House of Representatives
15 December 1914

6^th Parliament · 1^st Session

QUESTION
- FODDER DUTIES
QUESTION
- THE MORRIS BEEF COMPANY
QUESTION
- PRICE OF WHEAT
NEW TELEPHONE RATES
QUESTION
- DELIVERY OF TELEGRAMS
QUESTION
- PILLAR-BOX PILFERING
QUESTION
- LIGHTHOUSES
QUESTION
- HORSES: BROADMEADOWS CAMP
QUESTION
- FEDERAL CAPITAL DESIGNS
QUESTION
- MEAT INDUSTRY
QUESTION
- DEFENCE DEPARTMENT
QUESTION
- POSTAL WORKS
QUESTION
- NORTHERN TERRITORY
QUESTION
- RIOT AT BROOME
QUESTION
- TEMPORARY EMPLOYEES HOLIDAYS
QUESTION
- SAILING TIME OF ORIENT STEAMERS FROM FREMANTLE
QUESTION
- EXPEDITIONARY FORCES
QUESTION
- FEDERAL CAPITAL WATER SUPPLY
QUESTION
- PAY OF COOKS AT PORTSEA CAMP
WAR PENSIONS BILL
- Second Reading
LAND TAX ASSESSMENT BILL
- Second Reading
INVALID AND OLD-AGE
ASSENT TO BILLS
ESTATE DUTY BILL
- Second Reading
ESTATE DUTY ASSESSMENT BILL
LAND TAX BILL
SPECIAL ADJOURNMENT
ADJOURNMENT
- Order of Business

page 1891

QUESTION

MEAT INDUSTRY

Mr SHARPE:

– Did. the Minister of Trade and Customs notice in yesterday morning’s newspapers a report that a conference of New South Wales cattlemen seemed to deplore the fact that so many heifers and calves are being slaughtered, and to suggest that it is likely to deplete the meat supply of Australia?

Mr TUDOR:
ALP

– I did not see the report, but I do not see what the Department can do in the matter. I do not know that we can stop people from doing whatthey like with their property. I presume that, as the cattlemen are taking up the subject seriously, some step will be taken. The matter is of interest to all of us, and if anything can be done it should be done as soon as possible.

Mr SHARPE:

– Is the Minister of Trade and Customs aware that a large percentage of the cows supplied to the meat works on the Brisbane River are heavy in calf, and that many of them have been turned out of the slaughter yard, and have calved within 24 hours ?

Mr TUDOR:

– No; but I will have inquiries made, because I think that under the Commerce Act we’ can prohibit the carcasses of such cattle from being shipped.

Mr MASSY-GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

QUESTION

POSTAL WORKS

Mr SINCLAIR:
MORETON, QUEENSLAND

– Will the PostmasterGeneral state whether he has issued instructions to the Deputy PostmasterGeneral to cut out all works possible in connexion with the Postal Department during the present crisis?

Mr SPENCE:
ALP

– I do not know but that some such order was issued by my predecessor, but an instruction of that kind would be quite contrary to the policy of this Government. We are proceeding with all the works that it is possible to carry on.

Mr MASSY-GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– I should like to ask the Postmaster-General if he proposes to proceed with the construction of all the telephone lines that have been approved by his Department during the coming financial year? Is there any reason for their being delayed ?

Mr SPENCE:

– We are proceeding with the whole of the work that has been passed as rapidly as possible.

page 1893

– A question relating to the pastoral’ development of the Northern Territory is, I think, one of so much importance, that it should be given notice of.

page 1894

QUESTION

RIOT AT BROOME

Position of Pearl Shellers

Mr BAMFORD:

– Has the attention of the Minister of ‘External Affairs been directed to a paragraph in yesterday morning’s newspapers to the effect that riots have occurred among the pearling population of Broome, and stating further that, owing to financial stringency, the pearlers would be unable to return to the islands, or other places from which they came, many of the natives employed in the industry? Does the Minister know anything of the matter; and, if the statement is true, does the Department intend to deport these men at the expense of the Government ?

Mr MAHON:
ALP

– The newspaper reports in question have been confirmed by a telegram received by the Prime Minister from the Premier of Western Australia. Trouble has arisen at Broome, but the local authorities have been able to cope with it. As to the second portion of the honorable member’s question, it is doubtless convenient to convey the impression that the pearlers are without funds necessary to return these men to their homes in the distant islands. The pearlers, however, are under an obligation to return them, and we shall exhaust every means to compel them to discharge that obligation before considering the deportation of any of these natives at the expense of the Government.

page 1894

QUESTION

TEMPORARY EMPLOYEES HOLIDAYS

Mr FENTON:
MARIBYRNONG, VICTORIA

– Some misapprehension has arisen from the reply given yesterday by the Prime Minister to a question put to him by the honorable member for Brisbane. I wish to know whether the Prime Minister, in referring to workers in the various Government factories who have been denied payment for working during the Christmas holidays, intended also to include temporary employes in the Public-

Service, such as telephone linemen, who, under an award of the Arbitration Court, have certain holidays allotted to them?

Mr FISHER:
Prime Minister · WIDE BAY, QUEENSLAND · ALP

– My reply had reference to a special concession of holidays that I made when I last held office as Prime Minister. That concession was accepted; but those who remained on duty demanded double time in respect of the arrangement. All other holidays will be granted as usual.

page 1894

QUESTION

SAILING TIME OF ORIENT STEAMERS FROM FREMANTLE

Sir JOHN FORREST:

asked the PostmasterGeneral, upon notice -

Whetherhe will again bring under the notice of the Orient Steam Navigation Company, who are under contract with the Government, the great advantage it would be to the travelling public and to the people of Perth and Fremantle if, as far as is possible, they will arrange for their ships going and coming from Europe not to leave Fremantle before 4 o’clock on the afternoon of the day of sailing?
Whether he will also again bring the matter under the notice of the Peninsular and Oriental Company, through the Imperial Government?
Whether he will point out that, as a generalrule, these ships do not leave Fremantle till 4 p.m., and that while they would be affording a great convenience to the travelling public and the people of Western Australia the companies would not really be incurring any disability for themselves?

Mr SPENCE:
ALP

– The answer to the first two questions of the honorable member is “Yes.” In regard to No. 3, I shall draw attention to the representations which have been made by him on these points.

page 1894

QUESTION

EXPEDITIONARY FORCES

Purchase of Horses in Queensland - Brigade-Major, 9th Light Horse Regiment - Donations to Red Cross League.

Mr FINLAYSON:
BRISBANE, QUEENSLAND

asked the Assistant Minister, representing the Minister of Defence, upon notice -

How many horses were purchased in Queensland for the First Expeditionary Force -
1. by the Department direct,
2. by private firms?
What are the names of those firms?
How many horses did each firm supply?
What was the price per head paid them?
What was the price paid per head for horses purchased by the Department direct?
How many horses were presented by firms and individuals?
Wove the departmental officers limited to a maximum price in their purchases?
Is it a fact that the private firms were authorized to purchase horses without any limitation as to price?
Is it a fact thatall horses purchased by the departmental officershad to pass a veterinary examination?
Is it a fact that the departmental officers were instructed to accept horses supplied by private firms without veterinary examination?
How many horses were rejected as unfit of those (a) supplied by each firm, (b) presented ?
How were those rejects disposed of, and at what price?
Will the Minister table a return giving answers to above questions applying to the whole of the Commonwealth?

Mr JENSEN:
ALP

– The answers to the honorable member’s questions are as follow: -

Total number of horses purchased in Queensland for the First Australian Imperial Force was 1,020, of which 764 were obtained by the Department by direct purchase, and 250 were purchased by private firms. 2 and 3. The firms referred to, and number of horses purchased by each, are as follows: -

Dalgety and Company,, 92 horses; New Zealand Loan and Mercantile Agency Company, 140 horses; Australian Mercantile Land and Finance Company, 24 horses.

The average price per head paid for horses purchased by private firms was: - Dalgety and Company, £16 9s.1d.; New Zealand Loan and Mercantile Agency Company, £191s.; Australian Mercantile Land and Finance Company, £18 13s. 4d.
The average price paid for horses purchased direct by the Department was £16 7s. per head.
Firms and individuals in Queensland presented 984 horses.
Yes; the Department’s officers were limited to a maximum price for each class of horse.
No; private firms were under the same limitations as regards price as the Department’s officers.
Yes; the system of purchasing adopted by the Department is for a Purchasing and Veterinary Officer to work together.
Yes; owing to horses being so urgently required at the outbreak of the war, orders for horses were placed with firms, and horses purchased under these orders were accepted without veterinaryinspection.
110 horses were rejected as unfit for military service. Of these, 84 were presented, the remainder, 26, were purchased by the firms. The number of rejects purchased by each firm is not at present available, but will be furnished later.
The rejects were disposed of by public auction, and realized £4 12s. per head.
The information is now being collected from the several States.

It is desired to add that the system of purchase of horses by private firms was terminatedsome time ago.

Mr YATES:
ADELAIDE, SOUTH AUSTRALIA

asked the Assistant Minister, representing the Minister of Defence, upon notice -

Whether the Minister received from officers of the 9th Light Horse Regiment a request for a reply to the complaints made against the brigade major?
Has the decision of the Minister in regard to such complaints been communicated to the officers aggrieved?
Are the officers entitled to an inquiry under the King’s Regulations?
If so, has such inquiry been held?
If not, will he make such inquiry?

