436 THE COLLIERY GUARDIAN March 1, 1918. the ratable value, which is arrived at by making deductions from the gross estimated rental as provided by the Parochial Assessments Act, 1836, referred to above. The gross estimated rental is usually about 6 per cent, less than the corresponding income tax assessment, and net ratable value is usually another 15 per cent. less. The question arises as to how is the 11 gross esti- mated rental ” to be fixed. What rent would a hypo- thetical tenant give for the mine in its present posi- tion? One of the grievances of mine owners is that there is no uniformity in the system of valuation throughout the country. Again, it is a well-known fact that collieries within the same district often differ considerably from the point of view of natural advantages. The output of coal and the selling price per ton may be for all practical purposes equal in the case of two collieries, yet through the presence of a few important faults in one and the absence of faults in the other, the one has considerably higher working expenses to be taken into account as compared with the other. Appeal on the ground of excessive assess- ment would involve the disclosure of information which no mine owner would ordinarily care to contemplate. Referring back to the definition of “year’s esti- mated rental,” it is obvious at once that' in the very large majority it is impossible to assess collieries on this basis. It is permissible in such cases to arrive at the net ratable value by what is known as the rail- way method, that is, taking the occupier’s receipts in Tonnage Wrought, and Gross and Net Ratable Values for the Counties of England and Wales. Name of county. Amount of coal. Gross ratable value. 1 Net ratable value. ! -i Tons. Estimated value. £ Per ton. £ Per ton. s. d. d. d. Cheshire 620,101 7 0 18,161 703 15,907 6’16 Cumberland 1,739,491 5 9 40,749 5’62 34,931 4’24 Derby 10,093,222 7 9 87,373 2’09 74,498 1’77 Durham 30,307,177 5 2 ' 678,742 5*37 603,381 4’78 Gloucester 1,359,814 8 10 23,349 4’12 21,144 3'81 Lancashire 21,707,867 6 6 522,827 5 78 432,931 4’76 Leicester 1,336,547 7 1 25,323 4’54 22,213 3'99 Monmouth 6,755,308 7 5 161,329 5’73 154,279 5’63 Northumberland 8,794,005 5 4 172,010 4’68 147,786 4 03 Nottingham 6,582,582 7 0 196,349 7’16 165,011 5’74 Salop 710,490 7 0 16,025 5’42 14,622 5’00 Somerset 876,254 8 1 15,587 4’27 13,177 3'61 Stafford 13,937,406 6 5 273,698 4’72 229,072 3 93 Warwick 1,700,490 7 0 19,015 2’68 15,529 2’19 Westmoreland 1,246 7 0 75 14’51 70 12’69 Worcester 893,880 6 5 24,470 6’57 20,714 5’53 Yorkshire 21,976,027 6 6 552,139 6’00 479,900 5’23 Brecknock Carmarthen j 944,652 6 8i i 23,650 6’00 19,726 4’87 Denbighshire 2,180,316 6 3 30,533 3’35 27,483 3’02 Flint 715,183 6 3 4,531 1’52 4,252 1’42 Glamorgan 20,297,004 8 2 714,063 8’44 587,851 6’95 Pembroke 71,271 9 6 1,840 6’19 1,381 4’64 the preceding year, and then deducting therefrom allowances for capital and other expenditure which cannot be called rent. The famous case of the Denaby and Cadeby Collieries Company v. the Doncaster Union (1898) is of special interest in this respect. The following is the method in which the net ratable value would be arrived at under the ruling in this case:— From the gross receipts from sale of coal raised at the colliery during the preceding year— Deduct discount, bad debts, cost of coal getting, and other working and management expenses above ground and under ground. Occupier’s share of the profits for interest on capital, trade profits, and an allowance for risk and casualties. Rates and taxes. Leaving “gross estimated rental” available for hypo- thetical landlord. Deduct therefrom repairs and renewals of buildings, main roadways, main airways, and other permanent works, insurance, sinking fund, and other expenses necessary to maintain the premises in a state to earn the rent. Leaving “net ratable value.” In a paper read before this institution in 1899, Mr. (now Sir E.) Boyle, K.C., who had appeared for the appellants in the above case, discussed this method, and illustrated it by figures. This method appears to be the most reasonable one on which a colliery may be assessed. The same method has been advocated in papers by Mr. G. Humphreys-Davies and Mr. E. J. Castle, K.C. As illustrating the diversity of practice in different unions, the following tables, which were taken from a paper by Mr. A. Hassam, bring out in a striking manner the inequalities in the system of valuation. Since Mr. Hassam wrote his paper, the Departmental Committee on Local Taxation, appointed in 1912, have published their final report, from which it is evident that practically no change has taken place in the system of assessment and in regard to the inequalities of burden as between different parishes. Discussion Summart of the Rating of Collieries in England and Wales for the Year 1890. Rate or basis of assessment No. of Unions. No. of mines. Valuation. Deductions. Gross. Ratable. Average per cent. Remarks. 