DUTY ON BEER

Press, Volume LXX, Issue 21257, 31 August 1934, Page 18

DUTY ON BEER

'•to THO IDITOR OF THE UISS. Sir, I notice it is proposed by the Government to reduce the duty on neer by 3d a gallon. The total consumption of beer (New Zealand) last year was 8,601,484 gallons. The New vear ? , a^ GW f rles Co mpany, in its ates that jt P aid 17 *> 2d as excise duty. This

means that this company's output was 6,322,851 gallons, leaving only 2,275,633 gallons for all the other brewery companies. On last year's output the concession means £107,518 to the brewers of the Dominion, as it cannot be conceived that it can be passed on to the consumers. The New Zealand Breweries Company a while ago watered its stock 50 per cent, and paid a dividend of 7 per cent, on the whole of it. This means that 10J per cent, was paid on its original capital, yet this company will receive about ,■£38,000 in reduced taxation. I expect to see the shares take a big jump. I should have appreciated a penny or two a gallon reduction in the petrol tax, and I think Ihe general public would, too.—Yours, etc., W. DOBBS. August -2, 1034. I The above 1 tier has been referred to an official of the company, who replied: "An houc.it criticism would have recited the Government's reasons for the reduction, viz., to reduce the duty on English beer by 3d a gallon, as a reciprocal gesture to the Mother Country to take the Nelson farmers' surplus hops, and so, in turn, as a fair proposal to the local breweries, to make them a like reduction of duty to meet the competition of the imported product. Then, again, Mr Dobbs's assumption that the reduction of 3d a gallon is to be pocketed by the company, cited without the knowledge as to whether it is the company's intention to pass the reduction on or not, is further evidence of his unfairness. In justice to the company, when the Government found it necessary, on two recent occasions, to increase duties and to apply the sales tax on beer to supplement the public administrative purse during the depression, only a portion of this was passed on to the company's customers 1 , so it is only reasonable to suppose that they will again meet their people fairly. Mr Dobbs would have been well advised to have awaited the company's attitude in this connexion before rushing into print."] 'rr> thx editoe o» the mess. Sir, —I notice in "The Press" this morning a great outburst in the House of Representatives by Mrs E. R. McCombs on the reduction of 3d a gallon on beer duty. Mrs McCombs may know a lot about the prohibition side of it, but she certainly knows nothing about the brewing industry. Does Mrs McCombs know that outside of the New Zealand breweries most of the small breweries are running at a loss and have been doing so for the last three years. For although the New Zealand Breweries have paid for 1932 8 per cent, and 7 per cent, for 1933 and 1934 the small breweries have paid no dividends at all, and if the present Government had not given this small reduction of 3d a gallon it would have meant that the small breweries would have had to close up. Another point that Mrs McCombs overlooks is the fact that the duty on beer is so easily collected by the Government, being paid in cash every week. Before the war excise duty on beer was paid by stamps at the rate of 3d a gallon, and after the war it rose to more than Is 6d a gallon paid on every brew. This meant that the brewer had to pay duty on beer as it was brewed, and as good beer has to be kept in the wood and bottles for at least three to six months before it is sold, any person can see what large sums the Government got in duty when the breweries were holding big stocks. Mrs McCombs also forgets that the working man, whom she is supposed to represent, has only one beverage, and that is beer, and in many cases that is all the working man has to look forward to. Good, wholesome beer brewed from pure malt and hops is recognised as the best beverage made in an( * taken in moderation, it will do far more good than harm, for it is a food as well as a drink. For Mrs McCombs to say that the 3d a gallon reduction in beer duty will increase the number of men on the No. 5 scheme and increase insanity and crime, etc., is just utter rot, and I am surprised at a woman of Mrs understanding making such an absurd statement. I would like to see Mr Coates reduce the beer duty another 3d a gallon and also take off the sales taxthen the working man would get cheap beer.—Yours, etc., , HOPS. August 30, 1934.