8.—2

X

Departments, £134,584, for rates to local bodies, £27,000, for Boads and Bridges, a sum not exceeding £150,000, to be paid to the Boads Construction Board ; the balance, if any, after payment of these charges, to be paid over to the Public Works Fund. PEOPEETY-TAX. I will noAV, Mr. Speaker, in accordance with the promise made in the early part of this Statement, again refer to the Property-Tax. The Act, Sir, although requiring some amendment, has been found, upon the whole, effective, and, now that its provisions are generally understood, it is admitted throughout the colony that ihe tax is thoroughly fair in principle, and that it has, generally, Avorked satisfactorily Ido not mean, Sir, to imply by this that direct taxation is palatable; but I venture to say that in no country in the world has direct taxation been accepted more willingly, or paid more readily, than the Property-Tax has been by the people of New Zealand. I have had prepared, for the information of the House, several very interesting Tables (No. 10), which will, I think, greatly increase our knowledge with regard to the distribution of wealth, and especially in reference to the ownership of land. There are, I find, 21,761 freeholders within boroughs, and 43,058 freeholders of country land. The total number of freeholders in the colony is 60,658; being somewhat less than the aggregate of freeholders of borough and country lands, because some owners of property hold land under both designations. It is, perhaps, desirable that I should give the House, at this' point, some particulars as to the cost of collecting the tax. The total expenditure made for last year, including outstanding liabilities, but exclusive of Land-Tax charges, was £31,000, being made up of the following items cost of valuation, £16,000, salaries, £7,275; preparing tables, £700, miscellaneous, including cost of collection, £7,025. With regard to the valuation, I find it has cost about £3,000 more than the Land-Tax valuation, the \ xaluation under the latter being £13,000, and under the Property Assessment Act £16,000, but if the proposals of the Government are agreed to, and this valuation is used by the local bodies as the basis for their rating, the whole of the cost of this assessment Avill be saved to the country during the next year, the saA'ing going into the coffers of the local bodies. In fact, Sir, if Ave make one triennial valuation do for both general and local purposes, the cost of it will be so small as not to amount to 1 per cent, upon the rates and taxes collected. If this suggestion should be accepted, it would not be fair to charge more than £5,000 per annum for the cost of valuation against the Property-Tax for the three years during wdiich the valuation continues in force. But, admitting that the whole of the introductory expenses and the triennial valuation are to be charged against the PropertyTax, even then the rate per cent, for levying and collecting the tax, supposing it to be continued at the rate of one penny in the pound for three years, Avill be very moderate. The estimated cost of the Property-Tax Department for the next two years is £12,000 For this year I shall ask for £6,000, exclusive of liabilities, so that the total cost for three years will not, I think, exceed £44,000, and the total receipts for that period, provided the present rate of one penny in the pound be continued, Avill certainly reach £860,000, thus making the total cost of the tax a little over 5 per cent, upon the amount actually paid into the Treasury And, if a proportionate deduction is made from the triennial valuation on account of the use made of it by the local bodies, it will be seen that the Property-Tax can be collected for less than 4 per cent., a result with which, I think, we may be well satisfied. Of course any alteration in the rate of the tax will necessarily increase or diminish, as the case may be, the relative cost of collection. When the Property-Tax was first imposed a strong fear, perhaps not unnaturally, w ras expressed by many persons that one of the effects of the tax would be to drive away foreign capital seeking investment in this colony. I have consulted gentlemen from all parts of the colony who are authorities upon this subject, and I have not found one who entertains the opinion that the Property-Tax has had any appreciable effect upon the flow of capital to the colony, and, as a matter of fact, during few periods of our history has more foreign capital come into the country and found investments than during the last year at an equally low rate.