PARLIAMENT.

Waikato Times, Volume XXXVII, Issue 2974, 6 August 1891, Page 2

PARLIAMENT.

LEGISLATIVE COUNCIL. WKDXKSIUY. Tim Council met hi i3O p.in. A uninhut- of petitions were presented in f.ivnur of tin Shop Knurs' Bill. In leply t.i a question, Mr linc'Tley said tint bonuses to policy holders in the < ioveriiiiiunt Life Insurance Office would be paid shortly. X (ijlt-ct committee was appointed to consider tlm limkruptcy Bill, and tho Auctioneers Bill was rend a «euoti<l time. HOUSE OF liEPRESENTATIVKS. TUESDAY. The House met at hall-past two. Mr B.iilance moved the second reading of the Land and Income Assessment Bill. After expl lining the manner in which the Hill wis arranged, he m.id as regards the income tax the Government provided as far as possible to ensure secrecy in the collectiou of the incoire tax, but as to land and mortgage they would necessarily have to be of a irora public character. He referred in detail to several of the clauses, pointing out that clause 10 provides that companies carrying on a business in the colony shall be at all tiir.'-s represented by a person residing in the colony, who shall be appointed by tho company, or some agent or attorney. The Government had determined to retain Boards of Reviewers, although they were objected to under the property tax. There was a stringent provision in part 4 with respect to the taking of land, and tho Governor could at any time during the triennial period purchase for Her Majesty land or any interest therein mentioned in any return under this act, and may pay to the parson or company making such roturn the sum at which the land is valued, together with 10 per cent of the value. Clause 40 provided that covenants made to evade the tax may bo made void on certain conditions. Ttie portion of the schedule relating to improvements contained provision that improvements must have been effected more than 10 years prior to the assessment, bnt improvements could be made 10 years before so long as they were visible at the time of tho assessment. All visible improvements would be subject to taxation. The 10 years' provision was made to prevent people from bringing forward improvements which were not improvements. He had not seen any reason to alter tho proposals for a land tax contained in the Financial Statement. Iu that Statement Id in the £ had been stated as tho tax on land and mortgages. That was the proposal ho now made. It had been said that the Government taxation proposals would fall with great severity on a particular class of the community, but he held they would lint press heavily on ono class, namely, the improvers. It had been said that unimproved land would only pay live per cent., but it would be lidiculous to say that if such land wore cut up it would not pay more than fße per cent. The owners of those lands were non-improvers, and if they were improvers their income from the land would, of course, be largely increase!. If they could make thoso owners of large unimproved tracts of country assist the Government iu the work ot colonisation, there would certainly be a wave of prosperity all through the colony as the result. As to the question of income, ho found that banks were placed on the income system And mortgage system. He regarded banks as altogether different from other companies, and ha promised to bring banks under a system of income tax pure and simple. As to investment companies, he proposed to out them on tho same footing as banks. Building societies would be exempt, as they wore under the Property Assessment Act. friendly societies and