Mr JENSEN:

– The answers to the honorable member’s questions are as follow: -

Yes.
Yes.
No.
No.
No.

Mr BURNS:
ILLAWARRA, NEW SOUTH WALES

asked the Assistant Minister, representing the Minister of Defence, upon notice -

Whether his attention has been called to a report in the Herald newspaper of the 4th inst., that two members of the Expeditionary Force on duty at Rabaul had purchased two pairs of pyjamas from a local storekeeper and on opening them found in each pair a note from a Mrs. Dalton, North Sydney, and Miss Stevens, of Vaucluse, showing that the pyjamas had been donated to the Red Cross League for the men serving at the front?
Will the Minister cause an inquiry to be made to find how these articles got into the hands of traders?

Mr JENSEN:

– The answer to the honorable member’s questions is “Yes.”

page 1895

QUESTION

FEDERAL CAPITAL WATER SUPPLY

Dr MALONEY:
MELBOURNE, VICTORIA · ALP; FLP from 1931; ALP from 1936

asked the Minister of Home Affairs, upon notice -

What is the head of water from the service reservoir at Red Hill?
What is the thickness of the pipes which have been ordered for the reticulation of the Capital City of Canberra?
Are such pipes thicker than the pipes used for Melbourne and Sydney?

Mr ARCHIBALD:
ALP

– The answers to the honorable member’s questions are as follow: -

Sufficient to give 100 lbs. pressure at the site of Capitol and the Military College, and to command the surrounding suburbs. 2 and 3. None have been ordered for the reticulation of the Capital City.

page 1896

QUESTION

PAY OF COOKS AT PORTSEA CAMP

Mr BRENNAN:

asked the Assistant Minister, representing the Minister of Defence, upon notice -

Is it a fact that persons employed at Portsea, for the Australian Light Horse B squadron, were paid off at the rate of five shillings per day, while in fact they were promised eleven shillings per day; if not, at what rate were they engaged and paid?
Is it a fact that such cooks were paid for sixteen days only, while the pay-sheet showed sixteen days and two extra?
What is the usual rate of pay for cooks in camp?

Mr JENSEN:
ALP

– Inquiries are being made, and the required information will be furnished as early as possible.

page 1896

WAR PENSIONS BILL

In Committee (Consideration of GovernorGeneral’s message) :

Mr JENSEN:
Assistant Minister of Defence · Tasmania · ALP

– I move -

That it is expedient that an appropriation of revenue be made for the purposes of a Bill to provide for the grant of pensions upon the death or incapacity of members of the Defence Force of the Commonwealth and members of the Imperial Reserve Forces resident in Australia, whose death or incapacity results from their employment in connexion with warlike operations.

This is the formal motion upon which the War Pension Bill will be based. I shall reserve what I have to say on the subject until I move the second reading of the Bill. I hope that the Committee will permit this motion to pass in a formal way.

Question resolved in the affirmative.

Resolution reported and adopted.

Second Reading

Mr JENSEN:
Assistant Minister of Defence · Bass · ALP

. I move -

That this Bill be now read a second time.

– That is about the biggest percentage killed in any battle.

Mr JENSEN:

- Mr. Knibbs’ letter continues -

But pointed out that in the case of the American Civil War (1861-66) the death-rate during the whole period of the war, viz., five years and two months, was as high as 7 per cent, per annum.

In the course of an_ investigation made by them into the mortality experience of the Imperial Forces during the war in South Africa (11th October, 1899, to 31st May, 1902), Messrs. Schooling and Rusher ascertained that the death-rates per cent, per annum during the whole period, viz., two years seven months, for the various branches of the Imperial Forces were as follows, mortality from wounds and from illness being separately shown, and officers being distinguished from non-commissioned1 officers and men : -

These figures indicate markedly higher rates of mortality from wounds, and markedly lower rates from illness, amongst officers in all branches than amongst non-commissioned officers and men, the death-rates fromall causes being, however, considerably higher amongst officers than amongst non-commissioned officers and men. For the whole campaign, for all branches of service, the death-rate per cent. per annum for officers was 5.32, and for noncom missioned officers and men, 3.82.

Those were the deaths from wounds and other causes during the South African war. Dealing with total and partial incapacity, which is far greater, Mr. Knibbs writes -

Invalidity Bisk. - Statistics of war casualties other than fatalities are not available, but figures are given in McLauchlan’s paper in respect of the numbers discharged from the British Army as invalids during the period 1886-1895. The rate of impairment so obtained for troops stationed in the United Kingdom was 16.2 per 1,000, or, approximately, 3.2 invalidities to each death.

Mr Watt:

– Surely there is something wrong there ! The troops must have been on service somewhere.

Mr JENSEN:

– In the United Kingdom there were three persons totally or partially incapacitated to every one where death occurred, a fact that must be taken into account in considering a pension scheme. Mr. Knibbs continues -

In the absence of more complete data it may perhaps be permissible to assume that the number of non-fatal casualties on the present occasion will bear approximately this ratio to the fatalities. This would give an invalidity rate of, say, 11 per cent. per annum for officers, and 8 per cent. per annum for non-commissioned officers and men. On the basis of these figures the expected numbers of the Australian Expeditionary Force invalided would be as follows: -

These only relate to the 20,000 troops who have already gone.

Out of the 20,000 who have gone, we car* expect that 1,630 will be incapacitated under the law of averages; though, if our soldiers reach the seat of war and go into the firing line, we may fear that, under the new methods of warfare, the losses will be far greater. Mr. Knibbs proceeds -

It is alsonecessary to make some assumption as to the proportions of those dying who leave dependents, since the compensation is much greater in the case of those who leave dependents than of those who do not. Taking the community as a whole, probably more than half of the males of early adult age have dependents either lineal or collateral, but as the existence of dependents will exercise a restraining influence on the desire to volunteer, it may, perhaps, be sufficiently accurate to assume that of those who die one-half leave dependents.

In the case of invalidity, an assumption must; be made as to the extent of incapacitation. In the absence of information on this point it may be assumed that one-half the cases result in total incapacitation, and that the remaining half result in varying degrees of incapacitation, such that, on the average, their claim rate is; 50 per cent. of that for total incapacitation. These assumptions combined are equivalent to. assuming an average rate of 75 per cent. of total incapacitation throughout. If it be further assumed that the average full annual payment to each invalided officer is £200. and to each non-commissioned officer and man is £72, the cost pur annum in respect of invalidity will be as follows for a campaign of a year’s duration : -

On the basis of tlie data and assumptions specified in tlie foregoing sections, it may be roughly estimated, in respect of thu Australian Expeditionary Force of 20,000 officers and men, that the cost for compensation of one year’s duration will be approximately £130,000 for death benefits, and an annual payment thereafter for invalidity benefits commencing at about £103.000, and gradually diminishing as tuc pensioners die.

Under the law of averages, in the sending away of a Force of 20,000 men, the death benefits for one year of service would be £130,000, and the capitalized value of invalidity benefits would be £1,230,000, or a total of £1,360,000. That is the minimum amount which it can be said, roughly, it will cost the Commonwealth for one year’s fighting.

Mr Groom:

– What is the total demand on the revenue ?

Mr JENSEN:

– On that estimate, £130,000 for death benefits and £102,000 for invalidity pensions per annum. Mr. Knibbs goes on to say -

If the campaign extended beyond one year the amount should be proportionately increased.

From the figures given above it would appear that if it were desired to secure by initial subscription or contribution a scale of compensation such as that assumed in the present report, the amount required to be raised in respect of each officer and man would be about £GS for each year of campaign.

LAND TAX ASSESSMENT BILL

Second Reading

Mr FISHER:
Prime Minister and Treasurer · Wide Bay · ALP

– I move -

That this Bill be now read a second time.

-Would it be fair for me to do so ? This matter has nothing to do with the Land Tax Commissioner; it is the Government that takes responsibility for the proposal.

There has been considerable discussion as to how assessments will be made. In the words of the Land Tax Commissioner, this is what will happen -

The law will place on the land-owner the responsibility of stating the freehold value of his land, and4½ per cent. of this will be regarded as the economic leasehold rent. The value of this economic rent for the unexpired term of the lease will be found by appropriate tables, and the value of the rent paid to the Crown will be deducted from this economic rent value to find the value of the lease for purposes of taxation.

The memorandum continues -

It will not be incumbent upon a land-owner to make returns of any leases where the full economic rent is being paid, but if there is an under-statement of value the provision in the law relating to under-valuation of freehold land will be made to apply as far as practicable.

Mr JOSEPH COOK:

– It seems to me that this little piece of machinery will prove to be entirely inadequate so far as the whole scheme of taxation now proposed is concerned. Moreover, I think it is time that the whole machinery in the principal Act was overhauled. I have no doubt that when we meet again another amending machinery Bill will be ready for the House. Already we hear that things are not turning out as they should. I do not wonder at that, because the Government have undertaken a most difficult and delicate operation, and one, the end of which I do not pretend to foresee or appreciate properly. However, the Government say that they have mathematicians in the Departments who are setting all these things right by rule and rote. I hope that it may be the case, so far as the ascertainment of the value and the imposition of the tax are concerned. My attitude is a very simple one. I am opposed to this taxation at every point. In my judgment, nothing has occurred in connexion with the whole scheme of finance that the Government have submitted to the House which could not be rectified without the imposition of this taxation. It is wholly unnecessary, and for that reason I am opposed to it, without considering too closely the details.

