4th Parliament · 1st Session
Mr. Speaker took the chair at 3 p.m., and read prayers.
– Has the Minister of Home Affairs read a paragraph which appeared in yesterday’s Argus, to the effect that the Government has in contemplation the erection of a five-storied building for the accommodation - of the officers of the Commonwealth Departments? The paragraph states that -
The official intimations in this connexion indicate only that “approaches are to be made” to the State Premier, but, as a fact, the matter has advanced considerably beyond that stage. It is known that Mr. Murray is ready to meet the wishes of Federal Ministers, and that plans and estimates have been under consideration. It is more than probable that a new five-storied building will be erected on the vacant land beside the offices now occupied by the Federal Treasury, at a cost of something like £30,000.
Is this statement correct? If not, at what stage have the negotiations arrived?
– W - We have not yet settled upon any specific amount. The figures are merely approximation guessing.
– Is it intended that the premises shall be occupied permanently by Commonwealth officials, or used merely for a term of years? If the buildings are to be leased from the Victorian Government, will the Minister say for how long, and, before finally deciding upon the matter, lay on the table the papers regarding it?
– W - We have only plans before us at present. We are seeing if it is possible to consolidate the Commonwealth offices.
– What branches of the public service are intended to be placed in the new buildings, the plans of which the Government are considering?
– T - The offices are for no particular branches, but we must always have some portion of our public service in a great city like Melbourne.
– What about Sydney, and the other capitals?
– I - In Sydney, too. Washington is only 246 miles from New York, and yet there are Commonwealth offices in the latter city.
– Is it the intention that this building shall take the place of the one we thought the Government were going to proceed with shortly at the Federal Capital site?
– The The proposed building has nothing to do with the Federal Capital, with which we are going right on. The point is that we do not desire to have offices scattered all over Melbourne ; it is our wish that honorable members and others should not suffer inconvenience in seeking interviews with Ministers.
– Is it proposed, after the Parliament has removed to the Federal Capital, to continue the occupation of these offices in Melbourne, and, if so, will it not be equally necessary to have offices in each of the other capitals?
– It It will always be necessary to have at least a little Works Department in each capital.
– According to the newspapers, the Ministry intends to appoint a manager for the small arms factory. I ask the Minister representing the Minister of Defence of what use will it be to appoint a manager to the factory before the War Office has decided upon a standard service rifle? Is it intended to continue the manufacture of an out-of-date rifle?
– I shall be pleased to put the honorable member’s question before the Minister of Defence, and to let the honorable member know the Minister’s reply as early as possible.
– I wish to know why the salary of the factory manager has been increased from£400 to£700 per annum? Is it the intention to pay £400 per annum to the chief manager of the factory, or is the salary merely for a submanager ?
– I am unable to answer that question offhand, but shall obtain a reply from the Minister.
– Does the
Treasurer intend to deliver his financial statement to-morrow, and, if so, at what hour?
– All being well, I shall deliver it to-morrow morning, beginning as soon as our preliminary business comes to an end.
– Is there any reason why the public accounts for the period ended 30th June last should be withheld? Why have they not already been made available?
– I did not know that they had been withheld.
– Has the Minister of External Affairs read in to-day’s newspapers the account of experiments conducted in Sydney by a Mr. Pike, who has succeeded in obtaining communications from vessels at distances 500 miles greater than the radius provided for in the Government scheme for establishing wireless communication throughout the Pacific? If so, will he take the fact into consideration in dealing with that scheme?
– I have not read the paragraph referred to, but I shall read it, and shall give it the fullest consideration in connexion with the scheme referred to.
– Is it correct that the warships Yarra and Parramatta are not to come to Australia under the Commonwealth flag? If so, will the Prime Minister lay on the table of the House all the correspondence with the Admiralty on the subject?
– The statement is correct, and I shall be very glad to lay on the table any correspondence which can be so dealt with. Some international difficulty might be caused were ships of war to sail under any flag but that of a Government recognised by foreign Powers.
Secondhand Uniforms - New Defence Scheme : Additional Strength
asked the Minister representing the Minister of Defence, upon notice -
– The answers to the honorable member’s questions are as follow: -
asked the Minister representing the Minister of Defence, upon notice -
What is the estimated number of additional permanent officers and men that will be required under the new Defence scheme?
– The answer to the honorable member’s question is as follows : -
When the system of universal training is in full operation there will be required 231 officers (permanent) additional to the existing numbers, for administrative and instructional duties. These will be appointed only gradually, and for some years 220 temporary “Area Officers” will be employed.
Two hundred additional non-commissioned officers are required. These have been provisionally appointed.
Any other increasedpersonnel in the Permanent Forces consists of additions to the existing regular troops required for the defence of the fortresses and defended ports.
Port Hedland Post-Office - Port Davey Telephone
– On Wednesday last the honorable member for Newcastle asked the following questions on behalf of the honorable member for Coolgardie: -
In reply to inquiries which were then being made, the following information has now been received : -
asked the PostmasterGeneral, upon notice -
Whether he will give an assurance that he will make provision upon the Estimates for the present year for the establishing of telephonic communication between Port Davey, Tasmania, and existing centres of population?
– In reply to the honorable member’s question, I have to state that no provision can be made on the current year’s Estimates for this work.
asked the Prime Min ister, upon notice -
– The answers to the honorable member’s questions are -
asked the Prime Minister, upon notice -
In reference to the deputation of pastoralists which waited upon him last week, and made statements that a number of Riverina freeholders would be ruined by the imposition of the progressive land tax, and supported their statements by certain figures -
Will he obtain the names of the said owners and the names of such properties?
Will he obtain from the Lands Department, in Sydney, a detailed statement of the area of the several freeholds comprised within the electorate of Riverina, and the amount paid to the Crown per acre?
Will he also obtain from the several shires the unimproved value placed upon such lands, and the amount of tax levied thereon?
– I shall endeavour to get the information asked for.
– For the information of the House, I beg to announce that the Postal Commission, after an unparalleled career, has at last completed its report, and, dependent on the printer, this report will be in the hands of the GovernorGeneral on 28th or 29th of this month. I trust the report will have the same reception from honorable members as it has received from those concerned in its preparation.
MINISTERS laid upon the table the following papers : -
Quarantine Act - Regulation Added (Provisional) No. 6oa- Statutory Rules1910, No. 78.
Lands Acquisition Act - Land acquired under, at Woodstock, New South Wales - As a site for a Post Office.
Public Service Act - Regulations Amended -
No. 172 - Statutory Rules 1910, No. 81.
No. 202 - (Provisional) Statutory Rules 1910, No. 82.
Debate resumed from 2nd September (vide page 2527), on motion by Mr. Fisher -
That this Bill be now read a second’ time.
Upon which Mr. Deakin had moved, by way of amendment -
That after the word “ That “ the following words be inserted : - “ the form of land tax outlined by the Prime Minister, and provided for in this Bill, is unjust in its incidence and an abuse of Federal powers.”
– It is my intention to oppose the motion, and to support the amendment. 1 draw a distinction between the abuse of Federal powers, and the abuse of the Federal Constitution. I am of opinion that the Government proposals are well within our constitutional limits ; but I draw the distinction that they are an abuse of the powers that we may exercise under the Constitution. I do not wonder that the debate has occupied some lime, and will probably occupy a day or two longer. The subject is undoubtedly the agrarian question which has disturbed civilized society from its foundation up to the present day ; and we cannot expect the discussion on so important a matter to be concluded so readily as the discussions on some of the simpler Bills which occupy our attention. The question is of such wide, far-reaching importance that a great many of those gentlemen who are honestly and zealously supporting it, hardly realize how far it will take us. They do not realize the multitudinous effects that the measure is going to have in various directions ; some of those effects are little imagined by them at the present time. The fullest discussion in the House and in the country is requisite, because, undoubtedly, whether this measure passes or not, it will agitate the Commonwealth for many years to come. If it passes in its entirety as introduced, I venture to predict that, at the next general election, there will be an upheaval, and that those who have proposed it will go out of office. The measure is so extraordinary, far-reaching, and extravagant, and so full of anomalies and injustices that it seems to me the national conscience must be aroused, and the national reason exercised, and that the gentlemen who have pinned their faith to so curious an interpretation of the mandate of the country will lose office.
– We accept the penalty.
– I know that the Prime Minister is absolutely zealous in this matter, and honestly actuated, and that he and his supporters are prepared to take the full responsibility. I am merely pointing out what I think must be the inevitable result of the extravagant interpretation of the will of the people at the last election. The Prime Minister, in view of the enormous importance of this measure, did himself little justice when he submitted it to this Chamber. In a speech which dealt with some of the statistics on the question, he left out important matter that we might expect from a gentleman in his official position in submitting so far-reaching a proposal. Where was the justification for this measure, where the defence of the anomalies that had been pointed out in it, and where the defence of the seeming, nay, the certain, acts of injustice that it must perpetrate on society throughout the Commonweath? Nothing of that was given, but the honorable member simply laid the Bill before the House, and the only justification that he offered seemed to be the justification offered by Eliphaz, the Temanite, when he was trying to appease Job for the bursting-up policy that was being applied to him -
Lo this, we have searched it, so it is; hear it, and know thou it for thy good.
Outside of some such impression as that quotation from Holy Writ would give us, the Prime Minister gave no defence of the measure. When pushed pretty closely during his speech for reasons for this, that, and the other provision, he was only able to tell us that the Attorney-General would deal with them in his speech on the succeeding day. If any speech ever made by the honorable and learned gentleman was looked forward to with interest by this community, it was the speech that he was to make on the second reading of this Bill. I am willing to admit that the extreme ability and cleverness displayed by the AttorneyGeneral won him the hearty applause of his own followers, particularly those on the Corner benches, to whom the speech was mainly addressed, but it sadly failed to give the people of this country that explanation and defence of the Bill which they had a right to look for from a gentleman in his position. The speech was an attack upon the honorable member for Ballarat; it was a reference, more or less fitting, to the verdict of the electors at the last election. The honorable member addressed himself to the constitutionality of the proposal, and uttered witty and caustic generalities, which amused the House and entertained us all. Then followed a sort of paraphrastic recapitulation of the various clauses of the Bill, intended to explain their operation in simple language, but in a way which made the lawyers on our side start and stare at the interpretations the Attorney-General was giving to his own measure. There was no argument for or defence of the Bill. He did not deal with the strong criticism launched against it, not by this side of the House, which, at that time, had not spoken, but by the press, and by writers who have earned some title to express themselves upon a matter dealing with the lands of the Commonwealth. The honorable member met none of those glaring instances of injustice that had been pointed out as likely to result from the operations of the Bill ; but simply, in his witty and clever way, eluded the whole of the arguments, and left the House in no better position to indorse the proposal of the Government than before the honorable and learned gentleman addressed himself to the subject. His argument, as I have said, was addressed mainly to the Corner members opposite. It was as though, and it has been the same in many previous instances he was expected to show the gentlemen on those Corner benches the clever way in which he could set by the ears all the celebrated lawyers on this side of the House, and the great thinkers in the country. Like Goldsmith’s Village Schoolmaster -
While words of learned length and thundering sound
Amaz’d the gazing rustics rang’d around,
And still they gazed, and still the wonder grew,
That one small head should carry all he knew!
I admired, as much as did anybody in the House, and have always admired, the cleverness of the Attorney-General on this and other occasions. I admit his great ability, and have often thought of him - to compare small things with great - as the
Voltaire of Australia. One quality he lacks. Voltaire always had a keen appreciation of justice, and that is a characteristic that is sadly lacking in every public utterance ot the Attorney-General. He does not recognise the necessity in our public dealings, and particularly in our enactments, of having some sort of ethical base. It was admitted on all hands to be a fine speech, but I should like to direct the imagination of the House to the much finer speech which the honorable and learned gentleman could have made had he been commissioned to speak from this side of the House in opposition to the measure. Had he had the facts to which I previously referred, and to which it will be my duty to refer more in detail as I proceed, regarding the glaring anomalies in the Bill, and the acts of injustice which will follow from it, its strange inconsistencies, and its utter lack of any ethical principle - had he, speaking against the Bill, had those facts to deal with, what a much better speech he could have made. How much more effectively could he have torn the proposals of Ministers to pieces than endeavour to upset some of the past utterances of the honorable member for Ballarat and other gentlemen who sit on this side with me ! The Attorney-General happens also to be a writer to the press, in which he makes admirable defences of the Government proposals. In an edition of his “Case for Labour,” immediately preceding that speech, he wrote with reference to this Bill-
The criticisms are daily directed against it from almost every conceivable stand-point. It is, as I observed last week in connexion with the Australian Notes Bill, at once an unnecessary, illogical, iniquitous, inequitable, and dangerous measure. It is crudely conceived, badly drawn, doubtfully legal; its language hopelessly ambiguous and involved. Under the avalanche of criticism which grows with every passing day, the supporters of the measure might well be somewhat uneasy.
That is the honorable member’s own writing and thought, so far as he gave expression to what he believed to be the case for the- Opposition. Although I accused him of injustice in not properly representing in his speech the effects of this measure, I say here that he is singularly just in so adequately and fully representing in his writings the attitude towards this measure of honorable members who sit with me on this side of the House, and of those great journals and public writers who are opposing it. He has described their attitude very accurately and fully.
– The same attitude on this and everything else that the Government have introduced.
– The Minister of External Affairs is utterly wrong, because on other measures there are honorable gentlemen on this side, and journals in the country, who have supported the Government. I allude particularly to the Australian Notes Bill. It does not follow at all that we are bound to oppose everything the Government propose. But, knowing as fully as he did the case against the Bill, and what was thought and written about it, as evidenced by the few brief words I have quoted, which adequately covered the whole of the ground, why did he not, when he stood up here to give us that further information promised by the Prime Minister, so deal with the question as to show us the answer to those many charges of the ill-effects of the Bill ? I say straight away that it is not a good measure, and that it cannot come to good. The measure is, as stated by the Attorney-General in his article, illconceived, ill-digested, and ill-matured. This Bill is like Dr. Johnson’s famous, or rather infamous, leg of mutton, which he declared to be ill-bred, ill-fed, ill-dressed, ill-cooked, ill-served, and having other evil tendencies that would follow. We are not going to see the full list of its evils now; but, if it passes in its present form, we shall soon afterwards feel those evils. When the Attorney-General, slapping his right fist into his left palm, was so edifying my honorable friends opposite that they could only wonder with the foolish face of praise, it is strange that he could not have dealt with the bare facts for which we all were calling. This is now described as a taxation measure. The Government, instead of speaking of it as a measure designed only to burst up large estates, deal with it as one that is absolutely necessary for revenue purposes. But the Prime Minister, in submitting it, took a course most unusual in connexion with the introduction of such Bills, by failing to show the House what revenue was required, and what revenue would be derived from this source. When closely pressed, either in this House or elsewhere, he explained that he expected that the tax would yield ,£1,000,000 per annum. Other honorable members, replying to him, have said that careful calculations revealed the possibility of a revenue of from £2,500,000 to nearly £3,000,000 per annum being obtained from this tax. The Prime Minister “pooh-poohs” such an idea, yet he gives the House no other information than that which he says is a rough guess, by which he arrives at the conclusion that about ^1,000,000 per annum is to be obtained from this source. Why could not the Attorney-General have dealt with that aspect of the question when the Prime Minister had left it to him? Why should he not have given us the necessary information to show whether we. ought or ought not to pass this as a revenue Bill ? Why should he not have dealt with the question of whether we should be justified in thus interfering with the functions of the States, not constitutionally, but as a matter of expediency, in the development of their resources? Why should he not have given us some reason to support the request of the Government that we should impose this obnoxious taxation, beginning, as it does, at the wrong end of the scale? I could better understand taxation of this kind if we commenced below the point at which we now purpose leaving it to the States to tax land, instead of confining ourselves to the higher values by which, in effect, we claim the sole right to tax. If we impose this exceedingly heavy taxation on the higher values of land, it will be impossible for the States to impose any other land taxation.
– Another State rights speech.
– The State? will be restricted to the imposition of taxation on the margin left them between j£i and ^5,000. The honorable member for Gwydir says that I am now arguing for State rights. As a matter of fact, I am dealing with the expediency of the Commonwealth Parliament so adjusting its measures that the States will be able to exercise their functions under the Constitution, instead of our taking from them those powers so necessary to the development of the public estate in all parts of the Union. I should not have cared if the AttorneyGeneral were only one of the irresponsible members of this House - if, for instance, he were like the honorable member for Cook, the honorable member for South Sydney, and others who, in speaking on this measure, have shown their inability to get beyond the constant repetition of the cry, “ Burst up the large estates.” Their whole argument was nothing but a repetition of that cry, and the quotation of certain woefully wrong facts in regard to the land question in Australia. If the AttorneyGeneral had been as irresponsible as those honorable members are, I should not have wondered at what I describe as his delenda est Carthago - - “ Carthage must be annihilated,” burse up the large estates - argument without any consideration of what would be the effect of the bursting up of those large estates on a number that do not require to be burst up. If the honorable gentleman had been an irresponsible member of the House, I should not have wondered had he confined himself to that one argument, but I am surprised that a man in his position, with his ability and admitted grasp of public questions, should have become so elusive that those who wished to follow him could not do so, finding nothing in his speech but sheer invective. Indeed, his speech reminded me of the story of a man who applied to the editor of a great newspaper for a position. The editor asked him what were his qualifications, and on what subjects he specialized. “ Oh,” replied the man, “ Invective.” “ But what is your particular subject ?’ 1 again asked the editor, “ Any subject at all ; pure invective - strong, forcible invective,” .came the reply. That was the honorable member’s attitude on this Bill. He indulged in strong, forcible invective, but no argument. The honorable gentleman twitted the Leader of the Opposition with being a supporter of unimproved land values taxation. In that respect, I stand in the same boat with the honorable member for Ballarat. I am a supporter of unimproved land values taxation, but the circumstances have not yet arrived when the Commonwealth is compelled to tax land to the extraordinary and alarming extent now proposed in order to obtain sufficient revenue for its services. I am not one of those, nor is the Leader of the Opposition - and the honorable member for Ballarat’s speech the other clay was quite consistent with his previous utterances, notwithstanding the witty invective of the Attorney-General - who believe that we should go to the extent of wrenching powers from the States in this way - in a way that possibly is not unconstitutional, but is unmistakably in contravention of the spirit of the Constitution, and certainly against the interests of the people of Australia. The AttorneyGeneral twitted the honorable member for Ballarat with saying, not only that it was possible that such taxation would have to be taken up by the Federation if not imposed by the States, but that the question of immigration could not be dealt with un- less the land question were also dealt with at the same time. My view, and that of many other honorable members who believe in unimproved land values taxation, was that the utterances of the honorable member for Ballarat, to which the AttorneyGeneral referred, were in support of an effort that we were all making at the time to induce the States to take up this matter. It was, as it were, a threat to them, and we hoped that something would come of it. I took that view because we strongly believed that it was impossible for this Parliament to promote immigration under any measure that it had power to enact, unless we took strong powers of dealing with the land policy of the States without assuming adequate control of it ourselves. To that extent, I stand in the same position as the Leader of the Opposition, and, although the Attorney-General asserted that whilst we declared ourselves in favour of such measures as these, we invariably said “ For God’s sake, do not pass them now ! “ I say that now is the time for a proper system of land taxation. But neither now nor at any other time should we be justified in imposing an iniquitous and an unjust system of taxation such as that now proposed. The honorable and learned gentleman, like his less able and less witty followers, could only repeat the statement about the need for bursting up the large estates. He could not advance any argument to show that it should be done in the way proposed, or to prove that we should pass a measure doing gross injustice, creating anomalies, and likely to produce many unforeseen difficulties. At the present time the Crown has in Australia 986,000,000 acres, and 787,000,000 more leased to tenants ; with most of the latter areait will again have the power to deal. Only 92,000,000 acres have been alienated in fee simple; but if we make the necessary exemptions, the area to which a measure of this kind could rightly be applied is only 5 per cent. of the total area of the continent. Under these circumstances, why should we now be in the throes of an agrarian struggle? Is land scarce?