WtvitlKS banks would a's > he wxeinpt f|o»i taxation. 11l regard ti 11 .ide and counto c they proposed to exempt t.'io:-e incomes u;, to £300, and a tax of lid ill the pound v.-.add be imposed up to JL'IOOO, and over that N, Railways would be taxed on 111 I r income, only ; and not on the lan 1 lle'y o. cnpe d, but if tliev owned large areas ot land outside their lines, they would lie liable to the land tax. lie hi'lil that no new-cl.etiie of taxation was ever fair, hut the t Jovcrnmeiit had considered the whole cpie-tion most thoroughly and iuipntidly. As far as exemptions of irnprovcin nits were concerned, he should be prepared to tjo as far as any member of tho House, provided that the nere- ary levcmie nould be laised. Their de-ire should lie to obtain a pure land tax, and if they had not proponed tint it, was become the necessities of tho Country had not all nved them toe,, further than they had dore. He icterred to the several amendments pi,,postal by hon. members, and said they would, ho doubt, receive full con-iderntion by the House. Mr Shera bad asked that no exemption from improvements should be made, but he should aslt the Hou-e not to agree to that. It had been said they should make the same exemptions to companies as to individuals, but ho held they were rrnkinc large concessions to those "ompanies by putting pore income tixon thorn. Ho desired to say that buildinir societies pure and simple, not loan companies, would be exempt from taxation, but loon companies would pay income tax only. It had been objected that no ditfer•nce should be made between professional incomes and those of trado and i ommerce ; but he hold there was a wide difference, and the proposals of the Government, on that head, he thought, were sound ones, Jfo roferred to tho various meetings held by Chambers of Commerce on the taxation proposals, but he looked on these Chambers as a kind of political machinery to uphold tho Conservative party. His experience was that these Chandlers invaiitlily workod again-t, Liberal interest-', and at the last election they hud been very active in that respect. Those bodies were quite entitled to pass any resolutions they liked, but he warned the house not to be misled by those resolutions. He had not gone into the merits of the Bill exhaustively, and hoped the debate on tho second reading would not be unduly prolonged. He did not wish, of course, to restrict tlie opinions of lion, members, hut he hoped they would reserve the chief portion of their remarks till the Bill got into committee.

