FARMERS' INCOME-TAX.

Taranaki Daily News, 13 March 1917, Page 7

FARMERS' INCOME-TAX.

| ■ MOA SETTLERS' PROTESTS Tire meeting of farmers at Tnelewood to discuss the question of the fanners' income tax on Saturday afternoon, was attended by oyer 120 farmers. Mr li. J. Bakewell, of Waitui, occupied the platform, and said ho was responsible for the. advertisement calling the meeting. He asked the mooting 1 to elect a chairman. The meeting's choice fell on llr T. Bonier, chairman of the Mo a Dairy Company. Mr Bakewell spoke for over' ail hour, lie bad the majority oE those present in sympathy with him, although there were one or two hecklers, whose interpositions served to enliven the proceedings considerably. Mr Bakewell said he came to discuss with them the Finance Act of 1016, and particularly so far as the provisions of that Act affected the. dairy farmers. Sir Joseph Wardi who was responsible for the Act, was faced with the expenditure of a huge sum of money, made necessary by the war. lie directed his attention to tlfe customs, and after deriving a certain amount from that source, he turned to the direct producers and found that there .were 14,000 people to draw from. The income tax was imposed, and the need for still more money presented itself. A special tax, an excessive profit tax, and a super-tax, were imposed, so that the producers were called on to pay four taxes. A good tax, said Mr 'Bakewell, was a simple tax, easily understood and uniformly imposed. It must be easy to collect and a minimum of money should go towards the eost of collection. Tt should not be necessary for the collectors to pry into the private affairs of the payers. The speaker traced the history of tlic tax from the time it was first imposed in England over 100 years ago. Tlio income tax in New Zealand had never been les,s than Gd. During the Boer War it rose to Is fid, and he believed it would be r>/- this year. Three months before the present war, the London i-vpeetator had stated that it was impossible to justly levy income tax oil tenant farmers in England, and that the computations of their returns must be mere guesses. The speaker considered it was still more difficult to levy that tax on owner farmers who formed the producers of New Zealand. In France there was an income tax imposed on small farmers, but the speaker ventured to prophesy that after the'war that tax would be swept away. ' Once in 140 years tho tax had been levied in America, but the effort was opposed, and the case went to the highest court in the land. It was there declared that the tax was contrary to the constitution of the United States, and no more was heard of the effort. Mi' Bakewell said that the, tax harrassed the farmers. It had been reported that New Zealand butter had realised 2/- per 11> on the British market. Ho would like to see the second shilling. The chairman: So would I. Proceeding, the speaker instanced a case of a farmer with 200 acres of mortgaged freehold, who was called upon to pay .-CKS income tax for a single year. '"Was he a scholar?" was the unusual question asked by a member of the audience. ''lf he was ho should have done what a man I know had done. He should have insured every member of the family, including the cat." (Laughter). I The speaker instanced another lease of a man very much poorer than the first, who was called upon to pay £l3O. A voice: What were his gross returns?

Mr Blakewell said the man who was asked to pay £l3O milked S3 cows, valued at about £lO per year. One of the interrupters again endeavoured to speak, but what he said was drowned in the storm of voices crying '■' Sit down!"

From a man who worked 00 atres, Mr Bakewell continued, the Commissioner of Taxes demanded £52, which worked out about 11/0 per acre. When the demand v camc, that man was lying in a New Plymouth nursing home suffering from heart strain, due, the speaker felt sure, to the hard work put in on those 90 acres. He instanced further cases of unjust impositions, and said not even the greatest scholar could understand how the levies were arrived at. (Applause). The Commissioner of Tuxes went behind the hack of a neighbor of the speaker's and found in the dairy company's book that the neighbor made £SO more in lflltl than he did in lfllsi. Of that £BO, the Commissioner demanded . £3fi. What was there to show that in 1016 the neighbour had not increased his herd, and that the increase in the herd provided the £BO. Moreover, everyone knew that the 1015 season was a bad one. while in his 28 years of experience in Taranaki he had never known a better season than Mlfi. Was the Commissioner living in windy Wellington cognisant of these circumstances? Voices: Jvo, of course not! The speaker provoked rounds of applause where he referred to Hie wonderful work of the women in their efforts to help the farmers. Did the Commissioner take into account the work of the women and the boys? All the p.eople on a farm were contributing towards the income of the head of the household. Morally, the head of the household was merely the trustee of the money earned by the family, and the Commissioner had no moral right to levy a tax on the. joint income, although that income was legally in the name of the oiie mail. Mr Bakewell said lie bad travelled all over the 'world, but nowhere had he met with such an unjust direct tax. Mr Bakewell strongly criticised the. cry that the tax was imposed for the purpose of winning the war. He described this i'.s downright casuistry and trickery. If