Mr PATTEN:
Hume

.- I only rise to enter a protest against the whole of this legislation. It will go on record that I am opposed to these taxation proposals, “ lock, stock, and barrel.” I want to be perfectly frank and candid. I do not think that this is an opportune time for the introduction of such a measure as this; and, therefore, I intend to oppose it.

Question-That the Bill be now read a second time - put. The House divided.

AYES: 30

NOES: 21

Majority … … 9

AYES

NOES

Question so resolved in the affirmative.

Bill read a second time.

In Committee:

Clause 1 agreed to.

– Certainly not, but the means taken to secure those minerals are improvements.

Mr GLYNN:

Mr WATT:

– One honorable member opposite, who is unofficially attached to the Government - the honorable member for Gippsland - crossed the chamber and voted with the honorable member for Darling and his colleagues on this side of the House. This need not be a party question. It is one that is susceptible to a difference of opinion, but it has always appeared to me that a mistake was made - and I say this with the greatestrespect to the legislators of those days - when they embodied section 29 in the Principal Act. But with the amendments which this Bill will make I think not the weight, but certainly the area, of land taxation throughout the Common wealth will be more equitably spread.I do not wish it to be thought that, because I speak in this way, I support the land tax proposals of the Government generally. I think that their proposals to tax at this stage, and at the rates set forth by them, are burdensome and wrong, but if they are to go on they should go over the proper area, and not merely over the freehold interests hitherto taxed.

Sir WILLIAM IRVINE:
Flinders

– There are two points which deserve the attention of the AttorneyGeneral. One of them is highly technical, although very important, and the other is of a more substantial character. In the first place, the effect of this provision, introduced into the Act as it now stands, will be to make the lessees under future pastoral or agricultural leases liable to pay on the whole freehold, fee-simple value of the estate without any reduction in respect of the rental payable to the Crown. With regard to leases hereafter existing section 27 governs the position. It provides that the owner of a leasehold is to be deemed the owner of the fee-simple. He will not be able to deduct any rent payable by himself to the Crown. The section declares that -

He shall be entitled to deduct from the tax payable by him in respect of the land, an amount equal to the sum of the amounts payable in respect of the land by the owners of any freehold estate, and of any precedent leasehold estate in the land.

That does not apply. Then sub-section 3 is intended, I think, to get him out of this difficulty, but it does not do so, because it says that -

Notwithstanding anything in this section, where the owner of the fee-simple of the land is exempt under section 13 of this Act from taxation - the lessee of the land is to be taxed as if his lease were created before the Act. Then, under section 28, it would be merely an assessment of his leasehold estate. The highly technical point which the AttorneyGeneral should take into consideration is that sub-section 3 does not apply at all to these cases, because the Crown is not included under it. Where the owner of the fee-simple of the land is exempt under section 13, then the next section is to apply. But the Crown is not the owner of the fee-simple. Section 13 exempts the Crown, it is true, and most of the other exemptions are exemptions of the feesimple; but the owner is not the owner of the fee-simple until there has been created an estate known as the fee-simple. Therefore, this would not have any effect. The difficulty can be got over by a simple change of words. As it stands, the Crown is not the owner of the fee-simple, and, therefore, the actual effect would be to make all future leaseholds the subject of this tax without any reduction for the rent payable by the Crown.

Mr HUGHES:
Attorney-General · WEST SYDNEY, NEW SOUTH WALES · ALP

– Does the honorable member say that they fall under section 27> and not under section 28 ?

Sir WILLIAM IRVINE:

– Yes. I do not propose to suggest the necessary amendment, because I think the AttorneyGeneral should consult his draftsman about the matter.

Mr Hughes:

– I shall certainly look carefully into the matter, but it appears ro me that they are included under subsection 3.

Sir WILLIAM IRVINE:

– The honor-

Able gentleman means to say that the Crown is the owner of the fee-simple?

Mr Hughes:

– In that case, what is the application of sub-section 3 ?

Sir WILLIAM IRVINE:

– It does not apply to Crown leases at all. It applies, to other leases, ot it may apply to leases such as those granted for charitable purposes, or to friendly societies.

Mr Hughes:

– I wish to say that, whatever may be the effect, the intention is that the lessee shall have the benefit of the improvements.

Sir WILLIAM IRVINE:

– I have no doubt of that, and, therefore, I have drawn the Attorney-General’s attention to the matter. The other point is one of much more substantial difficulty. I shall say a word in a moment or two about tlie general policy of taxing mining leases ; but, assuming that we are going to do so, I suggest that the proviso should read in this way -

Provided that in the assessment of the unimproved value of any lease the value of any metals or mineral”! reserved to the Grown shall he excluded.

Without reading the whole of section 28 in its technical terms, I may say that .its effect with regard to leases, before the coming into operation of the Act, and in regard to existing leases, is to direct the Commissioner to assess the value of a leasehold estate, by imposing on the lessee the obligation of being the feesimple holder, and allowing certain deductions. The section then goes on to say in sub-section 3a -

For the purposes of this section -
1. The unimproved value of a lease or leasehold estate of land means the amount by which the part of the unimproved value of the land corresponding to the unexpired term of the lease exceeds the value of the rent reserved by the lease, according to calculations based on the prescribed tables for the calculation of values.

– You mean that if mines are taxed they should be taxed in a different way.

Sir WILLIAM IRVINE:

– That is my view. But at the same time I think that the taxation of mining propositions, at the present juncture, would be imprudent. We are not really taxing a monopoly. The State makes a rough estimate of the royalty or rent it gets based on the probabilities of successful mining for precious metals, and our .taxation would be imposing a handicap on an industry which, being purely speculative, would bie very liable to be affected in the extent of “its operations by any additional burden we throw upon it. I do not hold very strong views on the matter, but I make the distinction between the two things, and I think that we should be careful before imposing any additional burden on the mining industry.

Mr FENTON:
Maribyrnong

.- I do not intend to extend the debate, but I think that the following particulars dealing with the methods of valuation carried out in New Zealand under a similar Act to our measure should help us in considering this question: -

Valuation of mineral bearing lands. - Laud containing or supposed to contain oil, coal, or other mineral deposits is valued as for the surface use only, and is of the same unimproved value as similar lami in the neighbourhood, always without any regard to speculative mineral value, until the oil or minerals are produced, when the profits (if any) will be duly valued.

In cases of coal-mines, valuers are required to value the surface of the land and the improvements effected both above and below the surface, and enter these values in their fieldbooks. The additional data relating to rent, royalty, output, yearly profits, and the separate interests of lessor and lessee, &c, are ascertained by the Valuer-General.

Mr Watt:

– Apparently the profits are taxed in New Zealand.

Mr FENTON:

– It seems to me to be a tax on the profits made by mining companies. We could adopt the same system. No great injustice would be done by taxing mining leaseholds that are profitable ventures.

Mr Atkinson:

– They now pay a dividend duty to the States.

Mr FENTON:

– If the contention of the honorable member for Flinders is correct, that the clause, as drafted by the Attorney-General, provides that a man who takes up a pastoral lease is to have the value of the lease calculated on the speculative mineral value, in my opinion it is absurd. I do not know how any valuator can arrive at the speculative value of any minerals that may be contained in a pastoral lease. But if the view taken by the honorable member for Flinders is correct, the clause should be amended.

Mr RODGERS:
WANNON, VICTORIA · LP; NAT from 1917

.- I wish to draw the attention of the AttorneyGeneral to section 33 of the principal Act, which reads -

Any person in whom land is vested as a trustee shall be assessed and liable in respect of land tax as if lie were beneficially entitled to the land : Provided that where he is the owner of different lands in severalty, in trust for different beneficial owners who are not for any reason liable to be jointly assessed, the tax so payable by him shall be separately assessed in respect of each of those lands :

Provided, also, that when a trustee is also the beneficial owner of other land, he shall be separately assessed for that land, and for the land of which he is a trustee, unless for any reason he is liable to be jointly assessed independently of this section.

Death by accident or ill-fortune may suddenly place the widow and’ children of a taxpayer who has died intestate in a position of extreme disadvantage. Where there can be clearly no intention of defrauding the revenue, the section should be given a wider scope. Relief is granted where an estate is vested in a trustee in severalty, even though not actually parcelled out, but is still held in trust; but in more than one case the Court has determined, in the case of intestacy, that the best interests of the widow and children would be served by carrying on an estate as one estate, instead of realization. I do not propose to debate the main principle of leaseholds, except to say that the view which has appealed to me in connexion with the broader principle of taxation of State leaseholds is that the State has reserved certain lands to itself ; and the leaseholders of those lands have been tenants and caretakers, exercising police authority over those estates. In some instances the letting of these lands at low rentals is something in the nature df a reward for police services performed ; but arbitrary conditions in respect of vermin and preservation are very often imposed, which are a factor in determining the leasehold value. If the Federal authority comes in and taxes those interests, the people will not take the same responsibility on the land as caretakers as they have done previously.

