Jowett v Federal Commissioner of Taxation [1926] HCA 22

Fo WY St Martins

Centre Valuer- fa Genoral Seay 218 — 38 C.L.R.] OF AUSTRALIA. 325 [HIGH COURT OF AUSTRALIA.] JOWETT . i : 4 js i : . APPELLANT ;

AND

THE FEDERAL COMMISSIONER OF ) : TAXATION. .. 5 RESPONDENT.

Land Tax—Assessment—Crown leases—Unimproved value—Ascertainment—Method H.C. or A. of valuation—Land Tax Assessment Act 1910-1916 (No, 22 of 1910—No. 33 of 1926.

1916), secs. 3, 28 (3) (a). cae 2 Held, by Rich J., that, in ascertaining for the purpose of sec. 28 (3) (a) ee

of the Land Tax Assessment Act 1910-1916 "the unimproved value of the 27; July d- land" where the land is held under Crown leases, (1) the realization value —=— of the supposed fee simple must be found, and not the amount of money which, according to some economic theory, is represented by the land ; (2) the process

of estimating what the land, if improved under proper conditions, is worth,

and deducting what it would cost so to improve it, affords a guide which is evidentiary only, and not conclusive, of the unimproved value in fee simple,

and aids in finding only the limit of what a buyer would give ; (3) to compute

what the land so improved is worth by capitalizing the profits of the operations

carried on upon it is fallacious, because in the operations are involved personal

exertion, experience and skill, and no allowance is made for these matters ;

(4) but if there has been a sale upon a walk-in-walk-out basis of a Crown leasehold of the same or comparable lands, the unimproved value of the fee

simple may be arrived at by apportionment of the price to the various items,

and an appropriate calculation of the fee simple equivalent of the term sold—

(method of such calculation discussed) ; (5) if a method of capitalizing returns

from pastoral undertakings in an average year is adopted the percentage

taken should in general be at least 15 per cent ; (6) the prevention of the