– It cannot be got.
– If the honorable member refers to the newspapers of this or the other capital cities, he. will see that they teem with advertisements of land for sale.
– As much as £5,000 is asked for a block.
– The honorable member is speaking of Collins-street land, perhaps. Nowadays men seem unwilling to take any land except such as they can win in a lottery, or as is situated close to a city.
– The honorable member would drive them into the Never Never.
– Some one must go out there. Those who went to the Never Never in the early days are the wealthy squatters whom honorable members now wish to crush. If our young men showed the same pluck they would become equally well off in the course of time. We shall not facilitate enterprise if we say to our young men, “ If you incur the privations which your fathers incurred, and undertake the task of carving out an estate in the wilderness, the nation will tax its value away, as soon as that value has assumed anything like decent proportions.”
– Hundreds of bond fide settlers who are seeking land cannot get it.
– That statement has been repeated so often that I should not be surprised if the honorable member believed it. There is plenty of land available, only a great deal of it requires the possession of capital, and of willingness to work hard to make it useful. Many of our young people are not so fond of hard work as their fathers were. As tothe deductions to be made from the 92,000,000 acres which have been alienated, it is necessary, in connexion with these proposals, seeing that their object, although ostensibly taxation, is really to burst up large estates, and make settlement closer, to deduct, first, segregated estates. If a man holds 3,000 acres in one State, 3,000 in another, and 3,000 somewhere else each estate being many miles from its fellows, nothing can be gained by bursting up his holding. For the same reason, you must deduct city and suburban property, because the taxing of such lands will not increase immigration, promote closer settlement, or stimulate agricultural production. You must also deduct the area in the far-out arid districts, because those lands are not fitted for closer settlement. If you burst up such estates, the land will merely fall out of use. Under the proposed tax it cannot be made use of until it falls to a value of1s. 6d. or 2s. per acre, which must mean the robbing of some one. This bursting-up policy must deprive some persons of hard-earned or inherited means, and do gross injustice. We may win a party struggle by the adoption of certain means, but we cannot put legislation of this kind on the statute-book without arousing the national conscience to the recognition of the mistake. We cannot commit such wholesale robbery, and expect to go unpunished by the electors.
– The honorable member must withdraw the term he has used.
– I presume you take exception to the word “ robbery,” Mr. Speaker. I shall therefore substitute the word “injustice.” To take from a man eight-tenths of the value of his property is to do an injustice which could not be described without transgressing the rules of the House.
– That is not done by the Bill.
– I shall show that it is. The Attorney-General, writing some time back about the far-out arid lands which the honorable member for Gwydir calls the Never Never, said -
A man looking for land cannot get it under existing conditions. A man must go hundreds of miles from a market. He must take up land where rainfall is unreliable ; he must spend years struggling against adverse conditions, and at the end find himself broken and penniless.
If the Bill aims at bursting up estates in areas where, according to the AttorneyGeneral, the land is useless for closer settlement, our legislation will wrongfully dispossess the present holders of land in these districts to make their land available to men who, according to him, do not wish for land of that kind. The honorable gentleman dealt with only one other phase of this measure, though he promised to deal with two others. He contended that the Labour party had a mandate from the electors to introduce land taxation to bring about closer settlement, and to stimulate agriculture. He was justified in saying that the party had a mandate from the people, but it has given that mandate a wrong interpretation. I admit that the electors voted for land taxation, which would render available for closer settlement land suitable for agriculture, but I do not think that their verdict warranted the bringing down of this particular measure. It has been affirmed by Ministers and their supporters that the people thought that city and suburban lands should be taxed. I admit that it was understood by me, by the Prime Minister, the AttorneyGeneral, and other members, that such land would be subject to taxation if a land tax were introduced, but it was not under stood by the electors. During my addresses I pointed out that it would be absurd to tax valuable blocks of city land, like those held by the banks and the commercial palaces which adorn our cities, with a view to promoting closer settlement. I was told by well-known members of the Labour leagues that I misrepresented the case, and that the proposal was only to tax large country estates. Questions and statements were asked and made at my meetings which show that that was the general opinion. No doubt the constituencies represented by honorable members opposite understood their views. I give the honorable member my assurance that it was not understood in my district. It was not so understood by the general body of electors, or by the leading members of the Labour Leagues, who follow candidates about in order to keep them up to the mark. Then, again, honorable members opposite cannot assert that they received a mandate from the people to impose a tax as high as 6d. in the£1, and 7d. in the £1 in the case of absentees. During the whole course of the election, the highest sum I ever heard mentioned was 4d. in the £1. We have been told by the Prime Minister that, whatever appeared in the public prints, a proposed tax of 6d. in the £1 was on his notes ; but we do not get a mandate from the Prime Minister’s notes. The people of the country must understand and know what is proposed, and I am convinced that they did not understand that there was to be a tax on city lands, or that the tax would be as high as 6d. The Prime Minister argued that there is a necessity for such legislation on account of the need of revenue, and on that score I am with him entirely. Though I am at variance with many honorable members on this side on the point, Ihad foreseen for some time that if they came back to power they would find it necessary, sooner or later, to seek extra revenue. I am entirely in accord with the arguments of the Attorney-General, who has said that if further revenue be needed, we cannot tax the people further through the Customs. But the honorable gentleman should be the last in the House to take credit for such an attitude. He,like myself, is a Free Trader; and yet he consented to some of the heavy duties which have been imposed, and it does not lie in him to twit honorable members on this side with the idea offurther taxation through the Customs. He knows well that there are many honorable members sitting beside me who voted strenuously against the imposition of heavy duties. I recollect well that, when the PostmasterGeneral indicated a preference for a land tax accompanying the duties in order that the latter might be lessened, I agreed with him, and asked why his party, who had all the power in those days, did not propose a land tax. I am one who claims to be a loyal land-taxer.
– Is the honorable member a single-taser ?
– No, I am not; but I would tax the unimproved value of the land. I admit the necessity for increased revenue from somewhere, and, being a land-taxer, I am bound to look to the land in preference to any other source. Now that we have repealed the Naval Loan Act. by which the late Government expected to finance some of their immediate difficulties, we must have extra taxation, and I know no better way, if we are forced to raise it, than to impose a tax on land. But there is a marked difference between .a tax on land and a tax of the nature proposed, which interferes with the primal industries of the country, acts prejudicially on most of our vital interests, and imposes injustice on many of the people. I can conceive of a land tax that would give all the revenue required, and yet leave the State free to deal with those matters of public policy which must be left with them so long as they have the lands and the railways in their power. I should like for a moment to look at the genesis of this land tax movement in Australia. Prior to Federation, the attitude of the Labour party in this connexion was expressed in a desire to “ get at “ the large land-holders and absentees for revenue purposes. There was no question of bursting up estates - no question of taking over the manipulation of the whole of the works policy - but simply a desire to tax for revenue purposes. After Federation we had the proposal to burst up large estates; and why? As an excuse for the frenzied anti-immigration policy of the Labour party. Not the Labour party themselves, but the leagues behind them, were strongly opposed to any form of immigration ; no proposal was ever made that they would agree to for encouraging immigration and peopling our empty spaces. It was argued that large estates should be burst up, and land made available, when, it was said, as many people as the Government chose could be brought in. Mr. Watson, who had the honour of leading the Labour party in the early days of Federation, boldly proposed a Federal tax, or rather advocated such a tax - he was not in power at the time - to burst up large estates and also to obtain revenue. But that gentleman fully recognised the absurdity of placing such an impost on city and suburban lands. He knew, as we all know, that many of these lands are put to their highest productive use; and though he recognised there was a constitutional difficulty, he hoped it might by some means be got over. That was the position of the movement up to the time when Mr. Watson severed his connexion with this Parliament. The Labour party, however, were compelled to recognise that if our scheme of defence, which both parties were beginning to realize as necessary, were carried out, there would be required in a few years’ time something like £3,000,000. Then came the further cry with which the Labour party went to the people at the last election, that the extra cost of defence, which they definitely put at £1,000,000, should be met by the taxation of land. Underlying every move, and the most recent and matured expressions of the leaders of the Labour party, there is always the ultimate aim of getting all, or nearly all, the land value, and all, or nearly all, the political power, concentrated in the hands of the Federal Government with a view to nationalization. That is what we are doing to-day ; we are moving in that direction by means of this Bill ; and that is the reason of the incongruous nature of the proposals before us - the reason for the many anomalies and injustices. This is the first stage in the confiscation of land values and the concentration of all power in the Federal Parliament. I invite attention for a few moments to the attitude of the Labour party on the question of the relation of the States to the Commonwealth. The Labour party has never been in favour of a central authority in their own organization, but have always recognised that there must be decentralization in order to have effective work on the part of the local bodies. If the Labour party had been successful in obtaining power in the State Legislatures, we should have had no Such proposal as this Bill. But they now see a chance of concentrating all the land value and all the power in the Federal Parliament; and their ultimate aim is nationalization. The Labour party have practically captured the Senate, the Chamber which we thought was to be the protector of State rights. Where is the protection of- State rights to-day? I repeat that if the position had been reversed, and the Labour party had obtained power in the State Legislatures, and had been in a minority in the Commonwealth Legislature, ‘there would have been no attempt to settle the agrarian difficulty here. It would be better in the interests of Australia to have land nationalization at once, with any measure of just compensation that can be conceived, than a tax of such gross injustice and glaring wickedness, ruining so large a percentage of the people, and improving the position of no one. I have admitted that circumstances compel the consideration of land taxation by the Commonwealth. There is, first, the necessity for revenue, and then the fact that the State Governments have refrained from taking action. The result of the last election undoubtedly forced the question on the consideration of this Legislature ; but there are certain matters which we ought to keep in view. The measure before us totally omits to take those matters into consideration, and on that ground, although I am a land-taxer, I am bitterly opposed to the present proposals. The first thing to be considered in any proposal for land taxation of a national character, is the justice of the impost. Nothing will be finally approved which is not just; an unjust measure may pass, but it will be altered and amended, until we have some rough form of justice, and finally repealed. The Attorney-General, when addressing us, interpolating a question, said - “ Are you going to impose a tax on a minority of the people in an unjust way ? “ No, we are not. That is not our proposal. I shall show before I sit down that it is a just tax. I hope to be able to prove - and I trust that this Parliament; as a whole, will concede - that there is no more just system of taxation than the one that we propose.
I have carefully scanned the remainder of the speech without coming across a single passage which is a defence of the justice of the measure - without coming across an answer to that very strong criticism levelled against the Bill on the score of its glaring injustice. I know that it is contended, and rightly so, that the public safety is the highest law, but have we reached in our land problems that state of difficulty in which we are compelled to set aside contracts and to impose all these injustices from considerations of national safety or national defence? I say we have not, and the maps and figures exhibited to-day, and on other days, prove conclusively that no such position has yet arisen in Australia. The second consideration that ought to be before our minds in dealing with a measure of this kind, is that it must be an important branch of a complete fiscal system. You cannot properly consider a land tax of any sort, much less one of this magnitude, except in relation to the other taxation imposed by the country. It is not intended to re-open other schemes of taxation. This is to be superadded to the rest, in spite of the fact that we do not know what is to be derived from it. We strongly suspect that instead of ^1,000,000, as anticipated by the Prime Minister, it is more likely to produce a revenue of £3,000,000. A third consideration should be how far such a measure affects the financial relations between the States and the Commonwealth. We have only recently made an arrangement with the States by which we get rid of the old Financial Agreement and enter upon a new one, paying the States 25s. per head of their population for, at any rate, ten years to come. That was a solution of the financial relations question at the time, but then the States had full power, and some of them were exercising it, to tax the lands of the community. Honorable members may say that if we impose this tax we do not prevent the States continuing to tax the land. But we do. Nearly all possible taxation of land by the States would have to go by the board if we instituted the proposed system of Federal land taxation. All that would be left to the States would be that margin between nothing and £5,000, which is the worst end of the problem for the States to deal with. If there should be any division of ends between the States and the Commonwealth, that is the end which ought to be dealt with by the Commonwealth Government. The other end, representing the extremely large values which influence the decision of agrarian problems, ought to be in the hands of the States. But in any case, how can we say that we are doing justice to the States in agreeing to give them 25s. per capita, . and a few weeks afterwards taking from them at one fell swoop all that they could ever hope to get out of land taxation, which, although not a very great source of revenue to them at present, would inevitably be a growing source, and was sure to reach large dimensions in the immediate future? In this measure we have altogether left out of consideration the financial relations between the States and the Commonwealth. The next question which we should have to consider in any proposal to impose a Federal tax on land, is the probable effect upon the Crown estate in the various States. The States must inevitably deal with their lands in connexion with their railway policy and water conservation policy. One of the great future operations of Australia will be to conserve water wherever it can be conserved, in large areas, and at enormous expense. That cannot be done by the States unless they have control of their own land policy, and how can a State have any adequate control of land that it desires to dispose of unless it has the power of taxing that land and the power of regulating the taxation ? Look at some of the expedients that have been proposed when a railway is demanded in certain districts. The party opposite have frequently advocated the betterment principle, but how can the States go in for a betterment policy when the Federal power has already absorbed all that it is possible to take in the shape of taxation from the land? If we owned the lands and the railways I could understand, to some degree, the taxation proposed, although I could not swallow it or vote for it. Not owning the lands and the railways, and not having charge of water conservation and other matters necessary for the development, of the public estate, we had better leave this question alone, or work in co-operation with the States, in such- a way as to secure the adequate development of our resources. The last consideration in regard to any measure of this sort is that of population and immigration, and the adequate defence of Australia, which honorable members opposite claim underlies their proposal. That, perhaps, is the greatest consideration of all. Undoubtedly, with our vast vacant spaces, with the growing disquiet throughout the world, with men’s thoughts leading them to fear all sorts of uprisings in the near future, we must prepare to defend Australia. We cannot defend it without population, and, undoubtedly, we can so effect certain land laws as to stimulate population, although I do not think we shall do it by this Bill. We cannot do it effectively ourselves, but the States can do so. I am answered that they do not do it, but I believe if we had at heart the interests of Australia, and not so much the interests of the success of. the reigning party, we- could get the States to co-operate with us in_ a policy which would increase the population of Australia, and so provide for its adequate defence. Let us examine the effect of this taxation on the lands that the States have to deal with. But it will, perhaps, be seen better if we take the Northern Territory lands as an example. Those are the only lands that the Commonwealth Parliament will have to deal with for some time to come. We are taking the Territory over at a considerable expense, and it would be right to take it over at any expense. We have to spend considerable sums of money to develop it, and must recoup ourselves for this immense expenditure in some way. We have to develop that part of the continent, and get it peopled. We can only do what we have in view with regard to Northern Australia’ by selling the land, and land like that of the Northern Territory is not going to be sold in model farms of 100 acres. To be effectively and economically occupied and used, it will have to be held in large quantities, at any rate, in the first instance. The Commonwealth Government -will have to dispose of it when it comes into their hands, and the probability is that in developing tropical agriculture in that part of Australia they will have to get rid of large quantities of land in blocks worth £15,000 or more. But the moment they sell it or dispose of it, down comes their Act, and taxes it at 2d. in the £1, while if the holders are absentees, using their capital for the development of the Territory, and putting people on to it, the tax is made 3d. in the £1.
– Does the honorable member know the value of the land there?
– I shall show the honorable member that the tax is more than the value of it, and will tie up the hands of the Government in dealing with their own land, because I do not see how they can very well exempt the lands of the Territory, when they have been alienated, from the operation of their own taxation measure. This measure, then, will stop the Government from developing their own territory, and all the expense that they will be put to in purchasing it, in paying compensation to South Australia, in laying a railway into it, and the thousand and one other expenses that will have to be incurred to develop it, will all be thrown away. The Government cannot use the land in that part of the continent with a tax like this staring them in the face. The tax, in the first instance, would be more than the value of the land.
– How does the honorable member make that out?
– The land is not taken up now at any price.
– Then what is its value?
– We do not know. It has yet to be seen.
– It has no value at present, if you cannot get anybody to take it up.
– It has no value while nothing is done. If something is done with the land, it will have a great value. That has been the case in Australia everywhere. Those waste spaces shown on the map will have no value until something is done with them ; but put railways through them, and open them up, and they become valuable. The Northern Territory might be handed over to a private syndicate, who by expenditure would give it very considerable value in a year’s time. However, I do not advocate that. The Commonwealth should take it over, and develop it, and sell it or dispose of it in other ways, so as to get it peopled, but that will never be done with the Northern Territory in face of the operation of a taxation measure like this. Those are what I regard as the main considerations that should actuate the House in dealing with a Land Tax Bill. I should like to refer here to what has been done by the States quite recently in the direction of obviating the necessity of such a tax, or at least of its extremely high characteristics. It is said that the States do nothing, and the Attorney-General claims that it is the shadow of this Bill that has forced the doing of this, that, and the other. Any one who has read the political history of Australia will know that proposals of land taxation run through the whole of it, and that measures are being considered even now for introducing effective land taxation. We are told by the honorable member for Angas and others that the legislation introduced into South Australia up to the present has been effectual in breaking up large estates and bringing them into closer cultivation. We are told that the holders of land there are offering it for sale. Honorable members from Western Australia tell us that there are 2,000,000 acres of good land fit for agricultural settlement available there now, and advertised in the markets of the world. We are told by the Premier of New South Wales that he intends building certain cross-country railways, which will have the effect of opening up 2,000,000 acres of land fit for agricultural settlement. In all the States the policy of re-purchasing large estates, whether it is a right or a wrong one, has led to the growth of small landed proprietors. I think it is a wrong policy, because it has the effect of forcing up the value of land. But let us take the Prime Minister’s own figures. In his secondreading speech, referring to New Zealand, he said : -
The extent of large holdings of 1,000 acres and over decreased at the rate of .4 per cent, during the period 1906-8 inclusive, while the small holdings increased at the rate of 5.3 per cent., pointing apparently to the influence of unimproved land value taxation.