Mr HUGHES:
AttorneyGeneral · West Sydney · ALP

.- Admittedly, the issues raised by this Bill are complex. On the other hand, it has been received in a most unusual spirit. I think it is the first measure of taxation in regard to which there has been such a happy disposition of members, so that we seem to have arrived at the golden age, in which party is forgotten, and each man speaks out of the conviction that is within him. I fear, however, that there are certain reservations in the minds of honorable members which leave us very much as we were in all essentials. I wish to reply very shortly to the honorable member for Wannon, who raised a most important question in regard to the position of beneficiaries in trust estates. I quite admit that there may be cases in which hardship will arise, or has arisen. Where a great estate has been cut up into such relatively small parts that the interest accruing to each beneficiary is in itself so small as to be fairly entitled to come under, the lowest rate of tax, it frequently happens that, owing to the manner of assessment, the estate is assessed at the higher rate. The question is a difficult one. We must not open the gates too widely; but when- the House meets again an amendment of the Land Tax Assessment Act will be introduced making certain necessary improvements in the machinery, and I promise the honorable member tit at in tha- interim th& matter he has raised will be carefully looked into. If possible, the Government will introduce such an amendment as he suggests, or, at any rate, the honorable member will be given an opportunity of introducing an amendment.

The honorable and learned member for Flinders has invited the attention of the Committee to certain highly technical and extremely interesting points. I can best serve the purposes of the Committee and of myself by stating at once that these matters will be most carefully looked into. But I am of opinion that the honorable gentleman’s contentions in regard to section 27, and the nonapplication of sub-section 3 of that section to lessees under the> Crown,, must fail. At the same time, the suggestion which he has been good enough to make to me, that wo should amend sub-section 3 by inserting after the words “ where the “ the words “ Crown or,” so as to remedy any ambiguity in the term of “ ownership,” which might exclude the Crown, will be looked into carefully, and, if the position be as “the honorable gentleman has stated, an amendment will be proposed in another place. In regard to the other point, _as to how far the definition of unimproved value covers, or ought to cover, mineral rights, I say no more than that the term “ unimproved value “ is one which is already well settled. It has been current in the economic world for half a century. If anything is well known and definite in meaning, what is connoted by the term “unimproved value” surely is.

– Oh, no. The right honorable gentleman would be happy in hell. The writer says -

The new proposal provides that, commencing with a tax of Id. and l-15,000th part of Id., where the taxable value is £1, the rate shall increase “ uniformly with each increase of £1 sterling of the taxable value by l-15,000th part of Id.” This looks like the same thing expressed in other language, hut the difference is more than that between Tweedledum and Tweedledee - it is radical. In this new scheme, instead of each additional £1 alone canning an increased tax of l-15,000th part of Id., the presence of that additional £1 throws an additional l-15,000th part of Id. on each and every preceding £1.

That statement is absolutely incorrect, however simple and conclusive it may appear to the gentleman who penned it. It contains two quite inaccurate assertions. In the first place, the existing tax does not proceed by l-15,000ths of Id., but by l-30,000ths of Id., and the increments under the proposed tax will not affect each preceding £1.

It has been pointed out, however, that on £75,000 the increment of tax, calculated by the proposed formula, would be lid. upon the last pound of £75,000. This was not intended. I therefore propose to alter the formula, substituting l-18,750th of Id. for l-15,000th, which will make the increment of tax exactly 9d. in the £1 at that point.

Honorable members have spoken of the tax as confiscatory - a hard expression, which should not be used unless it can be based on solid fact. But no attempt has been made to support this charge by recourse to the facts. The actual effect of our proposal can be best seen in the examples set out in the following table : -

– Admittedly. To be taxable, it must be a lease for more than one year. For instance, a permissive occupancy would not be taxable. The clause, when amended, will read as follows: -

Notwithstanding anything in the last two preceding sections, the owner of a leasehold estate under the laws of a State relating to the alienation or occupation of Crown lands or relating to mining(not being a perpetual lease or a lease with a right of purchase or a lease of land to be used for pastoral, grazing or cultivation purposes or a homestead lease or a mining lease) shall not be liable to assessment or taxation in respect of the estate, and the owner of a leasehold estate under any such lease for a term not greater than one year certain shall not be so liable. . . .

Mr Groom:

– What about the proviso?

Mr HUGHES:

– That proviso will stand, and will be practically a direction to the Commissioner as to how he is to ascertain the value.

The honorable member for Flinders suggested an amendment so that the reservation of mineral rights to the Crown would apply to all leases, and not to mining leases alone. I shall look into that suggestion, and see if it can be adopted. I desire only to say, in conclusion, that the principles embodied in the principal Act have been in no way altered by this Bill. The rate of tax has been increased, but the method of taxation is unaltered. It does not, as alleged, go back over the whole of the estate any more than it did before. The effect is to increase the rate on each particular £1 of taxable value from £5,001 to £75,000, from which point a flat rate of 9d. in the £1 is being imposed, instead of 6d. in the £1 as before. I have already given concrete examples of the effect of this tax. As for the equity of taxing leaseholds, it is generally admitted that the principle of taxing the difference between the rent paid and the economic rent is a fair one. It is contended, however, that it will be difficult of application. Whilst I do not deny that, I hold that in practice many of these difficulties will disappear. Very many leases, for example, will in the very nature of things be outside the scope of this measure. In the first place, all leases the unimproved value of which is less than £5,000 will be outside the scope of the Bill. If we are to accept the statements of honorable members opposite as indicating the value of leases generally, very few will come within the scope of this measure. It follows, therefore, that, if their own arguments be sustained, this tax will affect very few. Those to whom it will apply will be very large lessees, who have a very valuable estate, which is, to all intents and purposes, a freehold. The difference between freehold and leasehold is largely a question of degree. Some leaseholds are as valuable as freeholds. And, certainly, there is no real and substantial difference so far as the right of the community to tax them is concerned. I trust that the Committee will agree to these proposals, and will allow me, in due course, to submit the necessary amendments.

Mr JOSEPH COOK:
Parramatta

– I have listened to the AttorneyGeneral’s very interesting speech, and desire now to put before the Committee one or two considerations. It appears to me that the honorable gentleman has indicated only some of the difficulties that are likely to crop up in the application of this principle under the machinery provided for by the Bill. The only comforting assurance we have had from him is that he proposes to review the entire machinery by the time that we meet again. The honorable gentleman says that the only difference being made is one of assessment; but the machinery which is provided for one form of taxation may be oppressive and quite inadequate when applied to another form.

Mr Poynton:

– When applied to another kind of title.

Mr JOSEPH COOK:

– That is so. Machinery that might be well enough in its way when applied to freehold might be altogether inapplicable to the taxation of leaseholds.

One difficulty that I foresee is that the Government, all through, are setting up two valuators in respect of the same piece of land. If the Attorney-General has ever known two different authorities to agree upon the same tax, he has met with a great rarity. There begins the difficulty. It is a difficulty connected with the ego, with human nature, and which leads to all sorts of inequalities. Under our present method of taxing, valuing, and leasing, it is rarely that we find two men agreeing as to the valuation of a piece of land. In our case, however, we shall be “top dog.” What we say will be law.

Mr Hughes:

– No. Lessees will have the same right of appeal.

Mr JOSEPH COOK:

– The honorable gentleman knows that this very right of appeal is one of the greatest grievances of the present day. There are men who do not know what they will ultimately have to pay, and who cannot get their appeals dealt with. They have paid, but the question of what they should properly pay has not been settled, and they cannot obtain a settlement.

Mr Hughes:

– Then all I can say is that they should get a settlement.

Mr JOSEPH COOK:

– I did not gather from the AttorneyGeneral what he proposed to do in the matter of taxing mining leases. There are in Western Australia certain timber leases which run for periods of from fourteen years to twenty years, and pay a certain rental, but .are not re-appraised. These timber leases give great employment, encourage the settlement of country, and open up avenues of trade, and the State thinks that it gets its value out of them in that way. In the case of pastoral leases in Western Australia, many of them have fourteen years to run, and at the end of that period the leases are terminated subject to payment for improvements. The timber leases simply permit the lessees to take off the timber. There is no right to the soil. To propose to alter the Bill at the present stage would be of no avail, and would be inconvenient, but I ask the AttorneyGeneral to consider what effect this legislation will have on timber leases, pastoral leases, and mining leases. To tax them heavily would be a serious matter, because in many instances the leaseholders do not pay dividends, and where they do they have to pay a State dividend tax. Of course I disapprove of the whole principle of taxing these leaseholds, but T. merely ask the Attorney-General now to make a note of this matter.

Mr HUGHES:
AttorneyGeneral · West Sydney · ALP

– I shall certainly note the matter. I can assure honorable members that this taxation will prove exceedingly complex and difficult. The Government have no intention of hampering lessees, retarding development, or preventing the carrying out of the policy of opening up lands and settling people on them now being pursued by the States. In three or four months we shall have our knowledge widened by the experience gained by the

Commissioner in attempting the valuation of leases, and whatever may be the result of that experience, honorable members will have the benefit of it. It will then be open for Parliament to consider how far certain classes of leases should be exempted altogether from the operation of this proposal.

