A SAFEGUARD.

Auckland Star, Volume LXIV, Issue 200, 25 August 1933, Page 3

A SAFEGUARD.

EXCISE DUTIES.

UNECONOMIC INDUSTRIES.

SOME CHECK NEEDED

The imposition of excise duties as a safeguard against the birth, under tho shelter of purely revenue tariffs, of uneconomic secondary industriee is an economically sound position, in the opinion of "Professor B. E. Murphy. The point was raised at to-day's sitting of the Tariff Commission by Mr. W. J. Truscott, a director of Spedding, Ltd., who was informed "by Professor Murphy that the commissioners did not subscribe to the interpretation of Article VII. of the Ottawa agreement which implied that revenue tariffs could not be imposed by New Zealand unless corresponding industries existed in the Dominion. . Mr. Truscott said his idea was that when it came to imposing revenue tariffs, an excise duty should be introduced to prevent the creation of uneconomic secondary industries; it should apply to those lines upon which a tariff had "bCen imposed for revenue purposes only. Professor Murphy: Your idea is that to prevent a purely revenue tariff from becoming one of protection, internal production should be balanced by an equivalent excise? Mr. Truscott: That is so. Professor Murphy: Are you just making a passing observation, or do you wish the point to be considered by the commission '! Mr. Truscott: I would like the commission to consider it. "In my own view it would be competent for us to consider it, but I don't know the view of iny colleagues," Professor Murphy replied. "I have often heard it .said that :t purely revenue tariff should be prevented from becoming a protective tariff, by the application of equivalent excise duties. I think that is economically sound, though difficult and, possibly, impracticable to administer. I do not know whether the chairman holds that it is within our order of reference to consider it." Mr. Truscott stated that the commission had had applications from a numrber of small and uneconomic industries for increased protection. Actually they had been created under a revenue tariff of 20 per cent and were now asking for as high a, duty as perhaps 40 to 50 per cent. They would never have started had there been an excise tariff in operation at the time.