The Press Tuesday, November 8, 1927. The Petrol Tax.

Press, Volume LXIII, Issue 19152, 8 November 1927, Page 8

The Press Tuesday, November 8, 1927. The Petrol Tax.

When the tax of fourpence a gallon oil petrol was introduced, we said that the Government might defend the tax by reminding motorists that they had admitted that improved highways would mean a saving in the bill for tyres and repairs. This defence was made by the Prime Minister when replying to Sir Joseph "Ward's criticisms on Friday night last. The Government, Mr Coates said, was "simply giving the " motorists what they had asked for": the tax would amount to only £4 per annum per car on the average, and there would be "a tremendous sav- " ing " in the life of the tyres and of the car. This may sound reasonable, but it is not so reasonable as it sounds. There underlies the Prime Minister's argument, at least as he puts it, the notion that motorists could not complain if the whole of the " tremendous " saving" were taken from them in taxation. " Tremendous" is a strong adjective, and a "tremendous saving" cj,n be assessed at £25 a year. "Would the Government be justified, then, in making the petrol tax six times fourpence, or 2s a gallon—a levy which, if as much petrol as ever were consumed, would bring in over four millions sterling to the Treasury 1 Of course it would not. All that the Government may say is that a reasonable tax on motorists, sufficient to secure from them their proper share of the cost of constructing, maintaining, and improving the highways, will actually be a benefit to them. The question is whether the tax of fourpence is reasonable. The average owner of a private car will not find the tax a severe burden, but there are some motor-owners —taxi-drivers, motor-carriers, and private transport firms—who will find it really oppressive. Apart, however, from the special hardships which must follow the making the petrol tax the main source of highways revenue, there is the question whether so substantial a tax is really needed. The total sum which the Government proposes to collect in registration fees and the taxes on tyres and petrol is no less than £1,226,000 per annum. The Government does not require so much money as that. If it did, then'it would be contemplating a policy much in advance of the country's needs and in advance of the country's ability to pay. Mr Coates gave a list of the moneys required: £300,000 demanded by iocal bodies, £IBO,OOO necessary for new roads, soma unspecified sum for the amortisation of unspecified lotos, £350,000 for capital construction account, and £60,000 "to meet the reasonable de- " mands of the motorists in the cities." The amount to be contributed during the year' by the counties was estimated to be greater than the £276,000 contributed in 1926-27, so that the Government appears to be contemplating the collection of over a million and a half a year for its highways policy. Since the expenditure of the Main Highways Board in 1926-27 was. not much more than half a million, the Government's proposals are not easy to understand. If the petrol tax were cut down to twopence a gallon, the Government would still be collecting from motorists nearly £900,000 a year, and would have ample funds for as much expenditure as is prudent.