Mr Fleming:

– Will you consider coal leases at the same time?

Mr HUGHES:

– Yes. The Bill as it stands proposes certain amendments which are categorically set out in paragraphs a, b, and c. I propose to omit these paragraphs with a view to inserting the same amendment in a different form. Thus section 29 of the Act will be amended in a direct way instead of as set out in the Bill. I move the following amendment -

That all the words after the word “ amended,” line 2, be left out with a view to inserting in lieu thereof the words - “ by omitting all words after the words perpetual lease ‘ and inserting in their stead the words - or a lease with a right of purchase or a lease of land to bc used for pastoral, grazing, or cultivation purposes or a homestead lease or a mining lease, shall not be liable to assessment or taxation in respect of the estate, and the owner of a leasehold estate under any such laws - for a term not greater than one year certain shall not be so liable.

Provided that in the assessment of the unimproved value of a lease the value of any metals, or minerals, or other rights reserved to the Crown shall be excluded.’ “

Mr ATKINSON:
Wilmot

.- The Attorney-General has said that when the House meets next year he will introduce another Assessment Bill. I ask him whether he will add certain words to the definition of “ absentee “ which will remit the tax on land purchased by people who are not able to come to Australia for twelve months or perhaps two years. These people should not be treated as absentees. They have bought the land here, and if they were actually present in the Commonwealth they would not have to pay any tax, because they would be covered by the exemption. The Treasurer, when speaking last night, regarded my suggestion favorably. We should not treat these would-be settlers in a hostile way by imposing this taxation upon their holdings. The revenue we gain by doing so is practically nothing, and the imposition of a tax in this way might cause us to lose settlers.

Mr Hughes:

– I shall certainly do as the honorable member suggests.

Amendment agreed to.

Sir JOHN FORREST:
Swan

.- I am very much opposed to this clause, because it is the crux of this new legislation for the taxation of leaseholds. I hope that, during the recess, the Government will give the matter further consideration, in order to see whether this tax, which comes at a most inopportune time, cannot be modified, if not entirely obviated. I shall vote against the clause.

Question - That the clause (2), as amended, stand part of the Bill - put.

The Committee divided.

AYES: 28

NOES: 19

Majority … … 9

AYES

NOES

Question so resolved in the affirmative.

Clause, as amended, agreed to.

Clause 3 agreed to.

Mr MASSY-GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

.- I move that the following new clause be added to the Bill - 2a. Sub-section (1) of section 44 of the Land Tax Assessment Act 1910-12 is hereby amended by inserting after the words “ District Court of a State “ the words “ or in cases where the assessment made by the Commissioner is less than £10,000 a stipendiary or police or special magistrate.”

Section, proposed to be amended - 44 (1) Any taxpayer or person may within the prescribed time appeal to the High Court in its original jurisdiction, the Supreme Court, or a County or a District Court of a State, or such other Court as is specified in that behalf by proclamation, against any assessment by the Commissioner with respect to his land, on the ground that he is not liable for the tax or any part thereof, or that the assessment is excessive. . . .

I desire to show the necessity for some immediate alteration in the machinery which the Act provides for hearing appeals. On pages 32 to 34 of the annual report of the Land Tax Commissioner, it is shown that there are 14,870 persons who pay this tax. Of that total, 11,530 assessments are below £10,000 in value. In other words, there are only 3,340 assessments above £10,000. On page 13, the Commissioner states that there were pending or unsettled at the time at which the report was made, 1,027 appeals, only four of which had been put down for hearing. That shows that the machinery provided for appeals has hopelessly broken down.

Mr Hughes:

– Does the honorable member refer to appeals which are bond fide pending?

Mr MASSY-GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– The Commissioner gives in columns the number of appeals withdrawn, pending, settled, and set down for hearing, and of 1,027 pending, only four were set down for hearing. By reference to pages 33 and 34 of his report it will be seen that fully 80 per cent. of the assessments affect estates of an unimproved value of £10,000 or less, and the presumption, therefore, is that there is a similar percentage of the appeals pending, and in which a sum not exceeding £35 is involved. In many cases the amount involved would be only £3 or £4, or less. At the present time it is impossible for a taxpayer to get an appeal heard, however small the sum involved, without incurring great expense. In one instance which came under my notice, a land-holder whose tax came to £28 a year brought the matter before the Court, and, losing his case, had to pay £800 in costs. I think that in that case the Court arrived at its valuation in a manner which was wrong, but the result is that, although there are many taxpayers in the district who consider that they are suffering grievous injustice, not one of them dare appeal to the Court for a remedy. No doubt, when the Act was passed, it was thought that the appeals would concern only very large estates, and in the first place all appeals had to be made to the High Court. As a matter of fact, however, the sum involved in a great, many instances must be very small. Much larger sums are often involved in municipal and shire valuations, but appeals in regard to such valuations can be heard by police or stipendiary magistrates, and the same provision might well be extended to appeals in regard to. the Commonwealth land tax. When a man is suffering an injustice facilities should be provided for an appeal to a Court without incurring enormous expense. I hope, therefore, that the Minister will accept the amendment. I have not endeavoured to provide lor an altogether different kind of Court. The Commissioner of -Land Tax suggests arbitration, but where small sums are involved it would be cheaper to have appeals dealt with by police or stipendiary magistrates than to go to the cost of appointing arbitrators.

Mr HUGHES:
AttorneyGeneral · West Sydney · ALP

– Obviously, on the representations put forward by the honorable member for Richmond, the Act needs amendment, and, assuming the case to be as he. has said, I agree with him that greater facilities for appeal should be given to the taxpayers. That the sums involved are often small is not to tlie point; the taxpayers have a right to speedy justice. Still, I ask the honorable member not to press the amendment. I shall discuss the matter with the Land Tax Commissioner, and if I find that the facts are as the honorable member has represented them to be, or in any degree approaching it, an amendment of the Act will be proposed in due course to provide greater facilities for appeal. I do not know yet whether stipendiary or police magistrates should be appointed to hear appeals, but if, as the honorable member for Richmond has said, appeals from valuations under Local Government Acts are heard hy those magistrates, there seems no reason why appeals from valuations under this Act should not also go before them. When the House meets again, and the Amending Assessment Bill is introduced, a clause will be drafted to deal with this matter.

Mr P P Abbott:

– Will the Bill be introduced this session 1

Mr HUGHES:

– Yes; when the House meets again. I am at one with the Committee in thinking that wider facilities for appeal should be given to taxpayers, but I do not pledge myself to the adoption of any particular Court for the hearing of them.

Mr MASSY-GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

.- If the Attorney-General will say “cheaper and wider facilities “ I shall not press my amendment. He must admit that it is not right that an appeal regarding a tax of £28 should involve the taxpayer in costs amounting to £800. I ask the honorable gentleman to consider the advisability of cheapening appeals.

Mr Hughes:

– The procedure ought to be speedy, and it ought to be cheap.

Mr MASSY-GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– Yes; now it is neither. The Commissioner himself complains of the great number of appeals pending with which it is impossible to deal. All honorable members know the trouble of getting appeals heard. I was successful in consequence of representations made to me by gentlemen in my electorate in getting a Court appointed, but they have been very sorry about it since. I hope that something will be done to cheapen and facilitate appeals, and as the Minister has promised to consider the possibility of that, I ask leave to withdraw my amendment.

Proposed new clause, by leave, withdrawn.

Mr P P ABBOTT:
New England

– I move -

That the following new clause be inserted : -

Section 44 of the Land Tax Assessment Act 1910-1912 is amended by adding at the end thereof the following sub-section : -

The owner of pastoral or agricultural lands may notify the Commissioner, within the time and manner provided for appeals that he desires the appeal shall be heard by arbitration, and thereupon the appeal shall be settled by arbitration in accordance with the laws relating to arbitration of the State in which the laud is situated.

I am led to submit this proposal for the reason that in each of the several appeals that have been heard in the different States the learned Judges have practically expressed the one opinion that the present procedure is too costly and too tardy a way of securing satisfaction. I “would refer the Attorney-General to the last report issued by the Commissioner of Land Tax- that for 1912-13- where, at page 12, will be found the following extract from a judgment given by Mr. Justice Ferguson, in New South Wales, in the case of MacDonald v. The Deputy Federal Com mi si oner of Land Tax, New South Wales, as follows: -

Coming to the question of the value of the lands comprised in these areas, I amconfronted with the usual wide and irreconcilable divergences of opinion amongst the expert witnesses. I think it is very much to be regretted that the Court in cases of this kind has not the assistance of assessors or independent expert advice.In the absence of such assistance. I must decide asbest I can on the conflicting evidence forming my own judgment as to the justness of the inference which the several witnesses have drawn from the specific transactions upon which they base their opinions. I have not, of course, the advantage of their wide general knowledge of values, and of the many circumstances which cannot be given in evidence, but upon which knowledge of value is largely based.

