8.-5.

88

[\V. GOW.

You said that other legislative means should be taken ? —lf desired, to break up large estates. Or prevent reaggregation ? —No, I did not say that. 1 said to break up large estates. The Government have the means in their power. They can take possession of those large estates at a fair valuation. Ido not see why the possessor of a large estate: whei purchased that land in the early days should not have his reward. Take, for instance, Hawke's Bay. I know that lam too timid a person to have gone and taken the, risks that some of those early settlers took in Hawke's Bay. They practically he-Id their land at the risk of their lives, and I can see no reason why the men who did that in those clays should not reap the, reward of their boldness and progressiveness. But if the country wants their land, then the country is entitled to take it at a fair price anel use it. Of course, we, know the difficulties. We kneiw that they sometimes get more than a fair price, We know that all kinds of strings are pulled ; but the- principle still remains, that these; men are: entitled to the benefit of their early boldness and foresight, anel if the country wants their land it is entitled to take: it from them at a fair price. I think that will be admitted. Then, in regard to aggregation, I think there is a great deal too much maele of aggregation. Aggregatien arises not always out of an earth-hunger on the part of the purchaser of land, but very often out of the fact that lands have been cut up in areas on which it is quite impossible to do any good with them. Mr. Begg will understand that. It is only a natural thing that these lands should pass into the hands of other people, who will seek to increase the size, erf the: holdings. If it is thought there is a danger of undue aggregation—that is to say, of wealthy people adding acre to acre, simply for the: purpose of becoming large estates-owners— very well; that can be dealt with in the same way as the: holders of the present large estates can be dealt with ; the land can be taken from them at a valuation, 1 think nothing of aggregation, because it is a reaction from undue subdivision. Then, you would not differentiate at all between the man who holds £1,000 worth of land and the man who holds £100,000 worth ? —No, "not in the land-tax. The lanel-tax is simply a tax upon his privilege eif holding land at all, and, counting year by year, it to some extent absorbs the possibility of unearned increment. I do not say that it wholly absorbs it, but if the tax is a fair one and is exercised year by year, in the course of years—twenty years, for instance—the tax, paid regularly and capitalized, would approximate perhaps the possible: unearned increment. That would depend upon the rate, of tax, of course ? —Yes. I am not in a position to say how much that tax ought to be, nor am 1 in a position to say how much the income:-tax ought to be. The Chairman.] What woulel you regard as a safe maximum for the income-tax ? —I should imagine about 3s. in the pound, or 3s. (id., to be a safe: maximum for inconu:-tax. Ido not knevw whether I should say anything on the subject of the taxation of companies. If you have views we> shall be glael to have them ? —1 have: views on that subject. It is a very debatable subject. Would you like to hear them ? The Chairman : When Mr. Shirtcliffe has finished. Mr. Shirtcliffe.] I am very much interested in what you have said about the land-tax. I understand that you advocate a flat rate of land-tax irrespective eif area or value, and, in the case of lanel held for speculative purposes, the imposition of no additional penalty ?—No ; because if the flat rate is properly considered—and Mr. Clark is capable of properly considering it—it will be a rate whieii will in normal circumstances pretty well eat up the possible unearned increment; that is to say, the unearned increment of one year would be pretty well eaten up by the rate. I have bought sections myself and have paid rates on them, and lanel-tax too, and I know that when you come to sell out and think you are doing very well, when you figure eiut what you have paid in the meantime in the way of taxation you find there has not been very much in it. It seems to me, that if a man has held land for speculative purposes fer twenty years and maele no attempt to improve it the community has been deprived of the use of that land. Would you not consider it fair that he should pay some penalty, in addition to the lanel-tax that anybody else pays ? — It. might be considered fair, but I question whether it would serve any particular purpose. In the case of country land, whether it be, agriemltural land or pastoral land, no man holds that land absolutely idle. He may not be using it to the best advantage, He: may be using it very much sheirt of the, best advantage, and he may be doing so deliberately. What I point out is that this year-by-year tax will spur him up in the matter. Take suburban lands ? —ln the case of suburban lands I do not know that it is a matter of very much consequence. One man wants to hold on to his 5-acre patch. There are plenty of others who are wanting to sell. In some cases there will be, more difficulty than in others. In a- place where lanel is exceeelingly scarce there might be some little: purpose to be served by the proposal to put a special tax upon such land ; but, generally speaking, I do not think that the putting-em a special tax upon land which is being held and not sufficiently useel will serve any particularly good purpose. Mr. Clark.] Do you think that the exemption of such a large area of land in recent years by reason of the ordinary mortgage exemptions has helped speculation, anel that the abolition of those exemptions would meet the difficulty that Mr. Shirtcliffe. has mentioned ? —To some extent it would. I do not suppose it was intentionally done, but the effect of the recent legislation was to allow very largo incomes arising from land to escape. 1 suppose it was really an accident rather than anything else, but under the theory which I propound no income would escape, no matter where it arose. Mr. Begg.] You were going to speak of the company taxation ?—Company taxation suits me all right as it is. But, all the same, I think it is quite inequitable, I elo not think it is eepitable to treat a company as an individual. However much it may save, my own pocket, it is not a fair thing. I think, therefore, in opposition to my friend Mr. Clark, that as soon as it can possibly be done a change should be made. Ido not think it can be done at once. The demand for revenue is too great and the effect of the change too uncertain. It may not be possible to do it at once, but I certainly think, in the words that were use-el in the report of the Taxation Committee, that the change shoulel bo contemplated, and as soon as possible the taxation of companies as entities should be given up and