Mr Bryce suit! no iJ'>u 1 jt tlia Bill was » vory important one, but ijurli.i j>s it would be as well to adjourn the debate so tint tlie House might consider the merits of the speech. Mr Ballance thought tho debate should proceed unless the House generally desired mi nJJonmmont. Mr Brycu continued his remarks. He said ha had no particular fault to find with tho machinery of tho Bill, although he thought it was rather vague in that respect. In regard to tho Premier's statement about tho secrecy of the mourn tax he pointed out that in America a different system prevailed, as they relied there on the fullest publicity to prevent fraud. It might bo repugnant to the people of New Zealand, but at any rato it was said to work well in the United States. He thought, with the oxpenenco of tin? property tax h-fore him, the Premier should have avoided giving the Commissioner too much power under this Bill. Ha agreed with the Premier that triennial valuations wete better than continual ones, as triennial valuations would cause less dissatisfaction. With respect to tho Board of Ueiieweisit was proposed to appoint, ho thought some of those persons might feel it incumbent on them to put very high valuations on properties, but he sugges'ed t.i tho Premier that if ho desired to make the tax permanent and popular care Hhould bo t iken not to make valuations too high, but rather under the mark. He thought the clause giving power to purchase, land at tho value stated in tho return would work very badly, because too much power was given to the Commissioners, who might make it very harassing to owners. An effort was made in clause -10 to prevent people evading the tax, but he pointed out that his rendering of that clause would prevent what the Bill profe-sed to provide for, namely, prevent tho breaking up of large estates. Referring to tho portion of the schedule which provided that impro' emonts must have been effected more Urm ten years prior to arsessment, he felt sure the Premier had interpreted that wrongly. His (Mr Brvco's) opinion of it was that under that c'auso if a man felled a piece of bush, and an assessment was made twelve ye ns afterwards, that would not be called an imp"o>. emeut under tli.it provi-ion. He held that ten years was altogether too short. He thought ir, should have; been » generation, and to make it ten years would inflict groat injustice. The Premier would certainly have to alter the provisions if he meant to doal fairly with improvements. Ho agreed that it was not desirable to put too much power into tho hands i.f the Commissioners, as they might remit taxation to parsons not entitled to remission. With respoct to the graduated tax, ho held that as it stood it might very weil apply to improvement", although the Preniior stated it was not so intended. As to tho Premier's statement tint lie, had receivod vory few objections to the proposed taxation, the time had not cme yet for objections, and the Premier could not except any such until the tax came, into force. He predicted that when the taX was in force, and the collector came to tho door, Mr Ballance would then find plenty of objections tn the tax. The Premier had been rather hasty in his self-congratulation about not receiving objections to it. There were many features of the Bill highly objectionable. It was well known that the income tax produced irritation and annoyance wherever it was in force, but the worst feature about it was the vice it infused into the community, and it was notorious that false declarations made in Knglawt were vory general. As to the Chambers of Commerce, to which the Premier referred, it might be true these bodies represente.il the conservative element in the country, but if the commercial men in the colony wore conservative it was not tho case in the old country, where commercial men - were liberal in town and Conservative in the country. The Premier had stated there was a strung feeling in favour of a single tax, but ho held that if a single tax were enforced it would lead to disaster. JOnemption of improvements just now was a popular cry, and tho Premier was going with that popularity in advocating that. A proper system of taxation should, in his individual opinion, include all improvements, but ho must say tn exempting one sort of improvements and taxing another sort they would do great injustice in many cases. Was it intended to tax improvements after £3000 exemption was reached? (Mr Ballanco : Yes; but not a graduated tax.) He could not see why the exemption of a man's improvements should stop at £3000. As for putting a tax on bare land or the value of it, he held if they imposed a disability of any kind on land which did not apply to other property they would prevent the flow of capital to the toil, and that was not a desirable thing to do. He held that the Premier's proposals would tax a man who was engaged iu tho heroic work of colonisation to the very hilt, whilst others really escaped altogether sc far as improvements were concerned Tho fact was the present Bi'l favoured people who settled near the towns, but pressed harder on those settling in the country. Ha asked whether it was for revenue the Premier wanted the graduated tax. If so, whore was the jussice of it ? The Premier did not say it was for revenue ; but was it, then, for tho purpose of breaking up largo estates* If for that purpose it was for the sake of punishment. Was it for the State to come forward now and say that a man was committing a crime because ho held land which ho bought fairly, and undor golmen contract to hold it ? Even a foreign State would not do so, unless for the payment of some sort of indemnity. If the tax, therefore, was for revenue it was unjustifiable, but if for punishment it was still more unjustifiable. It was proposed to oxeuipt mortgages from the graduated tax ; but they should not ha exempted, as mortgagees must be looked upon as the very worst form of absentees. He was not aware what the income tax would produce. (Mr Ballance : Professional, £150,000 ; trade and commerce tM0,000.) If the income tax, with the tax on companies included, only reached i' 70,000 to i'SO,OOO, he questioned whether it was ui e. to introduce all this machinery for that purpose. He concluded by suggesting that the debate on the Bill in committee should be reported in Hansard. Mr Scobie Mackenzie followed, taking Boveral objections to the proposed measure. Dr. Newman said he had risen specially to move a motion which ho had contemplated for some time —namely, to impose a tax on absentees. There was nothing new in such a proposal, and it was only a fair and reasonable way of reaching people who hitherto failed to contribute a proper share of the taxation of the country. Jf his amendment were carried the effect