Then Mr. McKay comments -

The dilemma in which the learned Judge found himself illustrates the position of every purely legal tribunal which, under the Commonwealth law. is compelled to adjudicate in eases of appeal. later in his report he says -

Experience has shown that the present methods of dealing with appeals against valuations are costly to litigants, attended with inordinate delay, and sometimes result in decisions of doubtful accuracy. Even when a case reaches the stage of hearing, the legal methods of procedure do not commend themselves as in anyway practical or reasonable.

He says further -

Representations have already been made to the Government in this connexion.

This report was published on the 26th June last. The Attorney-General and his Department have been approached by Mr. McKay, who has pointed out the injustice under which taxpayers are labouring; but from June last to the present time the Government, although they are now amending the principal Act, have taken no steps to remove this serious cause of complaint. In New South Wales alone. 718 land tax assessment objections are pending. I think I am well within the mark in saying that not half-a-dozen cases have been dealt with in that State. What chance, then, have land-owners who, in accordance with the demands made by the Commissioner, lodged their extra assessments, amounting, in some instances, to several hundreds of pounds, to secure the determination of their appeals ? Some of these cases have been pending eighteen months, and during all that time landowners have been deprived of the use of this money. No step has been taken by the Crown to set the appeals down for hearing. What possibility is there of their being dealt with, and justice obtained, within an early date? Honorable members opposite have always advocated the principle of conciliation and arbitration. Apart altogether from industrial arbitration, we have in the Telephones Lines Purchase Act provision for the settlement of claims according to the arbitration laws in force in the different States.

Mr Archibald:

– That principle has not worked out very well.

Mr P P ABBOTT:

– Surely my honorable friend is not going to say that, for that reason, conciliation and arbitration should go by the board. If the Labour party are consistent in their advocacy of the principle, then they must vote for my proposed new clause, which will enable the people concerned to secure justice in a speedier and cheaper way than is now possible. Instead of having the subjectmatter of their appeal inquired into by a Court of law sitting in a city where witnesses have to be brought from a considerable distance, at heavy expense, and where the Court sits for only five hours a day, we should have, under my proposal, a ready means of settlement. Mr. Justice Ferguson has said that he would like the assistance of assessors to guide him and to render it unnecessary for him to take a little off the Crown value and to slightly increase the valuation of the appellant with the object of arriving in that way at an assessment. What speedier way could be devised in dealing with an appeal than that proposed by me, that the Crown should appoint an arbitrator, and that another should be appointed by the appellant, both being practical men, and that they ‘should °meet on the ground, bring their expert knowledge to bear, and decide upon a proper assessment? It would be unnecessary for their expert knowledge to be conveyed, as at present, through a conduit pipe into the mind of a learned Judge in order that he might come to a decision. They would meet on the ground, and, having made an inspection, would say to the appellant, “ John Brown, your tax is so much and you must pay it.” If there was any difference of opinion between them they would call in a third party, and his decision would be final. Having had considerable experience of valuations and of resumption inquiries, I say, with- all respect to the honorable member for Richmond, that my proposal is better than that advocated by him, although I recognise ,lab in eases where the tax does not exceed £40 or £50 police magistrates should have power to deal with them, and that if it were adopted an end would be put to the heartburnings prevalent amongst land-owners to-day. I press the Attorney-General to say whether there is in this proposed new clause anything opposed to the principles which he advocates, or to the contention of the Commissioner. If the Government believe in the principle of conciliation and arbitration, then what better or speedier method can they suggest for dealing with the appeals which are now pending? I ask the Attorney-General to consider this proposal apart from party politics. If it be accepted, I am satisfied that many of the present-day troubles of the Land Tax Department will be cleared away, and that pending appeals will be settled at a very early date.

Mr HUGHES:
AttorneyGeneral · West Sydney · ALP

– The honorable member’ is in effect putting forward an alternative method to that which the honorable member for Richmond proposed to extend. Without committing myself in any way to the principle which the honorable member desires the Committee to adopt, I promise that I will look carefully into the matter, and see to what extent the principle of arbitration can be usefully adopted in this connexion. More than that I cannot say. At the present time I am not disposed, nor should I be asked, to accept the proposed new clause. It is our intention, as I have already said, to bring in a comprehensive Bill to remedy a great many weaknesses which experience has exposed in the law as it stands. This- matter will be looked at. The principle of arbitration is, of course, not new, and there is no material reason why it should not be applied to this particular case, if it is found, on examination, to be expeditious and cheap, and a substantial improvement on the existing method of determining appeals. I ask the honorable member not to press the matter at this stage.

Sir WILLIAM IRVINE:
Flinders

– After the statement made by the Attorney-General. I do not think there is much to be gained by the honorable member pressing his amendment. Having regard to the consideration which the Attorney-General has promised to give to the whole subject, I should like tomake a suggestion. We all deplore the absolute impracticability of appeals in matters of this kind, and the immense expenditure incurred; but I cannot help thinking that both the proposals which have been made this afternoon would involve, if not quite as great expense, at least expense of a kind which ought not to occur. The greatest expense in connexion with any form of appeal, no matter what the tribunal may be - whether it be a High Court Justice, a District Court Judge, a police magistrate, or arbitrates - is that relating to the presentation of evidence, to the calling of witnesses, and the whole procedure of what is practically a judicial tribunal. I would suggest to the Attorney-General that, instead of the appointment of arbitrators, whose function it would be to hear evidence and to decide upon it, he should consider the practicability of enabling the taxpayer concerned 0 to appoint a valuer and the Crown to appoint another, subject to the condition that if they could not agree upon a valuation an umpire should be appointed. A great improvement would thus be effected in the present system. The essential difference is that under such a system we should get rid of the judicial procedure of calling witnesses, and so forth; and that we should have thrown upon these indepen- dent persons, as experts, the obligation of arriving at their own values. If they could not agree upon the valuation to be placed upon the property, it would be for the umpire to make a settlement. The only way in which it is possible to avoid the great expense attendant upon any formal appeal is to do away with what is called the judicial procedure of these appeals, and to try to substitute for it some mode by which the parties could have independent valuations made and be made to abide by the result.

Mr BRENNAN:
Batman

.-I do not know whether the honorable member for New England realizes the fact that there is more than one system of arbitration in the several States. My own experience is that legal or judicial determinations by arbitration are not greatly less expensive, but very often more expensive, than judicial proceedings by way of appeal. I confess I have a good deal of sympathy with the view put by the honorable member for Richmond. My belief is that the solution of the difficulty will ultimately be found in the appointment of special magistrates.

Mr Archibald:

– With all the expense of working up cases and summoning witnesses !

Mr BRENNAN:

– There will certainly be expense in the way of witnesses, but those who are accustomed to the hearing of cases before police and special magistrates will admit that they are expert and expeditious, as well as conscientious. We shall not, however, be able to constantly unload, by means of our Federal legislation, work on the State stipendiary or special magistrates, who already have so much to do, as chairmen of Wages Boards, in hearing cases arising under the Federal Arbitration Act and the Lands Compensation Act that they cannot cope with their ordinary duties in petty sessions.

Mr Wise:

– The only really cheap way is that suggested by the honorable member for Flinders.

Mr BRENNAN:

– I do not know whether that would prove the cheapest or the most expeditious, but it would certainly be better than the present plan. It is intolerable that these cases should be mounting up in the way they are, for it amounts almost to a scandal. I know from experience that the solution will not lie in appealing to the arbitration laws, as we have them here, nor in the creation of judicial arbitration tribunals which are so vastly different from our industrial arbitration tribunals in whichwe desire to get rid of all that circumlocution and delay incidental to ordinary judicial proceedings. I hope that the Attorney-General will sympathetically consider the suggestion of availing ourselves of the services of special magistrates.

Mr PIGOTT:
Calare

. -There is much to be said for both the proposal of the honorable member for Richmond and that of the honorable member for New England. The former might be applied to cases with a limit of £10,000, and the other to cases over that amount. From my experience, living in the country, as I do, where we have appeals on shire rates and so forth, a great advantage is found in having the cases heard locally, where the witnesses are. There could be as many Courts as there are country towns and villages, and justice would be practically brought to the very doors of the appellants. I am very glad that the matter is being taken up as it is by honorable members on both sides. I have had private conversations with honorable members supporting the Government, and I know that they are quite in accord with both the proposals that have been put forward. I hope the Attorney-General will give the suggestions his sympathetic consideration.

Mr HUGHES:
AttorneyGeneral · West Sydney · ALP

– I shall give the matter my most careful consideration. I promise the Committee that I shall afford honorable members the opportunity of considering any proposal made, with the object of remedying the present condition of affairs, and, if they consider such proposal insufficient, to submit any amendments they believe will render it more effective.

Proposed new clause negatived.

Title agreed to.

Bill reported with amendments.

Standing Orders suspended, and report adopted.

Motion (by Mr. Hughes) put -

That this Bill be now read a third time.

The House divided.

AYES: 27

NOES: 18

Majority . . …. 9

AYES

NOES

Question so resolved in the affirmative.

Bill read a third time.

page 1932

INVALID AND OLD-AGE

Bill returned from the Senate without amendment.

page 1932

ASSENT TO BILLS

Assent to the following Bills re ported : -

Supply Bill (No. 4).

Appropriation (Works and Buildings) Bill

1914-15.