1. Sliding scale on value of coal, one- twelfth to one-fourth 7 101 £ 93,030 £ 81,167 14 65 15 to 50 per cent. 2. Receipts - less expenses Q 11 5,981 4,774 20’24 15 to 25 per cent. 3. Output at 3d. to 8d. per ton, without deductions 5 60 73,854 73,854 Nil 4. Output at 3^d. to 2s. 6d. per ton, with deductions 9 175 267,938 243,041 9’33 5 to 25 per cent. 5. Output on an unknown basis 11 209 527,633 415,230 19’78 Nil to 40 per cent. 6. Amount per ton on the output for the net value, and 5 to 25 per cent, added to obtain the gross value 8 290 707,642 594,110 16’15 7. Output at 3^d. to Is. per ton, shafts at Id. to Ud. per ton, and machinery at 6 to 7j per cent, of the capital value.. 14 301 629,963 557,743 11*64 Nil to 33 per cent. 8. Output, and separate valuation of machinery, e’c. (no basis stated). .. 11 153 401,881 351,580 12*47 Nil to 25 per cent. 9. Sliding scale at 2£ per cent, of the selling value of the coal, plus £5 per acre for land 1 12 4,777 4,777 Nil 10. Royalties and rents, without deductions 5 43 11,241 11,241 Nil — 11. Royalties and rents, with deductions 25 131 96,668 81,438 15’00 4 to 25 per cent. 12. Royalties and rents, plus valuation of machinery, etc 8 64 81,556 73,714 9’57 No deduction on coal, but 13. Royalties and rents, plus valuation of machinery, etc 9 212 133,272 114,770 12’60 only on machinery, &c. 14. Acreage, up to £120 per acre 3 44 27,899 25,754 13’79 Nil to 25 per cent. 15. No basis stated 6 34 65,653 57,140 12’94 Nil to 20 per cent. 16. Professional valuers—basis not stated ... 20 245 463,609 399,627 15’89 Nil to 42 per cent. Totals 145 2,085 3,594,597 3,087,960 14’13 — of this report will be reserved to the later paper, when the author proposes to deal specifically with the effects of recent Finance Acts and the rating of mines, and to compare the system outlined above with systems in vogue in other countries. DISCUSSION. Mr. John Willmot (Warwickshire), proposing a vote of thanks to Capt. Bowen, said that these heavy impositions were gradually eating very largely into the body of our estates, whilst land, which yielded practically the lowest rate of interest of all invest- ments, was subject to the heaviest charges, both for taxation and rating purposes. He had found, as a surveyor, that the d.uties which were imposed, and which were growing so very heavy, were having a serious effect in restricting the enterprise of those who formerly pressed to be co-venturers in mineral estates. Mr. Thomas Jones (Mineral Referee) said it was unfortunate that so many of our rating authorities had such different methods of arriving at their results. He thought the table prepared by Mr. Hassam (con- tained .in “ Taxation of Collieries ”) was very enlightening as to the different bases on which the different authorities assessed. One of the rates of assessment was on the basis of output at 3d. to 8d. per ton, without deductions, and there were only 60 mines so dealt with; whereas nearly all the rest had deductions. Another basis was “royalties and rents, without deductions,” which applied to 43 mines; and in another case the basis was 1 ‘ royalties and rents, plus valuation of machinery, etc.” There were 64 mines to which the latter applied, and where there was no deduction on the coal worked, but there was a considerable deduction on the plant and machinery. That was his experience, as a rule, in the North Wales quarries. No deduction was made on the material worked, and the full royalty per ton was treated as gross and net; but on the machinery, buildings, etc., various deductions were made. With regard to the question of allowing deduction in the rating upon expenditure on capital account: in the case of coal mines the pits lasted for the whole life of the coal field, and, of course, there were more or less seams to work. In quarries, as a rule, especially in under- ground quarries, they were every year working out a considerable amount of expenditure in abandoning levels and inclines at various means of access which were constantly cut off, the principal working off in the way of steps, one step cutting away the step of another, and therefore they had to make new roads. The rate collector or the tax collector would not allow any deduction for this constant expenditure, which was simply maintaining the hereditament in a rent- producing condition. It was rather hard that they had to pay rates on their development cost, because that development cost was only reinstatement, and nothing more. As to the methods of assessment, he knew that in the Welsh district the custom was to assess the rates upon output, and taxes, of course, upon net proceeds. How the net profits were arrived at he would not like to say, because he was not