The honorable gentleman also told us that in New South Wales, during the same period, the smaller estates had increased at a larger ratio than had the large estates. The point from which we have to take confidence is that in a State like New South Wales the smaller holdings are increasing. The Prime Minister said -
During the period 1906-8 inclusive, large holdings in New South Wales (i.e., those of 1,000 acres and over) increased in extent at the rate’ of 1.3 per cent., and the smaller holdings at the rate of 5.8 per cent.
That was a larger increase than had taken place in New Zealand. In New Zealand it is next door to impossible to obtain any great increase of large landed- estates direct from the Crown, but in New South Wales, and more particularly in Queensland and Western Australia, it is inevitable that large landed estates must be created by recent alienation from the Crown. The areas are available, and in the public interest they must be used. It is better that they should be sold now at £r per acre or less than that they should remain in idleness for a generation, or, possibly, a century, and then be parted with at double or treble that price. The idea is that we should make use of Australia’s lands, increase their productivity, and so increase our population. If the large estates of New South Wales have increased, not by repurchase, but by fresh alienations, we have, on the other hand, the comforting assurance that the number of small holdings has increased to a far greater extent.
– It is the aggregation of farm lands in settled districts that is causing the great trouble.
– But does not the honorable member recognise that the figures to which I have referred apply to all lands, and that if we eliminate from them those relating to grazing lands we show a much better position with regard to farming lands? It is inevitable that grazing lands must be held in large areas, and, therefore, the increase in respect of smaller estates must relate to agricultural holdings. Having dealt with what I consider to be the right considerations that ought to actuate the House in dealing with a Commonwealth land tax, I should like now to allude to what, in my opinion, are some of the wrong considerations. One of these is that desirable ends are justified by any means. I fear that that is the actuating motive of this proposal. Certain ends to which I have referred are desired. Those ends are to be gained by any means - even means which impose an injustice on many people who have worthily built up their fortunes and well-being amongst us. The fathers of those people were alluded to as the pioneers and explorers of our country, whilst they are regarded now as miscreants who are withholding the public estate from some one who wants it. That “ some one “ is apprehended to be in existence, but I do not find him so much in actual evidence as he is in talk. A second wrong consideration is the imposition of such a tax for mere party successes. If there were not some sort of blind, unreasoning feeling on the part of the less thinking part of the community that we ought to burst up the large estates, those who have more capacity for dealing with this complicated question - including all the members of the Labour party in this House - would not be in such a hurry to bring in what, under the guise of land taxation, is really a measure associated with signal acts of injustice - a measure which must lead to land confiscation, even if it is not actually intended to bring about land nationalization. A third wrong consideration, which has been made use of in the campaign in support of this measure, is that of enlisting a majority to evade taxation by imposing it on a small minority. For what is this exemption of £5,000?
– To catch votes.
– The conclusion is that, by imposing such an exemption, you can obtain more votes in support of the tax. A man possessing property the unimproved value of which is under £5,000, would vote - as many, no doubt, did - to tax others possessing property in excess of that valuation.
– That is unworthy of the honorable member.
– It is unworthy of the party.
– The exemption is onlyone step in the gradation.
– Having enlisted this large majority - a majority consisting* of those owning land whose unimproved value is under £5,000 - in support of this absurd tax on estates of a higher value, the next step will be to induce a section of the small land-owners to unite with the large land-holders to carry the tax further down the scale, and so on until the last step is reached. I am reminded in this connexion of the horrible story told in Marcus Clarke’s For the Term of His Natural Life, of the four men who escaped from the west coast of Tasmania. They became very hungry and three of them having whispered together, one of them disappeared. Later on, after two of them had whispered together, the third man disappeared, and the remaining two had to watch each other day and night lest the one or the other should likewise disappear. The policy of this Government is to eat up the weakest sections of land-owners at this stage. They will then combine other sections to eat up the next, and so on till the whole are eaten. In this way they hope to bring about a system of land nationalization. I have no hesitation in saying that there will be an elaborate development of taxation, by which the various sections of society will be in turn enlisted to gradually absorb the whole value of the land in Australia. That means land nationalization - that is the course on which the Government are embarking, and this undoubtedly is only the initial stage. Honorable members when outside have been honest in the matter, and have said boldly when questioned as to the £5,000 exemption, “ That will do for a beginning, but you do not suppose that it is going to remain for all time? It is going to be reduced till we take the whole.” Probably also the tax itself will be gradually increased. The hope of honorable members opposite is gradually to bring about a scheme of land nationalization without compensation. The intention is to destroy the value of land by an elaborate system of taxation extending probably over a good many years, so that ultimately the State will be able to absorb the whole. That is another wrong consideration; and the last that I shall mention is the total disregard of the present Ministry for the financial necessities of the States. Having recently passed through this Parliament a measure to adjust’ our financial relations with the States, they reopen those relations by imposing upon the States a difficulty which they will seriously feel in the very near future in settling their finances. The greatest need of most of the States at the present time is a forward railway policy. Without such a policy we cannot have immigration, and a forward railway policy means spending money. Some of the States cannot spend any more money without imposing increased taxation. What are they to do? Are they to tax the bare margin of unimproved values of from £i to £5,000? If we impose this tax in the form proposed by the Government, we ought to consider the finances of the States, co-operate with them, and return them some of the money that we gather from their land. If we do not, what shall we be doing? We shall be wresting from the States not merely the revenue that will be derived from land taxation, but the very control of the land. We shall be preventing them from dealing with their own lands, and pushing on with their own works. Later on, when it is proposed to take over the railways of the States, it will be argued that we ought to take them over because we have imposed land taxation and can, therefore, more effectively develop the railway policy of the whole community. Is this not the initial stage in a policy of gradual unification? The States are to have their powers taken from them, one by one, if not by an amendment of the Constitution, by such fiscal regulation as will leave them powerless, and render it necessary for them to hand over their powers to the Federal Parliament because of sheer inability to exercise them. I strongly condemn this tax on account of the injustice that it will work, and the Attorney-General has not shown that the criticism levelled at this measure on the grounds of its glaring injustice can be disproved by the Government. Then, again, it is impolitic, since it ““ill not get at the land-holder at whom we wish to get. Its injustice is manifest, in the first instance, in relation to the exemption of £5,000. Why should a property of the unimproved value of £5,000 be exempt from taxation ? Many people regard this in the light of a rough income tax, and I should like to know why any land having an unimproved value of £5,000 should not contribute something to the necessities of the State, when we tax sugar at the rate of 6s. per cwt. In an absolutely just system of taxation we cannot have any exemption, save, in respect of an amount below which the tax would not be worth collecting. Speaking in accordance with strict principles of justice, there should be no exemption whatever from a land tax. But what is the further point? Our problem is mainly that of revenue, and we wish further to cause good arable land within economic reach of markets to be put to the highest possible use. That is the problem which Ministers are setting. It is said that the States will not do this, and, therefore, the Commonwealth must do it. How do they propose that the Commonwealth shall do it? By taxing progressively the unimproved value of poor grazing land which has not increased since it was purchased, perhaps, fifty years ago. There may be abstract justification for taxing the unearned increment of land worth £5 an acre which the holder bought for £1 an acre, but there are millions of acres in Australia which were bought for £1 an acre and are not worth more than that to-day. Shall we, by bursting up the large estates formed by this land, assist closer settlement or encourage immigration ? This land is being put to its highest economical use now. It could not be sold in blocks of 5,000 acres, because such blocks would not afford subsistence for a family. Where the tax cannot be paid. by the holder of the land, the property must pass out of occupation, and become overgrown with scrub again. The only alternative is a depreciation of value to something like 2s. an acre, which will enable some one else to obtain the land at a cost on which he can afford to pay the tax. The Prime Minister admitted that the facts placed before him by a deputation the other day were very important, and promised them consideration. It is a singular thing that while we are discussing the second reading of the measure, primary principles like this and the taxation of Crown leases are still under consideration by the Government.* According to the deputation which waited upon the Prime Minister, there is, in Riverina, an area of 64,145 acres whose total unimproved value is £56,127, and whose average net profit is £1,336. The tax on that area would be £576, or 8s. ?d. in the £1.
– How is the value arrived at?
– The Prime Minister was assured that he would be given an opportunity to verify the statements, though, of course, the persons concerned do not wish their names to be made public, because many of these estates are mortgaged. Another area of 26,923 acres has an unimproved value’ of £19,443, and returns an average net profit of £83. On it, the tax would be £567.
– If the owners sold out and deposited the proceeds in a bank, they would do better than that.
– The honorable member must know that in Australia a pastoralist may lose money for a series of years and make good his losses in two or three subsequent, years, but, on the whole, grazing is such a gamble that it would be impossible to do what he suggests. Another area of 65,821 acres has a total unimproved value of £61,801, and returns an average net profit of £862. On it, the tax would be £684, or 15s. 9d. in the £1. There are many other instances, with which I shall not weary the House, the taxation varying from 9s. in the £1 on the net income to amounts exceeding the net income. These are authenticated cases, the deputation having assured the Prime Minister that it was prepared to satisfy an officer of the Treasury of the correctness of its figures. Under the Bill, a man holding 100,000 acres of land of the class I have mentioned, worth £r an acre, and another holding 20,000 acres of fairly good land, worth £5 an acre, would each have to pay the same amount nf tax ; but whereas the man holding poor land could not put it to better use, or get rid of it, the man holding the good land could put it to better’ use, or could sell it to advantage. Thus, great injustice will be done to those in the arid districts, without advantage to the community, because the effect of bursting up large estates where land is poor will merely be to put it out of occupation, or to ruin the present holder, and transfer his interest to some one else, who will be able to obtain it for much less than it originally cost. I should like to refer to some letters which appeared in the Sydney Morning Herald, signed “Justitia.” The identity of the writer was accidentally revealed to me ; and I assure honorable members that no man in New South Wales, and possibly in Australia, is more competent to deal with this question than he is.
– Is he the editor of the Pastoralists’ Review ?
– No. I will let his arguments speak for themselves. If they do not carry conviction, it is not possible to convince honorable members opposite of- what is as clear as daylight to me, and to most on this side. The writer admits that there is some possibility of break ing up large estates of arable land, and thus stimulating closer settlement, and continues -
But there is a class of land-holder to whom none of these conditions apply. I refer to the owners of land in the drier and less fertile districts.
– Do I understand that the honorable member is. reading from an article commenting on the matter now before the House?
– The honorable member will not be in order in doing that.
– The honorable member is not reading anything relating to this debate. What he is reading is a discussion of the matter which forms the subject of this debate, but is not a comment on the debate. I submit that he may read from any book or newspaper anything which does not comment on the present proceedings.
– The article from which I was quoting was written before the discussion of the Bill commenced.
– I asked the honorable member if it referred to the matter now before the House.
– It refers to the matter now before the House j but not to the debate itself.
– Under these circumstances, the honorable member may not read it.
– For other reasons, it may be as well not to read it. The article is very lengthy, and honorable members who have an open mind can look it up, and the other articles, for themselves. The writer knows the subject from A to Z; and his statements must convince every reasonable man that the measure, as it stands, will do great harm to Australia. It will absolutely ruin the holders of grazing land of low value in the far distant and arid regions. Under this tax these lands cannot be occupied, but must be confiscated so far as the present holders are concerned. It is most desirable that the rich lands of the country should be made available for effective closer settlement, and there is some justification for a tax in their case; but the only effect, so far as the lands in the outlying portions are concerned, is to hand them over to the rabbits or cause them to revert to their primeval scrub. I am sure that that is not the desire of honorable members opposite; but many of them, in order to achieve the end they have in view, are moving in the dark. I should like to lay particular stress on the case of lands in the Riverina district, and show how, in the opinion of those best able to judge, areas will be rendered absolutely unproductive. I ask honorable members to pause before they pass the measure in its present form, with the result of crushing out the present occupiers. The other day a case was brought under my notice of a man who holds 10,000 acres in the Riverina district.
– I should like to hear some of those estates named.
– There must be some sort of confidence between gentlemen, and if an honorable member says that he has verified a case, I think his word should be accepted without question. I have no personal interest under this Bill. If all my shreds of land were put together I should not have £4,000 worth ; but, so far from trying to evade taxation, I am of the firm opinion that that £4,000 worth ought to be taxed. I am interested in the welfare of the country only, and that is why I desire to place before honorable members a case which shows the glaring injustice which may be perpetrated under this Bill. This man owns 10,000 acres, which cost £10,000, and on that sum I suppose he will be taxed under this measure. The profit he made out of his holding last year was £120 ; and the tax for which he will be liable is £20 odd. This man declares that he will not pay the tax; and if the bank, which has a mortgage, forecloses, what will be the position ? The bank will be called upon to pay taxation amounting to £293 15s., because this estate is lumped with all the other lands held by the bank and taxed at the highest rate. Moreover, this is a bank registered in London, and with more than two-fifths of its shareholders in England; and, therefore, it will come under the absentee clauses, although all its assets, dealings, and business are in Australia. This great increase of taxation will be imposed on the bank simply because it is forced to take over this land in order to protect itself. I should also like to refer to a letter I received the other day from a gentleman who is interested in a trust estate. The AttorneyGeneral told us the other day that beneficiaries in trust estates would be dealt with separately ; but trust estates, like land tenures, have many variations, and give rise to much complication when considered in relation to taxation. The grandfather of the writer of the letter left a valuable estate a number of years ago to nine daughters and one son, with provisions for children, grandchildren, and so forth ; and there are now forty-three beneficiaries. The testator left certain specified properties to. each of the nine daughters, but this provision does not break up the estate, which remains as a whole, and, therefore, liable to the higher taxation. For some twenty or thirty years the estate has been going down in value, because it is not particularly well looked after, until now the income of my correspondent, who is a grandchild, is £43 Now, under the proposed scheme of taxation this poor man will be called upon to pay £16 in taxation owing to the fact that being a trust estate, the property is regarded as one and taxed at the higher rate. This occurs under a measure introduced by a Labour Government, who, particularly, ought to look after the interests of the poor and see that justice is meted out with even hand. Then let us look at the effect of the proposed taxation on city and suburban lands. A man with£5,000 worth of unimproved land in Melbourne or Sydney will escape taxation. Can such a man be regarded as a fit object for the charity of this House? Ought he not to be called upon to bear his share of the burden? But that is not all. If an exemption in the case of grazing land be very politic, and an. exemption in the case of agricultural land be only less politic, an exemption in the case of city land is absolutely impolitic. Look at the operation of the tax as between individual and individual. One man may have £10,000 worth of unimproved land and nothing else, and he is called upon to pay taxation on £5,000; whereas another man may have £5,000 worth of unimproved land, together with stocks, deposits, investments, mortgages, and so forth, aggregating £1,000,000, and yet he is called upon to pay nothing, so far as the Commonwealth is concerned, except Customs duties. Is there any justice in such a position ?
– How would the honorable member deal with such a case under this Bill?
– I shall let the honorable member know before I am finished. A man with £1 0,000 worth of land, paying £24 is. 6d. in taxation, may have effected £50,000 worth of improvements and be giving employment, stimulating energy, and, by the fact of building, reducing rents - be altogether an active and commendable citizen. Another man may have five blocks of vacant land, each worth £1,000, which he is holding for a rise, stimulating no activities, but keeping up rents, and not a commendable citizen in any way; and yet he goes scot free. One man, a captain of industry, may build on land worth £20,000, and, under our Tariff, prosper, and we may applaud his pluck and success. This man decides to extend his business, and he opens up branches in two other States. The tax on his original £20,000 worth of land is £93 15s., but, by reason of his buying land for the purposes of his branch establishments, his tax is at once increased to £649 6s. id. By the incidence of our Tariff and other measures, we show that, in our opinion, a man who promotes industry and the manufacture of Australian goods is doing some good to the country, and yet, if he be enterprising in the way I have indicated, we penalize him so much that his tax on his original block is at once increased from £93 15s. to £216 8s. 8d. If that is not the ne plus ultra of woodenheadedness 1 do not know what is I I cannot conceive how any man, who has thought over the matter, can support a measure under which such a state of affairs is possible. I know that my honorable friends opposite are not much in favour of banks, but, after all, a bank, whether State or private, is a public facility. The Bank of New South Wales, for instance, must have numerous branches all over the country in order to convenience the people ; and because of this all the land so occupied is taxed at the highest rates. A certain bank on its premises in George street west, Sydney, will pay 6d. in the £t, and next door there may be a vacant block of equal dimensions, on which the owner pays nothing in the shape of taxation. In the one instance the owner is doing all he can to utilize the vacant spaces of the city for commercial purposes, while in the other the owner is simply waiting for a rise. I can understand the efforts to break up agricultural lands for closer settlement, although I do not altogether approve of the methods proposed ; - but I cannot understand any proposal for breaking up land in cities and suburbs. Is there anything to be gained by smashing up 6 feet of land, because, in some instances, that is all that is required to exceed the minimum of £5,000? The underlying principle of the Bill «is that no man shall hold more than £5,000 worth of land without the tax falling upon him to induce him, sooner or later, to break it up, so that a larger number of people may be occupied in using it.
