4th Parliament · 1st Session
The President took the chair at 2.30 p.m., and read prayers.
asked the Minister representing the Minister of Home Affairs, upon notice -
What steps, if any, are being taken in regard to the payment for transferred properties?
– The answer to the honorable senator’s question is -
With respect to the payment of transferred properties the Government have this matter in view.
In Committee (Consideration resumed from 25th October, vide page 5090) :
Clause 2 agreed to.
Clause 3 -
In this Act, unless the contrary intention appears - “ Absentee “ means a person who does not reside in Australia or in a territory under the authority of the Commonwealth ; and includes a person who -
is absent from Australia and such territories at the time when the ownership of his land for the purposes of this Act is determined ; or
has been absent from Australia and such territories during more than half of the period of twelve months immediately preceding that date, unless he satisfies the Commissioner that he resides in Australia or a territory under the authority of the Commonwealth; out does not include a public officer of the Commonwealth or of a State who is absent in the performance of his duty. “Unimproved value” in relation to land, means the capital sum which the feesimple of the land might be expected to realize if offered for sale on such reasonable terms and conditions as a bond fide seller would require, assuming that the improvements (if any) thereon or appertaining thereto and made or acquired by the owner or his predecessor in title had not’ been made. “ The Commissioner “ means the Commissioner of Taxes.
– The definition of “ absentee “ in the New Zealand Act differs somewhat from the definition in this Bill. I move -
That in paragraph b the words “ twelve months” be left out, with a view to insert in lieu thereof the words “ three years.”
I think that the adoption of my amendment would have the effect of liberalizing the definition of “absentee.” We must recollect that in these days people travel a great deal, and it seems hard that a man who may be absent from Australia for twelve months should be regarded as an absentee. It is of advantage to Australia ihat our people should move about. 1 trust, therefore, that (he Government will recognise the reasonableness of my proposal.
-Colonel Sir ALBERT GOULD (New South Wales) [2.38]. - I wish to say a few words in regard to the earlier portion of the clause. I find that in it “ absentee “ is defined to be a person who is absent from Australia or the territories under the authority of the Commonwealth “at the lime when the ownership of his land for the purposes of this Act is determined.” But paragraph b provides an alternative in that under it an absentee may be a man who “ has been absent from Australia and such territories during more .than half of the period of twelve months immediately preceding that date.” Thus, if a man has been absent from Australia for seven or nine months prior to the determination of the ownership of his property, he will, strictly speaking, be regarded as an absentee. It is perfectly true that the subsequent portion of the paragraph provides that He may satisfy the Commissioner that he resides in Australia or a territory under the authority of the Commonwealth. I wish to get from the Vice-President of the Executive Council a clear statement as to the construction which the Government place upon this provision. Under it, will it he possible for a man who mav be absent on a visit to another part of the. world for a period of twelve months to be still regarded as a resident of Australia, and not ns an absentee? Very many of our people leave the Commonwealth for twelve months or two years—
– If they can afford to take a pleasure trip of that sort they can afford to nay the tax.
-Colonel Sir ALBERT GOULD. - I am endeavouring to discuss the construction which will be placed upon this provision. I am not debating the question of whether persons who undertake a pleasure trip can afford to be taxed. If that is the spirit in which legislation is to be enacted, God help Australia ! It would be a disgraceful thing if such a provision were included in a Statute for that reason. Of course, if the determination of this question is to be left entirely in the hands of the Commissioner, that arrangement will be satisfactory, because I presume that the Commissioner will be chosen on account of his standing and fitness for his office.
– 1 re-echo the sentiment which has been expressed by Senator Gould when he said “God help Australia!” God has helped Australia, absentees included. But I would point out to the honorable senator that the latter part of the definition amply meets the case which he has put. We all thoroughly understand that a gentleman may leave Australia upon business, but when he does so, he leaves his family, his home, and his interests here, even though he maybe absent for six months, or twelve months, or two years. It will be quite easy for him to satisfy the Commissioner that he has nol become a resident of another part of the world, and that he is not an absentee. Consequently, I do not think there is any need for the amendment. The clause is satisfactory as it stands, and under it no genuine Australian will suffer hardship.
– I should like to ask the Government how they interpret paragraph b, which reads - has been absent from Australia and such territories during more than half of the period of twelve months immediately preceding that date.
Why not insert in this provision the words “ six months,” in lieu of the words “ half of the period of twelve months”? Is it intended to add up the absences of a man from Australia till they aggregate more than six months? I cannot understand the provision.
– I would point out to Senator Chataway that the tax will be levied for one year, that it will be imposed at a certain time, and will begin to operate from a specified period. If a person is absent from Australia for more than half that lime, and it is clearly evident that he has left the Commonwealth and has taken up his residence permanently somewhere else he will become an absentee for the whole of that year. I do not see that he can be treated otherwise.
– I suggest that the word “ continuously “ should be inserted before the word “ absent.” Such an amendment would make it clear that it is not intended to add up temporary absences in order to constitute a man an absentee.
– It is ridiculous to suppose that the Commissioner of Taxes would, for the purpose of making a man an absentee, add together two or three weeks at one time of the year and two or three weeks at another. As far as I can see, it is impossible under this Bill for a citizen to be classed as an absentee unless he is away six months continuously. It would only create confusion to make an alteration of the kind suggested.
-Colonel Sir ALBERT GOULD (New South Wales) [2.47].- On a previous occasion the Minister, in referring to absentees, said that it would not matter whether a man was away from Australia twelve months or two years as long as he made his home here. Now, however, the Minister points out that a man might be classified as an absentee if he were away for twelve months. I am quite sure that the intention of the Government was not to impose extra taxation on a man who is merely out of Australia on a holiday.
– Certainly not, and the Bill does not say so.
-Colonel Sir ALBERT GOULD.- As the Bill stands, it is possible that if a man were away from Australia for three months at one part of the year and three months at another hewould be rendered liable to be designated an absentee, although his absence from the country might not be for a continuously long period.
– Every one has a clear idea in his own mind as to what an absentee is. If a person leaves Australia to take up his residence abroad, and starts business in another country, he is evidently an absentee, although he may not be away from this country for three months. It would be useless for such a man to attempt to prove to the Commissioner that he was not an absentee. But if he is a bond fide Australian, he may be away for two years, and may still satisfy the Commissioner that his busi ness required him to be away for that period, in which case he would not be an absentee.
– I hope that the Vice-President of the Executive Council will accept the suggestion made by Senator Chataway to insert the word”continuously. “ Every one knows that Australians are prone to travel a good deal, though they have no intention of leaving their homes in this country. I have in mind certain young men who quite recently have been travelling in Java, Japan, the Philippines, Siberia, Russia, Norway, Great Britain, the United States, and Canada.
– Did they make any attempt to settle in one of those countries ?
– Then the honorable senator is talking nonsense.
– We have to fall back upon the discretion of the Commissioner. Every encouragement should be given to Australians, to travel. In a case such as I have mentioned, if the discretion of the Commissioner were wrongly exercised, the young men whom I have in my mind would be within the purview of this super-tax. It might be very difficult to convince the Commissioner that a person was not an absentee. How would the Commissioner be informed?
– The honorable senator’s young friends would easily satisfy the Commissioner.
– How ? Would they have to come over to Melbourne from Tasmania ?
– Not necessarily. They could appoint the honorable senator to act as their representative.
– Why should they be compelled to do that ? If they instructed me, I might have to charge them a stiff fee. The insertion of the word suggested by Senator Chataway would make the clause much clearer, and carry out the intention of the Government.
Amendment, by leave, withdrawn.
Amendment (by Senator Chataway) proposed -
That the word “ continuously “ be inserted after the word “ been,” line 12.
– I wish to draw attention to a class of cases well within the knowledge of honorable senators. I refer to men who, for business reasons, are continually travelling between Australia and New Zealand. I happen to know a gentleman whose home is in New South Wales, but who is not actually in that State more than three months in the year. The rest of his time he is either on the water or in the Dominion. Under the clause as it stands, that man would be regarded as an absentee, because for more than six months in the year he is out of Australia. But under Senator Chataway’s amendment he would be exempt from extra taxation, because his absence from Australia is not continuous. There is, surely, no desire to insert in. the Bill a definition which must be harassing to certain sections of the community. Neither is it desirable to throw upon a man the obligation to go to the Commissioner and demonstrate that he is a bond fide Australian. Senator McGregor has suggested that such a person may appoint a legal representative. I have yet to learn that members of the legal profession work for nothing. Probably in some cases it would be troublesome to supply the Commissioner with evidence. It is quite evident that a commercial traveller who is continuously travelling between Australia and New Zealand is not an absentee. Yet under the Bill the Commissioner would have no option but to regard such a man as an absentee. Of course, if the Minister is prepared to resist all amendments, we may as well abandon our attempts to improve the Bill. But the principle of the measure is not touched by the amendment which is submitted simply with the object of making the measure work more smoothly.
– For the life of me, I cannot see that Senator Chataway ‘s amendment would improve the Bill. If it were carried, persons who were away from Australia for six months continuously would still have to satisfy the Commissioner that they were not absentees. Of course, I do not want to see any citizen of Australia put to inconvenience by the Bill. We are not legislating to inconvenience people, but simply to give effect to a principle which the people are desirous to have carried out. The difference between the clause as it stands and as it would read if the amendment were made is not of sufficient importance to justify a division.
Senator Sir JOSIAH SYMON (South Australia) [2.59]. - I think that Senator Gardiner hit the right nail on the head when he said that we do not legislate to inconvenience people. We all assent to that. The second reading of this Bill having been carried, we wish to assist in removing any possibility of inconvenience. When I was speaking last week, I stated emphatically that I am in favour of taxing absentees - that is, absentees of a particular kind, whom I then attempted to define; namely, persons who have lived in Australia, and who have made their means here, and have enjoyed the benefits of the prosperity generally enjoyed in Australia, and who practically desert the country which has been so good to them.
– Would not the honorable senator tax an absentee who has never seen Australia?
– I am not dealing with that just now. I have described the kind of absentee I should do anything in my power to get at. Men of that character should not be assisted, but should, I think, be made to pay for their dereliction of duty as Australian citizens. There is the other class of socalled absentees, comprising persons who have never been here, and, it may be, corporate bodies that have lent money to Governments or individuals in Australia, which has been utilized in promoting the prosperity of the country. The first part of the definition covers every one who does not reside in Australia. I do not deal with that, because I consider that in agreeing to the second reading of the Bill we affirmed the principle proposed by the Government of applying a different scale of taxation to those who have never been here before, but who are not absentees in the sense in which I use the term. The first part of the definition is clear and general, and it might apply to Australians who are not residing in Australia or in Territories under the control of the Commonwealth at the time the ownership of the land and the incidence of the tax are ascertained. But to make quite sure the draftsman, acting upon the instructions of the Government, included two other definitions to cover those who might try to escape taxation on the scale applied to absentees by claiming that they resided in Australia, although they happened for a time to be away from the Commonwealth. Paragraph a includes a person who - is absent from Australia and such Territories at the time when Hie ownership of his land for Hie; purposes of this Act is determined.
I think that is rather a hard provision, because the person might be away from Australia only on a short trip at the time the ownership of the land was ascertained. That should be obvious on the face of the papers, which would show that they were made out by an attorney or representative, and is a clearly ascertainable condition of things. Then we come to paragraph b of the definition, which suggests a condition of things which is not so clearly ascertainable, and the amendment suggested by Senator Chataway would meet the convenience of owners of land who will be taxed under this scheme, whilst it would in no way derogate from the effect of this definition. As it stands, paragraph b includes a person who - has been absent from Australia and such Territories during more than half of the period of twelve months immediately preceding that date.
The reference is to the date at -which the ownership of the land is determined. I direct the attention of Senator Gardiner to the fact that this would be covered by paragraph a if the absence were at the time at which the date of the ownership of the land is determined. But paragraph b is not intended to refer to the same kind of absence as that covered by paragraph a. The absence covered by paragraph b might be made up of odd periods of absence during the twelve months, amounting in all to an absence of six months. In such a case the land-owner would be liable to taxation as an absentee under this Bill, unless he went before the Commissioner, and satisfied him that he was a resident of Australia. There is no disability upon a man who is a resident of Australia, and may be occasionally absent from the Commonwealth, but in the cases covered by paragraphs a and b, there is thrown upon the land-owner die obligation of satisfying the Commissioner that he is a resident of Australia. I suspect from the wording of the Bill that the land-owner would be required to personally satisfy the Commissioner. If we provided that the absence should be a continuous absence of six months, it would be fair to put upon the land-owner the obligation of satisfying the Commissioner that he is still a resident of Australia, but if the six months may be computed by adding odd days or months of absence during a period of twelve months, we might inflict hardship upon a taxpayer, which, I think, we should all desire to relieve him of.
– The average man would never think of counting odd days of absence. He would simply say that he had not been absent six months.
– If we provide that the absenteeship shall consist of continuous absence for six months, it will not be unreasonable to ask that the land-owner shall satisfy the Commissioner that he is still a resident of Australia. What that would mean would be that prima facie any man who had been continuously absent from the Commonwealth for six months was an absentee. But if a man travelling in connexion with a commercial business in New Zealand or some other place outside of Australia was away for a month or two at a time, why should (ve throw upon him the inconvenience of going before the Commissioner to satisfy him that he was a resident of Australia?
– Why should we do so in the case of an absence for six months continuously if he was away on genuine business?
– I think that should be considered also, but that would not be as reasonable as the case to which I have referred.
– We should not refuse to relieve one man because we cannot relieve two.
– It is more reasonable to ask that a man who has been away from Australia for six months continuously should satisfy the Commissioner that he is still a resident of Australia than to ask that a man who is away occasionally for a month or two at a time should be required to do so. The presumption in the first case would be that the man had an intention to change his domicile, whilst that would not be a reasonable assumption in the second case. I suggest to the Vice-President of the Executive Council that, in all the circumstances, he might very well agree to accept the amendment.
.- I wish to repeat my request to the VicePresident of the Executive Council to accept the amendment. I point out to Senator Gardiner, and those who may be influenced by what he said, that, while we all agree that there is no intention on the part of the Legislature to legislate for the inconvenience of anybody, honorable senators must realize that under this Bill an obligation will be thrown upon every one whose total absence from Australia during a period of twelve months exceeds six months, to make an application to the Commissioner to direct that he shall not be regarded as an absentee. That must very seriously inconvenience a considerable section of the community.
– Surely it would be a very simple matter to satisfy the Commissioner as to where one’s domicile is?
– That would depend on the Commissioner, and he would not be doing his duty if he did not go into the evidence.
– I am very glad that the interjection was made. Absenteeism under this Bill should be based on all the considerations that influence the determination of domicile. The Commissioner must, unless he is satisfied to the contrary, declare a person an absentee. Let me put the case in this way. Assuming that Senator Long went away from Australia and was absent for six months and three weeks in all during a period of twelve months, does the honorable senator not realize that automatically the Commissioner must decree that he is an absentee?
– I do not realize anything of the kind.
– Under this Bill the Commissioner would have to declare th~e honorable senator an absentee.
– Though I might be away from Australia for twelve months, it might be an easy matter to satisfy the Commissioner that I was still a resident of Australia.
– Prima facie the Commissioner would have to declare the honorable senator an absentee. In the event of the honorable senator not taking the precaution to satisfy the Commissioner that he had not changed his domicile from Australia, he would be declared an absentee, and be taxed accordingly.
– Hear, hear; but all 1 would have to do would be to satisfy the Commissioner.
– How many persons would be warned of the necessity for doing so. Is there any provision in this Bill to show that when taxation demands are sent out they shall signify on the face of them whether the persons to whom they are addressed are deemed absentees or not? Within a certain period from the issue of the demand the person taxed would have to make an application to the Commissioner to satisfy him that he was not an absentee. Honorable senators are aware that only a certain period is allowed within which to pay demands made for taxation.
– But the demand includes a synopsis of the Act under which it is made.
– No. I have received demands for taxation, and I have not found that they include anything of the kind. A man may be away from home when the taxation demand is received, and may find on his return that there are only two or three days within which he can comply with the demand if he wishes to avoid the proceedings which may eventuate. Is there any provision in the Bill which will indicate to the taxee that he is to be treated as an absentee or not? If there were a separate form to be sent out, if there were something to indicate to him straight away that he was being treated as an absentee and that he would be heard within a certain period by the Commissioner or the DeputyCommissioner, there might be some justice and some reason in a provision of that kind. But if he is simply to receive a taxation claim and a notice of the amount of the demand made upon him, and it is not to be indicated to him that he is being so treated, it is not just. *
– Does not the honorable senator believe that a man will know when his tax is higher than it ought to be?
– No. I ask the Minister to observe that it is only an arbitrary line which is drawn. If we cannot’ preserve at least two men from inconvenience, from what might in many instances mean injustice, let us try to preserve one. I hope that the Minister will adopt the suggestion of Senator Chataway, and so establish the idea that justice will be done.
– I admire greatly the persistence of honorable senators opposite on matters which are of very little consequence.
-Colonel Sir Albert Gould. - Then why not give way?
– Because I do not see why honorable senators should on the spur of the moment move amendments which they ought to have considered during the last four or five days and circulated in print. The first definition in this clause describes an absentee as a person who resides out of Australia, and then proceeds to indicate the period when absenteeism begins. lt includes individuals who own land values in Australia and have never been within its borders, and also those who have been resident in Australia for years, probably for half a lifetime, but who, having amassed wealth, have come to the conclusion that in the interest of the aristo- cratic upbringing of their children it would be better for them to reside in Paris, London, Glasgow, or Edinburgh.
– Or in New Zealand.
– Or in New Zealand, or, for that matter, in Japan, China, or Java. Having come to that decision, these persons remove their families and their removable effects, and so sever their connexion with Australia except as regards the land values which they own here. I have stated several times that therein lies the convenience of fixing a period which will denote when absenteeism commences. A man who had been away from Australia for only three months out of a year might be an absentee, because he had shifted everything and taken up his residence elsewhere. But the Bill in effect says, “ We shall not make you an absentee until within the twelve months prior to the time ot proving the ownership - within the financial year - you have been absent for six months,” that is for half of the period. Under the amendment, however, a man who owned ^100,000 worth of land values might become an absentee, but evade taxation by not being continuously absent for the six months. He would incur some expense, but the saving of the extra penny would amount to between .£400 and ,£500. Would it not pay a man to slip over from, say, Ceylon at the end of five months, stop here for a few days, and then go away, if in that one year he could save £200 or £300, and so defeat the real intention of the Act ?
– That would not save him.
– I think that when it is clearly defined that an absentee is a person who has not resided in Australia for one-half of the period of twelve months, the Bill is as liberal as it ought to be. Although the amendment seems very inconsequential, still it might have the far-reaching effect which I have suggested. There would be a danger, no matter how small it might be, of evasions, and for these reasons I do not think it advisable to accept the amendment.
Senator CHATAWAY (Queensland) (3.24]. - I did not give printed notice of the amendment, because I thought that it was purely a verbal alteration, which would be taken up and moved by the Minister himself the moment it was mentioned.
-Colonel Sir Albert Gould. - There is no obligation to submit amendments in print.
– No. If I had thought that the Minister would have taken the suggestion so seriously, and quoted so many foreign countries to defeat it, probably I should have given him notice of my intention “to move it. The Commonwealth Franchise Act provides that only a person who has lived in Australia continuously for six months is entitled to the suffrage.
