Government's move to raise an extra $7 million in land taxes came under heavy criticism from Opposition MPs last night.

The United Bermuda Party said it wanted to know why the Government "needed to raise an extra $7 million'', just a few months after a Budget in which few taxes were raised.

Opposition MPs said it raised questions over Mr. Cox, who it was claimed had done a 180 degree about turn in proposing to raise taxes when pledging he would not.

But the Government defended its actions, saying it was only bringing up to date legislation that the UBP had neglected.

The accusations came as the House of Assembly passed the Land Tax Amendment Act 1999, which will increase many land tax bills but offer reductions to others.

Shadow Legislative Affairs Minister John Barritt launched into the Government over the bill.

"Where is the money going? he asked. "Perhaps revenue is falling behind expenditure.

"I think the Country deserves an explanation. It is not good enough to say some people are going to get a reduction.'' And Shadow Finance Minister Grant Gibbons said it was extraordinary that there was going to be a 25 percent land tax increase so soon after February's Budget.

"Most of us remember the Finance Minister who said he would not raise taxes.

And three to four months after he is doing a 180 degree turn,'' he said.

Dr. Gibbons, who said the impact would be felt across the community, said the episode raised questions over the credibility of the Minister and his position.

But Mr. Cox, in introducing the bill, said the Progressive Labour Party had done much to lessen the blow to householders and had raised relief for pensioners.

And he slammed the UBP for letting annual rental values go unreviewed for ten years.

He said his department had received calls from people who were pleased the review had taken place, adding that deferring the matter would have made matters worse.

And he said it had only tackled one year, and would re-visit the issue in the future. In addition, residents have six months to object to the new rates.

The bill means homes with ARVs above $28,000 will see rises, with decreases for 75 percent of homes, he claimed.

The tax rate goes from 1.5 percent to 22 percent, depending on the ARV band -- with those in the higher bracket having a 60 percent discount on the total.

Mr. Barritt said the new system would hurt "people in the middle'', especially pensioners, some of whom had seen their land tax go from almost nothing to $800 a year.

He warned that businesses -- which were getting no breaks -- would pass on the tax burden by increasing the prices of their goods or by laying off people.

This in turn will cause workers to ask for increased wages to meet the higher prices.

Mr. Barritt asked what Government planned to spend the $7 million on.

"See if you can guess,'' responded Attorney General Lois Browne-Evans, while Transport Minister Dr. Ewart Brown replied: "We are working on a wonderful plan for the Country.'' Environment Minister Arthur Hodgson said the previous Government had put this tax system in place and it was therefore "sheer hypocrisy'' for Mr. Barritt to criticise it.

He said Government promised not to increase taxes and it hadn't. Payroll tax and Customs duties remained the same and the tax levels imposed on the five bands of ARV for properties had decreased.

To repeated questions by the Opposition of "where is the money going'', Mr.

Hodgson said a person paying tax does not ask this question and "it is a stupid question''.

TAXES TAX