But it is preposterous to expect anything of that sort to be done with city lands. However, as honorable members opposite have told us, they have the numbers ; their Bill is before us, and they will put it through. “ Should a wise man utter vain knowledge, and fill his belly with the east wind? Should he reason with unprofitable talk, or with speeches wherewith he can do no good ?” I know we cannot alter this Bill, and no effort of ours can make any difference in its form. But there is some sort of hope that Ministers and those behind them may take a more rational view of this question before the Bill is finally through the House, and may give it an altered form that will be less unjust and less full of glaring anomalies. Honorable members opposite came back to the House with a majority, and I was the first to admit that the price of their maintaining that position was moderation, and that, with moderation, they might hold office for the next six years. It seemed to me that there was nothing which would disturb them, if the measures they proposed were moderate ones that the community would approve of. But this measure is beyond all idea of moderation, lt out-Herods Herod. It goes beyond anything that has ever been proposed or publicly mentioned in Australia. lt will have the disastrous effect of forcing land out of use into idleness. It will not promote settlement so much as it could be made to promote it, because it is too extravagant, and will throw so much land on to the market by forced sale that there will not be buyers for it, or, at all events, not sufficient men here to work it for some time to come. lt will be disastrous in many ways which honorable members opposite have not yet realized, and which the community generally will .probably not realize until it comes into force. We are seeking to make a law for the whole Commonwealth, and it is hard to prove how difficult it is. Look at the various forms of land tenure. Ministers have not yet told us how they propose to deal with leased lands, or whether they propose to exempt them or not. The most interesting speech which I should have liked to hear from the Attorney-General was not the one he delivered in the House, but the one he made to the caucus on the question of exempting leases. How are Ministers going to deal with that great principle? If leases are to be exempt - and that is the proposal of some honorable members on the other side - another act of injustice will be added to the many that will be effected under the Bill The leaseholders in Australia aggregate between them about 780,000,000 acres; and if they are all going to be exempt, where will be the justice of taxing all those who own the fee simple? Many of the leases are next door to holdings ,in fee simple. If honorable members will only think of the various forms of land tenure that exist throughout the States, they will see the endless complications that we are entering upon. In Queensland there are prickly-pear leases. A man is given a lease of land which is covered with prickly pear, and has no rent to pay for a certain number of years. He has to take steps towards eradicating the pest; then he gets a light rental; and then, I think, a lease, which he can convert into’ freehold. He is working all the time to make use of something which is of no value to the State ; but when he succeeds, and gets the fee-simple of the land, the Federal Government come down on him with this tax, and take away from him a large part of its value. What do the people in Victoria or Tasmania know about prickly-pear leases? In New South Wales we have snow leases. What do they know of them in South Australia or Western Australia? We have, swamp leases, conditional purchase leases, deferred payment leases, and all sorts of rights and pre-emptions, and land tenures. If all forms of Government leases are exempt, a very large portion of the lands of Australia will be exempt from this taxation, and the Bill will be made still more unjust to holders in feesimple, who will have to bear the whole weight of the burden. Some honorable members opposite, notably the honorable member for Grey, see hard cases in the taxation of leases; but I wish they would wake up to the fact that there are also hard cases regarding freeholds right through the country, and very hard cases in connexion with trust estates and many of the city lands. The whole measure is so complicated, and has been so little digested, that the House might very well pause before it carries it. If it is carried in this form, it will be most disastrous to the best interests of the country, and when we next appeal to the people, the present holders of office, large as is their majority, will be hurled from power, because they will have departed from the principles of strict justice, and have misled the people as to what they proposed to do.
.- I suppose I have paid more attention to the speeches made by the honorable member for North Sydney than to those of any other member in the House, for the reason that he appears to me on some occasions to be a Liberal, for no member on this side could give expression to more noble sentiments than he utters in his speeches on various questions, the trouble being that he is not prepared to do anything. He told us that he is not in favour of any exemption whatever, and, therefore, the single taxer will be perfectly satisfied with his speech. Indeed, if he had set to himself to make a speech that would satisfy all classes of electors in his district, he could not have made a greater success than he has done. You can find in it something that will satisfy the man who is opposed to land monopoly, while the man who owns £100,000 worth of land can also obtain some comfort from it. The honorable member has also spoken of his anxiety, that we should do something for the poor, by so framing our system of taxation that the burden would fall very lightly upon the poor man who has no land and no employment. But the moment the party on this side of the House propose to do something for the man who has no employment, or capital, or land, the honorable member sees objections to it. The honorable member now comes to the. conclusion that if we carry out our policy we shall be swept off our feet at the next elections, as he says we deserve to be. If that were to be the fate which this party are to meet at the next elections through passing this measure, the honorable member would not have spent two hours in denouncing it. I have listened to the cases in which he sees great hardships. He spoke of some in the Riverina district, where valuable lands now in occupation were earning only a small income, and said that if we impose the proposed tax, those values would be decreased, so that the people who are now occupying the lands would have to give them up. If the lands mentioned by the honorable member are not earning more than he said they were, then the values mentioned are fictitious. As soon as this Bill is made law, the owners will be called upon to state their value, and will be extremely foolish unless they put down the true value of the land when furnishing their returns to the Land Tax Commissioner. Under this Bill, the land-owner is his own valuer, and if he puts a wrong value on his land, the Crown valuer may bring him up to the Court, but in cases like those mentioned by the honorable member for North Sydney he will be able to show in Court that the land is only of the value that he has assigned to it. If so, he will escape the tax, and there will be no hardship there.
– Does the Court inquire into hardship, or into what is the fair price of the land?
– The Court, in considering the question of valuations, will certainly inquire what is the fair market value of the land, and I submit that in the majority of cases the owners will have nothing to fear. We cannot introduce any reforming measure which will not create hardships in some directions. We have managed our human affairs so badly that we can introduce no reform, and make no advance, without damaging some persons. The very railway which the honorable member has spoken of as necessary for country districts injures somebody. The poor waggoner or bullock-driver has to find a fresh avenue of employment. One cannot introduce into the industrial world a machine like the linotype without, for the time being, throwing some mechanic who has served all his life at the printing trade into the street. No invention can be introduced that does not create hardship in some direction, and there will, no doubt, be some very sad cases of hardship under this Bill, but, in fixing our exemption at £5,000 we shall certainly diminish their number. I strongly favour an exemption, for without it it would be very difficult to avoid the most extreme hardship, the reason being that many people have paid for their land more than its true value. I know of people who have paid £5 and £10 per acre for land which, stripped of the fictitious gambling value created by the operations of the speculator to whom reference has been made, is not worth more than£2 or £3 per acre.
– Will this Bill reduce those values?
– I have no doubt that in some cases land which is now offering at very high rates will be reduced in price by the operation of this Bill. I shall refer later on to that point, when dealing with the position of the Government as a purchaser of land. I wish now to refer to the statement of the honorable member for North Sydney that we had no mandate from the people of the Commonwealth to introduce this measure.
– He admitted that the Labour party had a mandate, but not for the imposition of a tax running as high as 6d. inthe £1.
– If a tax of 6d. in the £1 were not mentioned by any of our candidates, the electors of the Commonwealth were informed by the Opposition that we proposed actually to confiscate the land.
– What was the position in the honorable member’s case?
– In the electorate of Capricornia I said that I was in favour of an unimproved land value tax with an exemption of £5,000.
– To the extent of 4d. in the £1 ?
– I mentioned no limitation. The public throughout the Commonwealth were informed by honorable members opposite, in circulars that were distributed broadcast, that we favoured the confiscation of land. I have here a circular that I obtained in the electorate of Brisbane, and also another circular headed “ Interesting to farmers,” which was printed by Messrs. McIlwraith and Blair, of Rockhampton, and distributed throughout my electorate. It reads -
INTERESTING TO FARMERS.
What the Socialistic party wish to do may be seen from the Bill introduced in the Federal Parliament by Mr. A. Fisher, which proposed -
To tax leasehold land (sec. 30).
To tax homesteads (sec. 28).
To tax land held by local authorities (sec. 12).
Trustees of land held in trust to be personally responsible (sec. 33).
All owners of land, taxable or not, are compelled to furnish returns (sec. 14).
Tax must be paid before taxpayer has the right to appeal, and the only Court to which he can appeal is the High Court of Australia (sec. 38).
The ultimate object being, as Mr. Lesina frankly explained to tax all the value out of the land. Or as Henry George put it, “ We may leave them (the landowners) the shell if we take the kernel.”
On 13th April
You can say if this is the Policy you wish.
This was circulated all over Australia.
– It was not circulated in my electorate. I never heard of it before.
– And I did not see it in my electorate.
– The honorable member did not see it because, probably, those who were distributing such circulars did not consider it necessary to give him a copy. I can assure the House that the emissaries of our opponents distributed such circulars by the thousand.
– Does the honorable member find fault with the contents of that circular? Is it not a correct statement of facts ?
– I am not finding much fault with it, because its effect, if any, in my electorate, was that of returning me with a mandate in favour of a Bill for the confiscation of land - to enable the State to take the kernel, leaving the shell to the land-owner. I do not, however, interpret the mandate to mean that I am willing that there should be a £5,000 exemption for the reason that many people - even amongst those who have £5,000 worth of land - have paid for their land far more than it is worth. As to the right of the Parliament to tax the land, I would quote a paragraph of section 51 of the Constitution -
The Parliament shall, subject to this Constitution, have power to make laws for the peace, order, and good government of the Commonwealth, with respect to…..
Taxation; but so as not to discriminate between States or parts of States.
No one challenges our right to tax sugar, boots, pianos, tobacco, or spirits, because, in taxing such commodities, ‘ we are seeking to give employment by establishing industries throughout the Commonwealth. The fact that we shall, by means of this tax, induce the cutting up of estates is only a question of its incidence. The fact that we shall compel land-owners either to contribute to the revenue or to use their land, does not in any way diminish our right to tax the land. That is merely an incident of the tax. The question of revenue is not referred to in the Constitution in connexion with the imposition of taxation. The question of revenue is not referred to when, for example, we seek power to impose duties of Customs and Excise. We are given plenary power to make laws for the peace, order, and good government of the Commonwealth with respect to taxation. Surely no one who knows anything about the efforts that are being made to get land within the Commonwealth will say that there is any peace, order, or good government in the present system. During my absence from this Legislature, I had the advantage of being in charge of the Queensland Government office in Sydney for a period of two years, and part of my duty was to advertise the resources of Queensland. From day to day I was interviewed by numbers of people coming from all parts of the English-speaking world in search of land. They came from Ireland, England, Scotland, and Wales, the United States,
Canada, and even from India. Some of my visitors were Anglo-Indians who wished to settle here; and I also had callers from New Zealand, as well as from Victoria, New South Wales, and the other States. All were in search of land ; and, on many occasions, from New South Welshmen, I heard stories of distress that would certainly affect the heart of the honorable member for North Sydney. I was interviewed by men who told me that in New South Wales they had been seeking land for six months, and, after spending from £50 to £100 in their search, had been unable to obtain any. Those who read the Sydney newspapers must be familiar with the statements published from time to time giving the result of land ballots, in which from 400 to 600 persons have applied for three, or, perhaps four, allotments of land. If there is land available in New South Wales, how is it that so many people are going from that State to Queensland in search of blocks? We have, as one justification for proposing this measure, the fact that it is exceedingly difficult to get land in any of the States, except in districts remote from railway communication, from schools, and all the comforts of civilization. Then, again, many people will not do as some of their forefathers have done - they will not go into the “ Never Never’” country. Honorable members opposite have said that we have no right to encourage land settlement by means of this Bill. Let us look at the position of the States. Victoria, for instance, is very fertile, and has a larger area served by railway than has any other State ; yet, it is a very difficult matter to get land here. In New South Wales, it is extremely difficult - so difficult, indeed, that the Sydney Morning Herald, in its issue of 24th December last, referring to the fact that the Legislative Council of Victoria had thrown out certain land tax proposals that were the result of an appeal to the electors, said -
When, therefore, second Chambers, mainly sympathetic as they are both here [New South Wales] and in Victoria with the large landed class, set themselves up consistently to thwart all proposals for opening up the alienated lands of this country to settlement, they are merely inviting ultimate popular resort to extreme measures. If the States cannot be relied upon to grapple with this problem through their own Legislatures, it becomes very difficult to sustain an argument against the Federal Parliament exercising its powers of direct taxation in such a way as to compel large owners to take a more realistic view of their national responsibilities.
That is the position. The State Parliaments have refused to take the proper view of their national responsibility, and the public of Australia have come to us for relief. Apart from the question of closer settlement, the proposals before the House are extremely equitable. Some honorable members deny that the public are entitled to any portion of the unearned increment, or the unearned value, of which we have been speaking; but the position we take up is a safe one, and one up to which I think the people of Australia have been educated. Honorable members opposite, in 1906, went before the general public with stories similar to those to which I have just referred. The public were told by them that we were anxious to confiscate land, and in that year we were defeated. Without a doubt, in many constituencies, our advocacy of the land tax proposals of the Watson Ministry led to the defeat of several of our candidates. I can well believe that one of the factors which contributed to my defeat in Queensland was the fact that, throughout that State, we were advocating a land tax, and that the Opposition were able to alarm the general public, and to lead them to believe that we really proposed confiscation. The people were not then educated up to the equity of land taxation; and, therefore, they voted against us. We have been preaching the equity of the land tax for twenty years, to my knowledge, and it is only within the last three or four years that we have been able to induce the people to return to this House a majority in favour of such taxation. The real equity of the tax lies in the fact that Australia has spent £242,956,565 in improving public and private estates. The Queensland Government has borrowed £41,000,000, of which £25,167,536 has been spent on railway construction, £2,963,083 in encouraging immigration, £2,448,349 on harbor works and lighthouses, £996,587 on electric telegraphs, £1,129,413 in providing water supplies, £1,465,211 on public buildings, and £923,656 in making public roads. On the total indebtedness of the State, the citizens pay an average interest of £3 18s. 6d. per cent: That money has been spent to improve the private lands of the State. No doubt there is land available for settlement in Queensland. You can get land for nothing there. You can get land anywhere in the State by paying 3d. per acre per annum for it during a period of ten years. But this land is distant from railways, schools, and medical attendance, and the people will not go on to it. Land speculators hold most of the private lands near the railways, which have been built at a cost to the taxpayer of over £25,000,000, and lands improved by money spent on other public works.
– What does the honorable member mean by land speculators? Does he mean that all that land is held by men who have bought it to sell again at a profit?
– The late Mr. Tyson bought 10,000 acres of beautiful scrub lands on the Johnstone River for 10s. an acre. That land is yet in its virgin state, and speculators have arranged to buy it, but if any honorable member wished to get it, he would have to pay 30s. an acre for it, and buy .the lot. A great deal of land has been bought in Queensland, and in the other States, for speculative purposes.
– Not much in Queensland.
– At any rate, the buying for purposes of speculation has had the effect of preventing land settlement even in Queensland. On the Darling Downs, between Toowoomba and Dalby, there is an immense tract of land held for speculative purposes. Since New Zealanders, and men from New South Wales, South Australia, and the other States began to come” to Queensland to get land, prices along the railways have risen from £1 to £5 and more an acre. It is the Government’s expenditure which has made this land valuable, and our purpose is to break up the monopoly in it. The tax will have that effect. Our people are unwilling to go out into the Never-Never, and I do not blame them. One reason is that they cannot get their women folk to accompany them. The Australian youth, having been taught the- comforts of civilization, and knowing the advantages of soci.il intercourse, are unwilling to go out into the Never- Never.
– They will have to go back sooner or late.
– Farmers should not have to go 20 miles from a railway.
– Does the honorable member call going 20 miles from a railway going back?
– In my electorate, settlers have to go 100 miles from a railway.
– The Labour party is in power to-day partly because it has shown the farmers that, in having to go 20 miles from a railway, they are being made to bear a heavier tax than will be imposed upon any land-owners by the Bill.
– Why is it proposed to break up estates 100 miles from a railway, if people will not go 20 miles from one ?
– Farmers who are more than 20 miles from a railway are paying a tax which cannot be estimated in money values. Such men are compelled to bring up their young families away from the blessings of education and social intercourse, and bear greater hardships than any which we may inflict on the rich land-owners by the imposition of this tax. In parts of Queensland the people are so unaccustomed to speaking to neighbours that it is sometimes difficult to get a man to say “ Goodday.” There is a great deal of truth in the story of Mr. Donald McDonald about the two stockmen who had been riding for some miles, when one, who had seen a beast some half-mile back, ejaculated “ Bullock.” No reply was given until another long stretch of country had been covered, when his companion inquired, “ How do you know that it was not a cow ?” Silence followed again, until evening. Then the camp was made, and, next morning, the man who had seen the bullock was found to be making preparations to clear out. His companion asked him why he was going. He said, “ Because there is too much argifying in this camp.”
– He ought to be here.
– On one occasion when travelling not far from a railway, I tried to enter into conversation with the wife of a teamster who was cooking the evening meal for a family of four or five children, of whom the youngest was about five years of age. Despite my attempt to enter into conversation with her, the only reply I could obtain to my various observations was, “Go along.” Those children were being brought up in the bush, away from schools, because of this land monopoly that we are trying” to break up. I do not blame the modern young man and young woman for refusing to rear a family in the NeverNever; I rather admire them for staying here and fighting the matter out with the owners of large estates. On one occasion I heard Sir George Reid, addressing 2,000 well-to-do citizens of Melbourne, say that the country was being ruined by Protection, and that the people should go on to the land. The statement was cheered to the echo, but the audience was not going on to the land. Some of them, perhaps, were Collins-street farmers, such as attend farmers’ gatherings-
– And farm the farmers.
– Yes, persons who sell the produce of the farmers, and often return them very little for it. If the result of the measure is that people can get land’ near railways more cheaply than is possible now, the Labour party will have conferred a great national benefit on Australia. The honorable member for North Sydney spoke about those who would suffer under the measure. A gentleman of that class was the late Mr. George Salting, who at his deathleft £2,500,000 worth of art treasures to the British nation, bought with money made by getting others to work his estates’ in this country. Another of the same type was the Sydney millionaire who left some £3,000,000 without bequeathing a copper to charities, or anything to the employes who had helped him to build up his great fortune. From the table furnished by the Government, it appears that a man with land of the unimproved value of £6,000 will pay £4 6s. id. - and there is no great hardship in that - the man with £8,391 worth will pay £16 4s. gd., and the man with £10,548 worth will pay £27 7s. 10d. A man with £10,000 worth of unimproved land is far better able to bear taxation than the poor family, whom the honorable member for North Sydney is so anxious about, is able to pay taxation of 10s. per annum on tea or kerosene. We desire to stop the accumulation of vast values as they have accumulated in the Old Country. One hundred years ago nothing like the increments now to be obtained from land in London could be obtained; and if we desire to prevent the awful poverty and misery, so largely due to land monopoly at Home, we ought to start early. The following figures will show some of the fortunes made out of the unearned increment in London -
It is estimated that £10,000,000 of these rentals is derived from the unearned increment, although the area of the whole of the estates is not more than 2,000 acres. It may seem an extraordinary thing to say, but in some parts of Australia there is as: much land monopoly as there is in Scotland. In the Queensland Government office, Sydney, of which I spoke, I met a New Zealander who was going to Scotland because he could buy land cheaper there than he could in the Dominion.
– How long ago is that?
– Last year.
– That was after the graduated land tax had been in operation in New Zealand for eighteen years.
