A TAXATION INJUSTICE.

Auckland Star, Volume LVII, Issue 26, 1 February 1926, Page 6

A TAXATION INJUSTICE.

The unfair discrimination made between private enterprise and publiclvowned businesses in the matter of taxation is an old complaint, but there is no reason why the public should be allowed to forgot it. The vigorous protest against it that the chairman of directors of the Gas Company made to-day will help to keep the subject alive. Mr. Upton speaks with feeling. His company pays £24,000 income tax, which is equivalent to od per 1000 cubic feet of gas, but it lias to compete against the Power Board, which is exempt to the extent of many thousands a year. There arc broadly two aspects of this question. One is that under the present law every extension of public enterprise contracts the field of taxation. The Auckland Tramways were a case in point. When they were privately owned they paid over £20.000 in taxation to the Government: to-day they pay nothing. That £20,000 has to be found by the rest of the community. If the Gas Company was taken over by the municipality to-mor-raw the £24,000 it pays to the State would be spread over the other taxpayers. The second aspect is the unfair, ness of the system. The law loads one competitor with taxation and exempts its rival. The policy is simply immoral. It is defended on the ground that these publicly-owned concerns are the property of the people. and are not operated for profit. The fact that they are public property is no excuse for the perpetration of injustice, and they are operated for profit in one sense at least, that they have to pay interest on their borrowed capital. Also, as Mr. Upton says, these concerns have no monopoly of the wish to give the public good service. He cites the condemnation of the present law by the Chambers of Commerce. Tt is curious that whereas business men who are members of Chambers of Commerce have rightly protested against this inequitable system, business men who are members of municipal bodies have uphold it. A few years ago Mr. Massey proposed to I tax municipal trading concerns. Pressure i was at once brought to bear upon him !by the municipalities and he withdreaw the proposal. Vet these local bodies are composed for the most part of business men. who should have some sympathy with the grievance of members of their class subjected to this unfair^competition. We may venture the opinion that if the State or the municipality proposed to compete in this wav against their own private businesses they would object strongly. The Government, it is only fair to say. has admitted the justice of these protests by subjecting some of its own trading concerns to taxation. It should go the whole length and put all businesses on the same footing.