Sitting suspended from 6.30 to 8.0 p.m.

page 1932

ESTATE DUTY BILL

Second Reading

Mr. FISHER (Wide Bay- Prime Min

Th at this Bill he now read a second time.

This is merely the taxing Bill. An Assessment Bill to provide the machinery will follow its passage. We all admit that the proposal means the superimposition of a heavy tax on State taxation, but it is a class of taxation to which no. one can object, because one doubts whether the accumulation of large estates is beneficial to a country, or even to the people who inherit them.

Mr FISHER:
ALP

– Yes.

Sir John Forrest:

– Then you seek to. have a lot of paupers in this country.

Sir Robert Best:

– Should not the. machinery Bill come first, seeing that the taxation is in pursuance of a clause of the Assessment Bill ?

Mr FISHER:

– If Mr. Speaker would permit it, there would be a great advantage in taking the discussion upon the two Bills together.

Mr SPEAKER:

Subject to any different disposition made by a testator in his will, the duty payable in respect of an estate shall be apportioned among the persons beneficially entitled to the estate in the following manner: -

The duty shall in the first instance be apportioned among all the beneficiaries in proportion to the value of their interests; and

where there are any beneficiaries under the will each of whom takes only specific bequests or devises of a value not exceeding Two hundred pounds, the duty which under paragraph (a) of this section would be payable in respect of the interests of those beneficiaries shall be apportioned among all the beneficiaries in proportion to the value of their interests.

As, notwithstanding the admirably lucid yet simple phraseology in which the Parliamentary Draftsman has robed this section, the precise intention thereof may have eluded some honorable members accustomed to a more verbose style, I will endeavour to explain it. In doing so, I am animated by the pious hope that by the adoption of an alphabetical method we may arrive with some degree of order at a happy conclusion. I begin therefore with a : Paragraph a says -

The duty shall, in the first instance, be apportioned among all the beneficiaries in proportion to the value of their interests.

Let me explain what these clear and simple words mean. We will assume that an estate of £100,000 has been bequeathed as follows: - To A, B, C, D, E, and F, legacies of £150 each; to G a legacy of £50,000; and to H the residue of the estate - that is, £49,100. Under paragraph a the legatees who receive £150 each would pay at the rate of 15 per cent., as also would G, who received £50,000, and the residuary legatee, who received £49,100. But, in order to remedy this obvious and glaring injustice, it is proposed, in paragraph 6, that the amount of the tax payable under paragraph a by the beneficiaries whose interest does not exceed £200 shall be paid by all the beneficiaries equally. Reducing this to its lowest terms, I mean, of course, terms of general coherence, and applying it to the proposition I have put before the Committee, we find that the residuary legatee, who would be drawing £49,100, and the beneficiary who drew £50,000, and the six legatees who drew £150 each, would pay the legacy duty between them that otherwise would be paid by the whole, and they would pay that duty in proportion to the interest each enjoyed in the whole estate. So that if the duty payable by those six legatees collectively were £135, that duty would be paid in the proportion that £90,100 bears to £900, or, in other words, the six legatees whose aggregate interest in the estate was £900 would pay roughly one-hundredth of the duty paid by the two other legatees. Thus stated, the clause is seen to be lucidity in excelsis. It is at such moments as this that one recalls with intense satisfaction that cannot be put into words the epitaph which our dear old friend Euclid used to subscribe at the conclusion of those little problems by which he reduced us to chaos, quod erat demonstrandum. However, the proposition is perfectly simple, and is the basis of a very sound principle which will be easily applicable. If it were possible to introduce a diagram into the Hansard report, I would represent the corpus of an estate as an oblong, and divide off a small portion of it by means of a series of parallel lines.

Mr LAIRD SMITH:
DENISON, TASMANIA · ALP; NAT from 1917

– I was induced to speak to the question by the remarks of the right honorable member for Swan to the effect that we did not need this taxation. I support the measure. I am glad that it is about to be placed on the statutebook.” Ninety per cent, of the people, the wealth-producers of the Commonwealth, the workers, will realize that they have at last representing them in the National Parliament a party which will tax the gentlemen who have not hitherto paid taxes as they should have done. Not having been accustomed to pay taxes, they do not like to have to pay them now, but they must get used to paying them; and if the Labour party are long enough in office they will get so accustomed to it that in the future we shall not hear such an outcry as we have had from the Opposition benches to-day.

Mr GROOM:
Darling Downs

– The reflection uttered by the honorable member upon the honorable member for Swan was absolutely unjustifiable. The honorable member for Swan need only point to his record in Western Australia with regard to the levying of duties generally to show that his service to the country has been good and faithful, and that his taxation was based as far as possible on the principle of ability to pay. There are one or two matters upon which I should like to have information. Beyond a statement from the Treasurer when he was introducing - this taxation that it would bring in £1,000,000, we have not been told what the tax is to yield.

Mr Hughes:

– The estimate is £1,000,000 for twelve months.

Mr Boyd:

– But the Budget proposes to collect £1,000,000 in six months.

Mr Hughes:

– The computation has been based on £1,000,000 a year.

Mr GROOM:

– The honorable member will find that the revenue will exceed £1,000,000 in the twelve months. In 1912-13, the taxes of the different States yielded £1,050,019. Assuming that we are to derive £1,000,000 only from this source, the effect as well as the intention of the imposition is to double the rate of taxation all through Australia. I venture to say that the Attorney-General cannot show in any probate or succession legislation in any part of the world a provision similar to clause 53, which provides -

Any person who, by any wilful act, default, or neglect, or by any fraud, art, or contrivance whatever, evades or attempts to evade assessment or duty, shall be guilty of an indictable offence.

Penalty: Five hundred pounds and treble the amount of the duty, payment whereof he has evaded or attempted to evade: or forfeiture of the estate, or any part thereof, in respect of which the offence was committed.

Mr WISE:
Gippsland

– The propriety of double income taxation has been discussed over and over again, but such taxation is altogether different from the taxation under consideration now. It would have been infinitely fairer to meet the extraordinary difficulties caused by the war by compelling us all to pay income tax. That would have been better than the taxing of a small section. This enormously heavy impost, when added to the burden of taxation imposed by the States, will provide the strongest lever that can be used to prevent Australia from having that share of the floating capital of the world which she needs for the development of her resources. Apart from the unfairness of the proposal under discussion, it is a most imprudent one from the point of view of the workers. We are likely to have very soon a larger army of unemployed than any of us would wish to see. We hope that this unemployment will not last long, and that ‘it will not be great. But the imposition of a tax like this will make the difficulty greater. I know that nothing we on this side may say will produce any effect upon honorable members opposite, but it is our duty to enter our protest against what to me at least appears to be fraught with extreme peril to the country. It appears to me that honorable members opposite are using the extreme peril of the Empire as an excuse for forcing on the people of Australia some of the most drastic and radical planks in their political platform.

Mr BOYD:
Henty

Mr Poynton:

– And then he is not the man who is punished.

Mr BOYD:

– Precisely. I hope the Government will make some modification in this clause.

Question resolved in the affirmative.

Bill read a second time.

In Committee:

Clause 1 agreed to.

Progress reported.

page 1948

ESTATE DUTY ASSESSMENT BILL

Bill read a second time.

In Committee:

Clause 1 -

This Act may be cited as the Estate Duty Assessment Act 1914.

Mr JOSEPH COOK:
Parramatta

.- I move-

That the following words be added : - “ and shall cease to operate on the 30th June, 1915.”

This will make the Bill a yearly enactment, as is the case in many other parts of the world. I shall not attempt to argue the question; it is too late for that now.

Question - That the words proposed to be added be so added - put. The Committee divided.

AYES: 18

NOES: 29

Majority . . 11

AYES

NOES

Question so resolved in the negative.

Amendment negatived.

Clause agreed to.

Clause 3 agreed to.

Clause 3 (Definitions).

Mr P P ABBOTT:
New England

– There is no provision in regard to the date on which the duties are to he assessed.

Mr HUGHES:
AttorneyGeneral · West Sydney · ALP

– I shall look into the point, and if it is necessary an amendment will be made in another place. In the meantime, I ask the honorable member not to press the matter. In my opinion no amendment is necessary.

Clause agreed to.

Clause 4 -

There shall be a Commissioner of Taxation, who shall, subject to the control of the Minister, have the general administration of this Act.
Until a Commissioner is appointed the Commissioner for Land Tax shall be the Commissioner.

Mr GLYNN:
Angas

.- I have compared the provisions of this Bill with many of the provisions of State Acts, and I find that they are mostly verbal adoptions of the States Statutes. For instance, clause 3 is almost a copy of the South Australian section. I do not think that we should appoint a Commissioner for a fixed period of seven years as provided for in clause 5.

Mr HUGHES:
AttorneyGeneral · West Sydney · ALP

– I propose to amend this clause in order to provide that the Land Tax Commissioner will be the Commissioner to administer the estate duty, and as he will then not have any separate tenure of office, Parliament will be perfectly free to limit the operation of the estate duty to any extent it thinks fit. I move -

That sub-clause 2 be left out with a view to inserting in lieu thereof the following : -

The Commissioner of Land Tax shall be the Commissioner.

The provisions of section five, subsections (2) and (3), and section six of the Land Tax Assessment Act 1910-1 912 shall apply in relation to the office of Commissioner under this Act as they apply in relation to the office of Commissioner of Land Tax.

