GOLD EXPORT TAX.

Auckland Star, Volume LXVIII, Issue 157, 5 July 1937, Page 4

GOLD EXPORT TAX.

SUGGESTED COMPROMISE.

A constructive suggestion for a modification of the export tax on gold, whereby the proportion of gold won which is necessary to provide for the average working costs, should be exempt from taxation, was put forward by Mr. W. P. Gauvain. chairman of directors of the Waihi Grand Junction Gold Company, Limited, at the annual meeting in Loudon recently. The proposed amount to be freed from taxation was the first sdwt of heading value a ton. "The export tax on gold is a tax on production and not on profits," said Mr. Gauvain. "A gold mining company may be giving employment to a large number of men and making no profits, yet is called upon to pay 12/6 for each ounce of gold produced. My suggestion would allow the treatment of lower-grade blocks of ore and ■would encourage to the fullest extent the exploitation of the mineral wealth of the country. The increase in the price of gold automatically allows the mining of lowergrade ore, but any form of taxation which minimises this opportunity must be contrary to the interests of the community. '"This taxation on production was "imposed by the previous New Zealand Government, and so far the present Government has not seen fit to modify the method. Any modification which would still provide revenue for the Government, and at the same time not retard the development of the gold mining industry, should be welcomed. I put forward the suggestion that the first sdwt of heading value a ton be eliminated from taxation. "This sdwt of heading value represents approximately the average costs of mining in the Dominion, although the costs of many of the smaller mines are far in excess of this figure. Under this system, if the heading value of a mine was lOdwt the tax would only be paid on adwt. Any form of taxation as suggested must also be applicable to dredginc and sluicing, but there should be no difficulty in applying the proposed method to these cases. '"For the past 10 years we have been employing from 6ft to 70 men. The anticipated cessation of our mining operations will have a detrimental effect on employment in the Waihi goldfield, although the result may not be felt immediately. Our representatives in New Zealand have from time to time drawn the attention of the Government to the harmful effect of this export tax, but without success."