Income Tax, $500,000 Short Term Loan, and Creation of Village Cooperatives Urged by Palestine Agricu

The replacement of the existing taxes by an income tax, the abolition of the animal tax when the income tax is introduced, the reduction of the already commuted tithe to seven and a half per cent and as an emergency measure the issuance by the government of a $500,000 short term loan is recommended in the report of the Palestine committee to investigate the economic conditions of agriculturists and to suggest fiscal measures that the government should take relative to them which was published here today.

The committee, which was appointed last June by High Commissioner Chancellor, consisted of W. J. Johnson, deputy treasurer of the Palestine government, R. E. H. Crosbie, assistant district commissioner for the southern district, five British area officers, the senior assistant treasurer, J. Gress and the junior assistant treasurer, Victor Levy, the latter two serving as secretaries to the committee.

Other recommendations are the establishment of government experimental demonstrations on better farming methods, the creation of village cooperatives, and the temporary prohibition on the importation of wheat. The government now has $175,000 available for small loans while the importation of wheat has already been banned.

The committee’s report emphasizes the difference in the standard of living of Arab and Jewish farmers. Painting a gloomy picture of the Arab cultivator’s lot, the committee assumes that with very rare exceptions every village provides for its own subsistence. The farmer is perhaps habitually short of ready cash but the committee finds no evidence that either he or his family is ever without sufficient food.

The Jewish farmer is better equipped for cooperation in agriculture than is the Arab farmer, his standard of living is higher and he enjoys social and cultural amenities unknown to the Arabs but appears to be weighed down by heavy debts, the committee reports, although not estimating these debts.

The committee’s work was done through a questionnaire in 104 Arab villages throughout the country, Palestinian officers filling in the forms while the information as to the Jews was supplied by the executive of the Palestine Jewish Colonization Association, and the organizations of Jewish farmers, cultivators, landlords, money lenders and industrialists assisted.

The cultivable area of Palestine is estimated at over 12,000,000 dunams by the committee which finds that the rural population has increased 33 per cent since the 1922 census. The average gross per dunam is ten shillings of which the tenant pays the landlord from a quarter to a half, the net return being almost equal to the rent.

The average annual cost of living of an Arab family of six varies from $125 to $190, exclusive of about $40 for interest on debts averaging about $135 per family. The average Arab family’s holding is 56 dunams, the committee found. An owner cultivator requires 75 dunams while a tenant needs 130 dunams or else he must supplement his income by hiring out as a laborer.

The burden of taxation is 19 per cent on net return and more than 10 per cent on income from ownership and the same gross income from agriculture. The cost of living, as shown by six typical Jewish settlements, ranges from $165 per family of six in Yavniel, a PICA colony in Galilee, to $625 in Nahalal, showing the different standards among Jews. Communal expenses, taxes and rent range from $30 per member in the communal colony of Beth Alpha to $140 per family of six in Nahalal, the committee’s report indicates.

The balance from the gross income to meet the cost of production is not always adequate to meet further expenditure even without paying Zionist loans varying from $30 to $4500 per family repayable in from 45 to 50 years, the committee found.

The report quotes Moses Smilansky, a Jewish agricultural expert, as estimating the income from 100 dunams of mixed farming land as $245, the cost of living for a family of five being $230 with the exception of those in the orange-growing-zone whose net income per dunam is $96.

ARAB DEBT $10,000,000

The committee estimates that the total debt of Arab cultivators is $10,000,000 and that interest charges are a minimum of 30 percent but a fee of 50 percent for three months is usual. The gross income of the Jewish farmer is roughly double that of the Arab farmer on the same holding, the report says, and his cost of living is more than double that of the Arab cultivator. The Jewish farmer also suffered from the recent sharp fall in agricultural prices.

Little cultivable land remains uncultivated, the committee says except for the plains of Beersheba, the Jordan Valley and the Huleh area, all of which require a large expenditure for irrigation and improvements. The report also sees the need for training cultivators by the government, although intermittent efforts have been made in this direction. Jewish training institutions have done much in this connection, the report states, but their influence on the entire country has not been felt where little has been done despite the example of the Jewish organizations in consolidating or creating markets for local products.