"Thereafter, when the proprietor comes to pay the feu duty or ground annual (if any) applicable to the ground, he shall be entitled to deduct therefrom the same proportion of the local rates and taxes paid by him as the said feu duty or ground annual bears to the total assessable annual value as entered in the valuation roll."

(Signed) Peter Burt.

Samuel Chisholm. J. P. M'Phun.

See contra,

County

Councils

Association,

Renshaw,

Vol. III. of Min. of Ev.,

App. No. I., pars. 41-2;

162-3

The Separate Report on Urban Rating and Site Values referring to Scotland says: "All existing contracts should be absolutely respected."

But the witnesses who proposed to the Local Taxation Commission that feu duties and site values should be rated, frequently suggested that this should be done irrespective of existing contracts, though one or two thought that some provision might be made, or that the system might be introduced gradually.

Mr. James Gray, Honorary Treasurer of the Glasgow Town Council, stated that the effect of rating feu duties would be to relieve the owner of the land, who has taken it subject to feu duties, and subject to the payment of rates.

The following questions were put to, and answers given by, Mr. Gray : Q. The man who owns the feu duty, or the man who has taken the land subject to the feu duty; which has gained the most by the additional value of the land? - A. It is to be supposed that the present owner has gained the most.

Q. He has gained the most ? - A. Yes.

Q. He has entered into the contract that he would pay the rates on the feu duty, has he not? - A. Yes.

Q. Yet you are going to break his contract, and you are going to give him something more, although he has gained more than the man who owns the land (feu duty) ? - A. Yes, but look at the new conditions of society altogether when the new taxation is placed on everybody; people must accustom themselves a little to the present wants of the community - to present needs.

Mr. Cochran, member of the Barony Parish Council of Glasgow, did not propose that the feu duty as such should be taxed, but the value of the land, "which maybe more or less than the feu duty as circumstances may arise." He stated that by this proposal the feu owner who at present pays no rates, would be rated "whether he has stipulated to be relieved of all taxes or not," though he admitted that the suggestion would involve the relief of one owner at the expense of another. He proposed that the land values in Glasgow (2,000,000l.) should bear the owner's rates amounting to about 300,000/., but that this should be brought about gradually. He also stated that feu duties are a popular investment in Glasgow, though he did not see that that was a reason why they should not be assessed to local rates.

Cochran,

15,853-8, 15.872-905, 15,916-9, 15,980-96, 15.997-16,009, and Vol. III. of Min. of Ev., App. No. XII., par. 13. Burt,

16.193,

16,253,

16,308-28

Gray,

17.244-51

Waddell,

15.784

Gray,

17,242-52

Cochran,

15,872-905

Gray,

17,248-51

Brand,

16,053-60

Cochran, 15,873-8. See contra, Brand, 16,048.

Mr. Ferguson [representing the Worker's Municipal Election Committee of Glasgow], who thought that unearned increment in land should be the property of the community, said: "What I suggest is to put on a tax - say 2s. or something else - upon the present land value, and make whatever arrangements of title, life interest, or some kind of title by which the harshness of the measure will be mitigated; but as for speculation in the natural opportunity of the future, that I repudiate, and any person who does it would have to take the consequences." His view is that owners of site values should ultimately bear the whole burden of local taxation, and that the occupier should be entirely relieved of the whole of the rating.

Mr. Peter Burt, President of the Scottish Land Restoration Union, put forward the view that land values should be taken from the present owners altogether, by imposing a rate which should be increased until it amounted to 20s. in the pound.

Mr. Chisholm, a member of the Corporation of the City of Glasgow, stated that his final object was that the land in every town should belong to the public Authority of the town.

Q. You have said more than once that you consider that land values belong to the community. If so, why do you not have the courage of your convictions, and propose that the community should take those land values straight away, if it is the fact that they do belong to the community? - A. Because I recognise that the system under which we live to-day, is the result of a long history, in which a certain system has taken deep root, and that it would be unwise, I might almost say unfair, to take at one fell swoop those land values. In view of the hardship which immediate appropriation of land values would produce, my own suggestion, not included in the Corporation Committee's Memorandum, is that at a pace, no matter how slow, say at an augmenting rate of one per cent. per annum you travel in that direction.

Cochran,

15,949-66,

15.967-75Ferguson,

16,828-40,

16,840,

16,849,

16,857-8,

16,891,

16,906,

16,927

Ferguson, 16,837-48.

Burt,

16,169-76,

16,329-33Chisholm, 17,084.

17,089

Generally speaking, the arguments advanced by witnesses in Scotland before the Royal Commission on Local Taxation in support of, and in opposition to, the proposals to rate land values were practically the same as those urged by the English witnesses already referred to. The following additional arguments against the proposals made by the Glasgow Corporation may be noted : As regards "feu duties": (1) That the system of feuing should not be discouraged, as it enables those who desire to build to acquire land without having to find the purchase-money in a lump sum.

(2) That landowners who have granted feus practically obtain no benefit from Municipal expenditure, and have no reversionary interest in the land. Accordingly no question arises of their obtaining "unearned increment."

As regards site values : (3) That as proprietors in Scotland pay half of most of the rates during the currency of leases, the argument put forward in England (where the occupiers pay the rates) that tenants enter into a "blind bargain," in respect to the payment of new rates and the increase of old ones, does not apply to Scotland.