– Yes; but that is a different thing altogether.
– Unless a man has lived in the Commonwealth for six months continuously we do not allow him to have a vote; but in this measure we say to a man, “ If you go out of Australia for three months twice during a year, we shall tax you as an absentee.” I suggest that the Minister should try to bring the Bill into reasonable accord with the Franchise Act in that regard, and tax a man as an absentee if he has been absent for six months continuously within the year. My amendment is perfectly reasonable and fair. The persons who will be mostly injured by the method in which the Commissioner may interpret the law will be commercial travellers who work be.tween Australia and New Zealand. It is of no use to tell us that the Commissioner will be a wise man, and all that sort, of thing.
– We shall take care that he is.
– Why should we throw upon the Commissioner the obligation of interpreting an Act of Parliament, and in a way which is not laid down? I again direct attention to the fact that the wording of the clause is not to the effect that an absentee is a person who has been absent “ from Australia and such Territories “ during the six months immediately preceding the date when he has to hand in an assessment of his land, but during half of the period of twelve months.
– I am reading from the clause, and if the Minister wants to explain that it means something else, I ask him to move the amendment. What attracted my attention was that the words “ six months “ were not used, as in the Franchise Act, but the words “ half of the period of twelve months,” which clearly means that you’ can add up the periods for which a man is absent, and if they come to .six months and a week, he may be proved to be an absentee. Let me illustrate how I think the provision is likely to work out in actual practice. Suppose that I am a commercial traveller who has to go over to New Zealand, say, every two months. Before 1 leave Australia it will be necessary for me, on each occasion, to drop a line to the Commissioner, explaining that I am about to go over to the Dominion on a trip.
– The honorable senator knows that that will not be necessary.
– I know something about direct taxes, and I find that Commissioners, however much we may trust them, are always to be found on the side of the revenue, and never on the side of the taxpayer. I suggest to my honorable friend that he should not treat this amendment in a hostile fashion, but try to realize that by accepting it he will bring the measure into consonance with measures which we have passed, because what the Government mean is continuous absence for six months. There is nobody in the Chamber, I venture to say, who does not recognise that six months’ absence under this clause means continuous absence, and not several temporary absences. Therefore, I ask the Government to consider whether they cannot introduce the word “continuously.”
– A man might be an absentee, and he might be here for three months at one time and three months at another time out of every year.
– If we are to clearly understand that the Government intend the absence referred to in the clause to be an accumulation of absences, I can understand them opposing the amendment. My impression was that the absence from Australia was intended to be a continuous absence for six months. If, on the other hand, they mean an absence of six months, all I can say is that I regret that they cannot accept the amendment.
.- Inasmuch as the usual parliamentary practice has been to postpone the definition clauses of Bills until the substantive clauses have been dealt with, I venture to suggest to the Vice-President of the Executive Council that he should adopt a similar course upon the present occasion. The Bill contains a full page and a half of definitions in addition to seventy-one clauses. Quite a number of amendments have been foreshadowed, and it may be that after we have enacted the substantive clauses we shall take an entirely different view of the terms set out in the definition clause from that which we now entertain. In these circumstances I suggest that the consideration of this clause should be postponed.
– I cannot understand this sort of obstruction. I am very sorry to use such a word in relation to so amiable a gentleman as Senator Keating, but he knows perfectly well that his statement is not in accordance with fact. The definition clause has figured at the commencement of almost every Bill which has occupied the attention of this Parliament, and it is not a fact that it has been the custom to postpone its consideration until the substantive clauses have been dealt with. I would remind honorable senators that if the definitions in this Bill are not clearly understood before the remaining clauses of the measure are the subject of consideration we shall find ourselves upon almost every provision discussing what the definition of certain terms is likely to be. Thus the debate will be protracted to twice the length it would otherwise occupy. If we deal with the definition clause now, there is no doubt that the consideration of the Bill will be expedited. Much as I would like to accede to the request of Senator Keating, I cannot see my way to agree to a course which is not in accordance with the usual practice.
– It has been the practice.
– It may have been in isolated cases, but it is not the general practice, and as the Commonwealth is now ten years old it is too late to initiate a new practice.
– This debate appears to me to be very much in the nature of a storm in a teacup. After hearing Senator Chataway talk about commercial travellers who may be taxed if this clause is persisted in. I feel quite concerned for another class. I can imagine the number of commercial travellers who are possessed of more than ^5,000 worth of unimproved land values.
– If they are absentees there will be no exemption in their case.
– But I am more concerned with the large number of shearers who visit New Zealand to make the big cheques which’some of my honorable friends opposite are so fond of booming in the Courier and elsewhere. The persistency with which members of the Opposition are urging the amendment suggests that there is a deep, dark, mysterious plot on foot to allow the millionaire to escape. They know that owing to the rapid development of the aeroplane, millionaires who may be absent from Australia will be able to return after a few hours’ flight, and thus to escape the tax. It is quite unnecessary for the Government to give way on this point, especially as the persistency with which the amendment is being urged indicates that there is some mysterious plot on foot. I think we had better stick to our guns.
– - The suggestion of Senator Rae that millionaires may escape the tax by visiting Australia occasionally in aeroplanes, is blown to pieces by the first definition of the word “ absentee.” I would further point out that the word “ reside,” which appear in the clause, has a very definite meaning at law. There is scarcely a Court which would define that word in the way that my honorable friends opposite suggest. Under the Commonwealth Franchise Act we confer a privilege or a right upon citizens for their continuous presence in Australia during a specified period.
– And the honorable senator wishes to offer a premium to them for their continuous absence.
– Under the Commonwealth Franchise Act, we provide that residence in Australia must be continuous for six months. Now that we wish to impose a penalty upon persons who are absent from the Commonwealth, I claim that we ought to follow the precedent which we have already established. Let us make the analogy complete by providing in this Bill that absentees must be continuously absent from Australia for a specified period. If we fail to do that this clause will undoubtedly drag into it persons who ought not to be covered by it. So far no valid reason has been advanced by honorable senators opposite as to why the word “ continuously “ should not be inserted. What injury would result from the adoption of the amendment? The danger is that under the clause, in its present form, persons whose absence may aggregate more than six months in a year may be penalized. It is within the knowledge of every layman that it has been found impossible to convince learned Judges of the common-sense interpretation which should be placed upon words. Cases have had to be taken to the Appeal Courts, and even to the Privy Council, in order to convince them. All this trouble will be avoided if the Vice-President of the Executive Council will abandon his attitude that we must not amend the Bill, even to the extent of crossing a “t” or dotting an “ i.”
– I would not have troubled the Committee with any observations on this amendment but for the fact that honorable senators opposite appear to be anxious to throw dust in the eyes of the people outside. Senators Chataway and St. Ledger have argued that because we confer the franchise upon citizens who continuously reside in Australia for six months, we ought not to declare a man an absentee unless he is continuously absent from the Commonwealth for six months. But I would point out that under such a provision a man might be absent from Australia half-a-dozen times in six months, and thus become entitled to the exemption.
– He will be entitled to it now. The whole point is whether he shall secure it as a right or by supplication to the Commissioner. »
– If we are going to adhere to the definition of “ residence,” which is laid down in the Commonwealth1 Franchise Act, it is not right that we should provide in this Bill for continuous absence, because the opposite of continuous residence is not continuous residence. If we say that citizenship means continuous residence for six months, then a man cannot be a citizen if he is not present in Australia for a continuous period of six months. Under this amendment, he might be away from Australia half-a-dozen times in the course of a year. There is nothing whatever in the contention, because, as has been pointed out, if a man can prove that he is a bond fide resident of Australia, he escapes the extra taxation. In every taxing measure that I have ever seen passed by any Parliament, extended powers have been taken. It has been exceedingly necessary to take those powers on behalf of the authorities which are saddled with the responsibility of collecting the tax. Otherwise, there would be loopholes for escape. It is possible that’ honorable senators opposite may have serious amendments to propose which will be worthy of a good deal of consideration.; That being so, it is a pity, and merely displays an obstructive spirit, that they should propose a silly amendment of this sort, which merely takes up time and attention, and prevents consideration being given to more serious propositions. I am inclined to give the fullest possible consideration to every genuine amendment from the Opposition side, but the present amendment has not been proposed in a serious fashion. It would be possible under it for a land-owner to spend in Australia only three days in the year, and yet not be an absentee. Furthermore, I point out that at the end of paragraph a appears the word “or,” showing that the paragraph under consideration is an alternative. If a person can satisfy the Commissioner that he resides in Australia, or in any Territory under the authority of the Commonwealth, he will not be an absentee, and the amendment is riot necessary for his protection. In my opinion, the amendment is moved primarily in the interests of people who may be mere visitors to Australia.
– It is moved mainly to protect commercial travellers doing business between Australia and New Zealand.
– I would not deprive any man of his rights, but a commercial traveller would always have the alternative of showing the Commissioner that he resided in Australia. That safeguard is insured. The clause is perfectly fair as it stands.
– - It appears to me that all honorable senators who have spoken desire to do the same thing, although some desire to do it in a different way from others. The first thing that a land-owner has to do under this Bill is to send in a return to the Commissioner, who will tax him. If he disputes the amount of the tax, he will be able to appeal to the Commissioner. If he is not then satisfied, the action he will take will depend upon the amount he has to pay. If the amount be small, in all probability, he will prefer to pay than to fight the Commissioner. Suppose a man is connected with a business house in Sydney which has a branch establishment in New Zealand. He must spend a good deal of his time travelling backwards and forwards. The clause, as it stands, will put such an individual to a good deal of trouble. I do not desire to see any genuine absentee escape payment of the tax. I believe that absentees should be taxed. But a man who lives in Australia, and merely goes abroad on business should not be treated as though he were not a genuine Australian citizen.
I cannot see how the amendment would create a loophole of escape. A person who takes up his residence abroad cannot avoid taxation under this measure. When the Bill was first introduced, we were told by the Vice-President of the Executive Council that it was perfect. Now, however, the Government have brought down a whole sheaf of amendments, showing that the measure is very defective. Of course, we know from experience that we have to take statements by Senator McGregor with a grain of salt. In his humorous moods, observations that he makes cannot be regarded as sober statements of fact. If every amendment is to be met as this one has been, what is the use of parliamentary debate at all ? The Caucus meets in advance, the Government rely on their majority, and no amendment is considered on its merits.
– When I find Senator Givens affirming that what is proposed in the paragraph under discussion is an alternative, I feel that it is incumbent upon me to direct attention to what we are really doing. Neither the case that Senator Givens mentioned, nor that of the imaginary millionaire suggested by Senator Rae, would be covered by the provision which it is proposed to amend. It is idle to say that the amendment would in any way affect those imaginary millionaires who are the bugbear of honorable senators opposite, and who, it is supposed, might come to Australia for a few days in order to escape the tax. They are dealt with in the first portion of the clause, which defines what an absentee is. Then the clause goes on to include others, but not to exclude those already defined.
– Suppose a person had been a resident of Australia, and went away. Would he retain the advantages given to him by his temporary residence?
– At present I am only showing that the imaginary characters brought into the discussion by the Vice-President of the Executive Council and by Senator Rae - who resorted to an air-ship - have been introduced to cloud the issue. Those individuals are covered by the first portion of the clause. There is no loophole of escape for .them. They can come here as often as they like, but they will still be taxed as absentees. Then, however, the clause goes on to deal with other people, residents of Australia, who may be temporarily absent.
– Residents of Australia who intend to make themselves absentees.
– We cannot tax people on their intentions. I have no doubt that it is disappointing to my honorable friends opposite to know that. Persons resident abroad, but who might come to Australia for a few days of the year, would not be exempt from being classified as absentees under the Bill itself. But then the clause goes on to deal with those who have been absent from Australia for certain purposes. They are the people in whose interest the amendment has been moved - residents of Australia who are called upon, because of their business, to visit other countries, but whose absence is not permanent. Their homes and their families are here, and they are legally resident here. Vet this Bill throws upon them the obligation once a year of going to the Commissioner, and proving to him that they are residents. What advantage is it from the point of view of this Bill to require such persons to prove their residence in Australia?
– Is not that an exceedingly simple process?
– It is not such a simple process as my honorable friend may suppose; but even if it were, why should we throw an obligation of that sort upon residents? It would entail upon busy men some amount of worry, trouble, and inconvenience. The amendment does not enable a single individual who is not a resident of Australia to escape. He is already tied up by the first portion of the clause. A provision is proposed which, without affording any protection to the revenue against those who may fraudulently desire to escape just taxation, will be a source of irritation and annoyance to the taxpayers of the country. I can see no reason whatever for the refusal to accept the amendment, seeing that under the first part of the definition genuine absentees are completely provided for.
– I should not have spoken on this matter if Senator Sayers had not repeated the old wheeze about the Caucus. If there was anything made clear during the last elections, it was the strong objection the people of Australia have to the absentee. We are not in this matter obeying the instructions of the Caucus, and it would be just as true for me to say that honorable senators opposite are carrying out the instructions of the Employers’ Federation.
– Perhaps this amendment has been moved under their instructions.
– I might just as reasonably suggest that it has been moved under instructions from the Employers’ Federation or the National Association, whose instructions honorable senators opposite are here to carry out. We know the power behind the present Opposition. That was clearly shewn in the last Parliament, when the Employers’ Federation brought about the Fusion, and created a party to fight for capitalists and big landowners. The people of Australia have determined to make the absentee pay more towards the expenses of government than he has done in the past.
– That is no reason for harassing a man who is a genuine resident of Australia.
– We are not making things more difficult than is necessary for the genuine residents of Australia, hut we are taking good care that it shall not be easy for the absentee to escape just taxation, as he has done too often in the past. The attitude which the Opposition have taken up towards this clause has reminded me of the man who objected to “ an absentee tax, or any other kind ot tax, on tea.” No doubt the real objection of the Opposition is to a tax of any kind. The most objectionable person with whom we have to deal is the absentee.
– Is he any worse than the man who is in gaol?
– We are not talking about criminals at all. I say that the Government would be foolish if they permitted the Bill to be mutilated by the Opposition in such a way as to enable so objectionable a person as the absentee to escape just taxation.
-Colonel Sir ALBERT GOULD (New South Wales) [4.5].- I quite agree that the Government would be foolish to allow the Bill to be mutilated in such a way as to permit the absentee to escape taxation. But the Opposition have no desire to amend the Bill in order that absentees may escape taxation. They wish to amend it in such a way as to prevent hardship being unnecessarily inflicted on bond fide residents of Australia.
– We are not dealing with residents, but with absentees.
-Colonel Sir ALBERT GOULD.- We have first of all a definition of an absentee, and then paragraphs including in the definition any person who is absent from the Commonwealth at the time when the ownership of his land, for the purposes of the Act, is determined, and also any person who is absent for more than one-half of the twelve months for which the tax is levied, unless they satisfy the Commissioner that they are residents of Australia. It has been pointed out that if a man were absent for a period of six months continuously, it would not be unreasonable to tax him as an absentee if he could not satisfy the Commissioner that he was a resident of Australia.
– He might be an absentee, and be here every three months.
-Colonel Sir ALBERT GOULD. - Such a case would be covered by the first portion of the definition. But the honorable senator must know that no man would come to Australia every three months in order to protect himself against the absentee tax.
– He could only do it for the first year.
-Colonel Sir ALBERT GOULD. - Under this definition, if a man is absent from the Commonwealth for a certain period he will be regarded as an absentee, and yet honorable senators opposite must recognise that the first part of the definition covers the case of those who are really absentees. Senator Long has said that it would be an easy matter to satisfy the Commissioner that a man was a resident of Australia, but let me remind him that the Commissioner will not know a tithe of the residents of the Commonwealth. A man is represented as being an absentee, and the Commissioner does not know him from Adam, and has never heard of him before. He will say, “ You must satisfy me that you have your home in Australia.” It will not be enough for the man to say, “I am not an absentee; I am a resident of Australia.” He will have to satisfy the Commissioner at least by a declaration, which will probably have to be corroborated by some person occupying a responsible position, such as a magistrate or a notary.
– He must satisfy the Commissioner or his deputy.
– It would be just as difficult to satisfy the deputy. After all, the Commissioner might disregard the evidence submitted, and ask for more; and if the Com missioner is not satisfied there is no appeal, and the taxpayer must pay up on the absentee scale.
– The honorable senator is putting it the wrong way about. What the taxpayer has to prove is that he is not an absentee.
– I am showing what he may have to do to prove that he is not an absentee. This will be but an added annoyance to the many annoyances that are always associated with taxation. I remind honorable senators also that it will add to the work of administration, and so far as I can see for no good purpose. One would not be justified in saying that the purpose is to harass and annoy taxpayers, because I suppose that is not the intention. I recognise that the Government wish to make sure that there shall be no leakage, and I am not supporting the amendment in order to enable people to escape taxation. I think it would in no way impair the efficiency of the clause, but it would prevent unnecessary irritation and annoyance to Commonwealth taxpayers.
Senator Sir JOSIAH SYMON (South Australia) [4.10]. - I think it well to point out that this provision would impose an annual infliction upon the unfortunate taxpayer. It is not as if an inquiry were proposed when the system comes first into operation. A taxpayer would under this provision be required annually to satisfy the Commissioner that he is a resident of Australia. Every commercial traveller who happened before 30th June in each year—
– This is not a Bill to tax commercial travellers.
– Does the honorable senator think that a commercial traveller might not be a land-owner, or is it proposed that commercial travellers shall be forbidden to be land-owners ?
– Or that they should escape taxation?
– To carry out Senator de Largie’s idea it might be well to add a proviso that no commercial traveller shall be deemed to be an absentee. Assuming, as a matter of grace and favour, that he is permitted to own a bit of land, I do not suppose the Government believe that he should be penalized, brought under the ban of an absentee and taxed more than a resident, and should be obliged once every year - personally, I think, but whether by representative or personally is immaterial - to appear before the Commissioner and undergo an examination as to the time he was absent from Australia, and satisfy the Commissioner that he still wishes to have the honour of being considered a resident of Australia. The thing seems preposterous. The object of the clause is to declare that every one who is not a resident of Australia is an absentee, and to throw upon the persons covered by paragraphs a and b the onus of satisfying the Commissioner that they are residents of Australia. If this were to be done once and for all it would not be so bad, but under the Bill as it stands it will have to be done every year. The simple remedy is to insert the word “ continuously.” It is not altogether reasonable to provide that a person who has been continuously absent for six months shall be regarded as an absentee. But it is less reasonable to say that a man who may be absent for a week or two at a time, but for six months in all, out of a period of twelve months, shall be regarded as an absentee unless he satisfies the Commissioner that he is a resident of Australia. As honorable senators on this side have said, it will not be a mere matter of form to satisfy the Commissioner, who will have judicial functions to perform. If we insert the word “ continuously “ we shall have a definite period of absence imposing upon the land-owner the obligation to satisfy the Commissioner that he is a resident of Australia. Unless some such amendment is made in the clause, an amending Bill will have to be introduced before very long, because I hope the selfrespect of people who must be absent occasionally from the Commonwealth will be so much shocked by this provision that it will lead to a kind of revolt. A system of taxation which in itself is oppressive and inquisitorial should not be made more so, and the convenience of the taxpayer should be considered more than it appears to be by this provision.