speak- ing from authority, as he did not deal with the accounts, but he knew that circumstances of position or situation had a considerable bearing upon the royalties and rates. Another question which Capt. Bowen raised was as to paying rates on all plant and machinery on the premises. They had been in a peculiar position in that respect. They “scrapped” the whole of their steam plant and machinery— between £25,000 and £30,000 worth of property—and installed electrical machinery which cost £20,000, but the current was uncertain, as it was generated some 10 to 12 miles away. The result was that they had both the abandoned machinery and the electrical machinery on their quarries until within the last two years, and they were assessed on the full value of that plant and machinery, although they never used it, and they had to substitute other machinery which was in use constantly. They were assessed on some- thing like £100,000 capital. Now they had “ scrapped ” the machinery, and the assessment authority had offered to reduce the assessment, and were reducing it, he thought, to less than £40,000. That was only an example of the way in which the assessment authority —as Capt. Bowen pointed out—made them pay on all their plant and machinery, whether not usuable or in use on the premises. Codification. Mr. G. Turville Brown (Westminster) said that the thing that struck him was the extraordinarily complex state the whole matter had got into. It seemed to him that there would be need for a great law-giver at the end of the war, to prevent develop- ment from being stopped by the weight of taxation. It must be borne in mind that immediately the war was over, we were going to be faced with probably fiercer competition than we had ever had before. As regarded the assessment for taxation and other rating of mines, there were two points he would like to make. The first was that, in his experience, the amount of time—including that of responsible officials of every mining company in this country—which was taken up over this question was already far too great; and the second was that he did not think that any ordinary surveyor of taxes ought to have to deal with these questions at all. The surveyors of taxes had got an enormous amount of work on their shoulders, and this particular branch of work was so technical, and so dependent upon knowledge of actual facts that occurred underground and above ground, that no surveyor of taxes could really be expected to tackle it, and the whole thing ought to be done by a properly constituted body of officials, who should meet the colliery or other mine companies’ officials and settle the assessment in each case, having regard to the particular circumstances of the mine. The whole thing wanted codifying, and he hoped that, when there was a little more leisure after the war, that would be one of the first things attempted, if not done. Mr. J. I. Davidson (Edinburgh) said he had a con- siderable amount of work to do for mineral com- panies. In respect of rating, there was one item he had not noticed in the paper, namely—the amount of annual damage to which the mineral companies were subject from subsidence of the surface and other inci- dental injuries caused to land. He certainly thought this should form a proper deduction in estimating the profits or the ratable values generally. Those pay- ments to which he referred were more usually made to the tenants—the agricultural tenants—of the surface; but occasionally they accumulated, and were charge- able to land owners on the lapse of leases. Within the last few years he had had to deal with a claim of no less than £42,000 in connection with damage to an estate as a result of land occupied during three, he thought, successive mineral leases which had come to an end. That was a question which ought to be care- fully kept in view by the rating authorities, because that mineral company was found liable in a very sub- stantial sum, which really represented a lessening of the income and revenue during the period of the work- ing of the mine. Mr. Rees said he should be much obliged if Capt. Bowen, in his next paper, would deal with the ques- tion of the valuation of unlet minerals. “We have had to make a valuation of all our unlet minerals,” he said, “ and I should like to have his observations on that.” The vote of thanks was supported by the President, and unanimously adopted. Capt. Bowen’s Reply. Capt. Bowen, in reply, observed that Mr. Turville Brown had referred to the time after the war when it was certainly essential that we should have some legislator or expert who would undertake the forms of taxation, and take into consideration the special needs of not only the mining industry, but some of the other larger industries in this country. The tendency of the modern colliery, at any rate, was to recover more of