Petrol Tax

Press, Volume LXXXIII, Issue 25244, 24 July 1947, Page 6

Petrol Tax

Mr Nash’s answer to the South Isiand Motor Union, which recently asked him again to abolish the 4d a gallon tax on petrol . imposed for war expenditure, told the union nothing it did not already know and gave it little ground for hope. The Minister promised, as he has pro mised before, to review the tax this year, and to examine it “ in relation “ to the financial position of the ‘’Dominion”; and the union is entitled to see in this promise some recognition, however vague, of motorists’ claims if, or when, taxes are to be further reduced. But that, of course, is not enough. What the motorists want the Minister to recognise, and acknowledge, is that the tax was a war-time measure, related to the “financial position of “ the Dominion ” in war time only and that, as the war has now been over for two years, it should come off without delay. It is obviously

true, as Mr Nash said in the House in September, that “ motorists “ should pay their fair share of tax“ation, as well as everyone else”; and in war time, when the country had to gather every penny it could, their fair share, like everyone else’s, was an increased amount. But taxes no longer supply the War Expenses Account. Some, accordingly, have been reduced, some abolished; and the Government’s failure to do anything about the extra 4d on petrol means that the motorists are left contributing to the Consolidated Fund, for no demonstrated reason, as much as they contributed to war costs for a very good and obvious reason. They are certainly paying more, at Is 2d a gallon, than the Governments of Australia, England, Canada, South Africa, or the United States require. The motorists are also asking the Governinent, and have been asking it for a long time, to use for highways purposes all the tax that is not remitted. At present 8d of the tax —the 4d imposed for the- War Expenses Account and another 4d imposed as a special emergency measure to assist the national finances during the depressiongoes into the Consolidated Fund, and the Main Highways Account receives the remaining 6d. The motorists contend that petrol taxation was imposed prjgiitally for road purposes. Mr Nash has denied it, and he has said, in addition, that highways taxation would not meet half the cost of the roads and bridges. But in pointing to the loan indebtedness of the Main Highways Board (£13,067,912 last year) and the relief it has been necessary to give it by wiping of! sopie interest on its loans, he has pointed to the need for reviewing the whole system of highways finance; and he has not weakened but has strengthened the arguments pf those who say that the changes should begin with the diversion to the Main Highways Account of the £1,500,000 or so which now goes into the Consolidated Fund from the depression tax on petrol.