Question- That the word proposed to be inserted be inserted (Senator Chataway’ s amendment) - put. The Committee divided.
Majority … 7
Question so resolvedin the negative.
– I move -
That the words “ twelve months,” in paragraph b, be left out, with a view to insert in lieu thereof the words “ three years.”
As my amendment has already been spoken to I need not enlarge upon it. I draw attention, however, to the fact that it is borrowed from the New Zealand Act, and that, if accepted, it will enable persons to take a trip for a period longer than six months. I think that the remarks made by Senator Symon rather strengthen my contention that if it be passed, a man will not require to go every year to the Commissioner to get leave, but once in three years will suffice.
– I think that, so far as absentees are concerned, the liberality of the Bill is most extraordinary. It gives a great deal more than any one intending to be an absentee from Australia deserves to get. As soon as ever any persons intend to be absentees it will be their duty to go and inform the Commissioner, and to my mind they ought to be charged from that very moment. But in the definition we allow an absence for one half of the year. Senator Walker, in his kindly liberality to those who care so little about Australia that they are prepared to leave it for good and all, wants to give them three years. I hope it will be in gaol.
– I would remind Senator McGregor that there are cases in which men are obliged to travel for the sake of their health. Are such men to come back every six months and get permission from the Commissioner?
– Such persons can find every kind of climate in some part of Australia.
– I am acting in the true interests of Australia in trying to make this definition as liberal as possible; but if the Committee are against me, of course I must submit to their will.
-. Colonel Sir ALBERT GOULD (New South Wales) [4.22].- The Government and their supporters appear to misunderstand the object of the amendment. Senator Walker has stated very fairly that it is borrowed from the New Zealand Act. We know that New Zealand is not a country where very much revenue is allowed to escape through any fault of the law. Honorable senators on the other side think that a man should not be away from Australia for more than six months. But the necessities of some persons are such that they are frequently called upon to be absent for much longer periods. They have the interests of Australia quite as much at heart as have men who have never gone abroad, and they contribute equally to its revenue. There seems to be an idea that directly a man sees fit to go out of Australia he should be regarded as an enemy rather than as a friend. It would be a very great advantage to many honorable senators if they had an opportunity of visiting other countries and realizing that there are men at the head of public affairs abroad who are inclined to deal with questions much more liberally than they are prepared to do. I am sorry that the Government are taking up this hostile attitude.
– The persons of whom the honorable senator is talking are not absentees, and never would be so considered.
– The object of the amendment is to make the Bill a little more easy for those who are bond fide residents, but who at times have to go outside its boundaries for a lengthy period.
– If honorable senators will refer to the definition of “ absentee “ they will see that it excludes from the obligation to prove residence -
I wish to remove from that obligation Australians who may be abroad serving their country, or the Empire, in another capacity than that of a public servant of the Commonwealth or of a State. I move -
That after the word “ include,” line 20, the words 11 an officer of the Crown or “ be inserted.
Take the case of Australians who have to be in the Imperial Navy for a considerable time. Why should they have thrown upon them this liability to become absentees? I want to relieve an Australian who may be performing a public duty in the service of the Empire or of the Indian Government just as much as he would be relieved if he were a servant of the Commonwealth or of a State. It happens that a member of the Senate is an Imperial officer, whose services might be required in India at any time. Is it reasonable that he should have either to accept the responsibility of being an absentee, and paying the higher rate of taxation, and having withdrawn from him the exemption, or to accept the annual obligation of proving that he is a resident of Australia temporarily absent? Every argument which justifies the relief of an officer of the Commonwealth or ‘of a State from the obligation can also, in my judgment, be urged in support of my amendment.
– Might not the insertion of these words except a non-resident who owned property in Australia?
– No, because this part of the definition of absentee merely says that it shall not apply in certain cases. I do not suggest that the wording of my amendment is perfect, but if the Minister approves of it, it will not be very difficult for him to find a better form of words. It is extremely hard, and against public policy, that we should not give the advantage of this relief to an Australian who may be called upon to serve the Crown in India, or to go on a diplomatic service, and who is as much a servant of the Crown as if he were employed by the Government of the Commonwealth or of a State.
– Does the honorable senator say that this exemption does not cover the case of an Imperial officer in our employ ?
– Senator Cameron holds a military commission from the Commonwealth.
– He is also an Imperial officer.
– That does not matter.
– If it be a fact that Senator Lt.-Colonel Cameron is a public officer of the Commonwealth, that would not meet the case I have put. He would not be abroad in the discharge of his duty to the Commonwealth within the meaning of this exemption. Clearly, it relates to the performance by a man of duty to the Commonwealth or the State of which he is a public officer. I have in my mind the case of a man who may be abroad in the capacity of a servant of the British Government.
– Then he would not be an absentee.
– Under this definition, he would have to prove that he was not an absentee. The only exemption provided 111 this paragraph is as to public officers of the Commonwealth or of a State who are absent in the performance of their duties. I maintain that an Australian who is serving the British Government abroad, in any of the capacities which I have indicated, ought to be afforded relief just as much as ought any of our own officers.
– I believe that the Leader of the Opposition has submitted this amendment in all good faith, and that he wishes to attain a certain end, namely, the convenience and security of residents of Australia. He has instanced the case of a member of the Senate, who is also an illustrious member of the Defence Forces of Australia. It will be recollected that that honorable senator, at great inconvenience to himself, went to South Africa during the Boer war. But, if this Bill had been operative at the time, does anybody suggest that he would have been required to prove that he was not an absentee?
– Of whom was he a servant when he went to South Africa?
– That does not matter. The same honorable senator afterwards went to England. But does anybody suggest that, in such circumstances, he would have been called upon to prove that he was not an absentee? His home and all his interests were in Australia. To my mind, “ a public officer of the Commonwealth or of a State “ includes every - body whom we ought to include. If we insert the words “ an officer of the Crown,” what may happen? We all know that there are a great many officers of the Crown who have never been in Australia. There are officers of the Crown who own estates in Australia to the value of £20,000, . £30,000, and £40,000. I do not think it would be wise to adopt the amendment. If it were proposed to safeguard the provision by inserting the words “ an officer of the Crown employed by the
Commonwealth,” that object is already secured by the words “ a public officer of the Commonwealth.” I hope that the amendment will not be accepted, because it will make the first portion of the clause conflict with the later portion.
– I wishnow to invite the attention of the Committee to an amendment of a different character, and one which, I hope, will be approached in a somewhat different spirit. I desire to point out the conflict which occurs in the three definitions dealing with “ improved value,” “ unimproved value,” and “ value of improvements.” I shall deal with the last of these first. It reads - “Value of improvements,” in relation to land, means the added value which the improvements give to the land at the date of valuation, irrespective of the cost of the improvements.
When we turn to the “ unimproved value “ in relation to land, we naturally assume what is a matter of fact, namely, that the unimproved value of land is its full value, less the value of improvements. But, under the definition of “ unimproved value “ there is the possibility of a different results being arrived at. The definition reads - “ 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 require, assuming that the improvements (if any) thereon or appertaining thereto and made or acquired by the owner or his predecessor in title had not been made.
That definition puts improvements on a different basis from that which has been adopted in the following definition. There is a conflict between the two.
– Let me give an instance. Eliminating all the words which have no bearing on my argument, the first definition of “ unimproved value” is based on the assumption that the improvements had not been made. Let us take a piece of land and see how the position would work out. Under that paragraph, the unimproved value of a piece of land the improved value of which is £3 per acre, and the cost of improving which was 5s. per acre, would be £2 15s. per acre. That is the value which a bond fide seller would require, assuming the improvements had not been made. But when we attempt to arrive at its “unimproved value under the next definition, a very different result is brought about. The lane? I repeat, is worth £3 per acre, and the improvements cost 5s. per acre. But although they cost only 5s. per acre, they may have added very much more than that amount to the value of the land. They may, indeed, have added to its value by -£i per acre. If we deduct that added value of the land from its full value, we shall see that its unimproved value is only ^2 as against £2 15s. under the preceding provision. I therefore move-
That all the words after “ require,” in the definition of “ Unimproved value,” be left out, with a view, to insert in lieu thereof the words “ less the value of the improvements.”
The words of the clause are cumbersome and vague, and if for no other reason than because of its simplicity, the amendment should be accepted. It would be a great improvement on the clause, and,_in addition, it would remove the conflict which exists between the definition which I am seeking to amend and the succeeding definition. From the experience of New South Wales I am satisfied that the more simple the language in which we set out these definitions the better it will be for those who have operations under the Bill. In the minds of everybody the unimproved value of land is its improved value less the value of the improvements.
– The amendment which has been submitted is a very simple one, and I admit that, so far as language is concerned, it would simplify matters very much. But the Leader of the Opposition cannot fail to recognise that many improvements are put upon land, the value of which, so far as the land itself is concerned, is very doubtful.
– Then they are not improvements.
– That is exactly where a difference of opinion would arise. A dam, or a fence, or a house, might cost a certain sum, but in five, ten, or fifteen years’” time, it might have deteriorated to such an extent that it would not be worth nearly what it cost. The words which Senator Millen wishes to strike out of the definition were expressly inserted to make it clear that no matter what improvements might have cost originally, they were to be appraised only at their present value. Consequently, I cannot see my way to accept the amendment, which would prevent the” improved and unimproved values of land from being ascertained in the easiest possible manner.
– Surely the Vice-President of the Executive Council has entirely missed the point of my amendment. He has spoken of improvements, the value of which evaporates by process of time. But such improvements are not in any way touched by my proposal. “ Less the value of improvements ‘ ‘ would mean the value of improvements at that particular time. If £100 had been expended upon constructing a dam fifteen years ago, and it had depreciated in value to £ 10 at the time the valuation was made, its value would be set down at ;£ro.
– But the owner might claim its original value.
– Let me show how little the Vice-President of the Executive Council knows of his Bill. The very next definition provides that the value of improvements shall mean the added value which they give to the land.
– Is not that a fair thing ?
– My contention is that it is a fair thing, but I want to have the two definitions placed on the same footing. I am showing that there is a conflict between them now. In the one case, what Senator Rae admits to be a fair thing is taken as the basis ; but in the other definition quite another basis is taken. There is likely to be conflict and litigation in consequence.
– The two definitions seem to me to be the same.
– How can they be? There is no subject which has given rise to greater conflict than the question with which we are dealing. It is not so easy as it looks to determine the unimproved value of land. We have here a very clear definition. It is stated that the value of improvements is to be the value which they add to the land, irrespective of their cost. They may have cost ^5, but may have added £$0 to the value of the land. In that case ^50 is to be taken as their value under this Bill. Senator Rae admits that that is fair. Very well, then, let us have the same provision in the previous definition. We should not have in one definition a provision that the bare value of the improvements is to be taken into account, and in another the provision that, not the cost or value of the improvements, but the value that has been added to the land, is to be considered. There is a difference that has led to trouble, and will lead to trouble later on. I propose to remedy it in a very simple way.
– There is no” conflict. The definitions are quite clear.
– I absolutely despair of producing any effect upon the mind of the honorable senator by argument, -if he says such a thing. I am quite serious. I never was more conscious than I am now - even though I lay myself open to a charge of egotism in saying so - that this is a question which I understand. There is here a conflict on a matter which has been fought out dozens of times in the Land Courts of New South Wales, and which, in one case, was carried to the Privy Council. I refer to the case of the Iandra improvements. The Minister says that there is no conflict, though this difference has been the subject of protracted litigation; and when I mention it some honorable senators opposite laugh, as if I were not pointing out a danger in the very Bill which they profess to have so much at heart. The point at issue, I say again, is that in the one case you are to take the value of the improvements, and in the other you are to take, not the value of the improvements, but the value which those improvements have added to the land. These are two different thingsI am attempting to remedy the conflict by a simple amendment. If the Minister is not satisfied with the form of the amendment, he can consult the draftsman as to an improvement upon it.
– I take it for granted that Senator Millen is in earnest, or he would not speak as he has done. But in the drafting of this Bill it has been made clear that the unimproved value of land is to be taken to be the value of any land in question as if nothing whatever had ever been done to improve it. There is no conflict between the two definitions to which Senator Millen has referred. In many instances improvements tan be made that give no value to land. Vet the owner might claim an allowance for them. If a land-owner were foolish enough to build a windmill where there was no probability of gaining any advantage from wind, and he claimed for improvements because the windmill had cost him £5,000, he would have no right to sustain that claim. I remember that in South Australia a station-owner sank a well at considerable expense. The water was so bad that when he put 3,000 old ewes into the paddock, they died in three weeks from drinking the water. He spent ,£3,000 in constructing tanks and troughs and putting up a windmill. He claimed for those improvements, so-called, though they had added no value to the land. It is to avoid claims of that description that those definitions have been drafted. I am perfectly prepared to take them as they stand.
– It appears to me that, under Senator Millen’s amendment, the Commonwealth Government would lose a considerable amount of revenue. Suppose, for instance, that it cost 5s. an acre to ring-bark certain country. Senator Millen would say that that added considerably to the value of the land in consequence of the greater quantity of fodder that would grow when the ring-barking had time to take effect; and he would claim that the owner should be exempted from an amount of taxation equal to the added value given to the land, which might be ,£1. an acre.
– The next definition provides for that very thing.
– Suppose that I ringbark a piece of country, and that the effect is, in a year or two, when the land commences to grow more grass, to give an added value of £1 per acre to it. I, however, have not effected a pound’s worth of improvement. I have effected 5s. worth, and time has done the rest.
– Time and intelligence.
– It does not require much intelligence for a man to know, in this country, that the grazing capacity of land is increased by ring-barking the timber upon it. Such knowledge is a merely elementary in connexion with Australian land settlement. I will show why the cost of such improvements should be allowed under the one definition and not under the other. I will give an example. On the holding where I was at one time farming in Riverina there was a certain area of land which had been ring-barked some years before. The Land Board charged me with the value of those improvements. But, as a matter of fact, there was no real improvement at all ; because, subsequent to the ring-barking, the suckers that had grown up had exhausted any value that the process had once given to the land ; and, as a matter of fact, had rendered it worse than it was before.
– It was not in accordance with New South Wales practice to charge the honorable senator with those improvements.
– I have seen hundreds of thousands of acres of land that have been ring-barked, but on which the suckers had been allowed to grow up, with the effect that, not only was the value of the ring-barking entirely negatived, but the land was brought into a worse condition than it was previously, because there were six or seven big suckers, each as big as the parent stump, growing where there was one tree before.
– The law of New South Wales says that improvements shall be valued at their value to the incoming tenant; and the Land Board had no right to charge the honorable senator as they did.
– Nevertheless, they did so. There was another improvement on this holding. The previous pastoral lessee had constructed a tank, for which excavations had had to be made. I had to pay him for it. He said to me, “ 1 think it is fair for you to allow me so much, because the tank was made, not by the modern methods of scooping, but by taking out the stuff with a cart and horse.” I said, “ I do not care if you took it out with a teaspoon; all I am going to pay you for that tank is its present value to me.” Whether the price of labour was i os. a week or 15s. a clay was not pertinent to the issue, so far as I was concerned. I said that I would pay what I could get an excavation of the same size done for at that time.
– That was in accordance with the law of New South Wales.
– What I was willing to pay was a fair thing as between the individuals concerned and the Crown. If an improvement had been effected in the matter of ring-barking, which, on the one hand, might have caused that land to be worth 15s. or £1 an acre more, although the actual work only cost 5s. an acre, it would not be fair to allow a concession in accordance with the value given to the land by the improvement. He expended only the labour necessary to ring-bark the country, and Nature did the rest. I see no reason why we should exempt from taxation an improvement due to the operation of natural causes.
– What Senator Rae has said is unanswerable, but the clause does not support it. The difficulty is that the definition as set out in the first paragraph comes into conflict with the second, in which an en tirely different definition is given. It rests as an obligation upon the friends of the Bill to reconcile this difference. If they accept the definition which Senator Rae has given as the basis for determining the value of an improvement, they should not accept the next paragraph, which says that the value of the improvement shall be estimated not on the basis of what it cost to make it, but on the basis of the additional value which is added to the land. That is the very thing which Senator Rae does not desire.
– The honorable senator is putting it upside down.
– I do not think so. There is a conflict between the two paragraphs. Senator Rae has contended that no improvement should be valued at more than it has cost.
– But sometimes at less.
– I said at not more than it has cost. To take that as a basis would be in accordance with the first definition. But let me ask the honorable senator how he can support the next definition, that the value of an improvement is to be the value it adds to the land irrespective of the cost of making it? I take the case which Senator Rae has suggested of ring-barking as an improvement. The timber is rung and left there for a time until it has become so dry as to reduce the cost of clearing the land for the plough to a minimum. The ring-barking may have cost 2s. or 3s. an acre, and may have added £1 an acre to the value of the land to a man who wants it for the plough. Senator Rae, following the first definition, says that what we must deduct from the value of the land is the cost of the improvements ; we must value the land as if the improvements were not there. But the second definition provides for an entirely different basis of valuation. It provides that we shall ask what the improvement has added to the value of the land. It may have cost 2s. 6d. an acre, and have added £1 an acre to the value of the land. Honorable senators must recognise the conflict between these two definitions, and if they will not adopt my method of removing it, they should themselves accept the responsibility of bringing the two definitions into harmony.
– If we take the value of the feesimple of the land and add to it the value of the improvements, we shall get the improved value. Conversely, if we take from the improved value of the land the value of the improvements, we shall arrive at the unimproved value. Senator Millen has suggested that we should strike out the limiting words “ assuming that the improvements (if any) thereon or appertaining thereto and made or acquired by the owner or his predecessor in title had not been made.” If we did that we should have three definitions of “improved value,” “unimproved value,” and “value of improvements,” which would be consistent one with the other.
– What would the honorable senator say is the unimproved value of the land on which this building is erected ?
– It would be its value less the value of the improvements upon it. We must deduct the value of the improvements ; there is no other way to get at the unimproved value. Senator Millen’s proposal is made in order to guide the Commissioner of Taxes along proper lines in ascertaining the unimproved value of land.
– What is the unimproved value of the land on which the building in which we are assembled is erected?
– Senator St. Ledger is a legislator, and not a land valuer.
– The honorable senator is speaking as an authority.
– I am not speaking as an authority on land values. As a matter of common sense I take it that the unimproved value is the improved value less the value of improvements. I think that the first State in Australia to suggest the true basis on which to ascertain the unimproved values was the State of Queensland, and the definition adopted there has been consistently adhered to. Unimproved value is clearly defined in section 195 of the Local Authorities Act of 1902 of Queensland. The definition therein contained has been tested in the Courts and uniformly adhered to.
– And it has been before the Privy Council.
– In some cases it has. The section reads -
In the valuation of land the following rules shall be observed -
Except as hereinafter otherwise provided, the value of any rateable land shall be estimated at the fair average value of unimproved land of the same quality held in fee-simple in the same neighbourhood.
That supplies the valuers of local authorities with a reliable guide in ascertaining the unimproved value of properties. What the Government have done in another place, and what apparently they propose to do here in spite of all we can say is this : They submit three fairly workable definitions of improved value, unimproved value, and value of improvements. But they nullify their effect by proposing a limitation in the definition of unimproved values. If we amend the definition of “ unimproved value” by the omission of the words to which I have already referred, we shall closely approximate our definition to the Queensland definition I have quoted. The retention of those words can only give rise to endless confusion. The definition of the “ value of improvements “ is clear, and would be a useful guide to valuers when taken in conjunction with the definition of “improved value,” and would afford facilities to the Commissioner of Taxes to determine accurately the “unimproved value” almost without the possibility of mistake. I hope that the suggestion of Senator Millen to strike out the limiting words I have quoted will be adopted.
