The Commissioner of Land Tax has forwarded the following memorandum for advice:

Referring to your opinion of the 26th ultimo⁽²⁾ on the scope of the amendment by section 4 of Act No. 29 of 1914, of section 66 of the original Act, I should be pleased if you will favour me with further advice in this connection, and more particularly as regards the following points. In your previous opinion you stated that if applicants show that the returns from land have been seriously impaired, a case has been made out for application of the section.

In considering such an application-

1. Is the Department precluded from considering losses which occurred or adverse conditions which obtained prior to 1st July 1914 from which the amending legislation dates so far as the imposition of higher rates of tax is concerned?
2. Is interference with market conditions caused by the war an adverse condition by which the returns from land can be considered to have been seriously impaired so as to secure relief from tax?
3. Is a heavy land tax which reduces net returns a matter to be similarly taken into consideration?
4. Is the expression 'returns from the land' to be interpreted as 'gross' returns or 'net' returns? If the former, is the Department committed to take into consideration in qualification of its judgment under section 66, the fact that to secure large gross returns and protect stock heavy expenditure or losses were incurred-

1. in providing fodder for agistment or in removing stock from properties where there is no grass to other places where they can be fed;
2. by sacrificing stock or produce at low prices owing to special conditions obtaining at the time of sale?

The decision given hereon, will affect the determination in the case of Dr A. of Bendigo, who has applied for remission of his case to the Board.

This gentleman possesses a landed estate comprised in five large properties, the unimproved value of which is assessed at £328,472. The improved value stated by himself is £442,629. His claim is based on the contention that owing to the drought, adverse season and adverse conditions (viz. non-saleability of wool owing to the war), the returns from his land have been seriously impaired.

It is admitted that Dr A. is in no way financially embarrassed by the conditions which have led to the loss of profit on his year's operations, a deficit, on net returns, after providing £7309 for land tax, of £449. He likewise states that there have been no abnormal physical losses (presumably loss of stock by death) because precautions were taken at great expense to avoid them.

It is admitted that Dr A. is in no way financially embarrassed by the conditions which have led to the loss of profit on his year's operations, a deficit, on net returns, after providing £7309 for land tax, of £449. He likewise states that there have been no abnormal physical losses (presumably loss of stock by death) because precautions were taken at great expense to avoid them.

As I am anxious to reply to Dr A., I should be glad if the matter could be accorded special and early consideration.

(1) The application will be made in respect of the tax for a particular financial year. If, owing to adverse conditions within the meaning of the section which occurred in years prior to the year in which the application is made, the returns for the year in question have been seriously impaired as compared with preceding years, in my opinion the Department would be justified in taking into consideration the losses which occurred or the adverse conditions which prevailed.

(2 and 3) The section applies in cases where 'by reason of drought or adverse seasons or other adverse conditions, the returns from the land have been seriously impaired'. I think that the words 'other adverse conditions' mean adverse conditions of a nature similar to drought and adverse seasons, e.g. bush fires, floods, plagues of locusts and such like matters.

In my opinion, interference with market conditions caused by the war and a heavy land tax are not adverse conditions within the meaning of the section.

(4) The section is intended to grant a remission to persons who have suffered substantial diminution in the benefits received from the land caused by drought, adverse seasons and other adverse conditions.

The benefits which a person receives from land are, I think, shown by the net returns from the land, and, in my opinion, 'returns from the land' means the 'net' returns.

[Vol. 14, p. 249]

(1)This date is attributed. The opinion is undated in the Opinion Book, but its position, in relation to adjacent opinions, suggests a date towards the end of January 1916.

(2)The opinion, not published, was dated 26 March 191$ [Vol.13, p. 382]. "In it Mr Garran, referring to the third of the conditioms speci?ed in the amended section 66, stated: