All improvements are exempt. All buildings, fencings, draining, crops, etc.—all value that has been added by labor, all live stock also and personal property; only the unimproved value of the land is taxed. Mortgages are deducted also in estimating the land taxes as they are taxed to the lender. There is a small-estate exemption of $2,500, where the net value of the estate doesn’t exceed $7,500. So that if a farmer has no more than $2,500 of land value left after deducting improvements and mortgage liabilities from the value of his real property, he pays no land tax. Besides the three exemptions mentioned, there is another conditional exemption. If an old or infirm person owns land or mortgages returning less than $1,000 a year, and can show that he is not able to supplement his income, and that the payment of the tax would be a hardship, the commissioner may remit the tax. Here the custom is quite the other way. The millionaire swears off his tax. Out of 110,000 land owners, in New Zealand, only 16,000 pay tax. The graded tax begins when the unimproved value reaches $25,000. It rises from ¼ of a cent on the pound of $25,000 to 16⁄4ths, or 4 cents, a pound on a million dollars, or more, of unimproved value. This graduated tax is in addition to the ordinary level-rate land tax levied each year, which is 2 cents on the pound. Absentee owners of large estates have still another tax to pay. If the owner of an estate large enough to come under the graded tax has been out of the country a year, this graded tax is increased 20%. The income tax applies to net income from employment, and net profits from business. There is an absolute exemption of $1,500, except in the case of absentees, and companies whether absentees or not, and a further additional exemption up to $250 a year for life insurance premiums, if the citizen wishes to spend his money that way. All income derived from land or from mortgages, so far as they represent realty, is outside this tax, which affects only income from employment or business. The farmer, who derives all his income from land, pays no income tax. The same may be said of a lawyer, doctor, teacher, artisan, or any other person who makes no more than $1,500 a year. The total number of income-tax payers is only about 5,600.