– I am sorry to have to again refer to this matter, but I am so impressed with the seriousness of it that I make no apology for doing so.
– The honorable senator is again barracking for his friends.
– I am quite aware that a certain type of man sees some ulterior object in everything that another says. Senator Gardiner is welcome to his opinion. Having had his sleep, the honorable senator might now keep as quiet as he was when he was asleep. He was adorning the chamber and fulfilling a much more useful function when he was asleep than he has done since he woke up. Senator Rae just now laid down an unquestionable definition of the value of improvements from one stand-point. That is the definition adopted in the land laws of New South Wales. The value of an improvement is its value to an incoming tenant, but not exceeding the original cost of making the improvement. I am sure that Senator Rae is supporting the Bill in the belief that it provides for that, and therefore I cannot understand how he can support a definition which violates what he believes to be an essential principle. The principle is set out in the paragraph defining “ unimproved value.”
I ask Senator Rae to look at the definition of the “ value of improvements “ and say whether that principle is not violated. There is no doubt that it is, and that there is a conflict between these definitions, the value of improvements being estimated on one basis in one, and on a different basis in another. If honorable senators think that the first definition is correct, they ought to amend the second, but if, on the contrary, they agree with me, they ought to amend the first. Let me give an illustration to show how it will work out. Under a later clause, a man who returns his land at 25 per cent, short of its value is liable to have it taken away from him. Take a case which was fought out before the Land Board in New South Wales, and which is known as the Iandra case. In that district, there was land with green timber, which was valued at £2 an acre, while land which was alongside, and which formed the subject of the litigation, was valuable, and being sold then at over £$ per acre. Owing to ring-barking and drying, the land with dry timber could be cleared for 10s. per acre, but the land with green timber would have cost at least 30s. per acre to clear. The result was that men were prepared to give £1 per acre more to get on to the good land with dry timber than to get on to corresponding land with green timber. One pound, therefore, ‘ was added to the value of the land as the result of the expenditure of 2s. or 3s. The first definition I referred to states that a man shall value his land practically on the basis of the cost of the improvements, which was 2s. or 3s. per acre. The second definition says that he shall not take the cost of the improvements, but the £1 added to the value of the land by reason of the original expenditure. I am not arguing which definition is right, but certainly both definitions cannot be right. I am surprised that the Ministry do not see that a conflict exists, and for the sake of their own credit, set to work to remedy it. Possibly, the explanation is that the clause is not now as it left the hands of the draftsman. In the other House, there was a prolonged controversy over the first of these definitions. Amendment after amendment was submitted by the Attorney-Genera], one being submitted, withdrawn, and re-submitted. That is how I think the conflict between the two definitions arose. But whether that be so or not, under the first definition an owner is required to deduct from the value of his land only the cost of making an improvement. Let us assume that he follows the second definition, and says, “ I am entitled to take off the value added by the improvement. The land is worth £$ per acre. The added value by reason of that improvement is ,£1. I am entitled, under the definition of ‘ value of improvements ‘ to take off the value added to the land by the improvement, which is £1.” He therefore returns the value of his land at £2. The Commissioner then comes along, under the previous definition, and says, “ You are liable to have your land forfeited, because you have not returned it within 25 per cent, of the true value. What you ought to have done was to take off the cost of the improvements, to value the land as if the improvements were not there “ ! In doing that, he would have brought the value of his land possibly to £2 15s. or £2 16s., as against £2. I feel quite convinced, and I believe that I have impressed honorable senators with the fact, that there is a conflict between the two definitions. I shall be quite satisfied if the Ministry will tell me that they will confer with the draftsman on the point. I do not want particularly to move an amendment, but I do wish to see that, for our credit’s sake, we do not pass a definition which is bound to be a source of trouble, conflict, and irritation.
– I suppose that .if there is one member of the Committee who is looked upon as a specialist upon land matters, it is Senator Millen, who has spent years practically in gaining his experience. I, for one, intend to support him. His arguments seem to me so clear, and at the same time to have so little effect on certain honorable senators opposite, that I am reminded of an incident I read in Bodwell’s Life of Johnson. On one occasion, Johnson gave what he thought to be a very good reason, . and Boswell remarked, “ I cannot follow you, ‘sir. I do not ‘exactly see where it comes in.” Johnson replied, “ I have given a reason. It is not for me to find you with comprehension.” It seems to me that Senator Millen has done his part.
Question - That the words proposed to be left out be left out (Senator Millen’ s amendment) - put. The Committee divided.
Majority … … 8
Question so resolved in the negative.
– As each State has a Commissioner of Taxes, and our Commissioner will deal with purely land tax questions, it is thought advisable, for the purpose of securing a clear definition, to alter the last definition in this clause. Therefore, I move -
That the word “Taxes,” in the definition of “ Commissioner,” be left out, with a view to insert in lieu thereof the words “Land Tax.”
This amendment, if carried, will involve a consequential alteration.
– I really think that the Minister ought to consider what he is doing. In the first place, we had an assurance from him that this was the most perfect measure which has ever been framed, and that it was almost inconceivable that any one could think for a moment that any alteration would be required. In his own graphic language, the honorable senator declared his determination to “ sit tight.”Is this his method of sitting tight? It is hardly worth while to do to-day what you are likely to undo to-morrow. We have had an assurance from the Minister that it is intended to bring down other forms of taxation. He has explained quite clearly that the Government could not do everything at once. In view of that intention, I suggest that it is better to retain this definition as it is, so that they can make this officer Commissioner for the dozen new taxes which they intend to impose at a later period.
– That might do another fellow out of a billet.
– Apart from that personal consideration, the Ministry ought to realize at once that it is desirable to leave this definition as it is if they seriously intend, as Senator McGregor led us to believe the other day, to impose further direct taxes before very long.
– I think that Senator Millen ought to clearly see that the fears which have been expressed by some honorable senators opposite, that they will be taxed in other directions, might be allayed by an amendment of this description, and, consequently, I think that it ought to be made.
Amendment agreed to.
Clause, as amended, agreed to.
Clause 4 consequentially amended, and agreed to.
Clauses 5 to 7 agreed to.
Clause 8 - (1.) The Commissioner may, in relation to any particular matters or class of matters, or to any particular State or part of the Commonwealth, by writing under his hand, delegate to a Deputy Commissioner or other person all or any of his powers under this Act (except this power of delegation), so that the delegated powers may be exercised by the Deputy Commissioner. . . .
Amendments (by Senator McGregor) proposed -
That after the word “ powers,” lines 6 and 7, the words “or functions” be inserted.
– I wish to point out to the VicePresident of the Executive Council that the word” functions “ is a very difficult one to define, both as a matter of fact and as a matter of law. I presume that there is some reason why the honorable gentleman has moved the insertion of the words “ or functions.” Bearing in mind the dictionary definition of that word, and also what is meant in law by the term functus officio, I think there is just a chance that by inserting the word “ functions “ we shall be empowering the Commissioner to delegate the power of delegation with which he is to be clothed - a course of action which we expressly desire to avoid.
– I am sorry that Senator St. Ledger was not present when clause 7 was before the Committee. If he objects to the insertion of the word “functions” in this clause he should have opposed its retention in that provision which has reference to ‘ powers and functions of Deputy Commissioners.” We now desire to bring this clause into harmony with the previous one. As a member of the legal profession, Senator St. Ledger knows that in vesting the Commissioner with authority we require to be very particular lest he may be found exercising functions instead of powers. I am very sorry that time should be wasted over such a trivial matter.
– If the Vice-President of the Executive Council is satisfied that by inserting the word ‘ ‘ functions ‘ ‘ in the previous clause we did not authorize the Commissioner to delegate his power of delegation, of course everything is all right. But I fear that we are going further than even the Government themselves intend to go.
Amendments agreed to.
Sub-clause 2 consequentially amended.
Clause, as amended, agreedto.
Amendment(bysenatorGregor) proposed -
That the following new clause be inserted : - “8a.” (1.) The Commissioner shall furnish to the Treasurer annually, for presentation to the Parliament, a report on the working of this Act. (2.) In the report the Commissioner shall draw attention to any breaches or evasions of this Act which have come under his notice.
– Sub-clause 2 of this clause provides that the Commissioner shall direct attention to any breaches or evasions of the Act which have come under his notice. How can he direct attention to breaches or evasions of the Act which have not come under his notice? It seems to me that the provision requires some explanation.
– The Government have not much of an opinion of the gentleman who is to be appointed Commissioner, and who is to receive a salary of £1,200 a year.
– Exactly. After the exhaustive criticism to which this Bill was subjected in another place, the Vice-President of the Executive Council gets up and airily moves amendments without condescending to assign any reasons for them. It is obvious that the Commissioner cannot direct attention to evasions of the Act which have not come under his notice.
– We agree with the honorable senator.
– Then why not eliminate the words “ which have come under his notice”? Either the Ministers or their draftsmen, or both, have failed to look into this provision. Surely our Acts of Parliament should bear upon their face some semblance of common sense. What is the meaning of sub-clause 2 of this clause ?
– It is tautological.
– Absolutely. I think that it is stupid.
– Does the honorable senator suggest that the Commissioner should report upon breaches or evasions of the Act which have not come under his notice ?
– No. I merely suggest the omission of the words I have indicated, because it is obvious that if evasions of the Act have not come under the notice of the Commissioner, he cannot report upon them.
– It is simply a question of redundancy; that is all.
– It is only absurd, therefore let it go. That is the argument of honorable senators opposite.
– I move-
That the words “ which have come under his notice “ be left out.
– - Senator St. Ledger has affirmed that the words to which he has called attention are useless. I wish to point out that they constitute a danger. They read that the Commissioner shall draw attention to any breaches or evasions “ which have come under his notice.” Evasions maybe known to the Department or to the Deputy Commissioners, and the Commissioner may not be informed. Consequently he may not report the matters to Parliament, because he has not had personal notice of them.
– Surely the deputies would report the cases to the Commissioner.
– It ought to be an obligation upon the Commissioner to obtain this information. If we are to assume that the Commissioner will have the necessary knowledge of evasions the words are unnecessary and absurd. If, on the contrary, there is a possibility of the Commissioner’s deputies having a knowledge of these things, and not reporting them to him, or of the Commissioner not making himself familiar with their reports, the words constitute a danger, because they allow of a possibility of the Commissioner saying, “ These matters did not come under my notice.” I have heard undersecretaries of Departments plead, in reference to matters of departmental business, that they had no personal knowledge of them.
Amendment of the amendment negatived.
Proposed new clause agreed to.
Clause 9 - (r.) Subject to the provisions of this Act land tax shall be levied and paid upon the unimproved value of all lands within the Commonwealth which are owned by taxpayers, and which aic not exempt from taxation under this Act. (2.) The land tax shall be at such rates as are declared by the Parliament.
– - I move -
That the following words be added to subclause 1, “provided that in each case from the unimproved value of the land shall be deducted the amount (actual or estimated) originally paid to the Crown on grant in fee-simple of the land.”
The supporters of this Bill tell us that they desire to secure for the State the increment of value created in connexion with land by the community. We are engaged in taxing the increment of value. But, whereas under this Bill lessees of the Crown are to pay nothing, a man who has bought land from the Crown, and paid for it, is to be taxed. If a man has paid £1 per acre to the Crown for his land, which is now worth per acre, he should only be taxed on the increment of £2 per acre. I submit that the amendment is equitable, and trust that the Committee will agree to it.
– - A, very long discussion took place on a similar amendment elsewhere. Although Senator Walker has assumed that all land alienated from the Crown has been paid for in some way or other, he must recognise that in this country a considerable quantity of land has been alienated for which nothing has been paid.
– Then nothing would be deducted under- the amendment.
– Then there would be an inequality in the value of the land that could scarcely be ascertained by any Commissioner or any body of deputies. In most instances the value that has been received for land by the Crown has been given back in various ways.
-Colonel Sir Albert Gould. -How ?
– It has been given back in payments to agricultural colleges and similar institutions to assist land-owners, and also in payments for the destruction of rabbits and other vermin that land-owners themselves ought to have destroyed. Apart from that consideration, however, the complications that would arise from putting Senator Walker’s amendment into operation in connexion with the land tax would be so enormous that the difficulties of administration would be greatly increased. It has to be remembered that this is a land tax, not merely a tax upon increments. There is nothing about increments in the Bill. Increments have been introduced by honorable senators opposite for the purposes of argument, and to give them an opportunity of airing their eloquence and knowledge.
– Justification for the amendment moved by Senator Walker is to be found in the speeches delivered in this Chamber, and from a hundred platforms throughout Australia. There is nothing upon which honorable senators opposite have been so eloquent as in pointing out how the landholders of Australia have benefited from the unearned increment, or as Senator Stewart has so often called it, the communitycreated value. It has been argued that, the community having created that value, was entitled to possess it. But clearly the community has no claim where there has been no increment. How can the community claim to take an increment that has not been created ?
– What about the money that has been paid back to the landowners in some way or other? Take the Wakefield system in South Australia, where the whole of the money paid by landowners for land was paid back to them.
– I do not know that my honorable friend could have mentioned a more misleading instance. What was done under the Wakefield system was this : It was a system devised by a philanthropist who, like a number of honorable senators opposite, knew nothing about land values or land settlement: The basis of his system was that persons should pay for land £1 per acre, which was more than it was worth j and in order to give to the land thus purchased the value of £1 per acre the money received for it was to be spent in bringing out immigrants.
– The honorable senator has omitted one feature of the Wakefield system, and that is that under it not less than £20,000 worth of land was sold at a time.
– That has nothing to do with the principle of the system. The only interesting feature in connexion with the Wakefield system that occurs in connexion with this Bill is that no more pernicious legacy has been left to Australia than the fixed rate of £1 per acre which was determined upon in consequence of that system. I should like to put this to the Committee as an illustration of the imposing of a tax where there is no increment. Suppose that an honorable senator purchased a cottage for which he had previously been paying IOS. a week in rent. Suppose that after he had completed the purchase the landlord still called, and said, “ I want my rent.” That is exactly what is going to happen under this Bill in regard to persons who have purchased land from the Crown. Having paid, we will say, their £i per acre for their land, they are now to be taxed on the payment which they have made for it to the Crown. That is a simple illustration of what is going to happen. If honorable senators choose to say that the increment has no bearing upon this tax, I will admit that there is some force in that statement. But, nevertheless, there is not a single supporter of the Government who has not told the electors that we are called upon to impose a land tax because it is desirable to secure the increment.
– A man may have two valid arguments for a proposition as long as they do not contradict each other.
– I quite admit that - except in the case of my honorable friend ! This amendment carries my memory back fifteen years, when I was associated with a similar proposition in the New South Wales Legislature. That was an amendment to exempt from the operation of a land tax land-owners who had purchased their land direct from the Crown, and paid £1 per acre for it. There is no value there which can be fairly taxed unless you are levying a general property tax throughout the country. If you levy a general property tax, that 20s. worth of land is, of course, one form of property, and undoubtedly should pay its share. But when you come to talk of a land tax, you should surely exempt land as to which there is clearly no increment.
– We will exempt where there is no value.
– It is not a question of exempting where there is no value. There is very little land in Australia that i-* not of some value. Even the poorest land of which I have any knowledge is worth 2s. or 3s. per acre for its productive return. But where I have paid a sovereign for an acre of land to the Crown, the Crown has no right to tax me on that sovereign.
– Though the Crown may have given 30s. back ?
– The honorable senator has referred to agricultural colleges in speaking of what the Crown has given back ; but I should like him to say how the pastoralists of Australia have benefited from the expenditure upon agricultural colleges.
– They have benefited by increased knowledge.
– What nonsense 1 Honorable senators might as well contend that, by our system of education, we are returning something to every taxpayer in the country.
– That is so; and it is the only justification for making its cost a public burden.
– The honorable senator forgets that the taxpayers are paying for it as taxpayers. The Government have no magician’s wand, by which they can provide the expenditure necessary for our education system. They must take it out of the pockets of the taxpayers.
– That is beautiful.
– Of course it is; like many other things I say.
– It is only beautiful because the honorable senator stopped short of stating the whole case.
– I do not know that there is any more I can say on the subject. The idea that the Government can do something of themselves is wide of the mark. They can only do what the money they take from the pockets of the taxpayers enables them to do.
– It is chiefly the owner of land who benefits by public expenditure.
– Senator Rae is welcome to that view ; but the only way in which the owner of land benefits is by an increase in the value of his land. We are dealing with lands where there is no increment of value, and the owners of whirl’ have derived no benefit which is not shared by every member of the community. If I pay £1 an acre for land, and there is an additional value given to the land, the tax should fall upon that additional value ; but the State should not tax the sovereign represented by the acre of land that still remains of that value. There is no justification for taxing that, unless we impose a tax upon all forms of property. If that were done, I admit that we should be entitled to tax the original sovereign given for the land. By exempting the price originally paid to the Crown for land, we shall be establishing this taxation upon an understandable basis. We shall be taxing the community-created value - neither more nor less. I do not hesitate to say that I have never opposed a proposal to tax the community-created value.
– As a single taxer, necessarily the honorable member could not do so.
– I can scarcely be called a single taxer, when, if I had my way, I should tax the honorable senator’s ceaseless levity. I am surprised at the attitude adopted by Senator Rae, whose views upon land taxation are well known. The honorable senator has for years lived politically upon his orations on the subject of the unearned increment. Ever since I have known him, he has always been talking about it. It is the gospel he has preached in season and out of season.
– Then I must be consistent, which is more than I can say for my honorable friends opposite.
– If the honorable senator means that he is consistent in uttering the same thing always, I agree with him ; but I can charge him with inconsistency in regard to his action to-day, which is not consistent with the attitude he has previously adopted in this matter. I cannot expect to bind the honorable senator too closely to a form of consistency which his present political relationship might make inconvenient. The honorable senator has spoken more eloquently than I can hope to do, of the justification for levying a tax upon community-created values. It should be remembered that this Bill does not mark the final step in our taxation of land. The more definitely and clearly we make our appeal to the community in favour of a principle they can understand, and the more clearly we put before them a principle which is just in itself, the more likely they will be to adopt that principle and adhere to it permanently. I am a believer in the right of the community to take some portion of the community-created increment of value. But it is because 1 believe in that that I am bound to oppose a tax where there is no increment of value. The Government propose to levy this tax upon the original amount paid to the Crown for the land. The Crown has this money in its coffers, and can invest it at 4 per cent. ; and if it has not got this money in its coffers to-day, it has, by expending it upon public works, relieved itself of the necessity of raising a similar amount to cover the cost of those works. For the reasons I have given, I must say I expected a more sympathetic reception for the amendment than, judging by the attitude adopted by honorable senators opposite, it is likely to receive.
– I am not at all surprised that the Leader of the Opposition and Senator Walker should put forward any and every amendment in the interests of the class they so ably represent. They are very anxious that land-owners should not be taxed on the original price paid to the Crown for their land. But they seem to forget that, whether those in possession of land paid a large or a small price to the Crown for it, they have had the use of the land, in most cases for years, and have also had the benefit of a ten or twenty-fold increase in its value.
