enjoy his improvements but the right to be encouraged in making them. (Applause.) Consider the dillcrence between mom.y in its enect upon the community when inJested merely tor the purpose of holding land for purposes of speculation and money spent upon improvements. He admitted that the primary motive which actuated a man in improving property was selfinterest, but u man could not lienc- - lit himself in this way without benejlitiiig incidentally his fellow citzens. A man who built a house, cleared a forest, or drained a marsh I benefited not only himself, but gave employment to labour in numerous nays. On the other hand, what | benefit did a mere specula tor confer on the community, a man who bought a block and held it-idle unjmade it worth his while to reap til the industry c i his neighbours I w here he had not sown ? (Hear, jhear.) He did no good to the comjiiiunity, but positively injured its progress and development. Tliey did jnot propose anything revolutionary, I but simply insisted that the 'speculaitor was the right man to pav a .good share of the taxation of the community. (Applause.) As a 'general rule throughout the cofonv ,hc had found that when iniprovetnents were exemjited the rating on .land was doubled u produce the j.same amount of revenue as was raised on the capital value system. That meant, taking an average based on the ex|K-rience of other districts, that' the improving portion of the community would pay less rates by one-third than they paid under the present system. Jt followed ns a, natural inference that the deficiency had to be made up by those who held vacant land, and as a rule they would iind—and he thought New Plymouth would prove no exception to the rule—that the owners of unimproved land paid just about twice as much as they paid now. (Applause.) Who would say this was wrong ? Who would deny it was pre-eminently just that those who received the benefit from the industry of the community should pav them some benefit in return ? (Applause) The very fact of one man putting up a building improved the value oi' an adjoining vacant block, ruder the present system the map who im-. proved was lined as though he had committed an olTence, Yet we were told that the man who made two blades of grays grow was a public benefactor, and should be encouraged, In ■■Trogress and Poverty," Henry George told this story : A' certain Oriental despot who 'wanted to raise money imposed a tax upon date trees, and to his- surprise his subjects began io cut Hown their date (ties in order lo evade taxation. Then he struck upon another another expedient. He abolished the tax on date trees and taxed the ground upon which the trees had grown, and to his surprise the people then, instead of cutting down the trees, planted date trees to utilise the land." This illustsaled exactly the principle of rating on unimproved vafues. It was not many years since in England they had a window tax, and the result was that people built houses with as few windows as possible. It was u tax upon light and sunshine, and though iniquitous in efl'cct was no more indefensible than our present system of lining for improvements. ( Ap- j pla use. I The old system of tiie t.oll , gate tax was' no more objectionable than the system of taxation which made it possible for a rich landown- I tr to place a toll gate round his ; property against the application of labour. ile (the speaker) had seen,, tiie same objections raised every- . where again»l tlw new system as . were now put forward. It was re-mm-ked how jn this connection there was so much sympathy for tiie poor man. lie wondered to himself, seeing' that Hie working man and the poor man had so many friends that he was no'l as a class belter off today ! Ue (Mr O'ltegan) ventured to predict that 'they would show their I belief in tile just and equitable system of unimproved values taxation. (Applause.) As a matter of fact, , Limy would lind in practice that the I poor man would invariably ilje bene- i lited. They were told there were ■ poor men who held sections and could not aflord to build on them. He had found generally throughout . the country that poor men did not ' indulire in the luxury oi holding land, but bought to build on it and ■ uoL to hold for speculative purposes. (Hear, hear.) Then they were told that in some casvs mc.l , willi large houses would escape taxation. and he hud seen it I stated in the papers that proprietors of line hptels Were going to pay less than ' at present- Rvon if this were true, it did not affect tiie principle one iota. If a man had a line building, whether a hotel or not, he should receive the benefit of it. As a matter of (act tlie.v Would almost invariubly iind that valuable buildings wore erected on valuable land, and how then would tiie proprietors havo to pay less taxation They might in a lew cases, no doubt, pay less, j but still .they would pay the amount of taxation, tliey should justly pay, and no more. Was it a wise thing to discourage owners ft-wiii ptlUMig up ii'wbd liuuse.i or oih-

