PETROL TAX.

Auckland Star, Volume LXI, Issue 196, 20 August 1930, Page 8

PETROL TAX.

REVEITJc ALLOCATION.

CITIES VERSUS COUNTRY.

REVIEW NEXT SESSION,

PRIME MINISTER'S PROMISE,

(By Telegraph.—Parliamentary Reporter. )

WELLINGTON, Tuesday,

Admitting that the whole question of petrol tax allocation required to be reviewed, the Prime Minister, the Hon. G. W. Forbes, in the House to-night announced that this question would be dealt with next session. Several speakers, however, commented on what they considered was unfair allocation to the cities, the principal contributors, and urged the Government not to delay

revision. The Prime Minister declared that lie was quite satisfied that after six years' experience of the petrol tax the country had arrived at the stage when it had been brought to the forefront and when claims between the cities and smaller boroughs should be given effect to. He had always felt that the cities with their 50 per cent of contribution to this revenue would not long be content with a distribution of 8 per cent of the proceeds. When this gentlemen's agreement was made he did not know whether motorists in the city were consulted and agreed to accept 8 per cent of the proceeds, but he doubted very much whether anyone. on their behalf would have come to such an agreement. When a claim was made by one section of the 'community for the whole of the petrol tax it was time the whole thing was looked into to see who really should share, and there should also be some consideration of whether a separate account and a separate highways board should deal with it. It was suffgested by Mr. E. J. Howard (Christchurch South) that the arrange--ment regarding the allocation of the tax was entered into with a small group and that the great mass of motorists were" ignored. The principle of the Tax and its allocation to a specific object was unscientific and unsound. This was proved by the annual row over allocation. He predicted it, and so long as the miserable system continued whoever was in charge would be in trouble. He contrasted the petrol tax with the scientific method adopted by the Prime Minister of assessing taxation on films by which the State would get its just share of the profits in a way which would not enable film importers to pass it on to showmen. Why Wait Till Next Session? > Mr. R. A. Wright (Wellington Suburbs) asked why members should wait till next session to introduce a fairer system. Wellington, with the increased tax-, would contribute £225,000 and get little more than last year, and the same thing would occur in all the cities. The four main centres would, he believed, say about £750,000 and get only a few hundreds more from the highways fund.

Mr. H. E. Holland, leader of the labour party, asked members not to •verlook the importance to the cities of good communication with country districts in the promotion of trade. It was, (however, a great mistake to set up an organisation independent of Parliament to spend the petrol tax. The Highways Board gave Parliament no information except that a certain amount of money was received and a certain sum spent. There were'no details of its policy or future plans. He hoped to see a select committee of the House appointed to investigate the whole position during *fcll6 XGC6SS. Mr. W. J. Jordan (Manukau) brought forward the matter of the Mount Roskill and Mount Wellington Road Board districts and the EJierslie Town Board and Panmure Township Road Board districts, .explaining that these districts, three of which had sufficient population to form boroughs, were in the County of Eden, but as there was no Eden county council they could not draw part of the petrol tax. Mr. Jordan asked that the whole matter of the allocation of the petrol tax to every class of local body be considered, and a definite statement made to the House. Clause Challenged. When the Finance Bill was in Committee, the Rt. Hon. J. G. Coates, Leader of - the Opposition, challenged clause 6 of the Finance Bill, providing that interest must be paid out of the Main Highways, Fund on the £1,226,000 transferred from, the Public Works Fund, The clause was retained by 43 votes to 28 The Opposition leader also divided the House on the proposal in the bill that subsidies to local authorities in respect of their general rates be paid in future from the Highways Fund. The clause was retained, by 44 votes to 28. Apportionment of petrol duty between counties and boroughs is covered by clause 38. . The' Prime Minister, . referring to strong protests against the smallness of the borough allocation of 5J per cent, stated that he was prepared to revert to 8 per cent after March 31. He could not do so this year, as the financial resources would not permit. The whole matter needed review, and. the P ro P or " tion would have to be decided. The present position, would enable the boroughs to get 8 per cent of 4d out after March 31 they would let them have 8 per cent of 6d. • Mr, P. Fraser (Wellington Central): That'is a fair proposition. - '■ Mr. A. Harris (Waitemata) asked, ■why not start immediately if it would be possible to do so in March? La bour - Members: Be generous! Position of Town Districts.

Mr. Jordan asked what would be done for town districts with populations of 6000, but which were not getting the benefit of being in the county area. Applications had been made to the Public Works Department for grants, but the position was indefinite. The Prime Minister replied that the bill did not disturb the present position. Grants were made from the counties' proportion to the smaller boroughs, but as he had already indicated an investigation of the whole allocation system ■would be held early next session in time to legislate the apportionment. The clause was passed by 45 votes to 27 and the bill was subsequently passed. •