– But the Government proposes to tax them on that increase.
– We do not propose to tax them on the profits they have derived from the increase in the value of their land. I can give honorable senators a case in point. At a land sale held here in 1837, Henry Howie purchased three blocks of land within a few hundred yards of this building for £40 each ; and from 1860 to the present time, those blocks have returned an annual rental of £30,000 a year.
– Not to Howie.
– To the same family.
– Well, tax their wealth.
– I wish honorable senators to understand that, as the result of that investment of £120, in 1837, members of a family who have never seen the land, have reaped an annual rental of £30,000 from it for fifty years. In 1880, that land, which was bought for £120 in 1837, was valued at over £1,000,000. We are not going to tax the wealth of this family. We do not wish to do that. We are content that they should retain the profits derived from the investment. But what we say is that, in the future, the community is going to tax these land values, because it is the community that created them. If I paid £1 an acre for land, I have had the use of it free of rent.
– Free of rent? The honorable senator has to pay1s. a year for it.
– We cannot compare land and cottages on the same basis, because while a man by his own industry may build a number of cottages, no man can create land. Honorable senators opposite are anxious to prevent land-owners being taxed on the original amounts they paid for their land, it may be fifty years ago. They forget that, during the fifty years, they have not only enjoyed the products of the land, but, in many cases, a hundred-fold increase in its value, which the people have created for them, but which they have put into their own pockets.
– If that is the honorable senator’s argument, why does he not agree to exempt lands which have not increased in value?
– I am not aware that land has any value at all, except that which is created by the community. If we gave a man the whole of Australia, and there was no community with which he could trade, he might get a living for himself if he worked hard every day in the year. The community gives land the whole of its value. If a man is in possession of a few acres or a few thousand acres, for which he paid a very small sum, it may be many years ago, he has annually been able to reap the productive value of the land, and in almost every instance, has reaped and pocketed the profits from the community-created value as well. The Leader of the Opposition and the honorable senator who moved the amendment are fighting for a section in the community that has, so far, shirked paving a fair share towards the cost of the government of the country, and will continue to shirk it as long as they can.
– No, but we have some regard for the men whom honorable senators opposite would ruin - not the men in Melbourne, but the men out back.
– Ruin the Howies? They have ruined many a tenant in Melbourne.
– I have paid a fair amount of attention to what has been said by honorable senators opposite.
– The honorable senator was asleep all the time. *
– That was early this afternoon. But it was like the honorable senator to direct attention to the fact, when I had been up for three nights travelling. We may yet have to call attention to some honorable senators opposite, and it may not be for sleeping either. The honorable senator can mark my words, that if I have to wait here for six years, I will take advantage of the opportunity-
– We know the honorable senator’s vindictive character.
– Order !
– Honorable senators will not only know it - they will understand it.
– I rise to a point of order.
– Is Senator Needham coming to the rescue of his big brother?
– Senator Millen has said that he knows the vindictive character of Senator Gardiner: I do not think that is a statement which should be made in this Chamber. I think it is out of order, and that the honorable senator should be called upon to withdraw it.
– Senator Millen was making interjections on which I called him to order. I ask Senator Gardiner to continue his speech.
– Am I to understand, then that I shall be in order in applying similar terms to Senator Millen? If that kind of language is permitted on the other side, we shall make use of it on this side.
– Does the honorable senator take exception to the words used by Senator Millen?
– I do, very strongly.
– Then I ask Senator Millen to withdraw them.
– As the honorable senator takes exception to my use of certain words, which I-propose to withdraw, I may be allowed to say what those words were. I said that I was aware of the honorable senator’s vindictive character. I withdraw the words, in deference to your request, but I think Senator Gardiner should be asked to withdraw the statement with which he followed them, when he said that we should not only know of his vindictive character, but should feel it, before six sears were up. I take that to be an admission from the honorable senator, but I think he should be asked to withdraw what he said.
- Senator Gardiner did not use any words in reply to Senator Millen’s interjection, which, in my opinion, tall for a withdrawal.
– I am quite prepared, without being called upon to do so, lc withdraw anything I have said, which may cause my honorable friend any uneasiness.
– The honorable senator’s statement did not cause me any pain at all.
– I desire to refer to the sympathy expressed by the Opposition for the big land-owners. I take it that it is the big land-owners who are going 10 be taxed. There are not a great many persons who now hold land which they originally purchased from the Crown, and, in a great majority of cases the amendment would apply to persons in the possession of land that has changed hands several times. I shall vote against the amendment, because the land-owners, for the amount originally paid to the Crown for their land, have had the use of that land.
– And the Crown has had the use of their money.
– It is a fair exchange. They have had the use of the land for the money they paid for it, andin most cases, they have had as well the vast additional value added to the land by the community. Our honorable friends opposite lose sight of the fact that the profits which those who purchased their land from the Crown have pocketed from the additional value added to the land by the community will not be taxed under this Bill. It proposes only to tax community-created values in the future. The profits from this year’s values will go into the pockets of the land-owners, but after this year, they will be asked to pay a tax of1d. in the £1 on values over £5,000, and because they will be called on next year to pay a tax of 1d. in the £1 on the value of the land which they have in excess of £5,000 honorable senators opposite are devising every means in their power to defeat that proposal.
– Is that all that landowners will have to pay -1d. in the £1 ?
– I did not think it necessary to add that on an estate worth £10,000 the tax would be 2d. in the £1, and so on. I believe that the sympathies of honorable senators opposite are with those who own more than £75,000 worth of land, and will have to pay at the rate of 6d. in the £1. It is about time that justice was done to the thousands of landless persons who have not only created the rich estates, and carried on the industries of the country, but have been compelled under the present form of taxation to provide for the upkeep of the Government. I intend to vote against the amendment for the simple reason that in the use of their lands the original buyers have had full value for the money which they have paid to the Crown.
– I do not think that Senator Walker, when he framed his amendment, could have fully considered the position of the original holders of land. Who is going to estimate the amount which was paid to the Crown for land?
– You can propose an amendment to leave out the word ‘ ‘ estimate.”
– I am taking the amendment as it is. The Leader of the Opposition has stated that the Wakefield system of land settlement was a philanthropic one, and the remark was cheered by Senator Vardon.
– But the biggest mistakes on earth have been made by philanthropists.
– Exactly. What was the position under the operation of the Wakefield system? In South Australia, not only had the land to be sold, but it had to be sold in parcels of not less than 20,000 acres each.
– I shall vote for any amendment, no matter what it is, which willwreck this Bill.
– That is a fair admission. We are now asked to exempt from this tax the amount which was paid to the Crown for the land, and I take it that my honorable colleague intends to vote for the amendment, for the purpose of wrecking the Bill.
– The honorable senator can take what he likes.
-Colonel Sir Albert Gould. - We are going to vote for the amendment as a matter of justice to the owner of the land.
– I want to show the injustice of it. Under the Wakefield system in South Australia, the land was sold in large parcels, so that poor men could not get any.
– In large parcels?
– Yes, £20,000 worth.
– In 80-acre sections.
– No land was sold there except in 20,000 acre parcels.
– But there were small areas sold.
– The land, I repeat, was sold in parcels of 20,000 acres. If the honorable senator looks up the articles of association of the South Australia Company, which was formed in London, he will find that the land had to be paid for in cash, but a third of the money had to be spent in bringing out immigrants from England for the purpose of working the land, a third in making roads and bridges, and a third to the Government. The whole of the money which was received for the land was ultimately placed in the hands of the land-holders. Is Senator Walker prepared to exempt the South Australian Company, and other large landholders in South Australia, the amount which they paid to the State, and which was returned to them in the way I have mentioned ?
– The Wakefield Association did not carry out its bargain.
– It did, so far as South Australia is concerned. I am not prepared to say that the bargain was carried out in New Zealand, because Sir George Grey came across the company’s track and spragged its wheels. I ask Senator Walker to withdraw his amendment in justice to the people of Australia. The South Australian Company, whose headquarters are in London, is drawing thousands of pounds a year as rent from South Australia. Indeed, in the case of many properties, it is drawing rack-rents. Yet it is the rack-renter whom honorable senators opposite want to exempt from this tax.
– It is all very well for honorable senators on the other side to get warm, and to accuse us on this side of desiring to exempt the rack-renter.
– That is what you are doing.
– Let me say that what honorable senators on the other side are trying to do is to drive the last nail in the coffin of men who have struggled as the honorable senator has never had to struggle. He may draw a picture of what has happened to some of the big land-holders, but let us look at the other side of the question. Are there no people in the Western Division of New South Wales who were compelled, under its land laws, to pay 25s. and 30s. an acre for land which was never worth 5s., in order to protect their improvements?
– How many acres of such land are there?
– If the honorable senator wants it, I can offer to-day a solid block of 10,000 acres at 7s. 6d. per acre, for which 27s. 6d. was paid, in the Western Division.
– It is up to the State to rectify its own blunders.
– All that Senator Gardiner has been talking about has been the blunders of the State; but honorable senators on the other side are not leaving it to the State to rectify them. On the contrary, they say that because the blunders of the State have led to private profit, that is a justification for levying this tax on the lands. Let us look at the class of men whom Senator Gardiner is out to ruin, if he can, whom a vindictive class hatred is pursuing, who are struggling today, and have been reduced to such a condition that special legislation has had to be passed to induce them to remain on the land. The men of whom I am speaking are those whose land was never worth the amount which they paid to the Crown, nor is it likely to be in the lifetime of myself or any honorable senator here.
– The men who can afford to give you a fee of ^1,000 to get land from the State unfairly.
– Is that in order, sir?
– Order! I ask the honorable senator to withdraw the remark.
– I do not wish him to withdraw it.
– I rise to a point of order.
– Let him alone.
– Is Senator Gardiner in order in suggesting that the Leader of the Opposition has received a fee of ^1,000 to get land for people unfairly?
– I thank my honorable friend, but I am quite able to look after myself in this matter. Let me tell Senator Gardiner-
– Order ! I think it is 1 who have to settle a point of order.
– It is one of the cowardly things which he is capable of doing - a most contemptible thing.
– I ask Senator Gardiner to withdraw the remark.
– I do not want him to do so.
– I ask him to withdraw the remark.
– I do not.
– I “withdraw the remark at your request, sir.
– Without qualification.
– It was evoked by the remark of Senator Millen that I was here for the purpose of trying to ruin somebody. When such remarks are allowed to go without comment, I think I am justified in hitting back, and hitting where it hurts.
– Let me assure Senator Gardiner that nothing which he says in reference to that matter can hurt me. The Senate knows and the country knows that the matter to which he and others like to attach my name was inquired into by a Judge, who gave me what no Judge will ever give him, a clean sheet. That is a thing which he never will get if he should ever appear before a Judge.
– And since then the people of New South Wales have sent me back to the Senate.
– Order ! I ask the honorable senator to withdraw the remark that Senator Gardiner will never get a clean sheet if he should ever appear before a Judge.
– In this Chamber, of course, I have to obey the behests which come from the Chair, and therefore withdraw the remark. But let me express the hope that if Senator Gardiner ever should appear before a Judge he will be able to come off as well as I did on that occasion.
– I rise to a point of order. I submit that by innuendo the honorable senator is saying exactly what you asked him to withdraw when it was stated directly.
– If it will please Senator Rae I withdraw at his request the hope I expressed.
– I do not consider that there is anything in the remark of Senator Millen to cause me to ask him to withdraw it.
– I was pointing out that whilst honorable senators here were content to rely for arguments and illustrations on cases where there had been an enormous amount of community-created increment, which, I admit, is a fit subject for taxation, they were shutting out those cases where not only was there no increment created, but where the land was not worth as much as the Crown was paid. In those cases there was no attempt on the part of persons to build up big estates. They did not desire to do it because they knew that, so far as land value was concerned, there was not an acre of land in the Western Division of New South Wales for which they could afford to pay £1 on a grazing basis.
– Are there not big leaseholds attached to all these big places?
– Do you propose to tax leaseholds?
– They are not exclusively freeholds.
– The honorable senator knows very well that when you get down to the region of 13 inches of rainfall, that is beyond Balranald, there are enormous freeholds with practically no leaseholds attached to them. I refer to the land which was the subject of the Western Division inquiry, and which would not fetch to-morrow in the open market 6s. 8d. per acre, although j£i was paid for it.
Sitting suspended, from 6.30 to 8 p.m.
– In the main I agree with Senator Gardiner that the great bulk of the lands of Australia which have been alienated have received an increment, and that their owners have hitherto enjoyed that communitycreated value without being taxed upon it. Consequently, they have nothing of which to complain. I confess that at one time I believed in the proposal to exempt from taxation the amounts which were originally paid to the Crown as purchase money for these lands. But upon reconsideration I have come to recognise that there is a kind of academic fairness about that proposal which does not work out in practice. As the Leader of the Opposition himself admits, we have a perfect right to tax land as such. There is no obligation upon us to tax other forms of property.
– This is a class tax.
– Then how about the class tax to which we have submitted by paying duty upon every bit of tobacco that we smoke ?
– That tax is paid by every class.
– Customs taxation hits a man not in proportion to his income, but in proportion to his necessities.
– I think that the honorable senator’s remarks would have been more appropriate upon the motion for the second reading of the Bill.
– All this talk about a class tax comes with very bad grace from those who by their votes are supporting the class which gains most from the existing condition of affairs, and which escapes contributing its fair proportion to the revenue. I wish now to refer briefly to a matter which 1 know my South Australian friends will pardon me for mentioning. In the records of the New South Wales Parliament - I read it there eighteen or nineteen years ago - is a despatch which Wakefield forwarded to the Imperial authorities, and in which he stated that to make the South Australian settlement a success it was necessary to have dear land, so as to insure cheap labour. He argued that if the land were cheap every person who came to the country, instead of remaining in the service of his employers, would take up land for himself, and that, consequently, it was necessary to put a big upset price upon it, so that only the wealthy would be able to purchase it. This is the gentleman whom Senator Millen has described as a philanthropist. Though the despatch in question evidences a queer form of philanthropy, it contains the utterances of an honest, outspoken Tory - utterances to which none of the Tories of the present day have the pluck to give expression. They conceal all their opposition to every democratic proposal under the guise of Liberalism. A celebrated character in history once exclaimed, “ What deeds are done in thy name, 0 Liberty !” and similarly we may exclaim, “ What deeds are done under the lovely name of Liberalism !” I wish now to refer to a matter which is not one of sentiment, but of fact. Some time ago a deputation waited upon the Prime Minister to urge that this tax would oppressively affect the land-owners of Riverina. The members of that deputation presented figures, which were published in the metropolitan newspapers, showing how the tax would operate. They pointed out that they had given a certain price for their land - £i per acre in the majority of cases - and that in many instances it was not returning them more than 3 £ per cent, upon the purchase price. They declared that the tax would operate so oppressively that in some cases it would eat up nearly all the income which they derive from their land, and that in others it would eat up the whole of that income and leave a deficit. They asked for relief upon the ground that the Crown had already receive^ full value for their land. I do not know whether Senator Millen is widely acquainted with the Riverina lands- I know that he has been over them. But I wish to point out that most of the land which these men occupy is well fitted for agriculture.
– Does the honorable senator say that of the Balranald estate?
– I say that from Hay upwards there is a huge belt of country lying between the Murrumbidgee, the Edwards, and the Murray which a few owners have monopolized, and that there are thousands of settlers who would take up that land if the opportunity presented itself. It is mighty bad management on the part of the present owners if they can make out of it only 2 J per cent, upon their original outlay. There is no justification for a remission of the tax on the ground that it will swallow up the whole of their income from those lands. Their claim will not hold water for a moment, at any rate in the great majority of cases. I am quite prepared to accept Senator Millen’s statement that faulty legislation in New South Wales has forced men to buy land which they would have been very glad to have held upon rental. I admit that an injustice has been done owing to the operation of bad land laws which were enacted by the Parliament of New South Wales, although Senator Millen’s friends were responsible for those laws. If there are persons who are labouring under an injustice because they were compelled to buy lands which otherwise they would have rented, the duty of the New South Wales Government is to grant them compensation. It would be arrant folly for this Parliament to decline to sanction the imposition of a tax which is just in its incidence merely because a few cases of hardship will arise consequent upon bad legislation on the part of New South Wales. I repeat that if certain persons have suffered injustice by reason of that legislation, New South Wales should compensate them for the injury which has been inflicted upon them. But that is no reason why we should reject a tax which should have been agreed to long ago in the interests of the whole community. I repeat that, upon the face of it, it seems fair to say that nobody should be taxed on the purchase money paid for land to the Crown.
– Who built the railways and roads.
– Exactly. As Senator Guthrie has pointed out, these land-owners have already had returned to them far more than they ever paid to the Crown, in addition to which they have enjoyed the communitycreated values attaching to their lands for a generation or two without paying any taxation whatever. So that if we were animated by class hatred - as has been suggested by honorable senators opposite - we would enact retrospective legislation. The land-owners may thank their stars that a party is in power which is animated by a spirit of justice and fair play, and which consequently allows them to escape. If Senator Walker’s proposal were adopted I should submit a further amendment for. the purpose of dealing with the hundreds of thousands, perhaps millions, of acres in New South Wales and the other States which have been dummied. Their owners committed forgery, perjury - indeed, almost every crime in the calendar - in order to dummy those lands. I admit that a great deal of this was directly due to bad legislation, which sometimes forced men to purchase land in order to prevent others from obtaining it. Consequently, they were frequently obliged to mortgage themselves up to the neck-
– It was “ catch as catch can.”
– It was, and the principle is a bad one. But Senator Millen must admit that if we are going to have an inquiry into what was originally paid to the Crown in the form of purchase money, we ought also to have an inquiry into all the dealings of our land-owners. If we did that we should discover that the criminals who did not get into gaol outnumbered those who did by ten to one.
– Senator Guthrie has enlightened the Committee upon the Wakefield system of acquiring land in South Australia. I confess that he knows much more about that subject than I do, but I do not understand what he meant when he said that under this amendment we should merely refund to the purchasers the money which they originally paid for their lands. All I propose is that the land-owners shall be permitted to deduct from the unimproved value of their land the amounts which they originally paid for it to the Crown. If they paid £1 per acre for that land, that amount should be exempted from taxation.
– When the old pioneers return.
– I know nothing whatever about that. To meet the wishes of honorable senators, I am quite willing that my amendment shall be amended by leaving out the words “ actual or esti- mated.” I ask permission to amend the amendment in that respect.
Amendment amended accordingly.
– My amendment in its present form makes it clear that I merely ask that there shall be deducted from the unimproved value of land in each case the amount originally paid to the Crown for the grant of the fee-simple. It has already been remarked by Senator Millen that honorable senators opposite over and over again in their addresses to the electors dwelt upon the unearned increment which ought to be taxed. To be consistent, they should support this amendment, which will restrict the tax to the unearned increment so-called, and even then will yield a revenue of more than £1,000,000 sterling. If the Bill goes through in its present form, experts throughout Australia agree that the tax will produce £2,500,000.
– All the better.
– Whoever heard of a Treasurer asking for more money from the people than he believed to be necessary ? This is essentially a class tax.
– A first-class tax !
