114 



COMMISSION OF CONSERVATION 



are no longer cut off from owners of land, vacant suburban lands are 

 cultivated and taxes are paid on the basis of ability to pay. In normal 

 times a purchaser of an improved lot in England can borrow two- 

 thirds, and in some cases a greater proportion, of the actual price he 

 pays for the land and improvements at from 4 to 4J per cent. Such land 

 can usually be purchased at a figure approximating to its real value 

 as a revenue-producing investment, and the local assessment is based 

 on the annual rental value. 



Where speculation occurs it should be the subject of a high incre- 

 ment tax at the time when any land is transferred; a tax which would act 

 both as a deterrent against speculation and as a means of obtaining for 

 the community as much as possible of the value which is socially created. 

 Ordinary revenue should be obtained from taxes levied on the actual value 

 of the land as a revemte- producing investment, and an assessment roll 

 prepared on this basis would be a guide to purchasers and mortgagees. 



Under present conditions the revenue obtained from local taxa- 

 tion is probably no greater than would be obtained on the above basis, 

 since a large proportion of real estate value is now escaping taxation. 

 A tax based on inflated values helps to sustain these values, is costly 

 to collect and is uncertain. 



The inequalities which result from the present system are illus- 

 trated by the following table giving assessed and actual values In 

 certain county areas in Ontario, the assessed values being taken from 

 the assessment roll, and the market values being less than the price 

 at which the land has been purchased or is available for purchase: 



In one of the above cases a property is valued at $5,000 for 

 one purpose and $78,000 for another purpose. If, on the basis of the 

 lower valuation, taxes were placed entirely on land values it would 

 make no difference to the tax, since the market value of the land 

 alone is much greater than the present assessed value of the whole pro- 

 perty. The farmers of the counties in which the above properties are 



