SATURDAY, SEPT. 17, 1898.

Waimate Daily Advertiser, 17 September 1898, Page 4

SATURDAY, SEPT. 17, 1898.

Reference has been more than once made in these columns to "Eating on Unimproved Values." No apology ia required for calling our readers' attention more fully to the subject for the reason that comparatively few people have taken the interest in it which it deserves. There are three methods of levying local rates, any one of which may be adopted by local bodies, viz., Eatmg on annual (or renting) value, rating on capital value, and rating on unimproved value. Till the Government Property Tax was introduced, rating on annual value was the only method by which local bodies could raise rates, but the advent of the Property Tax, which was levied on capital value, suggested a fairer method of raising local rates. The aim of all methods of taxation should be to place the heaviest share of the burden on those best able to hear it. Rating on annual value seeks to do this on the principle that if a man has property which could be let at =620 a year he should pay twice as much in rates aa the man whose property ■would only bring £10. No method of taxation can be expected to act with absolute fairness, but it is not difficult to show how much this method is open to objection. For intance, the needs x>f a man's family may require him to build a house of six rooms which is rated at .£2O ; but the reason that compels him to occupy a large house is the very one winch makes him less able to pay heavy rates. Again a valuer may consider a property worth £50 a year, but the owuer can only got £60 for it, while another property valued at £30 brings in a rent of £50. This, the oldest and most objectionable method, is the one adhered to in the Waimate Borough. Rating on capital value is the system in use in the County, and is ranch less open to objection. It is easier to ascertain the capital than the anuual value of a property, and at least a person's rates will bear some proportion to what he actually possesses. Then in the Borough one may have an unoccupied, unimproved section held as a speculation and worth £100. Its annual value is set down at £1, and it pays a rate of a shilling a year. In the County, a property of that value would, frith the present rate of 11-16ths, require to pay five shillings and ninepence. But even rating on capitaj value is far from being an ideal method of taxation, for the property-owner who keeps his land in good order, haa good fences, gates and buildings, is compelled to pay higher rates than the man with a property which might with care be of equal value, but pays less because of the slovenly way in which he works and. keeps his property. Put shortly the chief objection to both rating on annual value and rating on capital value is that they are largely a tax on improvements, and

the more money and labour one puts into his holding the heavier he is taxed. Just as the Property Tax suggested the rating on capital values, so the Land Tax, which exempts all improvements, suggested the tae rating on unimproved values for local rates, and two years ago Parliament passed " Th« Eating on Unimproved Value Act, 1896." By tins Act, the value of the land alone is taken into consideration when a rate is struck. IJndcr_ttie_§jstems in force both in Waimat eOounty an dlTorough every improvement useful or ornamental added to a property means an increase of rates and so improvement is hindered. Under the newest system improvement is encouraged and property held for speculative purposes is made to pay its share of the local burdens. For example take three adjoiaing town sections held by A, B and C. The sections, let us say, are worth jGIS each. A and C fence their sections and build a cottage worth Tho only improvement B makes~is to pay the half of the dividing fence which A and C compel him to do. A and C are probably rated at ;GlO a year each and pay ten shillings annually in rates, while B gets oft with one shilling a year. The rate f com the three sections is thus 21 shillings a year. In the course of half-a-dozen years',' tOAvn improvements have raised the value of the properties. A and 0 have contributed *66 between -4hern and B as many shillings. If A wishes to buy B's section he probably finds the latter wants £'30 for it and so his property has doubled in value at practically no cost to him. Under the rating on unimproved value if 21 shillings a year were required from these throe sections each would have to pay seven shillings and B would then perhaps be willing enough to part with his land to those who would make use of it or would turn it to good account himself. This, however, is one of the least important results which would follow the adoption of the Act under notice. "We shall next week discuss the subject farther, believing that it can be shown clearly that the Act operates hi the interests of -the people.