– The Government, by exempting £5,000 of unimproved value, will thereby exempt nine-tenths of the land-owners of Australia, leaving the other one-tenth to pay the whole amount of land taxation to the Commonwealth. That is a most outrageous system. I shall certainly divide the Senate upon the amendment.
Senator Lt.-Colonel Sir ALBERT GOULD (New South Wales) [8.18].- I support Senator Walker’s amendment. By this tax, the Government are endeavouring to place at a disadvantage men who, iri earlier days, instead of renting their lands, became freeholders, and paid to the Crown what was regarded as full value for them. In fact, in many cases they paid a great deal more than the value, in order that they might protect their properties from the inroads of selectors.
– Does the honorable senator seriously believe that men ever paid more than the value for land?
– Yes; that was done in many cases by lessees who wished to protect themselves. Both Senator Millen and Senator Rae have made that abundantly clear, and both speak from knowledge. These land-owners, instead of keeping their cash in their pockets, were practically compelled to pay it into the coffers of the public Treasury in order to secure land that, in other circumstances, they might have occupied at a rental of a few pence per annum.
– No one was compelled.
.- They were compelled to protect themselves. In the early days of Australia’s history, whatever may be the position of affairs to-day, it was eminently desirable that there should be a large number of persons, who, by owning land, acquired a stake in the country, of which probably they could not rid themselves without considerable loss. Some honorable senators appear to think that it would have been very much better had the land been nationalized. I do not hold that view. I believe that it is safer for a country to have men who are tied to it by the possession of land.
– The convicts in the early days were tied to the land.
.- What has that to do with the present position ? It was necessary for the advancement of Australia that, in the early days, men should secure freeholds in this country. That was a means of tying them to the country. Why should men who invested their capital in landed property be disadvantaged in comparison with those who invested their money in securities that they could more easily get rid of ? Are we going to penalize those men, who, in order to advance Australia - and they did advance the country - put their money into the land?
– Did they not advance their own interests as well ?
– Do not all men in whatever form of industry they engage endeavour to advance their own interest? Of course they do. Those men who paid their £1 per acre to the Crown have been legitimately enjoying the profits arising from their investment. At the same time, the Governments which received their money utilized it in the best interests of the community. It was a mere matter of exchange. The Government exchanged land for money which they used for general purposes, and those who bought the land made the best use of it in order to benefit themselves and the country at the same time. Some wonderful examples have been cited, such as that of a man who went to gaol for sixteen years, and whose property was enhanced enormously in value in the meantime. We have also had the example of a man named Howie, who purchased property in Melbourne about seventy years ago, and whose family have been living upon the proceeds ever since. But how many cases were there in which men who paid £i per acre for their land received no adequate return for their capital? Of course, there are examples in the “great cities of Melbourne and Sydney of men whose properties have been increased enormously in value,- but there are other cases of people who gave a fair price for properties which are hardly worth a snap of the finger today. Are the Government going to refund to them the money they have lost ? No ; they simply say to the man who has bad the good luck to make money by his investment, that he shall be penalized, whilst the man who has had the misfortune to lose money has to hold to his bad investment. This is a tax on success. Of course, we know that taxation generally falls most heavily upon the successful; but, at the same time, it behoves us to be perfectly fair and honest as between man and man. Every member of the community, whether he be poor or rich, should have the same measure of justice meted out to him. That is what the Opposition are asking Tor. Senator Walker has mentioned that in all probability the Government will derive more than ^2,000,000 of revenue from this land tax. Whether they will derive that much or more is beside the question. We are now debating what I take to be an abstract principle of justice. If the Government wanted 000,000, and this tax did not yield that sum, of course, they would have to look round for other sources of revenue. But whatever the yield may be, we ought to have a fair and square deal as between the Government and those who have bought property and paid honest money for it. They should at least receive the benefit of an exemption to the extent of the sum originally paid by them to the Crown.
– And which was all returned by the Crown.
– In some cases, but not in all.
– In every case.
– Some land-owners have derived their 5 or, perhaps, 10 per cent. from their investment, but others have derived very little.
– The exceptions prove the rule.
– The supporters of this Bill are treating all the big owners as “ exceptions,” no matter whether they have derived a fair return from” their investments or not. The cry of those who have demanded amended land laws in Australia has been that the community-created increment of value - the unearned increment as some call it - should be secured by the Government.
– The honorable senator’s side say that they do not want justice, but to wreck the Bill.
.- Nonsense. We tried to defeat the Bill at the second-reading stage, but we recognise that it has to be passed in some form. Whatever may have been said by any honorable senator, I simply state that Senator Walker’s amendment deserves support, because it is in principle honest, fair, and just, and an attempt to improve a measure that I look upon as being brimful of iniquities. I have never attempted to screen my view of the Bill.
– It is like the bottomless pit !
– The honorable senator may have more acquaintance with the bottomless pit than I shall - though I hope not. 1 do emphatically protest against the shape which this Bill has taken. I recognise, however, that the Government have the numbers. They have a good, solid party or twenty-three in a House of thirty-six, and their supporters will vote blindly, if necessary.
– We are quite aware of what we are doing.
– Probably the Ministerial supporters have had an opportunity of considering this subject in the privacy of their caucus, where they could exchange their own views without hearing any strong arguments on the other side. All that the Government have to say now is, “ Resist all amendments.” I do not believe that a single amendment will be made unless by the desire of the Government themselves. Their supporters will go together just like a flock of sheep following a bell-wether.
– There will not be many who will break away from the honorable senator’s side either.
– Occasionally an honorable senator on this side may be found voting with the Government when he believes that they are acting upon right lines; but we do not act blindly on this side.
– What was the Opposition caucus about to-day ?
– I do not know of any caucus of the Opposition held to-day, but I may say that whatever may be decided by the party in Opposition, its members will be quite prepared to come into the open, and give reasons for any course they propose to adopt. They will make it quite clear that they are not a lot of sheep following the bell-wether in a particular course. I believe that in this matter honorable sena* tors opposite are following a blind lead, and are not doing justice to themselves, to this Parliament, or to the people they are here to represent.
– I think that honorable senators opposite are proceeding on a false assumption. The argument on this side is based on the premise that this Bill and the Land Tax Bill, which is to follow it, are founded upon the idea of taxing what is called “the incremental value.” Assuming for the moment that there is such a thing as an incremental value of land, the Opposition contend that the Government are unjustly applying the principle which they enunciate. On this question, I take leave to differ to some extent from the opinion expressed by my leader, Senator Millen. In speaking on the second reading of the Bill, I said that for all lands which are made reproductive there is no such thing as incremental value. Senator Millen will not go nearly so far as that, and there’ are probably very few in this Chamber who will be prepared to go so far.
– Senator Millen knows better than that.
– Possibly ; but I am steering my own course in this matter in a way which will not materially interfere with my leader’s position, however much I may differ from him or from the Government on the question of the incremental value. The point is, that if there be such a thing, the Government are not applying the principle properly, and Senator Walker’s amendment is a proposal put forward to apply it properly.
Some startling assertions have been made by honorable senators opposite, not merely to-day, but years ago, and probably similar statements will be made for years to come, in support of the principle of an incremental value as the basis for land taxation. We have been told that land has no value but what the community gives it. One would think that it would be almost impossible to concentrate so much absurdity in so short a sentence. “ Land has no value but what the community gives it.”
– Hear, hear.
– Senator Gardiner cheers, that proposition, and I shall show him at once that it is utterly ridiculous. Land may have a very large value which the community does not give it, and which nobody but the man who applies himself to that land gives it. I cite an instance from the town of Bendigo, which I visited about a month ago. Quite close to the gold mines, and almost in the heart of the town, there is land which, for over fifty years, was regarded as absolute waste. The area, perhaps, was not more than fifteen or ‘ twenty acres. A few Spaniards, who landed here in consequence of some advertisement as to the resources of Australia, and did not obtain employment in Melbourne, went on to Bendigo. Seeing this land, it struck them that they could make it of value. By bringing their agricultural skill and knowledge to bear, they were able, within twelve or eighteen months, to make that land reproductive, and the products they raised made .Bendigo famous throughout Australia. I ask who created the present value of that land? It was created by these Spaniards, and by the application of their knowledge of agriculture to it. What has been the result? Other persons in Bendigo, and amongst them miners, having seen what might be done with land of that quality, have taken up similar land around Bendigo, and have made it reproductive. Will honorable senators opposite contend that the community created the value, primarily or wholly, now existing in that land? They must admit that it might have remained in its original state for a hundred years if it had not been taken up by men of intelligence, who were able to discern its possibilities. It is on this indisputable set of facts that I base my objection to the use and application of the term “ incremental value” embodied in this Bill. Let me deal now with another superstition, for I can call it nothing else, which was suggested by Senator Gardiner. The honorable senator mentioned an unchallengeable fact that fifty or sixty years ago a man secured some land in Melbourne for a few sovereigns, and that that land is to-day worth tens of thousands of pounds. I do not say that it might not be a proper thing to impose a tax upon the present owners of that land, but I can refer the honorable senator to land adjoining it which was bought only the other day for from £80,000 to ,£100,000. Here we have two persons owning blocks of land within a quarter of a mile of each other, and, according to Senator Gardiner, though one was secured for a few pounds, and the other cost many thousands of pounds, the same principle of taxation is to be applied to both, and the value of both to their respective owners is to be estimated on the same basis. We may find a block of land ii: Collins-street for which the owner paid £50,000 or £60,000, and a few yards further down the street we may find an equally valuable block for which the present owner or his farther before him gave only a few pounds. It must be obvious that it is most inequitable to propose to treat the owners of these blocks on the same basis. Senator Gardiner mentioned the land held by the Howie family, which has increased in value, it may be, a thousand-fold since it was purchased by Henry Howie. How can honorable senators opposite contend that it would be equitable to impose taxation which might reasonably be imposed upon the Howies upon the owner of land in the same neighbourhood who may recently have paid many thousands of pounds for it?
– How can we remedy that under the Constitution?
– That is the business of honorable senators opposite; it is not mine. Will honorable senators opposite reply to my argument? Under this measure these lands will be taxed to the same extent, although they were acquired by their owners under absolutely different circumstances. If it may be equitably applied in the one case, it must be inequitable in the other, and it is because this Bill makes no discrimination in such cases that I most seriously object to it. Where does the phrase, “ incremental value,” and the proposal to tax it come from? It comes from Henry George, who, twenty or thirty years ago, deluded the world and himself.
– Order i I ask the honorable senator to confine himself more closely to the question.
– Senator Walker’s amendment is submitted to mitigate what he and I consider to be the inequity - or shall I say the iniquity - of not taking into consideration the amount paid for land to the Government, in order to enable the Government and the community to secure an incremental value? That is the rock upon which Henry George split, and the reason is palpable. He was driven to the adoption of the single-tax, because he knew he could not meet the difficulty properly.
– Is this a homily upon Progress and Poverty ?
– As the Minister of Defence has come to the assistance of his party, I am disposed to think that I have said enough upon the question of the single-tax, and also upon the stupid proposition enunciated on the other side that land has no value but what the community creates. The Vice-President of the Executive Council has pointed out, in answer to some objections raised by Senator Walker, that when the settler went on the land the community gave him some advantages by constructing roads and railways and helping him to destroy rabbits t and other pests, that he was being paid ‘all the time, and that if he lost by his enterprise so much the worse for him. The Minister’s vision was not wide enough. What is going on in Queensland to-day? There are settlers on freeholds and settlers on leaseholds which they may gradually convert into freeholds, who have to clear their land of pests, and the great obstacle to that work is the pest-infested community-owned land. In those parts of the State - even on the Darling Downs, which comprise the richest and most productive agricultural land in Australia, and, in some respects, in the world - the settlers have frequently complained that the work of settlement and development is impeded by the inaction of the Crown with regard to clearing its land of Bathurst burr and prickly pear.
– Under this Bill those settlers will not pay any land tax.
– They may not pay the tax to-day, but they may do so at some future time. I am dealing now with the honorable senator’s contention that the Government is all the time a benefactor to them. As a matter of fact, in the districts I have referred to, the State Govern ment is, to some extent, retarding the work of settlement and development. Although the settler, whether freeholder or leaseholder, is bound by law to clear his land of pests, yet the adjoining block, which belongs to the community, is allowed to become a nursery for pests, so that after all the community-owned land is not by reason of that fact an advantage to him but rather an obstruction to the utilization of his land. Over and over again, both in the State Parliament and by Divisional Boards, resolutions have been passed calling upon the Crown to do what they compel the settlers to do. Let me put the position from another point of view. About £125,000,000 was paid to the Crown for the lands which are held at present. I know of a case in Queensland where a quarter of a million has been lost by two or three squatters who came from Victoria, and who were almost ruined thereby. They paid heavy rents on their leaseholds year after year, and they lost every penny of the sum I have mentioned.
– This measure does not touch leaseholds.
– I know that it does not, but the principle is just the same.
– No, the honorable senator is barking up the wrong tree.
– I started with a reference to leaseholders because to us in Queensland the leasehold tenure for large areas is more familiar. The loss of £250,000 on the leaseholds to which I alluded is nothing compared with what many freeholders in that State have lost. I have known cases where men have paid hundreds of thousands of pounds’ for land at the rate of ,£i per acre when the Crown was hard up for money with which to carry on the public services. The £125,000,000 which was paid by private individuals to the Crown for lands has been used by the Government for developmental purposes. If, on the one hand, the community created some value to the buyers of land, it is equally true, on the other, that the buyers have done some good to the community. If you are going to ask for incremental value, you ought to allow for so much of that money as has been contributed by private individuals in order to add to that publicly created value, if it is such.
– The Bill does.
– lt does nothing of the kind. The graduated tax is based on the incremental value, and not even the honorable senator can justify the rapid increase in the rate with the increase of values. It is only justified by the Government on the principle of the incremental value. But if you adopt that principle, surely you ought to take into consideration the fact that there are some freeholders who have paid money, in order to enable the Government to have that very incremental value, and, as Senator Millen has pointed out, it is proposed to tax them twice.
– Name them, and we will exempt them.
– If the amendment be accepted they can be ascertained at once, because those who wish to take advantage of it will have to declare the amount which they paid to the Crown.
– Senator Walker has virtually withdrawn the amendment.
– No; it has been modified slightly. If present holders purchased their land, not from the Crown, but from private individuals, the amendment will not apply, nor does Senator Walker seek to touch them. I hope that the justice of his amendment will commend itself to the Committee, and that, at any rate, it will be met, not by mere jeers, but by argument.
. -I intend to support the amendment as it has been amended. I told Senator Walker that I could not support the amendment in its original form, and that if certain words were not excised I should oppose it. I believe that under the Constitution the Government have no right to ‘tax land at all, as that is a matter for the States to deal with. But as the Bill has passed the second reading, I am quite willing to support any reasonable amendment, which will, at least, do a little justice. The Bill proposes to tax, not only the unearned increment, but also the amount which the holder originally paid for his land. We have heard a great deal about persons not losing money. I know that, while some persons have been successful in land speculations, others have lost a lot of money. I know that in a portion of Queensland where the Government had land sales, you could not get to-day£1 for every£10 which they received for the land. I could cite any number of such instances. I also know of cases where the holders could get ten times as much as was paid to the Crown. But these are not the only persons to be considered. Last night Senator Lynch told us that in New South Wales he paid£10 an acre for land which to-day is not worth £2, and I take it that it will be taxed on the higher amount. That shows that honorable senators on each side of the Chamber have made bad investments and good ones. This tax will touch them all. If land for which a man paid £1 per acre ten, or fifteen, or twenty years ago is still worth£1 - and I believe that in the western portion of Queensland you can buy land to-day for 15s. per acre, which was bought from the Government at £1 - he will be taxed, of course, on the amount which it is worth to-day, and, therefore, he will be losing both ways. I do not think that we should tax the principal. I admit that it would be fair to tax the unearned increment. I have always believed that every form of wealth should be taxed; but this Bill deals with only one form of wealth. I regard the amendment as a just one. In speaking upon the motion for the second reading of the Bill, I mentioned that the Vice-President of the Executive Council introduced it in a very briefspeech, and that he described it as a perfect measure which required no amendment.
– Then is it not presumptuous of the honorable senator to endeavour to amend it?
– Everything is presumptuous which emanates from the Opposition, because my honorable friends opposite have the big battalions upon their side. I repeat that the amendment is a reasonable one. In its original form I did not regard it in that light, because it would have permitted some persons to obtain a larger exemption than that to which they are entitled. Only to-day I was talking to a gentleman who informed me that the State taxes, the Divisional Board tax, and the tax proposed in this Bill would have the effect of absorbing the whole of the receipts from his property. He assured me that, when next year he is called upon to pay income tax. he will simply have to declare that he has no income. If I were at liberty to mention his name, I am sure that every honorable senator would be willing to believe his statement. Surely we do not wish” to entirely deprive a man of his living. If that is going to be the result of the tax in good years - and the past seven or eight seasons have been so good that they are almost without a parallel in our history - what will be its result in bad years?
– Is this a secondreading speech ?
– I am advancing reasons why the amendment should be accepted. If the Vice-President of the Executive Council arrogates to himself the right to prevent me from expressing my views, I shall simply tell him to mind his own business. I care no more for him, though he is the Leader of the Senate, than I do for any ordinary member of it. If I described his conduct as I should like to do, my language would be deemed unparliamentary. He has made himself most obnoxious to every member of the Opposition, and he does not possess the ordinary manners of a man. I recognise that it is idle for any honorable senator upon this side of the Chamber to endeavour to influence the Government. We can only express our views, and leave the country to decide, in the light of experience, whether we are right or wrong.
– I wish to say a few words in reply to the statements of Senator St. Ledger. I believe that all land values are created by the community, notwithstanding that the honorable senator has characterized those who- think in that fashion as stupid. He instanced the case of some Spaniards who took up land in Victoria, and suddenly imparted a value to it by producing something which the community could use. He appears to forget that, but for the community which consumed those products, that land would still have no value. In the Northern Territory to-day there are thousands of acres of the best lands in Australia, and yet no one is rushing to use them because there is no market accessible for them. I do not mind being classed as stupid with men like Henry George, Adam Smith, and Carlyle.
– Has the honorable senator solidly digested all those gigantic authorities?
– The honorable senator instanced two cases of land values in Melbourne. He gave the original value of certain land and mentioned the price which it had recently realized. What does that prove? Merely that one section had been trading in values which it never created. What does the Bill contemplate? It does not propose to take from a man the unearned increment, but merely to take a portion of it, and a very small portion. Ten thousand pounds worth of communitycreated values at 5 per cent, will return £500 per annum. Now, if a man be possessed of £500 worth of communitycreated values per annum, all we say to him is that he shall pay £20 a- year to assist us to maintain an adequate defence force to protect his property. We affirm that he shall contribute the enormous sum of id. per £1 on those community-created values. But Senator St. Ledger thinks’ that the right to pay the whole of the taxes should belong to the wage-earners of this country. If he thinks it stupid fOr any honorable senator to argue that all land values are created by the people, why is it that the land in Bourke-street is more valuable than 500 miles of the best agricultural land in Victoria? It is not because of its productiveness, but because there are good trading sites there. I hope that he will consider this point, so that when he comes to write another book upon Socialism he will realize that those who advocate taking, for the purposes of the community, a very small percentage of the community-created values in land, are not inspired with a wild idea to attack a special class. The land-owners can well afford to pay for defence purposes the amount which we are asking them to pay. This taxation is merely levied for the purposes of defence. Senator Sayers has been arguing that as our land-owners have paid for their lands they ought not to be taxed upon them. But whatever may have been paid for those lands, their owners have received more than a quid, fro quo for years past. The money which they paid for their purchase has been spent to preserve order, to maintain an efficient police force to protect their property, and to construct roads and railways. In short, it has been used to give them all the facilities of trade which they have enjoyed, and yet they now wish to escape a tax of id. in the £,1 upon their unimproved land values. They describe the tax as an injustice. But what about the injustice which has been inflicted upon the thousands of landless who have never had an opportunity to acquire land ? It is because I wish to remove an injustice from the many, and to afford the few an opportunity of contributing their fair share to the revenue, that I intend to support the amendment.