the Government wanted money to win the war, why didn't they check the waste, the extravagance, and the plunder that went on in Wellington? (Applause). Why on earth were those two politicians iii London, costing tJie producers of this country £28,000! (Applause).

A voice: You are wrong. They are not spending' ;C2S,UOO. Mr Bakewell (sarcastically;: My dear sir, lid yon ever stay at the Hotel Cecil? (-'Prolonged applause).

Mr liukewcll ventured to say tliat the politicians referred to were ,spending

.€IOOO per week. The speaker went on to say that it was a most unheard of thing that Parliament should not be in session. Tile Parliaments of Britain, Germany, Austria, and Australia, and the other countries at war, wefe in session.

Mr. \V. J. Kendrick suggested that politics should be dropped :.;id that iiteps should, be taken to organise the

Mr. Bakewell and others called on Mr. H. J. H. Okey, M.P., to address the •udlenco. ; ,

Mr. Okov said tliat if Parliament was in session tiin taxes would probably he increased. He went on to explain the provisions of the Act under which the income tax and the excess profits tax were levied. He pointed out that many mistakes were due to farmers not properly computing their incomes. He explained that the income tax and the excess profits tax were arrived at in two diAerent ways. The farmers' income tax was brought- in in' 1915. Before a farmer paid income tax he deducted all his mortgages, rates, labor, and five per cent, upon the capital value of his farm. Ho was then allowed £-300 exemption and £25 for each child under 1(1 years of age, provided his net income wa'S.not over £125. He was also allowed insurance premiums up to £SO. With regard to the excess profits tax, farmers should be very careful in arriving at their standard income. That was done by taking the average income of the three years just prior to the outbreak of the war, or the income of the best year of the three, so that if a farmer had one good year during the three years referred to lie would take that year's income aR the standard. The tax was 45 per cent, of the increase on the standard income. A farmer might not pay income tax, yet lie might be called upon to pay excess prdfits tax. lie was allowed an exemption on ■ x-'OO before he was called upon to pay 'tax on excess profits.

The documents in connection.with the instance cited by Mr. Bakewell, wherein a farmer was called upon to pa.v l £153 excess profits tax, were produced,' and on examining' them Mr. Okev showed that the farmer in question had not returned any standard income prior to the war. The Commissioner of Taxes had acted on the farmer's gross returns, the only information he had, and the farmer was held responsible for the tax levied until he forwarded a return of his standard income. On the figures sup plied, Mr. Okey said it appeared that the farmer in question would not have to pay anything in the way of excess profits tax at all. ! Mr. A. Paterson described the income tax as a "rotten failure." As a .solicitor he had filled in scores of papers for fanners, and knew the returns were very often the result of pure guess-work, Mr. Okey: How are you going to get the money?

Mr. Bakewell: Cut down the waste! Mr. Paterson: At. present only* the fools are caught. Mr. Bakewell moved, and it was seconded, "That the Government be urged to summon Parliament .for the purpose of watching over the interests of the farmers."

Mr Kendrick moved as an amendment, and Mr Williams seconded, "That this meeting protest against the farmers' income tax."

The amendment was put and declared carried, there being only one objector, the mover of the motion, Mr. Bakewell.

The other matters referred to in the advertisement calling the meeting, the cheeso and butter tax, and the Military Service Board, were not discussed.

A member of the audience moved that a hearty vote of thanks be given to Mr Bakewell for his address, and this was a -ignal for the dispersal of the meeting.