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Wednesday, 26 October 1910

Senator WALKER (New South Wales) . - 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.

Senator Guthrie - When the old pioneers return.

Senator WALKER - 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.

Senator WALKER - 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.

Senator Ready - All the better.

Senator WALKER - Whoever heard of a Treasurer asking for more money from the people than he believed to be necessary ? This is essentially a class tax.

Senator Stewart - A first-class tax !

Senator WALKER - 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 ALBERTGOULD (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.

Senator Guthrie - Does the honorable senator seriously believe that men ever paid more than the value for land?

Senator Lt Colonel Sir ALBERT GOULD - 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.

Senator Guthrie - No one was compelled.

Senator Lt Colonel Sir ALBERT GOULD .- 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.

Senator Guthrie - The convicts in the early days were tied to the land.

Senator Lt Colonel Sir ALBERT GOULD .- 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?

Senator Ready - Did they not advance their own interests as well ?

Senator Lt Colonel Sir ALBERT GOULD - 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.

Senator Guthrie - And which was all returned by the Crown.

Senator Lt Colonel Sir ALBERT GOULD - In some cases, but not in all.

Senator Guthrie - In every case.

Senator Lt Colonel Sir ALBERT GOULD - Some land-owners have derived their 5 or, perhaps, 10 per cent. from their investment, but others have derived very little.

Senator Guthrie - The exceptions prove the rule.

Senator Lt Colonel Sir ALBERT GOULD - 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.

Senator Guthrie - The honorable senator's side say that they do not want justice, but to wreck the Bill.

Senator Lt Colonel ' Sir ALBERT GOULD .- 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.

Senator Stewart - It is like the bottomless pit !

Senator Lt Colonel Sir ALBERT GOULD - 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.

Senator Guthrie - No.

Senator Barker - We are quite aware of what we are doing.

Senator Lt Colonel Sir ALBERT GOULD - 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.

Senator Mcdougall - There will not be many who will break away from the honorable senator's side either.

Senator Lt Colonel Sir ALBERT GOULD - 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.

Senator Pearce - What was the Opposition caucus about to-day ?

Senator Lt Colonel Sir ALBERT GOULD - 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.

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