– Some honorable senators appeared to be a little horrified when I interjected that I would vote for this amendment or any other that would wreck the Bill. I could not make any other statement. I wish to make it quite clear why I take up that attitude.
– No matter what arguments may be used upon this side of the Chamber?
– No matter what arguments may be used. My objection to the Bill is fundamental. I maintain that it has no right to be here. Last night I stated that I would oppose every clause of it.
– The Bill could not come here except by right.
– It has two objects. The first is to raise revenue, and the second is to burst up large estates.
– In any case that question was settled upon the motion for the second reading of the Bill.
– I would point out to the honorable senator that the second object to which he has referred was thoroughly discussed during the second-reading debate.
– I merely wish to justify the interjection which I made. I do not think that this Parliament has any right to resort to direct taxation until the Commonwealth has used every penny of the Customs and Excise revenue at its disposal. It has no right to introduce legislation to take control of the lands of the Commonwealth, since the Constitution left that control entirely in the hands of the States. I have been a consistent supporter of. the policy of taxing the unimproved value of land for over twenty years.
– As long as the principle could not be put into operation.
– I have helped to put it into force. I am not opposing the Kill on that account, but because the Commonwealth Parliament has no right to take up the question of land taxation. Neither from a revenue stand-point nor from the stand-point of bursting up the big estates ought this Bill to have been put before us.
– I have risen again to suggest one form of inequity that will occur if the amendment is not accepted. The point has been suggested by Senator Gardiner’s remarks. According to a case mentioned by him, there are land-owners who will be untouched. Suppose that I have a property in Bourke-street, Melbourne. The moment I feel that this tax is likely to be too strong for me, I can convert my property into cash, and my income will not be touched. But the man who buys the property, or who must occupy it for business purposes, has to bear the weight of the tax. As much as £50,000 may be put into a city property which is required for the conduct of a business. That property is to be taxed under this Bill. But a Government should always be careful in the administration of a land tax as to how such properties are affected. I confess that I should like to see this measure banned by bell, book, and candle, but, as it is to be passed, I wish to see it amended so as to make it less inequitable than it would otherwise be. Although we are twitted with being under the rule of a caucus, I am perfectly certain that if it were not for the caucus domination of the Labour party, there are some followers of the Government who would sweep away the £5,000 exemption.
– Name them.
– Senator Stewart is one. If honorable senators opposite are not converted by the instances that have been given they are beyond conversion.
– I must apologize for speaking again, but I should like to summarize the views which I hold regarding Senator Walker’s amendment. It is not a little to have obtained such an admission as that with which we have been favoured by Senator Rae, when he said that there was a theoretical fairness associated with the amendment. There is really no conflict as to the facts of the case. Two sides have been presented. The supporters of the Bill have continually dwelt on the fact that a large number of land-owners have succeeded in acquiring what is called the incremental or community-created value of land. On the other side it is urged that there is another class of land-owners who, through circumstances which I need not repeat, have purchased land in connexion with which there has been no added value. Those facts are not in dispute. We do not deny that probably a majority of the land-holders possess land in connexion with which there has been an added value. On the other hand, no one has denied that there are land-owners owning land which is not worth more than, or as much as, the original sum for which it was purchased from the Crown. It is quite clear that neither this Bill nor any Bill which this Parliament could pass could differentiate between those two classes - the men who have secured the unearned increment and those who have not. The supporters of the Bill say, “ Because we cannot differentiate, we are going to levy the tax alike on those who have secured the unearned increment, and upon those who have not.” We, on the Opposition side, also recognising that it is impossible to differentiate, prefer to make a slight concession to the man who has secured the unearned increment rather than levy a tax on those who have not. That statement marks the difference between the two parties. I wish to make it abundantly clear that if 1 had a choice of levying a tax on those who have secured the unearned increment, and of exempting those who have not, I would adopt that course. But I cannot do so. I prefer, therefore, the course of making a concession to a few wealthy land-owners, in order to do a measure of justice to those who have not been lucky in their investments, rather than to strike at those who have been unfortunate, in order to hit all the wealthy land-owners. I repeat that in order to ease the applicationof this measure to the man who has purchased land that is not now worth what he paid for it, I am prepared to make a concession to those who have greatly profited by their investments.
Question - That the words proposed to be added to sub-clause 1 be added (Senator Walker’s amendment) - put. The Committee divided.
Majority … …. 8
Question so resolved in the negative.
Clause agreed to.
Clause 10 agreed to.
Clause 11 -
Land tax shall be charged on land as owned at noon on the thirtieth day of June immediately preceding the financial year in and for which the tax is levied :
Provided that an owner of land who, after the thirtieth day of June, but before the thirtieth day of September, One thousand nine hundred and ten, has sold or agreed to sell or conveyed part of the land, or has sold or agreed to sell or conveyed all the land to different persons, shall, if the Commissioner is satisfied that the sale agreement or conveyance was bond fide and not for the purpose of evading the payment of land tax, be separately assessed for the year ending on the thirtieth day of June, One thousand nine hundred and eleven, in respect of the land so sold or agreed to be sold or conveyed to any one person, and be charged with land tax in respect of that land as if it were the only land owned by him.
– I wish to draw the attention of the Government to what appear to me to be unnecessary words in this clause. In the first line of the proviso it is stated, “ provided that an owner of land who, after the thirtieth day of June, but before the thirtieth day of September,” has sold or agreed to sell. I think that the words “ after the thirtieth day of June “ might safely be left out. The proviso would then read, “ provided that an owner of land who, before the thirtieth day of September,” which appears to be the dominant date. Much as I should like to see a later period fixed, I do not propose to suggest an alteration in that respect. The object of the clause is this: It sets out the date of ownership for the purpose of the tax, and goes on to provide that if the owner has sold or has entered into an agreement to sell before 30th September, although the conveyance is not complete and the actual transfer has not been put through, if the sale is bond fide and not for the purpose of evading payment of the tax, the owner is to be separately assessed in respect of the land in question. The clause has been introduced for the purpose of allowing people who are already in process of subdividing their estates and have made arrangements for sale to secure a measure of relief. That being so, the only date that is relevant is 30th September. The particular date prior to the 30th September on which an arrangement was made to sell makes no difference. It can make no difference whether it was on the 28th or 29th of June, provided no one is permitted to take advantage of the arrangement after 30th September. It is quite a common thing in New South Wales for more than three months to be occupied in getting a conveyance or transfer through. The sole purpose of the clause is to provide that where a transfer is under way the owner shall get the benefit just as if the sale were complete. I do not think that it can be the desire of the Government, or in accordance with the spirit of the clause, to limit the arrangements for the transfer of land which are to be so treated to those which are made between 30th June and 30th September. Therefore, I hope that the Minister will see his way to consent to the omission of the words “ after the thirtieth day of June.”
– I can hardly conceive that Senator Millen does not realize the true position. We are dealing only with this particular year, that is to say, the taxation year from the 30th June, 1910, to 30th June, 191 1. With those who executed transfers of land before the 30th June, 1910, we have nothing at all to do. They were not the owners of the land on the 30th June, 1910, when the ownership of the land should be determined. This provision is inserted as a concession to those who are bona fide sellers of land before 30th September, 1910. We say that if they have entered into an agreement to sell after the date fixed for the determination of the ownership, that is to say, after 30th June, 1910, we will give them a certain time - up to the 30th September, 1 9 10 - to complete the sale and so avoid taxation under this measure in respect of the land sold. This is a concession to the bond fide seller of land who is carrying out one of the principles of the Bill and is subdividing his own land, though it may be that in some cases the transfer will be to another large owner of land.
– I move -
That the words “ after the thirtieth day of June, but” be left out.
I recognise that the clause applies to this year only, and that next year it will be inoperative. The only object I can conceive for the insertion of this proviso is to ease off the shock which may be expected to be felt by land-owners when this Bill is first brought into operation. It is true that this is a concession to those who intend to sell their land. The Government propose that they shall have up to the 30th September within which to complete the sale of their land where they have made an agreement to sell after the 30th June. But a man who entered into an agreement to sell his land on the 29th June, and had not completed the transfer on the 30th June, would be denied the benefit of this concession.
– He would not.
– The honorable senator must see that he would, if he made his agreement to sell on the 28th or 29th June, because the concession is limited under the proviso to those who made such agreements after the 30th June and completed their transfers before the 30th September.
– The honorable senator must see that if a man had not completed his agreement to sell on the 30th June he would still be the owner of the land on that date. But if he wished to complete the agreement after that date he would have up to the 30th September to do so. The thing is quite plain.
– I am prepared to believe that I may be as liable to misunderstand the meaning of the clause as another, but I still venture to press the matter from my point of view. The Vice-President of the Executive Council says that if any man made an arrangement to sell on the 28th June he will not be shut out from the benefits of this proviso, but I point out that if a man made an agreement to sell on the 28th June, the transfer could not even by a miracle be completed before the 30th June.
– If it was not completed the man who agreed to sell would still be the owner of the land.
– That is my point. He would be the owner on the 30th June, and would have to pay the tax.
– No; because he would have completed the transfer before the 30th September.
– The assumption is that he would be able to do so. It is clear from the clause itself that it is considered that three months is not too long a time to allow for the completion of an agreement to sell, because where a man entered into an agreement on the 1st July he is given under this clause three monthsin which to complete the transfer of the land. What I wish to know is, why a man who entered into such an agreement on the day before the 1st July should not begiven the benefit of this concession as well.
– Unless he owned’ the land on the 30th June, he would not be taxed.
– But he would have owned the land on that date, though he- may have entered into an agreement the day before to sell it. The clause recognises that though a man may have agreed to sell his land, he will appear on the register as the owner until the transfer is completed. Under this clause, though a man may be registered as the owner of a piece of land on the 30th June, 1910, it is proposed to give him a concession in respect of land which, after that date, he entered into an agreement to sell. It is proposed to give him up till the 30th September, 1910, to complete the transfer of the land. I do not ask that there should be any extension of that term, but I cannot see why a man who has entered into an agreement to sell on the 28th June should not also be given the concession.
– So he will.
– I am glad to hear the interjection, because it shows that the Minister thinks that such a man ought to be given the concession. The only question, then, is as to whether these words will insure that he will get it.
– Yes, they will.
– The Vice-President says so, but I am afraid that I cannot accept his view.
– If the honorable senator cannot accept the view of the VicePresident of the Executive Council, whose view does he wish to accept?
– It is a novel proposition that an honorable senator on this side must accept the view of some honorable senator who for the time being happens to be a Minister. I can remember a time when I occupied a position similar to that now occupied by Senator McGregor, and when Senator Findley was not so ready to accept my view of anything. The clause says-
Provided that an owner of land who, after the thirtieth day of June, but before the thirtieth day of September, One thousand nine hundred and ten, has sold or agreed to sell - lt is not necessary that I should quote any further. Such a man is given a concession under the clause, and we need not bother even as to what it is. What I say is that a man who made an agreement to sell between the two dates mentioned is given the concession, but if he made the agreement to sell one day before 30th June-
– He will still get the concession.
– No, it is clear from the wording of the clause that the concession is limited to those who make an agree ment to sell between the two dates mentioned. If Senator McGregor’s contention is right, and the man who made an agreement to sell before the 30th June is given the concession, the reference to the 30th June in the proviso is entirely unnecessary, and it should read -
Provided that an owner of land who, before the 30th day of September, and so on. I put it to the Committee to pay whether the object of the clause would not be better served by striking out the words “ after the thirtieth day of June, but.”
– I think that the contention of the Leader of the Opposition is correct. I read the clause exactly as the honorable senator reads it. From the way in which it is worded I think that only those who agreed to sell between the 30th June and the 30th September, 19 10, will be entitled to the benefit of the concession. I think the Vice-President of the Executive Council would place the matter beyond all doubt if he agreed to strike out the words “ after the thirtieth day of June, but.” The clause would then provide that all who agreed to sell before the 30th September would be entitled to the concession. There is no reason why we should not put it beyond all doubt that those who agreed to sell before 30th June should get this concession. In view of the difference of opinion as to the effect of the clause, I think the Government might reconsider it.
– I am surprised at Senator Gardiner. Can the honorable senator not see that if a man sold his land before 30th June he was not the owner on that date?
– He may not have completed the transfer.
– Then, he would get up to the 30th September to do so. If no agreement to sell were entered into before 30th June, a man desiring to sell his land and making arrangements to do so between the 30th June and 30th September would, under this clause, be exempt from taxation. The reason the 30th June is mentioned is to indicate the date of the commencement of the year during which the tax is levied.
Senator Lt.-Colonel Sir ALBERT GOULD (New South Wales) [9.43].- In the first part of this clause it is provided that the tax shall be charged on land as owned on the 30th day of June, and then there is the proviso that the owner of land on the 30th June who made an agreement between the 1st July and the 30th September to sell his land shall be exempt from the tax. But the man who made an agreement to sell on the 30th June, or 29th June, will not be exempt under this clause. If we turn to the definition clause we shall find that- “ Owner “ in relation to land includes every person who jointly or severally whether at law or in equity. is entitled to land or to receive rent from land. A man who had land on the 29th June might have entered into a contract for its sale, and, if the sale were not completed on the 30th June, he would still be the owner of the land.
– But if the sale were completed before the 30th September he would still be entitled to the concession.
– That may be the intention ; but the clause draws a distinction between the 30th June and the day after the 30th June. A man may, at noon on the 30th June, have been registered as the owner of a certain piece of land. At one o’clock on the same day he might agree to sell the land, but be would not be entitled to exemption under this clause.
– Yes, he would.
– There appears to be no provision to protect a man who may have been the owner of land at noon on the 30th June, although he may have entered into an agreement to sell it on the 29th June.
– The clause appears to me to be quite clear. If a man agreed to sell on the 29th June, but did not complete the transfer of the land until some time in July-
– It does not matter when it was completed.
– It does. On the 30th June the Land Tax Commissioner must accept, as the owner of the land, the man who is registered as its owner. Suppose that two days previously that man has agreed to sell to some other person, his name will still be on the list of registered owners. But suppose that a week afterwards he delivers the transfer to the purchaser, then he has completed the transaction.
– It is a question of agreeing to sell.
– No; it is a question of “ has sold, or agreed to sell.”
– It often takes years to complete a sale. I know a case which has been running’ for three years, owing to a difference regarding the title.
– A sale is not completed until the transfer has been delivered and registered.
– The man may have paid a deposit.
– That is simply an agreement to sell. I think. that the clause is all right.
– This is a case in which, I think, the Vice-President of the Executive Council might graciously give way. Even one of his own supporters thinks that he should. In Australia it is a matter of longitude as to when 12 o’clock on 30th June is; 12 o’clock in Queensland is not 12 o’clock in Western Australia. There are many cases in which a man may agree to sell, but may not be able to carry out the sale. Suppose, for argument’s sake, that A agrees on the 28th June to sell, but, unfortunately, dies ; is not the agreement to be carried out? This is really a comparatively small amendment. Let us have the satisfaction of knowing that some honorable senator on this side has had the pleasure of seeing a small amendment made in the measure.
– In order that honorable senators may thoroughly understand such a simple matter as this is, I have risen to make a further explanation. Senator Stewart, in the position he takes up, is absolutely correct. Suppose that in April, or May, a person agreed to sell, and that before the 30th June the sale was not completed, he would still be the owner. But if the sale were completed before the 30th September he would be exempt from the tax, as he would not be the owner for this taxation year. If the amendment be carried, however, the position might be complicated to some extent. Honorable senators will notice that the words used in the proviso are “has sold or agreed to sell.” If, on the 1st July, or 28th September, any person agreed to sell, and had not completedthe sale before the 30th September, he will be exempt. A man who, prior to the 30th June, agreed to sell, but did not complete the sale, was the owner on the 30th June, but he can complete the sale before the 30th September. If he does not do so, he is held to be the owner, and is taxed. If, after the 30th June, a person agreed to sell, although the sale may not be completed until November or December, or some time afterwards, yet, because he made the agreement between 30th June and 30th September, he also will be exempt. I hope that honorable senators will allow the clause to pass.
– The Minister has rested his case on one class of individuals who may be benefited. I want to put the case of a class of individuals who will be hurt by the clause as it stands. My honorable friend has quite correctly stated that if any person entered into an agreement to sell between the 1st July and 30th September, although he may not complete the transfer for months, it may be for years, he gets the concession. Let me take an extreme case. Suppose that an agreement to sell was signed on the 29th September, although it may be two years before the sale is completed, yet the seller will get the concession. But if, on the 29th June, any person made an agreement to sell, and did not complete the sale until the 1st October, he does not get it.
– Quite right. He ought not to get it.
– That is where 1 differ from the Minister. The whole purpose of the clause was that if land is in process of transfer, the concession will be granted. But the Minister says now, “ We ure going to hold out that concession to those who on the 29th September signed an agreement to sell, although it may take two years to transfer the land, but we will not give four months to a man who entered into an agreement to sell if he happened to sign it on the 29th June.” That does not appear to me to be a reasonable and fair way of dealing with the matter. The object of the Bill is to encourage subdivision and sale. I cannot see why, if an agreement to sell was signed on the 29th June, the seller should not get exactly the same consideration as is extended to a man who signed his agreement three days later.
-531- - When I first heard this question mooted by Senator Millen, I was inclined to agree with him, but after a further perusal of the clause, I think that Senator McGregor’s interpretation is fully borne out. Senator Millen has stated that there will be a handicap, comparatively speaking, on the man who agreed, between the 30th June and 30th September, to transfer his land.
– No, he gets the concession. The man who, on the 29th June, signed an agreement to sell does not get the concession unless he completed the sale before the 30th September.
– I think not, as the honorable senator will- find if he will read the clause again.
– That was the Minister’s interpretation.
– I think that it is correct. The proviso reads -
Provided thai an owner of land who, after the thirtieth day of June, but before the thirtieth day of September, One thousand nine hundred and ten, has sold or agreed to sell or conveyed part of the land or has sold or agreed to sell nr conveyed all the land to different persons, shall, if the Commissioner is satisfied that the sale agreement or conveyance was bond fide-
– Now take the case of a man who, on the 29th June, agreed to sell, but did not transfer until October.
– He had agreed to sell.
– But when - before the date set out in the proviso?
–lt must be after the 30th June.
– The Minister says that, having signed the agreement on the 29th June, and not having transferred before the 30th June, the seller does not get the concession.
– I see that I did misinterpret my honorable friend’s argument. As I understand the clause now, it is designed to protect anybody who intends to dispose ot his land in the way of cutting ir up or distributing it, and to give him at least three months during this year within which he may do something, and prevent him from paying the tax.