it buildings, as the. ruling ou improvements did ? IH'l not a nmii, v/hut'hor 'Wealthy or not, l»y putting lII' good house* bciH'lit everybody ? J.t was a slock argument tlmt [h, new rating would lead to overcrowding. This was another old r'x'Htnut. We had heard it said that the vacant blocks were the lungs of the cities. He admitted that ut> im.s:. have luni>s for the pities, but KM thiMii be public property, let them 1.0 municipal parks, such as the lino Hardens we had here. Don't let f em be dirty vacant 'blocks, (lie receptacles for nil kinds of rubbish and ild tins, etc. (Laughter ami applause.) The taxation he advocat- • I could not possibly encourage overcrowding. If we taxed any- ' liing produced by labour we made ilint tiling dealer to tin' concamer. li' oil the other hand we taxed laud which was not the product of labour, . \ie made that Kind eheup<t. Tlmt seemed paradoxical, but was never!lk less tni;'. The t.ix, more correctly speaking, was n tax on the value of land, not the urea of land itself. The present system of taxation produced an artificial sc.trnly of land and made it dearer. In other wolds, land was held and boomed. This system was more calculated to encourage overcrowding, because with the dear price of land buildings were packed on lots, whereas if other land could lie obtained cheaply they would not be. When land was field for speculative purposes in town the people who wanted land at a reasonable rate had to go outside the borough. 'No doubt that had happened here. ("Yes !") lie had seen any amount of unoccupied land in this town, and this was the direct r. suit of the present system. Continuing, Mr O'Kegan pointed out that the system of unimproved rating had lieen carried by no less than eighty districts in this country. (Applause.) !n three cases interested parties managed to induce tsuflieient ratepayers to have a poll held ou the ,i|.ue»tion of reverting to the old system, and in each case the ratepayers as a whole atlinuud rating on unimproved values by increased majorities, showing that once the people felt the benefit, the justice and ecpiity of the sys-. torn, they would never go back to the old state of things. (Applause). In Wellington the system had been in force for nearly five years, and the town clerk reported recently that, everything expected, everything predicted, by the enthusiasts in favour of the change in the incidence of taxation had been borne out by actual experience. (Loud [applause). In Wellington, instead of leading to overcrowding, it had had quite the reverse effect. Ituilding hud been stiiiiu.ated, but it had mainly spread out into the suburbs. He also traversed the assertion as to extra rating in some cases being vested on the tenants. The tax led to an increase in the amount of land ill the market for use, and this lieing the case, the speculator's |value of land must have a tendency jto diminish ; and except in the cases where tenants were under old agreements to pay rates it would not alTect the tenants. Another point [was that tlvo owner of a vacant block did not require to insure, but his neighbour who held improved property had to insure his buildings, as well as having to carry the other fellow's legitimate s-harc of taxation. In conclusion the speaker eloquently summed up the sittiuntion and expressed iiis confidence that 10-"day's poll would be in the lallirinalive.

| The Major explained that an unimproved rate of Dd in the £ would ! produce the same amount of reserve us under the present, system. viz. ' £6910. He quoted a nuinln'r of representative cases lo show how the I new system xvouki work. (These lig- ! tires have already been jiublished.) IHe referred also to the greater New Plymouth scheme, which he had advocated for years, and Questioned | whether the adoption of the system would not delay the. consummation of this scheme. There were a lot oi j vacant sections in theso outside suburbs, and if they were rated on tho present system it was likely they would o|hiject to joining in with New > Plymouth if the now system was in 'vogue in the town. The population in the radius* ho mentioned was quite equal to that of the present New Plymouth borough. I Mr O'Hegnn said this was a local P'ia se he could hard\y advise uj>on. ]n Wellington they had carried the new system in the suburbs lirst, 'and then in the city. The remedy 'was to get the unimproved system adopted by the County Council, which, he ventured to i>ivdict, would bo at no distant date. The day was not far off when it would be in vogue from North Cape to the liluft. I A number of [questions were asked, and replied to by the speaker. They were mostly elaborations of his pre,vious points. I Mr J. McAnceny, of Hawera, caused much laughter with his remarks on the poll taken at Hawera. Ife concluded by suying' that there wns every indication that the system was working well, and that any attempt to upset it would be defeated. I The Mayor informed a questioner that it wis not possible for the !rtvtes on liny property to rise from '£o at present to £2."> under the new ] method. | Mr Stevenson moved a resolution in favour of the adoption of t'ic new system. Tho public were comj mencing to lile out of the hall 'before the resolution was put, but those remaining carried it by a large majority. I A vote of thanks to the speaker, landIand to the Mayor for presiding, (closed the meeting.