" ooid tie that, uirn' eiH of absentee- who now did nothing at all tor the colony would nv their fair share of taxation, and he ti|oll_'bt I) 1 ' better s\s!clll could tie de, i-ed than puUimr a tax 'on the unimproved land of absentees. He then m <vtd i.he amenditieiit tie had [riven notice of. Messrs,!. W. Thomson, R»es and Taylor ■| Iso -ip.iVe, the two latter on the side of the t loveniinent. At 12 o'clock Mr darkness moved th« adjournment of the debate, which was carried, and the House rose. WEDNESDAY. The Dense met at 2.30 p.m. Implying to questions, it wr.s stated that t.lei licensing question would receive every possilile attention during: the recess. Mr E. M Smith gave notice to move on ■ ■ irilT into committee of supply that in the o; ini"ii or the House the Government shoniil ai'lioint, a Royal Commission with power to spend tHOOO on > trial of the iron sand and iron onss of New Plymouth, so as to ascertain whether they can be smelted, thereby enabling New Zetland to make iron and >teel from its own ores. Mr f{ ch irdson resumed the debate on the Laii'l and Income As-essnient Bill. He said the Bid was based on conjecture as to the amount of revenuo it would yield, and the most the Pren ier hoped for was that lie would obtain as much money under it, as he had d.ine under the Property Tax. He referred at some length to the revenue, which had been obtained since the present Government as-imied i ttice, and after very careful consideration of fltruies, he calculated there was an aehi d deficit for the last six months of £100,000. and the pres nt st ite of the eolonv did ir-t warrant such a change in the incidence of taxation as the Government proposed. Mr McKen/.ie (Cloth.i) complained that no birht wlittever hat been thrown on the change pr iposed in the system of taX 'tin, and lie wi.-hej to lodge a formal protest against the measure. It, seemed to liini that th y were now dominated by the towns of the colony ; and that, using so, it wan essential that a country party should be formed for their own protection. The effect of the present Bill would be to remove t'le taxation from the shoiildois id the wealthy people in the cities, and place it on the land, winch would then have to pay an undue proportion of the taXition The debate was interrupted by the 5.30 adjournment. The House resumed at 7.30 p.m. Mr C. H. Mills was in favour of D". Newman's amendment, but thought that it flhould be withdrawn now so that it could be broncrbt on again [ n Committee. He could not agree with the 1-nt speaker that the proposed taxation would press heavily on the small farmers, and his reading: of the Bill led him to a different conclusion. Mr Buckland took exception to the Premier's remarks concerning the Chambers of Commerce. As to the taxation proposals, lie thought this now system Would prove no better than the property-tux, and he would record his vote against the Bill.

Sir John Hall only wished to refer to one or two points in tho Bill. The powers given to the Government by the clauses providing for secrecy under tho income tax would render that impost extremely unpopular. A little more information might have been given as to the exemptions, and ho could not sen why a man who inve-ted his capital in improvement should be taxed so much more heavily than a man investing iu bank shares. It, was said that the reason land was singled out for such heavy taxation was in order to obtain revenue, but if that was the case he asked why the Government proposed to throw away £40,000 by reducing the postage rates, a proposition that would bo opposed by nine-tenths of the peoi le iu the Colony. The mere fact of putting such heavy taxation on big estates would not ho cmtendo I advance tho bursting: up process. Mr W P. Reeves said ho did not think people of this colony would care for the American system of collecting the income tax, and imagined the Treasurer would rather run the risk oi losing a certain ainonnt of revenue, than put that system in force here. Ho was glad to hear Mr Bryce say that the income tax w»s a (jofd revenue raiser and was always to be relied on in that respect As to the, fraud which it was urcred would occur under the income tax, he might say that any heavy tax always led to fraudulent practices. He denied absolutely that because tho Government were working up to a land tax pure anil simple it meant that they were working up to a single tax. There wore thiiis/s in the Bill perfectly irreconcilable with the single tax, and it was unfair to assume that the (toveriinient were tending towards that tax. lie explained, with reference to income derived from live stock, that they would not be taxed, but incomes derived from dealings in stock would bo liable to taxation. As 1.1 Dr. Newman's amendment, the Government were not going to allow a red herrinu to tie drawn across the scent and could not allow their policy to be traversed in tint m tuner. The Government would give every facility for discussing the absentee tax in Committee, but they wished to get, their Land and Income Bill into Committee without beins encumbered by amendments. He pointed out that Mr Richardson, in drawing attention to the alarming falling off in revenue Co the extent of tM2,000 for the fiist three months of the present year had Dmittpd to state that the fourth months returns lessened the decre iso to £13,000 instead of £42.000. He denied that the present Bill was revolutionary in character, and said it would now bo seen whether those, who had clamoured so loudly against the property-taX would bo true to their colours by supporting the new tax. (Left Hitting.)