– If a man made an agreement to sell within those three months, it may be three years before he can complete the transfer, and he will still get the benefit of the Act.
– Do I not know that perhaps better than my honorable friend? Senator McGregor spoke rather curtly, if I may say so, with regard to the disposition of land. But it is not every State which is so favoured as is South Australia with regard to the transfer of land. It enjoys the fortunate position of being the State into which the Torrens Act was first introduced, and under the Torrens system of title - the Real Property Title Act, as it is called in some other States - it is possible to deal with land just as quickly and effectively as it is to deal with shares in a public company. But in other States, more particularly in New South Wales and Tasmania, it is very difficult very often to trace back titles, and complications are very great. Sometimes, apart from the preparation of abstracts of titles, the searchings through the various records to ascertain the correct titles are very extensive, and run into months - at times into years. I understand now the purport of the amendment moved by Senator Millen-, and I hope that Senator McGregor will see his way to drop the particular words which have been suggested, and so give an opportunity to do so to all who were prepared to accept the spirit of this Act in its full and proper interpretation before the end of September.
– That is past.
– It would be idle to deny the force of Senator Millen’s contention. It would be, to some extent, idle to deny that there is a great deal in the contention put forward by Senator McGregor, and supported to some extent by Senator Stewart. But the great point we have to consider is : How will the Commissioner of Land Tax interpret the provision? If he interprets it in Senator Millen’s way, possibly the purpose of the Act may be defeated. If, on the other hand, he interprets it in the Minister’s way, possibly the intention of the Government will be carried out. But, amidst the conflict of opinion, how can we be sure that he will do so? It is our business to try to make it absolutely clear that he will do so. 1 suggest to the Minister that he should carefully reconsider the clause.
– No; it is all right. The 30th September is past, and no great devilry can be concocted or carried out.
– In order to make clear what is probably the intention of the Government, Senator Millen has suggested the deletion of the words “ after the 30th day of June “ f or a purpose which he has pointed out, and the Minister has met that suggestion with the statement that Practically it is carried out. But. on further argument, it is not quite so clear that it is. I wish to have the clause made quite clear. I can see that there is a good deal in the explanation given by Senator
McGregor. But I can also see that the view which Senator Millen has pointed out is very likely to be defeated unless this amendment be made. On the whole, I am inclined to think that the very object which the Government intend to carry out will be best secured by the amendment. But if we cannot reconcile this conflict of opinion we ought to reframe the clause in such a way that there can be no doubt when the Commissioner of Land Tax has to interpret it.
.- I think that the clause will be made perfectly clear if we strike out the. words “ who after the thirtieth day of June but.” I have in my mind estates which, during the last year, have been cut up in different parts of New South Wales, and which, to all intents and purposes, are the property of the vendors until the terms, extending in many cases over many years, have been completed. I do not think it is fair or just to tax men who have parted with their land, in some cases to an enormous amount, particularly when you exempt from taxation those who did the same thing between June and September. I hope that the Minister will carefully read the clause, and see if he cannot consent to the alteration I have suggested. That, to my mind, would leave the clause in less doubt, and also exempt those who have subdivided their estates in a bond fide manner. I hope that the Government will yet reconsider their position.
– The speech of Senator Gardiner has brought to my mind what has absolutely taken place in New South Wales. An agricultural estate was subdivided and sold on the 21st June; a deposit was made, which, of course, does not come within the scope of the Bill, and the purchasers are allowed three months in which to make a further deposit. The land could not possibly be transferred until the 30th September, although the agreement to sell was made prior to the 30th June. Let us imagine a similar sale taking place a month later - that is, on the 31st July. That estate subdivided would get the benefit of this clause, whereas the estate which was sold a month earlier would not. Is there any reason why we should differentiate between these two estates?
– Take the case of a covenant to purchase within six years.
– Such an estate would not escape the tax. “All we say is that a concession should be granted to those who have sold, or who have agreed to sell, between these two dates. It seems to me that the revenue will not be hurt in any way if we say that all those who have entered into an agreement to sell before 30th September shall receive the benefit of this concession. Surely it is not intended to make fish of one and flesh of another?
Question - That the words proposed to be left out be left out - put. The Committee divided.
Majority … … 4
Question so resolved in the negative.
Clause agreed to.
Clause 12 -
The following lands shall be exempt from taxation under this Act, namely : -
all land owned by any society registered under a State Act relating to friendly societies or trade-unions ;
all land owned by any building society registered under a State Act relating to building societies, not being land of which the society has become owner by foreclosure of a mortgage;
all land owned by or in trust for any person or society and used or occupied by that person or society solely as a site for -
a place of worship for a religious society, or a place of residence for any clergy or ministers or order of a religious society ;
a charitable or educational institution not carried on for pecuniary profit ;
a public library, institute, or museum ;
– I wish to ask the Vice-President of the Executive Council a question in regard to paragraph c. under which it is proposed to exempt from taxation all land owned by any society registered under a State Act relating to friendly societies or trade unions.
– Does the honorable senator wish to eliminate friendly societies from that provision?
– No. But, inasmuch as it is proposed to make this concession to trade unions, I wish to know whether a similar concession will be made to an employers’ union, or whether such a union will be covered by the new clause which the Vice-President of the Executive Council intends to submit?
– DoI understand the honorable gentleman to say that an employers’ union will be equally exempt from taxation?
– In reply to the honorable senator, I wish to say that most certainly such a union will be exempt. I now move -
That in paragraph d the words “ under a State Actrelating to building societies “ be left out, with a view to insert in lieu thereof the words “ as a building society under any Act or State Act.”
The idea underlying the amendment is that the time may come when registration under a Commonwealth Act may be deemed advisable, and my proposal will put the clause in such a form as to permit of that being done. It will merely make the provision wider.
Amendment agreed to.
– In the year 1892-3 a great crisis occurred in Sydney by which some building societies had to come under an arrangement with its creditors for the purposes of liquidation. It was deemed desirable to alter their constitutions so as to enable them to offer easy terms to persons who were prepared to purchase properties which were under mortgage to them. The largest of these institutions was the Sydney Permanent Building Society, which found itself in a very awkward position. Its members, therefore, applied to be brought under a State Act, in order that they might obtain some measure of relief.
– Was not that partially a proprietary society?
– It was registered under the Friendly Societies Act, but its members had not sufficient power under that Act to carry out liquidation. They, therefore, asked the depositors who had lent them money to take properties in part payment. In this way the society has sold, I understand, about £150,000 worth of land, and, at its request, I have brought forward the amendment which I now have the honour to submit. I move -
That after paragraph d the following new paragraph be inserted : - ” (da) all land owned by any building society, association, or company, registered under a State Act relating to companies, and at the time of the passing of this Act subject to a scheme of arrangement with its creditors duly sanctioned by a State Supreme Court, not being land of which such building society, association, or company has become owner by foreclosure of a mortgage ; “
This provision will really enable the large society which I have mentioned to sell land without being subject to the land tax. It has already lost thousands of pounds, and has only continued to sell land for the sake of meeting those who have lodged money with it. It would be very hard if, in addition to all the other losses which they have sustained, the members of this society had to pay land tax. The shares of the society were at one time worth £40 each, but today they are worth only £1. It is practically still a building society in liquidation. I ask the Committee to give the amendment favorable consideration.
– The Government would do anything in their power to assist Senator Walker to frame an amendment of a definite character if it did not interfere with the principle underlying the Bill. But honorable senators will notice that Senator Walker not only wants to bring in building societies registered under State Acts, but associations or companies. He tells us that some of these associations or companies which have gone into liquidation have already parted with £150,000 or £250,000 worth of land. The Lord knows how much more they have to dispose of. Really, he is asking for too much. He gives us no assurance that these building societies, associations, or companies were instituted for any other purpose than to make a profit out of the people. There is no mutual principle connected with them. If they are in possession of land and go insolvent, there is another clause of the Bill which will affect them. I allude to clause 64, which is included for the very purpose of dealing with such cases as Senator Walker has brought under our notice.
– I should like to ask a question arising out of the Minister’s statement. He has said that Senator Walker’s amendment is not limited to building societies which are mutual in principle. In what portion of the Bill is any concession made that is limited to mutual building societies? Senator McGregor seemed to be referring to a provision especially designed to exempt building societies founded on the mutual principle. But as far as I can see the Bill does nothing of the kind.
– I move -
That the following new paragraph be added after sub-paragraph 2 of paragraph g : - “ 2a. A building occupied by a masonic society, or by a club or association of members of a trade or profession not carried on for pecuniary profit.”
This amendment is intended to take away any hardship that may be placed upon the members of an association that is not worked for pecuniary profit. Honorable senators are aware that some Masonic Societies, Commercial Travellers’ Associations, and associations formed in connexion with trades or professions, have erected buildings purely for the purpose of carrying on the work of their associations. In connexion with the Commercial Travellers’ Associations, for instance, there are funds for the benefit of widows and orphans, and also funds for educational purposes. Other associations have charitable funds. It is desired to exempt the lands occupied by such societies.
– I wish to know whether the VicePresident of the Executive Council will agree to include premises occupied by Chambers of Manufactures? In Adelaide, for example, the Commercial Travellers’ Association exists to promote the interests of manufacturers as a whole. The members derive no benefit, but devote considerable time and attention to the work. They may fairly ask that the premises which they have purchased, and in which they carry on their affairs, should be exempt. The Adelaide Chamber has recently purchased premises, and intend to have there a large room for exhibition purposes. The mem- bers will derive no pecuniary benefit, butI hope to help forward avery useful work.
SenatorMILLEN (New South Wales) [10.24]. - I am entirely with the VicePresident of the Executive Council in his desire to extend the concession to certain useful societies, but the amendment as it stands opens up a very important question. What is the object of exempting a building?
– It is the land on which the building is erected that is exempted.
– The amendment speaks of “ a building occupied by “ various bodies. Suppose that such a society were merely a weekly tenant, would the land upon which the building occupied by such a society was erected, be exempt?
– But that will be the case if the clause simply says “ occupied.” If John Jones owns a block of land upon which he erects a building, that he lets on a weekly tenancy to a club, John Jones will escape land tax under this amendment. If the Minister is satisfied I am, and I am quite sure that John Jones will be.
– I do not know how many Masons I “ shall bump up against,” but I am opposed to this amendment. I do not see why a Masonic Lodge should be treated differently from a Hibernian Society or an Orange Lodge. Furthermore, where do Socialist clubs come in?
– Such a club will never own . £5,000 worth of land.
– I want to tax every person or association that does own land of that value. When we talk about exempting clubs, take Sydney. There is a club there which, in the days when members of clubs had special voting privileges under the State law, had a membership of 1,200. Of course, commoners like I am would not be allowed within coo-ee of some of the palatial clubs in Sydney. But there are clubs like the Union Club and the Athenaeum Club, whose members are wealthy men, and ought not to escape land taxation. Too many concessions are being made to these people. I am against the amendment, and think that if the Government were as democratic as they profess to be, they would never have dreamt of proposing such a thing. I shall certainly vote against it.
– Senator Rae need not be alarmed. If he looks at the clause which my amendment affects he will find that it does not include such wealthy institutions as he has referred to. It deals only with buildings occupied by friendly societies, or clubs or associations of members of trades or professions, which are not carried on for pecuniary profit.
– That applies to a club.
– Not such a club as the honorable senator has in his mind. A club, to secure the benefit of this exemption, must be composed of the members of a trade or profession.
– Not necessarily.
– The clause says so.
– How would the Melbourne Club be affected?
– That is not a trade club.
– It is a squatters’ institution.
– It is a Conservative institution. There is no need for alarm, because the term “club” is qualified in the clause. Senator Millen, however, has raised a point of some importance, and to meet it I ask leave to amend my amendment by inserting after the word “building” the words “owned and.”
Amendment amended accordingly.
– I have listened with interest to what has been said by Senator Rae and Senator McGregor. I hope that the VicePresident of the Executive Council will see his way not to make any discrimination such as is proposed by the amendment. The proposed new sub- paragraph especially mentions “ a building occupied by a Masonic Society.” Would it not be possible to amend the clause so as to make no discrimination or differentiation? Could we not say, “ occupied by a society,” without specifying any society?
– That would open the door very widely.
– I should like to ask why. I do not think it is right that we should insert in any Bill a provision of this character. A number of my most intimate friends are very prominent members of the order referred to, but I do not think we should in any Commonwealth Statute discriminate between the members of that order and anybody else. I hope we shall respect the spirit of the Constitution, and at no time translate into legislative effect any provision which will discriminate in the way proposed between the members of our community.
Senator Lt.-Colonel Sir ALBERT GOULD (New South Wales) [10.35].- I remind Senator Keating that, under this Bill, it is proposed that friendly societies shall be exempt from taxation. There is only one society of the class that I am aware of that is not registered as a friendly society, and that is the Masonic body.
– What about the Orangemen ?
.- - They are registered as a friendly society.
– What about the Protestant Alliance?
– The members of friendly societies are given certain benefits in the way of medical assistance, or assistance to their families at the time of their death. The Masonic body does not offer its members such benefits, but in every other respect it stands on exactly the same footing as the Oddfellows, the Druids, the Protestant Alliance, the Hibernians, and other recognised friendly societies. It would, in my opinion, be most unfair to discriminate between the members of the Masonic body and the members of the friendly societies I have referred to.
– We should not exempt any of these societies.
– Or we should exempt them all.
– The Committee has already passed the provision exempting friendly societies.
– Then I say it would be very unfair to attempt to draw a distinction between members of the Masonic body and members of the friendly societies I have mentioned. They should all be placed on the same footing, because none is established for the pecuniary benefit of its members.
– If the word is struck out, they will still be covered.
– No; because they are not registered as a friendly society. To attempt to discriminate between the members of the Masonic body and the members of other friendly societies would be to act unfairly to a large section of the community.
– I think we had better reject the amendment now proposed, and recommit the clause, with a view to striking out all the societies proposed to be exempted from the operation of this Bill. I remind honorable senators that it will only operate in cases where the unimproved value of the land held is above £5,000. I see no reason why we should go out of our way to exempt from the operation of this Bill, for instance, the property held by the Trades Hall in Sydney. I venture to say that the people who are represented in the Trades Hall, and who believe in this method of taxing others, have no desire to be exempt from taxation themselves. The moment we refuse to pay our own share of taxation under this measure we give away the whole case for the taxation of other people. The authorities of the Trades Hall iri Sydney occupy land, the unimproved value of which must be over £5,000 and they should be just as liable to this taxation as any other owners of property of that value. I can see no reason for exempting the Masonic body from this taxation. If we have made a mistake in agreeing to some provision to which we ought not to have agreed, the mistake should be corrected. I would put the Trades Hall, the Masonic Society, and every organization of a similar character on the same footing. If they occupy land of the unimproved value of over £5,000 they should pay this taxation. Take the instance of a club like the Com~mercial Travellers’ Club, whose building in Castlereagh-street, Sydney, occupies a most valuable block of land. It may be said that it is not used for purposes of profit, but the use of it relieves the members of the club from the necessity of living in premises that are used for profit.
– They have to pay at the club as they would have to pay at an hotel.
– But they will be exempt from taxation under this Bill. We should remember that the number of clubs will greatly increase in this country.
– They represent a form of Socialism which the honorable senator ought to support.
– I recognise that, and I say that they deserve every credit for their co-operation, but I do not think the Legislature has any right to go out of its way to be benevolent to certain sections of the community. There may be other sections in the community who, because they may be without a representative who has the ear of the Government, will be neglected and forgotten. I object to the special exemption of any section of the community from taxation under a Bill applying to people holding land over a certain value.
Question - That the new sub-paragraph proposed to be inserted be inserted - put. The Committee divided.
Majority … … 9
– I do not know by what means the honorable senator could prove the fact.
Question so resolved in the affirmative.
Amendment agreed to.
– I move -
That the following new sub-paragraph be added : - “ 9.Golf links not carried on for purposes of profit.”
In Scotland, where the Vice-President of the Executive Council and myself come from, the golf links are open to the public, and it is a magnificent and healthful game.
– Golf clubs are already provided for in the clause.
– I see no harm in specially exempting the links.
– I believe that golf clubs axe covered already by the clause; but, as a believer in the national game of cricket,
I suggest that Senator Walker move to exempt cricket pitches from taxation.
– I see that public libraries, institutes, or museums are exempt ; and I desire to know whether Schools of Art in Queensland, which are not public libraries in the ordinary sense, but are private libraries subsidized by the Government, come within the exemption?
– The institutions spoken of by Senator Stewart are already provided for in the clause. I may point out that it is rather embarrassing that honorable members should at this stage raise questions in regard to matters that are already covered by the clause.
– I do not wish these institutions to be exempt.
– Then why does not the honorable senator move that the exemption already made be struck out? I point out that there is only one other, and it is a non-contentious clause in this part of the Bill; and that if honorable members will cease their trifling, we can quickly dispose of it, and go home early.
– This is anything but a trifling matter. I believe it to be the intention of this clause to exempt’ from taxation such libraries as Senator Stewart has indicated, but the question is whether it does do so.
– Ministers say “Yes” with that confidence which has marked their attitude throughout the consideration of this Bill, but I do not know that the Committee share their confidence. I suggest that the Vice-President of the Executive Council should ascertain from his legal advisers whether or not these semi-public libraries - for they are not public in the sense that any one may enter them-
– Any one can join them.
– I am not certain that that is the position in New South Wales. Intending members have to be proposed and seconded, and to submit to a ballot.
– But they are not proprietary libraries.
– That is so. They are not conducted for profit. I shall be quite content if the Minister will promise to consult with his legal advisers as to whether this clause will exempt such libraries.
– I shall make al! inquiries.
– And if it does not the responsibility will be upon the Minister to give us an opportunity to amend the clause.
– In Queensland, and also in some parts of New South Wales, what are known as Schools of Art are established on sheep stations.
– Would they possess land of the unimproved value of £5,000?
– 1 desire to know whether the existence of such libraries on a holding would affect the taxation of that holding.
– Are they public libraries ?
– -I do not know what is the legal definition of “ public,” but they are established, particularly at shearing time, for the improvement of the men employed on the station. The employers assist the movement in many cases by providing a reading-room, and, I believe, that some assistance ‘ is granted by the State.
– Are they owned by the members?
– I do not know. What I wish to know is whether the existence of such a library on a holding would give rise to complications as to the right to tax that holding.
– If the library were owned by the proprietor of the station it would not be a public library.
– It might be a public library. I understand . that people living in the vicinity are allowed to use such libraries.
– It is the site and not the library itself that is taxed.
– I wished to make sure that the existence of a library on a holding would not give ground for a claim that the site was free from taxation.
– I resent the suggestion of the Vice-President of the Executive Council that this is a waste of time. If any one has been guilty of a waste of time in connexion with this measure I have not, and I desire to have a clear statement with regard to the exemption of these Schools of Art.
– I desire to intimate that His Excellency the Governor- General has been pleased to appoint the hour of 11 a.m. to-morrow as the time when he will receive, in the Parliamentary Library, the Address-in- Reply to his Speech at the opening of this Parliament. I shall be glad to be accompanied by as many honorable senators as can make it convenient to attend.
Senate adjourned at 10.56 p.m.
Cite as: Australia, Senate, Debates, 26 October 1910, viewed 22 October 2017, <http://historichansard.net/senate/1910/19101026_senate_4_58/>.