Amendment agreed to.

Clause, as amended, agreed to.

Clause 5 -

Upon the appointment of a Commissioner he shall hold office subject to this Act for a term of seven years, and shall be eligible for re-appointment.

Mr GLYNN:

– That is all right, because the moment we repeal this legislation we repeal the machinery.

Clause negatived.

Clauses 6 to 9 negatived.

Clauses 10 to 12 agreed to.

Clause 13 (Duty on estates).

Mr GROOM:
Darling Downs

– I move -

That the following new sub-clause be added : - “ Estate duty shall not be assessed or payable upon so much of the estate as is devised or bequeathed for religious, charitable, scientific, or educational purposes.”

Mr HUGHES:
AttorneyGeneral · West Sydney · ALP

– I will accept that amendment; but I propose to report progress at this stage. That will give me an opportunity of considering another proposed amendment in relation to widows and next of kin.

Progress reported.

page 1950

LAND TAX BILL

Bill returned from the Senate with requests.

Ordered -

That the Message be taken into consideration forthwith.

In Committee (Consideration of Senate’s requests) :

Clause 2 (Amendment of Schedule 2).

Mr HUGHES:
AttorneyGeneral · West Sydney · ALP

– The Senate has requested, in line 14 of the schedule, we shall strike out “ fifteen-thousandth,” and insert in lieu “eighteen thousand seven hundred and fiftieth.” The same amendment is consequentially requested at two other places in clause 2, and at three places in clause 3. These amendments have been proposed by the Government in another place in order that the rate of tax on estates of over £75,000 shall not exceed 9d. Formerly, under the formula which appeared in the Bill, the tax was very nearly11d. The amendment reduces it to 9d., and the net effect of that is that on an amount of £75,000 the rate of tax will be less than 5d. I move -

That the requests be agreed to.

Question resolved in the affirmative.

Requested amendments made.

Resolution reported; report adopted.

Bill returned to the Senate, amended accordingly.

page 1950

SPECIAL ADJOURNMENT

Motion (by Mr. Hughes) agreed to -

That the House, at its rising, adjourn until 11 o’clock a.m. to-morrow.

page 1950

ADJOURNMENT

Order of Business

Mr FISHER:
Prime Minister and Treasurer · Wide Bay · ALP

– I move -

That the House do now adjourn.

– Well, we must sit until next week, and even over Christmas, if necessary. We will meet the wishes of the Opposition as far as we can.

Question resolved in the affirmative.

House adjourned at 10.59 p.m.

Cite as: Australia, House of Representatives, Debates, 15 December 1914, viewed 22 October 2017, <http://historichansard.net/hofreps/1914/19141215_reps_6_76/>.

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House of Representatives15 December 1914

QUESTION

FODDER DUTIES

Mr BURCHELL:FREMANTLE, WESTERN AUSTRALIA

Mr TUDOR:Minister for Trade and Customs · YARRA, VICTORIA · ALP

QUESTION

THE MORRIS BEEF COMPANY

Mr GROOM:DARLING DOWNS, QUEENSLAND

Mr TUDOR:ALP

QUESTION

PRICE OF WHEAT

Mr FENTON:MARIBYRNONG, VICTORIA · ALP; UAP from 1931

Mr TUDOR:ALP

NEW TELEPHONE RATES

Mr MASSY-GREENE:RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

Mr SPENCE:Postmaster-General · DARLING, NEW SOUTH WALES · ALP

QUESTION

DELIVERY OF TELEGRAMS

Mr SHARPE:OXLEY, QUEENSLAND

Mr SPENCE:ALP

QUESTION

PILLAR-BOX PILFERING

Mr PAGE:MARANOA, QUEENSLAND

Mr SPENCE:ALP

QUESTION

LIGHTHOUSES

Mr JOHN THOMSON:COWPER, NEW SOUTH WALES

Mr TUDOR:ALP

QUESTION

HORSES: BROADMEADOWS CAMP

Mr LIVINGSTON:BARKER, SOUTH AUSTRALIA

Mr JENSEN:Assistant Minister · BASS, TASMANIA · ALP

QUESTION

FEDERAL CAPITAL DESIGNS

Mr KELLY:WENTWORTH, NEW SOUTH WALES

Mr ARCHIBALD:Minister for Home Affairs · HINDMARSH, SOUTH AUSTRALIA · ALP

Mr Kelly:

Mr ARCHIBALD:

Dr MALONEY:MELBOURNE, VICTORIA · ALP; FLP from 1931; ALP from 1936

Mr ARCHIBALD:

Mr KELLY:

Mr ARCHIBALD:

Dr MALONEY:MELBOURNE, VICTORIA · ALP; FLP from 1931; ALP from 1936

Mr ARCHIBALD:

Mr KELLY:

Mr ARCHIBALD:

Mr Kelly:

Mr SPEAKER:

QUESTION

MEAT INDUSTRY

Mr SHARPE:

Mr TUDOR:ALP

Mr SHARPE:

Mr TUDOR:

Mr MASSY-GREENE:RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

Mr TUDOR:

Mr MASSY-GREENE:RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

Mr TUDOR:

Dr MALONEY:MELBOURNE, VICTORIA · ALP; FLP from 1931; ALP from 1936

Mr TUDOR:

Mr FLEMING:ROBERTSON, NEW SOUTH WALES

Mr Bamford:

Mr SPEAKER:

Mr FLEMING:

Mr TUDOR:

Mr Fleming:

QUESTION

DEFENCE DEPARTMENT

Mr BRENNAN:BATMAN, VICTORIA

Mr JENSEN:ALP

Mr MATHEWS:MELBOURNE PORTS, VICTORIA

Mr JENSEN:

Mr LIVINGSTON:

Mr JENSEN:

Mr BAMFORD:

Mr JENSEN:

Sir JOHN FORREST:SWAN, WESTERN AUSTRALIA

Mr JENSEN:

Mr Joseph Cook:

Sir JOHN FORREST:

House of Representatives
15 December 1914

Mr BURCHELL:
FREMANTLE, WESTERN AUSTRALIA

Mr TUDOR:
Minister for Trade and Customs · YARRA, VICTORIA · ALP

Mr GROOM:
DARLING DOWNS, QUEENSLAND

Mr TUDOR:
ALP

Mr FENTON:
MARIBYRNONG, VICTORIA · ALP; UAP from 1931

Mr TUDOR:
ALP

Mr MASSY-GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

Mr SPENCE:
Postmaster-General · DARLING, NEW SOUTH WALES · ALP

Mr SHARPE:
OXLEY, QUEENSLAND

Mr SPENCE:
ALP

Mr PAGE:
MARANOA, QUEENSLAND

Mr SPENCE:
ALP

Mr JOHN THOMSON:
COWPER, NEW SOUTH WALES

Mr TUDOR:
ALP

Mr LIVINGSTON:
BARKER, SOUTH AUSTRALIA

Mr JENSEN:
Assistant Minister · BASS, TASMANIA · ALP

Mr KELLY:
WENTWORTH, NEW SOUTH WALES

Mr ARCHIBALD:
Minister for Home Affairs · HINDMARSH, SOUTH AUSTRALIA · ALP

Dr MALONEY:
MELBOURNE, VICTORIA · ALP; FLP from 1931; ALP from 1936

Dr MALONEY:
MELBOURNE, VICTORIA · ALP; FLP from 1931; ALP from 1936

Mr TUDOR:
ALP

Mr MASSY-GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

Mr MASSY-GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

Dr MALONEY:
MELBOURNE, VICTORIA · ALP; FLP from 1931; ALP from 1936

Mr FLEMING:
ROBERTSON, NEW SOUTH WALES

Mr BRENNAN:
BATMAN, VICTORIA

Mr JENSEN:
ALP

Mr MATHEWS:
MELBOURNE PORTS, VICTORIA

Sir JOHN FORREST:
SWAN, WESTERN AUSTRALIA

Mr SINCLAIR:
MORETON, QUEENSLAND

Mr SPENCE:
ALP

Mr MASSY-GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

Mr PALMER:
ECHUCA, VICTORIA

Mr MAHON:
Minister for External Affairs · KALGOORLIE, WESTERN AUSTRALIA · ALP

Mr PIGOTT:
CALARE, NEW SOUTH WALES

Mr MAHON:
ALP

Mr FENTON:
MARIBYRNONG, VICTORIA

Mr FISHER:
Prime Minister · WIDE BAY, QUEENSLAND · ALP

Mr SPENCE:
ALP

Mr FINLAYSON:
BRISBANE, QUEENSLAND

Mr JENSEN:
ALP

Mr YATES:
ADELAIDE, SOUTH AUSTRALIA

Mr BURNS:
ILLAWARRA, NEW SOUTH WALES

Dr MALONEY:
MELBOURNE, VICTORIA · ALP; FLP from 1931; ALP from 1936

Mr ARCHIBALD:
ALP

Mr JENSEN:
ALP

Mr JENSEN:
Assistant Minister of Defence · Tasmania · ALP

Mr JENSEN:
Assistant Minister of Defence · Bass · ALP

Mr RODGERS:
WANNON, VICTORIA · LP; NAT from 1917