THE Wairarapa Age MORNING DAILY. TUESDAY, JUNE 4, 1912. TAXATION.

Wairarapa Age, Volume XXXII, Issue 10649, 4 June 1912, Page 4

THE Wairarapa Age MORNING DAILY. TUESDAY, JUNE 4, 1912. TAXATION.

•Two of the proposals contained in' the ipolicy speech >niada toy the Hon. ST. Mackenzie at Opunake last week ' are deserving of more than passing notice. One was tllat the exemption under the land tax be increased from £SOO to £IOOO, and the other that ■the exemption .under the income tax be inoreaised ibv £SO for each child. Each of ifcliese proposals contains a modicum, of justiae, though neither of 'them appears to have, ibeen pcirfected. It is aai anomaTy in taxation that land should fee taxed on every pound c/f value over ,and above £SOO, whilst incomes <shoukl )be exempted up to £3OO. Tlie latter mm represents interest at 5 per cent, on £6OOO. If it j be ifla.ir to assume that 5 per cent. i,s ' a sufficient .intercut on money invested iniandi, tjhen, .it would /require land valued at; £6OOO to produce an income of ' £3OO par annum. Let -us illustrate the .point. Tnk> brothers come to the Dominion with £sooo,each. 'One invests his money m al'bupiness , which 'returns 'him £250 in income. The other invests in land which' produces a similar 'amount. The <man> in- business pays nothing an taxation, but the main on the land ,pj:iys taxation, on. a capital value <rf £4OOO under the proposed exemption of £IOOO. It 'will cldarly be seen that to put the two on a fair footing, the exemption of the landholder should be £6OOO in. value. The concession proposed by the ißrirne , Minister .may afford temporary relief to a ,faw smialii .farmers, but with the ! rapid increase in the price of land it . will mean very little in ,the long run. The exemption should be much higher tlian. that suggested'. It will be argued, of course, that any remissions •of (taxation nrwist mean, that the ibur-j den Upon the big holder will become the greater. This is n result which •cannot 'we l ;! ibe avoided. The same principle will apply to the exemption | from income tax.. If £SO exemption is to ibe allowed Ifot' every Child in a, family, over and above the present exemption of £3OO, should riot tlie loss cif iwetnue time entailed (be .made up iby lan increase In the graduated income tax? It would be obviously unjust to saddle the iland -with the loss occasioned, through the exemption under the income itax as well as that caused by the increased exemption 'under the land tax. It must lalso .be remembered that payers of the .land ifcax liavte families' a$ wefll as ilhe .payei sof income tax. If a man in. a town with a family of six is to be exempted ,trom taxation for an income up to £6OO per yeair, sure•Tv the imian on. the land with a similar family is entitled to exemption up tti a similar amount. The Premier took occasion, lin his Opunake speech:, to oommenf .uiponi the fact that the population of the Dominion is drifting into the cities. iCan ilie .expect anvthiiig else when a discrimination, in the matter of taxation is'imade in (favour of the mam. in the citiv ? The principle of making men contribute- to the cost of admiiirisitraitioin of the affairs of the country in proportion, to theif stake in ifch'e' Dominion aiid tlieif ability to pay, is ,a isound one. ißu£ URe proposals of the Hon. iT. Mackenzie are clearly n6t based entirely upon this principle.