– Quite so, and perhaps it would be convenient to deal with that point now. It is singular that the land tax in New Zealand has, apparently, had the effect of increasing land values. New Zealanders who came over to New South Wales seeking land, said that, in the Dominion, they had to pay as much as £70 an acre, whilst some asserted that they had to pay £12 an acre for land 40 miles from a railway. It will happen, in some cases, that land far away from railways will, for a time, decrease in value owing to the tax, but, as settlement proceeds on the estates that have been cut up, the remaining portions will increase in value. This only shows that all our puny efforts to improve the condition of the people seem to be in vain, and that we shall be driven eventually to Socialism. Here we are, as in New Zealand, trying to remedy existing troubles by a graduated land tax, and the result is that land goes up in value. It will be found that the taxation will result not, as honorable members opposite have predicted, in permanently decreasing values, but in increased values owing to the settlement. It has been suggested that a good way out of the difficulty would be for the Government to become a land buyer; but a comic opera could suggest nothing more farcical. For the convenience of the public who read Hansard, I should like to quote a table showing the lands alienated, the lands in process of alienation, the lands leased, and the lands unoccupied in Australia, prepared by Mr. Thornhill Weedon, the Government Statistician of Queensland. It is as follows-
Is it not a farce, in the face of our having 968,000,000 acres of unoccupied lands in Australia, to talk of the Governments of the States going into the markets as a buyer ?
– It depends on the quality of the land, and the situation.
– That interjection furnishes us with the reason why we should tax the lands. There are large areas of the land unoccupied, which would grow anything required for human consumption. Land of the nature so much appreciated by the Richmond River farmers - that is, land with standing scrub on it - can be obtained in Queensland ; but those who want it have to go a long way from a railway or market. At the present time, in the Capricornia electorate, at a place called Mount Larcom, part of which is black-soil country, the price asked is £3 an acre, without a stick of improvement. What gave the land that value ? There is any amount of black-soil land in Queensland of the same quality to be had for 10s. an acre, if the people will go 20 or 30 miles from a railway. The fact is, that railways give the land its increased value, and the people who own the land of which I speak will do nothing with it themselves, but are simply waiting for a time when some farmer will be forced to pay their price. What happens if the Government become purchasers? It is the worst possible thing for the farmers when the Government seek to buy, because the value of the land proposed to be purchased rises and affects lands throughout the State. During the last two years, the Government of New South Wales sent round a Committee, or Commission, to inquire as to whether certain estates ought to be purchased. Nearly every witness examined estimated his land as worth £10 or £12 an acre, and, as a result of this Government interference,- values went up throughout the State. So much so, that farmers sold out at enhanced prices, and went to Queensland, where they could get cheaper land.
– How is it that land in Victoria and New South Wales has appreciated in value more in districts where the Government have not been competitors ?
– I can only suppose that the Government have made bad bargains. The Queensland Government are still purchasers, being allowed by law to buy about £500,000 worth of land each year for the purpose of closer settlement; and is it not horrifying that they should have to pay £3 ros. . when there are millions of acres of unoccupied land? The fact is, as I say, that railways and other public works give the added value. It was a railway which enabled the owners of the Jimbour station to get £400,000 from the Queensland Government for 120,000 acres of land. What happens when the Government enter the market? When the Queensland Government find themselves compelled to buy an estate, they give the owner notice that the land is required for closer settlement, and ask him how much he considered it is worth. In the case of the Jimbour estate, the owners, the Queensland National Bank, said the land was worth £3 10s. ; but, as it was freely stated in Queensland that any private buyer could have made a deal at £2 2S., the Government offered that figure, saying that, if the bank was not satisfied, the matter could be taken into Court. The owners went to Court, and brought a preponderance of witnesses to state that, in their opinion, the land was worth £3 10s. an acre. The Government, on the other hand, could not bring witnesses to prove that the land was poor4 because they had bought it, and could not tell the people whom they wanted to settle on it that it was of low value. The Government called some witnesses to prove that it was valued at only £2 2s. per acre, but the Judges heard such an array of witnesses testifying that the land was worth £3 10s. ari acre that they decided that the Crown would have to pay that price. The Crown, or the public of Australia, will be the victim every time. The legitimate way to give land at its proper value to the farmers is that proposed by this party, by imposing a land tax and compelling the land speculator to seek some other means of adding to his banking account. I spoke awhile ago about the tax the farmer paid, through his isolation, in bringing up his children under such great disadvantages. He is also taxed in the heavier railway freights he pays. A great deal of the country through which one travels by rail in New South Wales is not of very much agricultural value, and possibly much of it is good only for sheep and cattle, but one can go through miles of good agricultural land in Queensland without seeing a house, or even a hoof, in 20, 30, or perhaps, 40 miles. The land is being kept simply tor speculative purposes. The effect of that is to further tax the isolated farmer. When he wants to send his produce to market, he has to pay the heavy freights necessitated by the railway passing through these vast unoccupied distances. A number of the customers of the railways in Queensland are cattle, men, whose homesteads are 15 or 20 miles away from a station. One of the great advantages that will accrue to the farmer from this measure will be the greater settlement along the railway lines and the consequent cheaper- rates of carriage for his produce. But even this land tax will not bring about settlement as quickly as honorable members appear to desire when they speak about the necessity of populating the country from a defence stand-point. A farmer cannot be put on to the land without money. There may be, as the honorable member for Fremantle said, land to be obtained in the Riverina district at £5 an acre within 5 miles of a railway, but how much of that land would a man require to get a living on? A hundred acres would not be a very large farm, and to get that he would have to Pav £5O0> possibly before there was a fence round it. By the time he had put up his home and fence, and other improvements on the land, it would have cost him another £2 an acre. We have not in Australia the people with the necessary knowledge and capital to go on to the land, and they will require some assistance from the various State Governments. If we want the land settled, we shall not only have to lease it to the farmer at a very low rental, but we shall have to fence it, and put a house on it, and possibly make it ready for the plough, as the Canadian Pacific Railway Company are doing at present in Canada.
– The honorable member is now dealing with Crown land, not with lands that will be put on to the market as the result of this Bill.
– I am showing the difficulty there will be in getting settlers, even when these estates are broken up. Settlement will not be rapid enough, and the Government will have to go further than any State Government have yet gone in making the land ready for settlers.
– We will do that when we take over the Northern Territory.
– That would be a very good method to adopt there. The honorable member for North Sydney said that if we wanted to settle the Northern Territory we should have to sell it in large areas to speculators. It will be of no use for us to take over the Territory if we are to dispose of it in that way. It is idle to talk about settling the country from a defence point of view if we allow anybody to occupy it in 1,000-mile blocks, as the honorable members suggests.
– No. I said .that £15,000 worth would be about the least that a capitalist could look at.
– If the capitalists are going to spend £15,000 on the Northern Territory they will expect more value for their money than it will pay the Australian people to give them. The only way to settle the Northern Territory would be to treat the farmers well with regard to the land to be leased to them, and to have homes prepared for them. We shall not make any greater progress than was made in earlier times if we expect the modern man and woman to go out and suffer as the pioneers suffered in times gone by. I do not believe they will do it. Objection has been taken to our taxing the owner of city property. In that’ connexion I hope that every effort will be made in the Bill to prevent the owner passing this tax on to the tenant. One of the reasons why the public are bled in the prices they have to pay for the commodities they use is the high rents extorted from shopkeepers by the landlords. In every letting agreement nowadays there is a clause that the tenant shall pay all rates and taxes, and unless we prevent it, the owner will compel his tenant to pay the Federal land tax also. I am aware that it is claimed that it is impossible to pass this tax on, but we have to remember that there are only two or three main streets. In Melbourne, for instance, I believe that there is actually a case in Swanston-street where a man has paid £20 a week ground rent for the right to build a.shop upon a piece of ground with a 16-ft. frontage. It may be said that in course of time, as we make it unprofitable for a man to hold land out of use, buildings will become so numerous that rents will go down. That may happen, but it will be a very disastrous process for the tenant of a city shop unless we protect him from the owner. In some cases the agreements are only for twelve months, but I believe some of them are for as long as ninety-nine years. I understand that that is the case with the leaseholds obtained from the Cooper estate in New South Wales, and there is no doubt a clause in those agreements that any tax shall be paid by the lease-holder. A great “hardship would result if the tenant had to pay this tax, which ought to be paid by the owners of the Cooper estate, who got an immense area of land extending, I believe, from Botany Bay right round to Watson’s Bay, as a Crown grant in earlier times.
– In practice the tenants will not pay under this Bill.
– I know there is a great deal of anxiety amongst tenants in various cities and towns. That is so not only in Melbourne, but in places like Rockhampton, where there are some landlords who acquired their property years ago and are charging pretty high rent for the shops erected on it. If they can pass this tax on to the tenant it will be a very great hardship.
– It is proposed to insert a clause rendering nugatory any such agreement.
– I am very glad to hear it. The honorable member for North Sydney said that, owing to the inconsistencies and injustices of this Bill, this party would be swept out of power in three years’ time. If the party which is now in a majority in this Parliament is defeated at the next general election, it will be able to reflect that defeat, after all. has been the fate of many a reform party. It is a risk that we have to take, and which honorable members on this side of the House generally have taken ever since they have been in the Labour movement. Many of us, no doubt, at various times during the last twenty years, have been unable to secure a majority owing to the advocacy of a platform of which this taxation forms a part. If the injustice arising from this measure proves to be as great as the honorable member for North Sydney has said, then possibly we may be swept away, but the position is that we, as a party, have either to be executed politically because we introduce this measure, or to be executed because we fail to introduce it and to carry it out. That is our position, and whatever may be the result of the next election, I am pleased that we have an opportunity of proposing a measure of this character. Indeed, we should be recreant to our trust if we did not attempt to pass it. I have been connected with the Labour party now for twenty years or more, and do not hesitate to say that there is not a representative of the Labour movement who has not made land taxation a prominent part .of his programme. If the State Labour parties had left land taxation out of their programme, they would have been in power long ago in the State Legislatures. We have always believed in land taxation, however, and whilst I do not think that the benefits flowing from this measure will be as great as those for which we might reasonably hope, .1 am quite positive that we shall see very few of the evils and injustices which honorable members of the Opposition profess to believe will result from it.
Sitting suspended from 6.30 to 7.45 p.m.
.- The power of taxation that we are asked to exercise in connexion with the measures now before us is the very essence of our powers of government as a nation; and, without full possession of it, the national power that we possess would be practically useless. I realize that, in discussing this measure, we have to regard the real purpose of taxation under the whole scheme of government set forth in the Constitution itself. It is intended that our power of taxation shall be so wide and comprehensive, that the nation created under the Commonwealth Constitution shall be thoroughly equipped and empowered to carry out those purposes for which it was constituted. The power is a wide and far-reaching one, and very few limitations are expressly put upon its exercise. Section 51 of the Constitution provides -
The Parliament shall, subject to this Constitution, have power to make laws for the peace, order, and good government of the Commonwealth with respect to….. taxation.
Those words are wide and comprehensive, but three limitations are imposed with respect to our power of taxation. Two of those are expressly provided, whilst the third has been read from the general scope of the Constitution by the High Court, as a fair and reasonable interpretation of the Statute. The first limitation we find is that, the Commonwealth Parliament, when imposing taxation, has no power to discrimminate “between States or parts of States.” The High Court, in the case of The King v. Burger, has construed those words “ States or parts of States “- as synonymous with “ parts of the Commonwealth or different localities within the Commonwealth.” The existing limits of the States are arbitrary, and it would be a strange thing if the Commonwealth Parliament could discriminate in a taxing Act between one locality and another merely because such localities were not coterminous with States or with parts of the same State.
The next limitation - arid I mention these because I think that, as we proceed, we shall find that each will be raised - is in section 114 of the Constitution, which provides that the Commonwealth shall not impose “ any tax on property of any kind belonging to a State.” The third limitation upon our power of taxation is that arising from the construction placed upon the Constitution by the High Court in D ‘Emden v. Pedder, and other cases, that the Commonwealth has no power to tax any State agency or instrumentality. That is based on the principle that the right of taxation carries the power of destruction, and that if the. right of taxation were given, the right to destroy would follow ; so that if we had the power to tax State ~ agencies or instrumentalities, we should be able to destroy them. The Court has, therefore, read into the Constitution an implied prohibition of our powers in that respect. From these facts, it seems clear that the Commonwealth has a wide, comprehensive power of taxation. We can tax any particular subjects that we think necessary, and it is absolutely necessary that we should have this wide power. The one limitation, not upon the power, but upon its exercise, is that which is mentioned by writers in construing the United States Constitution, namely, that there is, under the Constitution, conferred upon the electors the power to control the elected, or the Parliament, so as to prevent the exercise of oppressive taxation. When we come to deal with that aspect of the question, we find that it is a matter purely between the constituencies themselves and the Parliament. Once the Parliament is elected with a mandate, then it is the duty of the Parliament to carry out that mandate; and if it is guilty of excessive 01 oppressive taxation, there is in the people the power to bring to book the offending persons. Chief Justice Marshall, in the case of McCulloch v. Maryland, declared that-
The power of taxing the people and their property is essential to the very existence of government, and may be legitimately exercised on the objects to which it is applicable to the utmost extent to which the Government may choose to carry it. The only security against the abuse of this power is found in the structure of the Government itself. In imposing a tax, the Legislature acts upon its constituents. This is, in general, a sufficient security against erroneous and oppressive taxation. The people of a State therefore give to their Government a right of taxing themselves and their property ; and as the exigencies of government cannot be limited, they prescribe no limits to the exercise of this right, resting confidently on the interest of the Legislature and on the influence of the constituents over their representative to guard them against its abuse.
Thus Marshall puts it that Parliament has a wide power of taxation. If that power is exercised oppressively, the ma’tter is one for the constituents themselves to redress. In another passage dealing with the relationship of the Judiciary and the Parliament itself with respect to excessive taxation, he said -
It is unfit for the judicial Department to inquire into what degree of taxation is the legitimate use and what degree may amount to the. abuse of the power.
In other words, he says what I think will be generally admitted, that the Legislature has its functions, the Executive its duties, and the Judiciary its functions. The Executive of the day, being responsible for carrying on the government of the country, will submit to Parliament . the measures considered necessary for the exercise of government, and it is for Parliament, in framing its taxation measures, to say how the tax is to be applied, and what it shall be in amount. For the Judiciary to step in and to substitute its discretion for that of Parliament would, of course, lead to a confusion of the respective functions of the Judiciary ‘and the Legislature. It is, therefore, clear that Parliament, undoubtedly, has the widest powers of taxation, and the widest discretion in the exercise of those powers; and that if it exercises a discretion as regards the amount of taxation alone, the Judiciary, it would appear, would not necessarily challenge the legislation. I am speaking now of a taxing measure passed in the exercise of the taxing power, for the purpose of raising revenue for the carrying on of the- government of the country. But it does not follow, because of this wide expression of opinion, that there is no limitation to the particular exercise of this taxing power.
I wish, in this respect, to refer to the opinion expressed by Cooley at page 679 of his Constitutional Limitations -
There are many cases of unconstitutional action by the representatives of the people which can be reached only through the ballot-box : and there are other cases where the line of distinction between that which is allowable and that which is not is so faint and shadowy that the decision of the Legislature must be accepted as final, even though the judicial opinion might be different. But there are still other cases where it is entirely possible for the Legislature so clearly to exceed the bounds of due authority that we cannot doubt the rights of the Courts to interfere and check what can only be looked upon as ruthless extortion, provided the nature of the case is such that judicial process can afford relief. An unlimited power to make any and everything lawful which the Legislature might see fit to call taxation, would be, when plainly stated, an unlimited power to plunder the citizen.
If we are to be guided by the” eminent constitutional authority whom I have quoted, it is possible, under the guise of a Bill termed a taxing measure, to do more than impose taxation for the upkeep of Government,’ and even to go to the length of plundering the people. If the authorities are to be relied upon, it is not enough to term a measure a taxation measure to prevent the Court from considering its objects. We are construing the provisions of a Constitution necessarily vague. In the United States, this work has largely been done, the view being clearly held that, although a national government must have wide discretionary powers, it cannot, under the pretence of exercising the power of taxation, impose heavy imposts amounting to ruthless extortion and the plundering of the citizens. Our own Courts have also laid down rules of interpretation regarding the exercise of the powers of taxation by the Commonwealth and its other powers. Briefly, they hold that this Parliament cannot accomplish by indirect means what it has no power to do directly. To support the exercise of a power we must show that we have that power, the onus of proof being on the Commonwealth. We cannot get a fresh power by our own legislation ; the powers we exercise must be either such as are conferred expressly, or implied powers obtained derivatively from powers expressed or provisions contained in the instrument of Government. It is laid down in Peterswald v. Bartley, 1 C.L.R., 511 -
In considering the validity of laws of this kind, we must look at the substance and not at the form. If the statute is good in substance, the Court will regard the substance, and hold the law to be valid whatever the form, may be.
That is the test which will have to be applied to these two measures when they have become law. The Court will have to examine every provision contained in them, and to make an analysis of the absolute underlying substance. If it be found that Parliament has exercised a power which it undoubtedly possesses, the Court will hold this legislation to be valid, but otherwise if the form of our legislation is found to be a pretence-
– That must be ascertained from the legislation itself.
– The Court must come to a conclusion from the provisions of the legislation itself. It will not concern itself with the motives of Parliament in passing these measures, the opinions expressed by parliamentary candidates on the platform, by writers in the press, or by members here. It will be guided by the words used in our legislation. In the case of Huddart Parker and Company Proprietary Limited v. Moorehead, 8 C.L.R., 414, Mr. Justice Higgins followed the line of argument adopted by the Chief Justice and the majority of the Court in The King v. Barger. He said -
In dealing with questions of constitutional powers, I take it that our duty is first to ascertain the meaning of the sub-section (in this case sub-sectionxx.), construing the Constitution as we would construe an ordinary Act of Parliament; and, secondly, to look for the subjectmatter of the Act impeached, the things or the actions regulated, the target aimed at, as distinguished from the motive which influenced Parliament. It may seem a paradox ; but the best way to find the subject of any Act is to find its object - what the Act accomplishes or aims at accomplishing. I mean, what it directly or immediately accomplishes, or aims at accomplishing, not what was the ulterior motive in the minds of the Legislature. An Act may impose a tax on land values. The object is to get money from land-owners by taxation. The subject of the Act is - to use the classification of section 51 - taxation. But the motive of the Act may be to induce land-owners to part with land which they do not put to use ; and with the motive this Court has nothing to do.
