FOREST SCENE NEAR WOOMBYE, NORTH COAST RAILWAY
CHAPTER IX.
APPROPRIATION OF LAND REVENUE.
Land Sales Receipts; not Consolidated Revenue.—Arguments used in favour of Treating Proceeds as Ordinary Revenue.—Auction Sales have now Practically Ceased.—Certain Proceeds Payable into Loan Fund.—Special Sales of Land Act; Appropriation of Receipts.
The revenue from sales of land for the first quarter-century was £4,672,659, besides £853,583 representing grants made in consideration of land orders issued to immigrants but not included in the revenue and expenditure returns. Nor does it include the sum of £382,346 received in cash for land sold within railway reserves and afterwards transferred to revenue. The latter amount must, however, be added to the cash receipts for land sold, which therefore totalled £5,055,005.
The practice of treating proceeds of land sales as ordinary revenue has already been incidentally alluded to, but it may be well to refer more fully to the subject. It is held that the taxpayer ought annually to provide for current expenditure, and that if land is alienated from the Crown at all the net proceeds, after defraying the cost of administration, should be applied to the construction of public works that would otherwise be of a character to justify charging their cost to the Loan Fund.
This principle in the abstract is unexceptionable; but in a new country much work is expected to be done by the Government for posterity in the nature of "invisible improvements"; in fact, it is so done, and cannot well be provided for by loan. Roads have to be cleared and formed, and buildings erected for the benefit of posterity as well as of those who so invest their money.
Moreover, the advent of population enhances the value of both public and private estates, while the maintenance of great public works like railways involves in most cases a heavy revenue loss for years after the lines are open for traffic. Only in very recent times have our railway earnings approximated, after payment of working charges and maintenance, to the amount of the interest charge upon the capital invested in them; but they have immensely benefited the country by providing facilities for internal transport, and by enhancing the value of the land, Crown and other, which they intersect and make accessible. Years ago, when the railway debt of Queensland stood at about 17 millions, an official estimate showed that, in making good the annual deficiency of interest and working expenses on the various open lines, at least as much had been spent by the Treasury as the entire first cost of their construction. So that contemporary colonists have still a charge against posterity for public works to be handed down, even though the first cost remains a liability in the form of interest upon inscribed stock held by the public creditor.
Further, it has to be said that, since the railways have begun nearly to defray interest upon capital, the auction sale of Crown land, except in small areas, has practically ceased. The receipts from auction sales in 1907-8 totalled only £33,391, and much of that sum would be absorbed were it charged with its share of the cost of administration. By the Land Sales Proceeds Act of 1906, all moneys received in payment for land sold under the authority of Part VI. of the Land Act of 1897—by auction sales of town, suburban, and country lands, or of such lands sold by selection after having been so offered—must be paid into the Loan Fund Account, and be applied to defraying the cost of such works as Parliament may from time to time determine shall be executed out of moneys standing to the credit of that fund. True, receipts for lands sold under the Special Sales of Land Act of 1901, being applied to the special purpose of retiring Treasury bills issued to make good revenue deficits, are excluded from the general law in this respect. But it is satisfactory that, even though the recognition of the principle that land is capital and not revenue has been tardy, it has now in Queensland the full force of statute law.