Mr. Harrison Moore, in his book on the Commonwealth of Australia, has another passage which may give the AttorneyGeneral a crumb of comfort. He writes -
The “ mere motive “ of the legislator is irrelevant; if the true nature of his Act, as discovered by its contents, is within his power, its validity cannot depend upon the motive which may be imputed to him, through common knowledge, or even the legislator’s own statement in the preamble may leave no doubt as to what that motive was. For instance, if the Legislature has power to impose taxation, the validity of a Customs Act cannot depend on whether the motive of the Legislature was the raising of revenue, or protection of industries; and a land tax will be good even though the object’ aimed at is the “ bursting up of large estates “ rather than “ the raising of money.”
The principles laid down by the authorities whom 1 have quoted must be applied to the measures now before us. I am not prepared to express a definite opinion regarding the constitutionality of these measures, although I am inclined to support the view favouring their validity. With the Land Tax Bill, however, is the Land Tax Assessment Bill. These two measures must be considered together.
– Would the Court construe them together?
– I am inclined to think so It is stated in the Land Tax Bill that the Land Tax Assessment Bill “ shall be incorporated and read as one “ with it. Although these measures are printed separately, they are to be read as one, and must, apparently, stand or fall together.
– Did the honorable member say that one measure would be ultravires if some provision in the other were declared to be unconstitutional?
– We are asked to read the two measures as one.
– For certain purposes.
– For all purposes. One measure imposes a scheme of taxation, and the other declares the persons who shall be taxed; This Bill would be meaningless without the other; merely the declaration of the pious opinion that, if a tax be imposed, it should be imposed in accordance with certain rates.
– It would be meaningless only if all the operative provisions ofthe other Bill were declared to be ultra vires
– That is so if one or two of the provisions can be declared ultra vires, and the rest remain valid. To consider the scheme of taxation the two Bills must be read together, and if one be declared ultra vires how can the other operate? If this measure passes in its present form, several important-, questions, challenging the validity of the legislation, will be raised; but I do not wish to deal further with a matter which cannot be decided here, and which must be left to another tribunal. I have only endeavoured to do my duty in pointing out exactly what our powers are, and what are the tests to be applied to the legislation.
There is another test ; and that is - what is the scope and intention of the Constitution itself, assuming that we have the power to impose a land tax? I say that, undoubtedly, we have a power to pass a form of land tax ; and the only legal question is the way in which we exercise our power. We are living under a Federal Constitution, the essence of which is the existence of six sovereign States and a National Parlia-ment, with powers which have been delegated to it. We have to bear in mind that the intention of the Constitution was that we should bring into existence sovereign powers exercising jurisdiction over the same areas, and that, in order to secure the good government of Australia, the several powers should work in harmony and co-operation, and not in a spirit of antagonism. If the powers are not exercised by the States and the Commonwealth with due regard to the jurisdiction of each, the whole scheme of government is brought into absolute confusion. Leading books on the British Constitution point out that it can work as a scheme of government only because there is a series of mutual checks on the different bodies, and because due regard is paid to the conventions of the Constitution by the different bodies to enable Parliament to accomplish its object.
– Are those conventions changeless ?
– I do not say they are. The British Constitution is built up on a series of practices from precedent to precedent, and has developed to the present system.
– Was not the last general election in Great Britain fought on the basis of the destruction of one of the checks ?
– A destruction which has not yet been accomplished. In any case, it was sought to attain that end in a proper constitutional way, by going to the source of the power of the Parliament: In Australia we have a scheme of government laid down with powers given to the National Parliament and powers given to the State Parliaments, and the intention of the Constitution clearly is that those respective powers shall be exercised with due regard to the well-being of the people, and to the absolute powers that each of the Parliaments possesses. I illustrate what I mean by a reference to this particular measure. If we look at the scheme underlying the Constitution, we see clearly that the full and complete power of indirect taxation is absolutely vested in the Commonwealth, while the States have left to them the power of direct taxation. Although the Commonwealth Parliament has the power of direct taxation also, what is the inference to be drawn? It is clearly that, so far as the Commonwealth can, it shall leave to the States the power of direct taxation. I do not say that, in proper case, the power of. direct taxation should not be exercised by the Commonwealth, but it should not be exercised to secure a temporary party victory, or to meet a temporary wave passing over the country. There must be regard to the permanent Constitution as the instrument by which the people propose to govern themselves. When Federation was established, the revenue from Customs and Excise, roughly speaking, amounted to about 75 per cent, of the total revenue ; and the whole of that passed over to the Commonwealth.
– We gave back to the States 75 per cent. ^
– We gave back a certain proportion, but nothing like 75 per cent. How did we do this? By the recent settlement we gave the States back as much as we thought was not necessary for our own purposes. The intention of the Constitution clearly was that the Commonwealth should never appropriate the whole of the revenue for itself - that some regard should be paid to the States.
– Did not the Constitutioncontemplate our getting revenue by direct taxation when it said we should only have- 5s. out of every £1 ?
– The Constitution provided that for a period of ten years - which was really a settling down period - the Commonwealth should be confined to 25 per cent, of the revenue.
– We are now trying to- “ settle up.”
– And in “settling up,” we should always do justice. After thatperiod we have, of course, complete power to deal with the whole of the revenues f rom< Customs and Excise, and an agreement has been arrived at to pay the State 25s. per capita. This meant an enormous loss of revenue to the States ; but we had the right, and we were perfectly justified in exercising, it. It was clearly the scheme of the Constitution that, so far as the first revenues of theNational Parliament was concerned, it. should be from Customs and Excise, direct, taxation being left to the States. In order to emphasize this point, I refer honorablemembers to Mr. Garran’s book, The Coming Commonwealth, in which he takes- simply an academic view of the Constitution and of what was intended. Mr. Garran says -
Whatever the Federal fiscal policy should be, it is likely that there would at least be a revenue Tariff sufficient, and, perhaps, far more than sufficient, for ordinary political requirements. It is, therefore, unlikely that, except in great emergencies, the Federal Government need resort to other modes of taxation; but since emergencies may happen, its power of direct and indirect taxation ought to be unlimited.
– What would the honorable member call a great emergency ?
– A war, for instance.
– It would be too late then !
– The honorable member is quite wrong, because at the present moment he is proposing to exhaust the
O sources of revenue which might be required in an emergency.
– We are getting ready for an emergency.
– The honorable member’s idea of patriotism evidently is that everybody should contribute to the defence of his country in theory; but that the contributions should, in practice, be confined to the few. At page 158 of his book, Mr. Garran says -
The Federal Government is not likely to resort to direct taxation except in an emergency.
That was written in 1897, when the Constitution was being framed, and we were considering the form of government that Australia was to be asked to adopt. The power of direct taxation had to be given to the Commonwealth, because it would have been stupid to create a nation and then so limit its powers that in a national emergency it would be crippled. On the 17th January, 1901, Sir Edmund Barton, speaking at Maitland, said -
Now, as to taxation by the Commonwealth, I may tell you that I feel quite as fully as any Treasurer could that such a power is not to be harshly or rashly exercised. In this case, any rash exercise of the power might be disastrous to every State. We have taken over great obligations from the States, but we have taken over the Customs with them, and you must recollect that if after the Commonwealth imposes its Tariff the States require more revenue, they can only obtain it by direct taxation within the States. The exercise of the power by the Com-* monwealth imposes on us an enormous responsibility, but in carrying out that responsibility they would interfere as little as possible with the States of the Commonwealth, as it was absolutely necessary to leave the field of direct taxation to those States. The States should be studied in every way, and the early difficulties of so great a change made as. little trying as possible. There must be no direct taxation by the Commonwealth unless under the pressure of some great national emergency, and riot even then if it can be avoided.
That was the view of Sir Edmund Barton when speaking, not of a temporary, passing policy, but of the general scheme of government which was then being initiated.
– It is to be hoped that that is not his opinion - now that he is on the Bench !
– Why not? The existence of the power is not questioned ; the only point raised is the time when the power should be exercised.
– Who has to decide as to the time?
– The nation, of course, has to decide. It may happen that in the absence of any mandate, the country will be faced with a sudden crisis, and the Legislature will have to exercise its powers to meet the occasion. Do not think for a moment that I believe in crippling the national power. I desire to see this a real nation, which it can never be if its powers to raise money to meet an emergency are in any way limited. If this scheme of government is to be a success, respect must be paid to each jurisdiction in regard not only to the exercise of power, but also to the extent of that exercise. That was the opinion, not only of Sir Edmund Barton, but of .Sir Frederick Holder, who, immediately afterwards, on being consulted, agreed as to the inexpediency of the Commonwealth exercising the power of direct taxation. Then Sir George Reid, speaking on the 21st January, 1901, is thus reported in the Sydney Morning Herald -
Mr. Barton says he is against direct taxation in the Commonwealth except in the case of emergency. As I pronounced this policy two or three weeks before, I am very glad Mr. Barton in this respect adopted my views.
I think we could not have stronger confirmation as to the way this power should be exercised than the illustrations I have given. I have quoted three independent persons, and I could quote more.
– All politicians !
– It is quite true that they were politicians; but it must be remembered that they were also members of the Convention at which the Constitution was framed, and were responsible for bringing into being this scheme of government. When we come to construe the Constitution, and look at the distribution of powers and the sources of taxation, we see that the view given by those politicians is confirmed by the instrument which the people ratified and adopted. The States have their important powers to exercise just as we have ours. They are intrusted with the function of education, the care of the sick and the poor as regards hospitals, and with a hundred and one other powers which I do not want to recapitulate. ‘ Honorable members must realize that if we take from the States the money which is requisite to carry out their functions we are not hitting the particular individuals who happen to represent the Government. If you cripple the States’ affairs so that they cannot carry out their educational systems, you are doing a wrong to all the young citizens growing up in the Commonwealth. I am not here as an advocate of State rights, but am simply defending the spirit of the Federal Constitution. I want the national power to be exercised to its fullest extent to meet all national emergencies and deal with all national cases, but it is foolish to shut our eyes to the needs of the States, because, if we cripple the States we shall not cripple individuals, but the citizens of the whole Commonwealth.
– The States are crippling themselves. They have had a chance to put this into operation for years.
– The honorable member will persist in mixing up temporary political questions with a permanent scheme of government. If Labour Governments were in power in the States and had Legislative Councils quite prepared to pass every one of their schemes, how would they be able to effect their purposes if the Commonwealth absorbed the whole of the sources of revenue? The argument does not applyonly to the circumstances of to-day.
– We are not going to trust the Legislative Councils.
– We must trust the people, not particular individuals: If the - Commonwealth absorbs all the sources of direct taxation, where are the States to get their revenue from? That is not a fair and proper way to bring about unification. Even though we had the legal power to impose direct taxation, it does not follow that we should exercise it in this way, although I frankly admit that honorable members opposite have received a mandate for a land tax.
– Then why bump up against the people in this way?
– It is the honorable member’s duty to be true to the Constitution, whether it “ bumps up against “ the people or not. We do not want to be guided simply by passing waves of political thought and feeling when dealing with the construing of an instrument of government. We must face these questions fairly and squarely, and speak our minds upon them. If honorable members are guided by the opinions of those who ought to know, and look at the scheme of government laid down in the Constitution, they will see that it is not fair and just or constitutional that we should mop up those sources of revenue without which the States cannot possibly exist.
– Is that not a nightmare of the Argus?
– Nightmares are very unpleasant, and generally arise from some particular injustice that has happened during the previous evening. We do not want these injustices to happen to the States. Looking honestly and squarely at the Constitution we see that it was not intended that the Commonwealth should exercise these powers except in a case of national emergency.
As regards the Bill generally, if you look at it and study its provisions, the conclusion is forced upon you that it has not been framed after a study of the problem with which it purports to deal. There has been no inquiry as to the facts upon which the scheme is to operate. A mere paper Bill has been drawn up, with the usual skill of the draftsman, but utterly regardless of consequences, and of the facts and conditions of Australia. Afterwards, if the facts do not fit in with the Bill, the attitude is to be “ so much the worse for the facts.” The scheme of’ the measure was taken from certain precedents in State legislation, but in the State Acts there are invariably two different subjects dealt with. Whether in New Zealand, New South Wales, or Western Australia, the Act, instead of being merely a land tax Act, is a land and income tax Act. What has happened in our case is that the whole of the clauses dealing with the land have been taken out of those State Acts and introduced into this House, while the other clauses dealing with income tax have been left to the States as independent measures.
– That is a fair divide, is it not ?
– A fair divide to an unfortunate individual who finds himself cut in half and allowed to bleed to death between two assailants. In the State laws which deal with land and income tax together, steps were taken to see that no double taxation was imposed, while one of the troubles with which we are faced in this Bill ii> that a good deal of injustice will arise through one taxpayer having his taxes unjustly duplicated. Take the New South Wales Act, and the treatment of mortgagees. The position is well put in the judgment of Chief Justice .Darley in the rase of The Liquidator of the North Sydney Investment Company Limited v. The Commissioners of Taxation, as follows : -
The Act provides for a double tax, a tax on land, and a tax on income, and by the express provisions …. income derived from the ownership of land is specially excepted, so that where income arises from land which is subject to taxation, the person who derives that income pays no tax upon it. In order to meet the case where two persons have an interest in land, as, for instance, a mortgagor and a mortgagee, the mortgagee, who derives his income, not from the land, but from his covenant, has to pay tax on the interest which he receives. At the same time, the mortgagor being in possession of the land, and in point of fact its owner, has to pay land tax on its unimproved value. In order, however, that the tax shall not be paid twice, it is provided that where the mortgagee pays income tax on the interest he receives from the mortgagor, the mortgagor is entitled to deduct from his land tax a sum equal to the income tax so paid by the mortgagee. It seems then to be clear that the Legislature intended to treat the mortgagor and mortgagee as if they were joint owners of the land.
But under our Bill, if a man has an estate of the unimproved value of £50,000, which is mortgaged to the extent of £25,000, he pays interest under his covenant on his mortgage, and income tax is levied by the States on that interest as received by the mortgagee. The land, therefore, bears a charge in that direction, and yet the mortgagor will also have to pay land tax on the full unimproved value of £50,000. When the land and income tax are dealt with in one measure, due regard is had to the equity and equality of taxation, but under this scheme no such regard is paid. The Commonwealth taxation is coming on top of the State taxation, and the unfortunate individual is being subjected to two different taxing laws at one and the same time. That is not fair or just. Let me illustrate my position by asking honorable members opposite how they would deal with this question if they were placed in power in a State? Supposing a Labour Government came into power in a State to-morrow, and intended to impose taxation on all lands of from £240. to £5,000 of unimproved value. Would they impose double taxation on the land, taxing the owner on the one hand by a land tax on unimproved values, and imposing an income tax on the products of the land on the other? The best way to test their attitude towards that question is to read the plank out of their platform. The following is a resolution recently passed in Victoria -
This Conference regrets that any misconception exists in relation 10 the respective held of operation of the land and income taxes, and affirms the principle chat the income tax is not intended to apply to land or the produce of land that is subject to a land tax.
– We know that.
– Then it is very strange that honorable members opposite do not apply the principle in this measure. They are subjecting the land to a land tax, and making no exemptions in favour of all those areas which are already contributing large sums of money to the revenue through the income tax, as they do in Queensland, tor instance. To show the extraordinary position in which the Prime Minister is placed, when he went before his constituents the question was raised, at meeting after meeting, whether, if a land tax were put on the land,, the people would have to pay income tax also, and the following was his answer -
At Kilkivan he had been asked if he proposed to tax leaseholds, and he said “ No.” He had been asked did he favour duplicate taxes, and he said “ No.” The Labour Conference had decided that the man who pays a tax on land values must not pay an income tax.
– We are not imposing a Federal income tax.
– Honorable members opposite are imposing a land tax on all the lands in Quensland that are already paying income tax on their produce, where their unimproved value is above £5,000. The very duplication of taxation with respect to which the Prime Minister was questioned is taking place already, in spite of his statement to the contrary, because this Bill makes no provision for exemption in cases where an income tax is paid. A perusal of the opinions expressed by honorable members opposite, and an examination of their platform, shows that this measure was advocated by them with the sole object of bursting up big estates. But, presumably, when the AttorneyGeneral came to draft his Bill, he found that, if he made those exemptions which should have been made to enable it to be confined to that object, the whole question of its constitutionality would be raised.
– The one thing perfectly clear was that there was to be only one exemption, and that to the extent of ?5,000
– Although that exemption may have been mentioned, the object of the Bill was stated so clearly that it impliedly meant a great many exemptions. I shall deal at once with the question of the objects that were said to be in view. Mr. Grant, at the Brisbane Labour Conference, said -
Mr. Watson had said that the progressive land tax was not for revenue, but for the bursting up of the large estates.
Mr. Watson. I said i was not primarily for revenue, but for breaking up the big estates.
We find, also, that Mr. Holman said -
The tax was not really a revenue-producing one–
– What is wrong with that?
– Is this not to be a revenueproducing tax?
– But Mr. Holman said that the tax was not to be really a revenueproducing one.
– Quite so.
– The honorable member says, “ Quite so “ to that, and yet declares that his intentions are honorable. Mr. Holman said -
The tax was not really a revenue-producing one, and whatever revenue was derived therefrom would be incidental to the accomplishment of its primary object - the breaking up of the big estates.
Then, again, we find that the present Minister of External Affairs said -
It is idle to expect much revenue from a tax of this kind, which, aiming as it did for the promotion of closer settlement, should not have an exemption lower than ^5,000.
Senator Findley also said
Farmers were being driven out of Victoria : through not being able to obtain land, and that condition of things should be remedied by the imposition of the progressive land tax to burst up the big land monopolies.
It is quite possible that the AttorneyGeneral, having read this report, and knowing :that the object of the tax was primarily to -burst up big estates, realized, when he came -to draft his Bill, that he would have difficulty in confining it to that one object, because to do so would be to invade the domain of land legislation, which is outside the scope of our powers.
– The Attorney-General never dreads -that kind of thing. ; 1
– I am inclined to think that he not only read this report of the Inter-State Labour Conference, but learned it off by heart.
– If the honorable member turns to the page of the report giving our programme, he will see something worth reading.
– I have read the programme.
– But the honorable member does not read it with a pure and contrite spirit.
– I think that the honorable gentleman is now getting into a repentant frame of mind.
– The honorable member read” it in a spirit of mockery.
– No, I have quoted the words of the report, leaving them to speak for themselves. If the honorable gentleman will look at this report, he will see that the statement was, “ We want to introduce a Bill to burst up the big estates.”
– The AttorneyGeneral, in his Case for Labour, on Saturday week, said that that was the object of the Bill.
– Quite so; but in attempting to draft a Bill to deal with that problem only, he probably found that, although in form it would provide for what purported to be a land tax only, it would be, in reality, and in substance, an invasion of the powers of land legislation which are left to the States. In order that his Bill should be constitutional, he has omitted those exemptions which ought to be made in a measure dealing with land monopoly, and has thus given rise to many of the inequalities, and injustices that we find in it. There is another point that I desire to emphasize. I freely admit that honorable members opposite were “ returned with a mandate to pass a land tax ; but if the views of the Prime Minister, as expressed from the public platform, are to be taken as being in the nature of platform pledges, then he has something to answer as regards the rates of taxation proposed.
– Will the honorable member say that we have departed from our manifesto?
– I am dealing only with the Prime Minister at the present time. I have before me a revised edition of the honorable gentleman’s speech which was circulated in pamphlet form throughout his electorate. It was issued by him for the information of his constituents, printed by the Truth Company, Gympie, and dated “ 1910.” It purports to be a report of a speech delivered on 30th March, 1909, and it includes a schedule starting with estates of from £5,000 to £10,000 in value, and concluding with those of the value of £50,000 and upwards, the highest rate of taxation mentioned being 4d. in the £1.
– That was the Gympie speech.
– But published in 1910.
– And our manifesto was published in 1910; and on that manifesto we were returned.
– But, after the publication of that manifesto, the Prime Minister again spoke in several parts of his electorate, and stated that the rate in respect of estates of from £50,000 to £60,000 in value and upwards would be 4d. in the £1. Here is the full text of his speech. If his notes contained a reference to a higher rate of taxation, why was not the report corrected? Why was it allowed to go forth as a statement of the highest limit of land taxation proposed?
– In our manifesto, we spoke of “an effective tax.”
– And the Prime Minister told his constituents that the highest limit to that effective tax would be 4d. in the £1, whereas, in this Bill, the rates run up to 6d. and 7d. in the £1.
– Not so.
– Here is the newspaper ; the honorable member can read it for himself.
– That is the Gympie speech, and a repetition of the Gympie speech, whereas our manifesto spoke of an effective tax.
– This is not a repetition of the Gympie speech. It is a report of a speech which the Prime Minister delivered on the 22nd March, 1910, after the manifesto had been issued.
– The Prime Minister said the other day that he referred by way of illustration to the rates, and stopped at the rate of 4d. in the £1.
– Whether he did or did not refer to that rate by way of illustration, we have the striking fact that, in the pamphlet, as well as in the newspaper report, the highest rate was said to be 4d. in the £1.
– It does not matter.
– Perfectly true; but when honorable members opposite take up a very high stand as regards election pledges, I think it my duty to remind them of what has been said in this connexion.
– Did the Prime Minister say anywhere that the schedule to which the honorable member has referred was the Government schedule?
– It was Mr. Fisher’s statement to his own constituents.
– He was not then Prime Minister.
– I did not say that he was.
– The honorable member certainly conveyed that impression.
– If I did, I correct it at once. I said that it was a report of a speech made by the honorable member for w ide Bay to his own constituents in Gympie ; and I do not wish to set upon it any higher value than that.
– He is entitled to his own opinion.
– That is so; but when one expresses an opinion, one should act upon it. The present Prime Minister also said that, at Kilkivan, he had been asked if he proposed to tax leaseholds, and he said, “ No.” Does this Bill tax leaseholds?
– In the first place, the electors were told that the object of this taxation was the bursting up of big estates. When we get the Bill before us, we find that there has been a complete change of front. The Bill is to secure revenue, and its incidental effect is to burst up big estates. Then, again, it does not provide for the exemption of leaseholds or of mineral leases. Did the Prime Minister tell the miners of Gympie that he intended to bring all the mining leases of the district under his land tax scheme? No; leaseholds were not to be included. The Bill is drawn in the most comprehensive way, apparently to enable the Government to rake in every possible penny.
– The mesh is very small.
– It extends over a very big area; and will mean a good haul for the first trawl. For instance, it provides that- “Owner” in relation to land includes every person who jointly or severally, whether at law or in equity -
There is no definition of the meaning of the word” land “ in the Bill ; and, in such circumstances, we have to turn to the Acts Interpretation Act. What do we find there? Section 22 provides -
In any Act, unless the contrary intention appears ….
” land “ shall include messuages, tenements and hereditaments, corporeal and incorporeal, of any tenure or description, and whatever may be the estate or interest therein.
There is nothing in the general definition clause to limit that wide definition of “ land.”
– There is. This is a tax upon the unimproved value of any estate in land.
– Of any estate, or in respect of any land.
– Unless the contrary shall appear.
– But where does the contrary appear in the Bill? We find, in the Bill, an express inclusion of leaseholds, so that every kind of land that it is possible to hold - an estate in fee-simple, for life, for a term of years ; indeed, every kind of tenure - is included, apparently, corporeal or incorporeal.
– Including mines.
– It would appear so. Land of every kind, unless in the Bill itself the contrary intention appears. The onus is thrown upon the owner of showing that his land does not come under the Bill. If honorable members look at the exemptions, they will find that the Bill even rakes in all the lessees of municipalities. Unfortunately, there is no clause to remove the hardships of this Bill from those who are obtaining their interest from trust estates. Ihave a draft here of a Queensland Bill in which a special attempt is made to prevent unnecessary hardships. However, that is a matter for Committee.
Under the Bill there is to be one Commissioner for the whole of Australia. He is to be assisted by several deputies, but there is not the usual clause providing that in case of illness, or absence, or temporary vacancy, some one may act for him. The whole onus of making the valuations is thrown on the Commissioner ; all appeals are from his decisions. The unimproved value in relation to land means “ the capital sum which the fee-simple of the land might be expected to realize if offered for sale on such reasonable terms and conditions as a bond fide seller would re quire, assuming that the actual improvements thereon (if any) had not been made.” In accordance with that definition, the Commissioner has to determine the unimproved value of land all over Australia. He has to be fully acquainted with the conditions at Kalgoorlie, in Western Australia, and with those at Croydon, in Northern Queensland. In New South Wales, three Commissioners were found necessary. We provide but one Commissioner for the whole of Australia, and do not permit him to delegate this function. His deputies may give him information, but the valuations must be his.
– Some one must take the responsibility for them.
– That is so; but I suggest that better machinery could be devised. The making of valuations is thrown, in the first place, on the unfortunate owners of land. According to an explanatory memorandum in reference to the New Zealand Acts, made by Mr. G. F. G. Campbell, Valuer-General -
It will be seen from the definition quoted that each particular piece of land must be considered by the valuer when estimating its unimproved value as if it alone had not been improved at the time of valuation. It is necessary for the valuer first to consider what would be the probable present condition of any piece of land which he is about to value, supposing that no capital or labour had been expended upon it. Having satisfied himself on this question, he would then require to ask himself what price the land in such condition would sell for in the open market at the date of valuation, assuming, of course, that everything else in the country which affects selling-values was actually in its present condition - the Colony progressive or otherwise ; stock high or low ; roads, railways, and bridges constructed ; telegraphs, telephones, schools, fta, built, and improvements on all other lands duly effected and in their present condition.
According to this statement, a man possessing land near Barcaldine will have to ascertain, in determining its unimproved selling value, the state of the market, the condition of our stocks, whether the Commonwealth is raising a loan or obtaining money by means of a note tax, the cost of running the railways of the State, the effect of the change in the telephone rates, the cost of roads, bridges, and other public improvements.
– In New South Wales the valuing of land presents no difficulty.
– I am showing what each owner must consider in arriving at the value of his property. No system will ever be found satisfactory that leaves the valuing of the land to the owners. Ultimately the assessments must be made by a fair and impartial administrative Board.
What are the consequences which may flow from under- valuation by an owner?
Dealing with the acquisition of land from the owner because of under-valuation, the Bill says -
For the protection of the revenue against the undervaluation of land, if the Commissioner is of opinion that the owner of any landhas, in a return furnished under this Act, understated the unimproved value of the land, the following provisions shall apply.
– The land-owners will all be honest.
– I wish the Bill had been drafted on that assumption. Thenfollows the penalty of acquisition by the Commonwealth. Each land-owner will have to send in a valuation, and I have referred to the difficulty of arriving at a true valuation ; but should the value appear to be under-stated, the Government may take possession of the land.
– The under-statement must be wilful.
– Where the mistake is wilful the owner is liable to prosecution, but if the Judge is satisfied that the value has been under-stated by the owner, and is not satisfied that the under-statement was not wilful, with a view to evading taxation, the land may be taken over by the Government. Very serious consequences may follow under clause 44 from an under-statement of value even when made honestly.
– That is not so.
-.- Then I shall be glad to have the position made clear in Committee. The Attorney-General has justified his position on the ground that the Commonwealth has power to acquire land for public purposes, hut the acquisition of property must, according to sub-section xxxi. of section 51 of the Constitution, be “ on just terms. from any State or person, for any purpose in respect of which the Parliament has power to make laws.” The acquisition cannot be for indefinite purposes.
– Would it not be justified by theinfraction of a law?
– That would not create a public purpose. TheCommonwealth could not take over 50.000 acres of landexcept for some purpose in respect to which this Parliament has power to make laws. According to Chief Justice Marshall -
We think the sound construction of the Constitution must allow to the National Government that discretion with respect to the means by which the powers it confers are to be carried into execution which will enable the body to perform the high duties that are assigned to it, in the manner most beneficial In the people. Let the end be legitimate; let it be within the scope of the Constitution; and all means are appropriate, which are plainly adapted to that end, which are not prohibited, but consist with the letter and spirit of the Constitution are constitutional.
The Attorney-General must show that means proposed here are appropriate and plainly adopted; but he contends he relies on the power of acquisition. On this latter point, I would refer him to the following authority. In Black’s Constitutional Law, page 376, occurs this passage -
Again, the exaction of money from individuals under the power of taxation, and the appropriation of private property for public use by virtue of the power of eminent domain, should not be confused. In paying taxes, the citizen contributes his just and ascertained share to the expenses of the Governmentunder which he lives. But when his property is taken under the power of eminent domain, he is compelled to surrender to the public something above and beyond his due proportion for the public benefit. The matter is special. The particular estate is taken because the Government has special need for it. It is in the nature of a compulsory sale to the State. Hence arises the justice and necessity of a constitutional provision for compensation to the owner.
That is a matter that I can discuss with the Attorney-General in Committee; at present, I only warn him that we cannot pervert the power of acquiring land for public purposes from its proper use. What the Attorney- General has to consider is whether this clause, which differs much from the New Zealand clause, will be considered by the Courts as appropriate, and as adapted to the end in view.
There is only one other point with which I have to deal, and that has reference to the Court of Appeal. When we have one man arbitrarily assessing lands all over Australia, and he is situated at the Seat of Government, there should be a properly constituted Court of Appeal.
– A nice job for the lawyers !
– Quite so; and it will be hard on the taxpayers if we do not do justice to them. Under the Bill, the Court of Appeal is to consist of a Justice of the High Court. Ought that to be so? At the present moment, our High Court Judges are more than overworked; and we are so altering the Conciliation and Arbitration Act that practically the whole time of the Judges of that Court will be occupied with industrial matters. Where has this Court of Appeal to sit? At the present moment, the High Court goes to all the Capital cities ; and I ask how many appeals are likely to be heard in the first instance? As at present drawn, the Bill in this respect will be found absolutely unworkable, and to inflict infinite injustice on land-owners.
– Does the honorable member suggest a State Court?
– 1 do. In New Zealand there is a magistrate in each district to hear appeals, and it is insisted that he shall be a magistrate residing in the district, so as to insure local knowledge. In Western Australia, the provisions are similar; and in New South Wales there is provided an appeal to a Land Appeal Court presided over by a District Court Judge, who goes to the country towns, and also a police magistrate. I ask the AttorneyGeneral to make this a real Court of Appeal by permitting appeals to be heard in any part of Australia. If it is necessary to have appeals to the High Court from this Assessment Appeal Court only on points of law, let that be so, but, really, valuations are questions of facts. If a man, for instance, outside Townsville desires to appeal on a question of land valuation, it is not fair to ask him to bring all -his witnesses hundreds of miles to southern Queensland. The Court of Appeal ought to bring justice to the doors of the people.
– Does the honorable member suggest stipendiary magistrates?
– I ask the AttorneyGeneral to consider the advisability of employing Judges of the Supreme Courts, District Court Judges, or any tribunal of the kind he thinks fit. My justification for detaining the House at such length is the fact that for the first time we are considering legislation of this nature, and we should examine it thoroughly, and see that justice is done.
I have always contended that land legislation is for the States. In Queensland, I have always stood, and always will stand, for the subdivision of big estates and the giving of every possible facility for settlement in small areas. I have no feeling of affection or regard for those huge vacant spaces alongside our railway lines. Those lands should be opened to the people, but it should be by the process of compensation, and not confiscation. We should see, if landed interests are taken away. that the owners are properly com- pensated ; but it must be clearly understood that no person who owns large areas shall stand in the way of the progress and development of this great continent.
We are told that much good in the way of immigration will flow from this Bill; and I assume that to-morrow, in anticipation of certain results, we shall see a large sum of money placed on the Estimates in this connexion. I should like honorable members opposite to show in what way people are to be enabled to obtain land cheaply when the big estates are cut up. The honorable member for Capricornia was quite right when he warned the Government that, although the Bill might effect some good, the States will still have to continue’ a vigorous policy of land legislation and land settlement. If we take over the Northern Territory, there must be a strong railway construction policy, with land settlement on the most liberal terms, and the provision of all those educational agencies found in an Agricultural Department.
– An Agricultural Department is badly wanted.
– We should have a National Australian Agricultural Department, and I hope honorable members will assist me to that end. If the States are willing, as many of them are, to carry on a vigorous land policy, we should cooperate with them. Let us exercise to the full all the national powers we possess for their legitimate purposes; but in regard to the powers the States possess, including those of land settlement, let us co-operate with them, in order that Australia may be full of vigorous people, adding to its wealth, and providing population to enable us to hold our own in time of peril.
.- When a friend of mine heard me express the intention to speak on this question, he was good enough to suggest I might find myself in a somewhat difficult position. He had, of course, in his mind the fact that I was associated with the Labour party for some considerable time, and that, possibly, I was identified very closely with the policy now laid before us in this Bill. I hope I am still capable of admitting a mistake, if I made one, or of indicating plainly and frankly that I have changed an opinion. It is not, however, necessary for me to do either. I think I can show clearly that my position with regard to this measure is one I have occupied all the time
I have been in the Federal Parliament, and that, in particular, during the last election ^campaign, I practically identified myself with the amendment proposed by the honorable member for Ballarat. Some people have desired to follow up the development of this policy by the Labour party. With my knowledge of that party, I desire to say that this Land Tax Assessment Bill has simply “happened along” in quite a promiscuous way. Its beginnings may be found in the position taken up by members of the party at the time when immigration, to put it mildly, was not encouraged - at least by a majority. They said then that it was not a right and proper thing to introduce artisans into the cities from outside Australia, and that, so far as farming immigrants were concerned, there was no land available. The next development was, of course, the idea of bursting up big estates, in order to make land available. But Mr. Watson undoubtedly indicated at an early stage of this movement, that the duty of .bursting up the big estates lay with the State Parliaments, and that, so far as he was concerned, it was not his intention to move in that direction as a Federal member. Of course, that position was modified subsequently ; but I think it was only during the last election campaign that the position developed to the degree that a land tax was proposed as a means of revenue. So far as the tax is concerned in that connexion, I regard it as’ very hypocritical and misleading. If the big estates are to be burst up by this tax incidentally, as we are given to understand, the effect will be that revenue must undoubtedly disappear. The question arises, if it is necessary to obtain revenue from land, and the big estates disappear, where is the revenue to come from? Undoubtedly, the exemption must be lowered ; and that, I take it, will be the inevitable result of the initiation of this policy in its present form.
I have always advocated direct, as against indirect, taxation. I have said in this House, and I repeat, that the incidence of taxation here is not equal to that of the Old Country. We have too much indirect taxation, and too little direct -taxation; but the method proposed by the - Government is not the way to put the matter right. I have, of course, read and studied a good many of those fascinating works on land taxation, of which HenryGeorge’s Progress and Poverty may be taken as typical. Henry George was by no means original in the proposals put forward in that very interesting book, and he has been succeeded by many others who, going on the same lines, have not added to the sum total of the arguments in favour of the scheme which had been put forward, but have only managed to confuse the issues in many minds. At no time could I see anything In a land tax than that it was undemocratic and unfair. I have never been able to see the advantages of the single-tax nor of any modification of the single-tax; and I propose to show as briefly as I can to-night, first, where such land tax proposals are necessarily undemocratic and unfair, and, secondly, where I think they could have been improved on immensely by the present Government. We have been told ad nauseam in this House that the proposals of the Government are part and parcel of a national policy. The Labour party, we are assured, are the national party, while those on the other side of the House are mere parochialists. I cannot help observing that nearly every speech from the other side on this question has been distinctly of the parochial order, and each speaker has been more concerned with the few acres comprised in his own electorate than with the general welfare of the Commonwealth. That has been particularly in evidence in the case of speeches made by members representing Victorian constituencies. One after the other, these gentlemen have delivered speeches, some of them undoubtedly eloquent, and some of them recited with an ease which indicates that they have done good service time and again on the platform. These speeches have all pretty well covered the same ground, and their prototypes in matter are to be found in the very interesting and well-written articles that have appeared in the Age.
– Only one Victorian has spoken.
– I think more than one, but the speech which I have in my mind, and which was delivered by a Victorian, is so characteristic of the attitude of Victorian members on that side that it may fairly be regarded as typical. Victoria being one of the older-settled States undoubtedly has this land question before it in a more pronounced form than we find it in the newer States. There is no question that the land in Victoria is in the hands of far too few individuals. The first time 1 travelled from Melbourne up into the far quarters of the Western District, I was astounded to find such immense areas of magnificent country so sparsely occupied. On making inquiries, I discovered much to make me, as a Democrat, desire to see a change. This was nearly twenty years ago, and the proposals even in those days for bursting up large estates were, I considered, highly commendable. As time has gone on, I feel satisfied that there is even greater justification for something being done in that direction. But it is not the duty of this Parliament to take those steps. The power to take them has been left in the hands of the people of Victoria, and it is not right for them to seriously interfere with the functions of other States as regards land settlement and development, in order to achieve this reform for themselves. The honorable member for Corangamite delivered a very interesting and able speech on the subject. I listened to him with a good deal of interest, and largely sympathized with his objects. In view of the existence of such an Upper House as the people of Victoria are blessed, or cursed, with, one would almost go the length of the honorable member in justifying the action of this Parliament, so far as Victoria alone is concerned. ‘ But we have to look at more States than Victoria, and that is where the fatal weakness of the attitude of such members comes in. He had a good deal to say in admiration of the sturdy pioneer farmer who settled on the lands of this State. I happen to have many friends in this State who were themselves sturdy pioneers in their time, and I cannot grudge that term even to those squatters who incur the obloquy and invective of honorable members like the honorable member for Corangamite. When those squatters went out into the wilderness of this State, the same class of people who are now denouncing them were ready to applaud them as sturdy pioneers, to sympathize with them in the dangers and difficulties they had to encounter, and to regard them as broad-minded patriots - as well as men seeking their own interests - in taking upon themselves the arduous task of pioneering. If they secured large areas of land in those days, it was simply because the land was in a manner thrown at them, and those of them who were long-headed enough to see the possibilities of land development naturally took as much as they could, as I believe most of us here would do if we had the same opportunity. I have friends in this State who tell me that, if they had cared, they could have been in possession of what are now some of the finest estates in the Western District, but at the time that those estates were available in those large areas, there was only one man here and there who was prepared to face the danger and difficulty of permanent settlement, and who had the foresight to see that it was worth while, in the interests of himself and his children, to undertake these great tasks. If those big estates have resulted in certain conditions, which are, unfortunately, against the best interests of Victoria, the matter is not beyond remedy even by the State; and, as a matter of fact, it is being remedied, not by legislation, but by the economic conditions that are at work behind nearly all our social affairs. On my first visit to the Western District of Victoria, I saw the ruins of many homes that had once been occupied by selectors. I had seensimilar relics of closer settlement in partsof Scotland, and was surprised to see these - in Australia. On making inquiries, I found that the district had for some years carried a much denser population, but that the land, which had been taken up in small selections of 320 acres, had fallen into the hands pf a comparatively few individuals. The explanation was very simple. Small settlers were encouraged to take up land when wool was fetching such a price as enabled them to make a living off 320 acres, but with the gradual and steady drop in the price of wool, they were forced out of their selections, and had to sell to those who had the means to buy them out. That was a state of affairs for which no one could be blamed, and which, although regrettable, had to be faced as being in the natural order of things. The same economic conditions undoubtedly operated’ throughout the whole of Australia to reduce the number of small settlers, and it is only during the last few years that the tendency has been corrected - again by economic conditions. The discovery that land hitherto regarded as. unfit for cropping can be made to produce good crops of wheat by the use of artificial manures, and the development of the dairying industry, have undoubtedly tended to break up big estates, and re-constitute the smaller settlers on the land, not only of Victoria, but of other States as well. Here we have the natural remedy for the condition of things regarding which so much oratory was thrown at the heads of the people, especially of Victoria, during the last election campaign. In the development of mixed farming and dairying, I believe we have a method by which the big estates will be normally, effectively, and permanently broken up. The honorable member for Corangamite mentioned the rush for land in the north-west of Victoria a little while ago, and pictured the unusual amount of bustle on the country roads in the direction where the land lay. He gave that as an illustration of the unsatisfied land-hunger that exists in this State. I have a fair amount of experience of Victoria, and, in my opinion, there is a very small amount of unsatisfied land-hunger in it. There are at present in the hands of the Closer Settlement Board estates for which tenants and prospective buyers cannot be obtained. The land thrown open on the borders of the Mallee, to which the honorable member for Corangamite referred, was sought for by men anxious not to settle on it, but to secure the unearned increment that could be obtained from its sale.
– Is the honorable member acquainted with the Cohuna Government land scandal ?
– I am fairly well acquainted with it, and there is about it something to be deplored; but the matter to which the honorable member refers cannot be dealt with under this measure. Very little evidence has yet been produced of an unsatisfied land hunger in Victoria. I have been surprised to find how many young fellows in the country look to the town rather than to the bush for a livelihood.
– They are compelled to do that.
– I know young fellows who could easily have gone on to the land had they chosen to do so, but who have elected to obtain a living in the towns. That is quite a common occurrence among the young men in the country districts of this State.
– Perhaps the honorable member is an authority on nonsense. I come now to my next point, which is that the object sought to be attained by this legislation will not be reached by it. In the majority of instances, those who want land in Australia do not possess sufficient capital to provide for the purchase of the land at the prices asked for it in the more settled parts of the Commonwealth. That remark applies particularly to Victoria. There are very few who have sufficient capi tal to take up land under existing conditions in this State, and those who wish to obtain farms for themselves are going elsewhere. Many in Victoria who support this legislation do so with the object of keeping all the young men within the State. Their object will not be achieved in this way. The young men will continue to go to Queensland, and particularly to Western Australia, where they can obtain land at a nominal rate, and perhaps under better conditions generally than apply to land which is sold at considerably more per acre in Victoria. The honorable member for Corangamite mentioned the case of an owner of land in this State who had refused as much as £z per acre as rent for land. If there can be found in this State a man who will refuse rent to that extent, will this tax compel him to lease his land? Will it be a matter of considerable difficulty for him to retain his land and still pay die tax upon it?
– We shall have the satisfaction of making him pay the tax.
– Had the honorable member returned to the chamber a few moments earlier, he would have heard me say that the object sought to be attained by this Bill in the direction of making land available in Victoria for settlers with limited capital will not be reached.
We have heard a great deal about “ the unearned increment.” That is a very wellsounding phrase, which is cast trippingly off the tongue at election time. When the intelligent elector is told by a candidate that there is going into the pockets of private individuals a vast amount of unearned increment that ought to go to the people as a whole, he is naturally taken by the statement, and is prepared to vote for those who want to secure to him his portion of it. But if it is necessary to secure this unearned increment, I wish to know why it is to be taken in the case of an unimproved land value of £5,001, and why there is none to be levied from the owner of £5.000 worth. Does it not appear distinctly disingenuous that the unearned increment should be levied in the one case and left severely alone in the other? The honorable member for Corangamite had his reply. He told us that the exemption represents the lowest value out of which a man can make a decent living. The honorable member gave us to understand that he was not a farmer, hut he might have had rather more knowledge of farming than a statement of this kind would indicate, and he might also have given honorable members credit for a little more.
– I said that it represented not the lowest amount, but “ about “ the lowest amount.
– At page 2318 of Hansard, the honorable member is reported as saying -
We shall allow you an exemption of ^5,000 unimproved value, that representing the lowest value out of which a man can make a decent living.
Taking the average unimproved value of land in Victoria at £5 per acre, we have thus an area of 1,000 acres exempt, and if a farmer cannot make £500 a year out of 1,000 acres he does not know very much about farming. The chances are that he makes something nearer £1,000 per annum, and if that is an income on which a man ought not to -be taxed under this Bill, then I feel sorry for the honorable member’s consistency. There can be no doubt, when we analyze such a position as this, that such an unjustifiable exemption is intended to secure votes amongst those who will thus be left free from the tax. Undoubtedly those people who are caught by this particular bait at the present time will find that the hook is in their mouths later on when they think it has been firmly fixed in the mouths of others.
The unearned increment which, is correctly associated with land belongs to every other form of wealth. We were told the other night by an honorable member opposite that land is the source of all wealth. I agree with that, but wish to know why it is proposed to tax, not all wealth, but merely that portion of the product of the land associated with the tenant or occupier of land. In taxing the unearned increment of land only, we undoubtedly miss the greater portion of the wealth created in every civilized community. The wealth of Australian cities is due to the land that surrounds them, and we have had this evening an interjection referring to those people in the big cities - in Melbourne in this :nstance - who “ farm the farmers.” The reference was to men who, .we are given to understand, amass wealth at the farmer’s expense. Why is the unearned increment which those people obtain not taxed ? Why are they allowed to escape? As a matter of fact, unearned increment pertains to every form of wealth that we can find. Even the small grocer in a provincial town has an unearned increment added to his business as the result of the development of the country round about him. It is the merest hypocrisy to contend that the unearned increment of the wealth of the country is being secured in the way proposed by honorable members opposite.
We could not have missed the “ shocking examples “ supplied to us of the unearned increment of the land in cities. We have had recited to us repeatedly cases in which land bought in Melbourne in the early days for the proverbial song is now worth so many fortunes. We are correctly told that the community contributed those values to that land. We are also given to understand that it is fair and proper to tax the unearned increments of. those valuable city blocks. If those city blocks remained in the hands of those who originally obtained them for a mere song, there would be something in that contention. But if they have changed hands of recent years at ordinary commercial values, then it is nothing short of confiscation to take from the people who own them that portion of the unearned increment for which they have paid a fair price in the market. That is where a great deal of the unfairness of a proposal of this kind occurs. Undoubtedly there are many evils connected with the occupation of land in every civilized country, but where property has been obtained under conditions sanctioned by the law, and use and want have tolerated them, we are not justified in sweeping the past ruthlessly aside in order to create what may be thought better conditions. I do not believe that the end justifies the means, though that appears to be the justification of many members of the Labour party for this policy.
Having shown that I am not a believer in the single tax doctrine, nor in the taxation of land as the principal source of revenue, I wish next to say that I do not consider an income tax an entirely fair and equitable method of raising revenue. The Labour party could have vastly improved on its proposals by bringing forward a tax which, while doing all that they desire, would not be unjust in its incidence.
– A tax on tea, I suppose?
– No. When a member of the Labour party, I initiated a movement which prevented the taxation of tea and kerosene, and I am opposed to indirect taxation, at least to the extent to which it is levied here. An income tax is objectionable because it does not involve equality of sacrifice. Where there are two men, each with an income of £500 a year, and one is bringing up a family of ten or twelve children to the advantage of the community, while the other is living single, and spending his money on pleasures that are neither good for himself nor for the community, it is unfair to tax them alike. But there is a tax which embodies all the conditions which a Democracy requires, and which could be imposed by this Parliament without creating the objections which may be made to’ the present proposals. It would produce more revenue, and would be a more lasting source of revenue, than the tax now before us. My idea of an equitable and effective democratic tax is a surplus wealth tax. Had such a tax been proposed, it would not have created the difficulties which surround this scheme, and would have met our circumstances more effectively and fairly.
An objection I have to the proposed land tax is that it penalizes States which are already taxed in order to get at those which are not. In Western Australia we have a land tax, though not a heavy one, which is fairly effective for its purpose. It is as heavy as can be justified in the present state of the development of the State, and could, and would, if necessary, be increased by the local Parliament. But Western Australia is to be deprived, in part at least, of a means of taxation in order to punish States which are not so progressive, and have not been so careful of their landed interests. The proposed tax undoubtedly hits more heavily the population of a new State than the population of the older States. In Victoria, those who will be affected have been obtaining a handsome revenue from land for many years past, whereas in Western Australia the tax will have to be paid by men who are struggling to get a footing, and will be imposed on land which is in the initial stage of development. It is a pity that men should be discouraged when developing land with limited capital.
I was amused to hear the honorable member for Denison say that the land of Western Australia is monopolized, because of the existence of two large estates, one of them containing 250,000 acres granted when its lands were not sought after. These estates undoubtedly fell into the hands of persons who should not have obtained the land in that way ; though I think they have since been subdivided into small areas. Western Australia, however, has sufficient land available for settlement to make those estates unimportant, though I can understand the honorable member for Denison thinking an estate of 250,000 acres a very large one, because a selector who is looking for land in Tasmania has to be careful that he does not step over the side of the island.
– We grow more in Tasmania on 5 acres than is grown on 50 acres in Western Australia.
– We shall soon grow more, acre for acre, in Western Australia than is grown in Tasmania. I wish I could persuade those who here talk about Western Australia to visit the State and study her possibilities. I speak as a selector, and as one who has been associated with farming else’w’here than in Australia. The honorable member for Fremantle has disproved the assertion that there is no land available for settlement in Western Australia, and while not wishing to cover the same ground again, I propose to bring his information quite up to date. I have here an advertisement by the Department of Lands and Survey, Western Australia, which appeared in the newspapers of 26th August last. It notifies that-
The following areas are now thrown open for selection, applications receivable up to 13th September: - Nunajin, 13,636 acres; Nangeenan, 17,687 acres; Mereedin-Nangeenan, 16,627 acres; Mangownie, 3,279 acres; Lake Brown, 2,000 acres; Morawa, 50,000” acres …. about 100,000 acres surveyed will be made available every few weeks.
This indicates that there is still plenty of land available in Western Australia, and that a large number of persons are taking it up. Under our land development policy, the country is going ahead by leaps and bounds; but I am glad to know that for many years the State will be able to offer inducements to the young men of Australia to settle within her borders. We enable willing workers to take up land practically without capital, and to make a success of their efforts. So far as climate and soil are concerned, we can offer conditions as good as any in the Commonwealth. In view of the ignorance displayed regarding Western Australia by honorable members who speak from the prejudice of their comparatively narrow surroundings, and who should, at the earliest possible moment, make themselves acquainted with the condi- tiona of other parts of the Commonwealth, I wish to quote briefly from a booklet issued by the Government of’ Western Australia containing statements made by several who have settled on the lands there. I pick out almost at random a statement by four brothers who settled some twelve years ago, and who, amongst the information they gave to the officials of the Lands Department, who compiled the booklet, include figures showing the product of the wheat per acre on their farm. It is a very interesting record, which, I think, could hardly be beaten anywhere else in Australia. They started in 1898, and obtained in the first year 7 bushels per acre. That was certainly not a big crop ; but those who are conversant with pioneer work know that a first crop is only scratched into land that is often sour and full of stumps; and cannot be called a crop in the ordinary sense. Down to 1910, the crop varied from 7 bushels to as much as 28 bushels per acre, the latter being obtained in 1903, when manure and the drill were used for the first time. The average production for the twelve years was 15$ bushels.
– Is the honorable member going to connect this with the question before the Chair?
– I merely cite this as an illustration in my contention that Western Australia has land available of a quality equal to any that can be obtained in the eastern States.
– The honorable member is going beyond that.
– And that, so far as Western Australia is concerned, there is no necessity for the proposals of the Government, which, instead of being’ an advantage, will prove a serious detriment to this State.
– Does the honorable member desire to keep back other States which have not the advantages of Western Australia ?
– -I do not, but I have shown that the conditions in the other States are such as will not be improved in the matter of closer settlement by the proposals of the Government, except in a few instances here and there - that the cost of land in Victoria, for instance, will prevent the great majority of those who desire to settle, from getting farms here, and who, with their limited capital, must go elsewhere.
Although this tax is one that will be of no advantage, but a serious detriment in some respects, to Western Australia, inasmuch as it curtails the taxing power of the State Government, it is still a tax that we shall survive. By the time Western Australia has reached the position, which she undoubtedly will, of being amongst the leading States of the Commonwealth, it is more than likely that other changes - to me, of an interesting character - will have taken place elsewhere. By that time the Federal Capital will have been moved from Melbourne, and the Commonwealth will be administered practically from a suburb of Sydney. We. shall, in all probability, find those people in Victoria, who are now crying up the National Parliament, and advocating an extension of its powers, joining with those who come from the remoter parts of the Commonwealth in order to curtail those powers. We shall find them adopting the principle of Home Rule, which is so dear to those of us who come from the outlying States. In this connexion I am reminded of’ a statement made by the honorable member for Corangamite about the crofters of Sutherland, in Scotland, who have been driven from their lands by the landlord. . That statement, no doubt, did excellent service on many platforms throughout the length and breadth of the honorable member’s electorate; but the honorable member probably did not inform his hearers of the causes that brought about the depopulation and the driving of the crofters into the wide world. ‘ The causes were the causes which I am prepared, to fight in Australia to the bitter end, and they are, centralization and the development in one Parliament of functions that ought to be retained as a portion of State Home Rule. If Scotland had not been ruled by and from London, those infamies would never have occurred. It was the centralization of the Government in London that made it possible for the crofters to be driven from their lands in the Highlands, just as it was the absence of Home Rule in Ireland that drove the peasants from the plains of that green isle. So far as this Land Tax Assessment Bill is concerned, it is undoubtedly a move in the direction of centralization and unification. I have seen the development of this policy in the Federal Labour party with very much, concern, and it is the one essential reason that has compelled me to sever myself from that party.
As a member sent into this House by a constituency of an outlying State, I am obliged, by my own convictions and by the interests of my electors, to fight this policy tooth and nail. I repeat that the time will come in the State of Victoria when those who are now making so much of the National Parliament - as they prefer to call it. though it is national in no greater sense than the State Parliaments are - will have to change their tune, and add the puny voice of a minor State to that of Western Australia in an endeavour to neutralize the effect of the mistakes made at a time when, by having the Parliament in their midst, they thought they could effectively control it.
Debate (on motion by Mr. Joseph Cook) adjourned.
Motion (by Mr. Hughes) proposed -
That the House do now adjourn.
– I desire to bring under the notice of the Postmaster-General a letter I have received from the municipality of Marrickville in regard to the erection of unsightly telegraph poles along the main thoroughfare in that municipality. The letter is as follows -
I am directed by the Council to bring under your notice the action of the Postal and Telegraph Department in erecting poles along the main streets of the municipality that are delapidated and unsightly, and anything but an ornament to the locality ; my Council think that it is quite time that some action was taken by the Department to provide a more sightly pole, such as those erected by the Tramway Department.
As an example, it is suggested that you make an inspection of those lately erected along the Marrickville-road, when you will at once see the reason for the Council’s protest.
The Council would be very pleased if you could bring the matter under notice.
I have noted the poles, and they are certainly not picturesque. I see, further, that the local paper contains the following in regard to the Mayor of the municipality -
His Worship also entered a strong protest against the action of the Post, Telegraph, and Telephone Department in disfiguring streets and principal roads with unsightly posts. Instead of something light and graceful, these high and mighty officials trimmed up worm-eaten logs, gave them a coat of paint, and planted them just where they pleased. He thought it high time that the Council took a strong stand against this high-handed vandalism.
The minute was received favorably, and it was decided to write a strong protest to the Postmaster-General through the Federal member, Mr. W. E. Johnson.
I am not in a position to speak as to the worm-eaten state of the posts, because I have not yet had time to closely inspect them, but I can bear out the statements made in regard to their unsightly character. This should not be permitted in thoroughfares which municipalities are endeavouring to make attractive. I ask the PostmasterGeneral to see whether poles of a more ornamental character, or, at any rate, which are less aggressively ugly, cannot be substituted.
– I shall look into the matter.
Question resolved in the affirmative.
House adjourned at 10.35p.m.
Cite as: Australia, House of Representatives, Debates, 6 September 1910, viewed 22 October 2017, <http://historichansard.net/hofreps/1910/19100906_reps_4_56/>.