Associated Chambers Call For Tax Review

Press, Volume XCIX, Issue 29194, 3 May 1960, Page 8

Associated Chambers Call For Tax Review

(Aeu> Zealand Press Association) NAPIER, May 2. The Dominion conference of the Associated Chambers of Commerce at Napier today decided to urge the Government to set up a special commission to undertake a complete review of the whole system and incidence of taxation with a view to making recommendations for a simpler system. The conference suggested that the Government might well adopt the recommendations of the I Government-appointed expert committee after its 1 taxation review in 1951.

Irrespective of the weight of taxation, the conference was of the opinion that the present legislation on land and income tax was becoming so complex and difficult of interpretation that the private individual had little hope of understanding his obligations. "Even skilled accountants frequently experience difficulty in interpretation, and the Inland Revenue Department itself has on occasions been confused,” said a report from the taxation and finance group adopted by the conference.

The conference also urged the Government to establish as soon as possible a taxation appeal authority along the lines of Australia’s Board of Review.

Airport Policy— I The conference urged the Government to state without further delay its national airport policy. The Government should state the number of international airports it intended to establish, their location, and the method of financing them, the conference agreed. With internal airports the information the Associated Chaml?ers wants known is the priorities to be accorded such airports and the methods of financing them. i A report adopted said the time had arrived when the over-all aviation picture should be carefully examined, particularly when there was evidence of competing interest for airport development. ! "Careful study should be given to existing airports, the direction and extent of expansion, and to the inter-relation of priorities for international and internal airports,” said the report. Sales Tax—

I If and when sales tax is reduced or abolished in respect of goods whose prices are controlled under the Control of Prices Act, relief should be given to those traders who would suffer hardship through holding unsold stocks. The conference decided to forward a recommendation to this effect to the ; Government.

This matter was noted as being of particular application to motor-vehicles, and it was felt that an unjust anomaly could arise if and when sales tax is reduced on such goods.

Use Of Ports— Problems associated with the flow of goods at New Zealand ports are to be studied by chambers of commerce. The ultimate aim of the study is greater ultilisation of port facilities. The Associated Chambers adopted a report of a trade, indenting, and development group requesting the study. It was necessary to the economy that ships be turned around as quickly as possible, the report said. To achieve this, harbour boards installed expensive equipment which speeded up loading and unloading, but it often lay idle.

The immediate remedv to achieve greater use of this equipment was the improvement of distribution and storage facilities. said the report. An improvement would enable the free flow of goods to and from wharves. After this, attention could be given to the introduction of ships’ work so that port facilities could be used to the fullest possible degree. Skilled Workers—

A “strong" recommendation to all employers, including the Government. to increase the rewards and incentives to skilled workers of all categories, and that they endeavour to widen the gap between the skilled and unskilled was passed.'

In a report from the conference's trade group, it was said that the narrowing of margins for skill, academic attainment, and responsibility had had particularly serious results in New Zealand.

“There has been a consequent loss of pride in workmanship." the report said. “Steps must be taken to arrest this drift, which is taking place at all levels.’’ The conference was of the opinion that the operation of the general wage order system was a major factor in reducing the margin between the rewards of skilled and unskilled labour. Housing Benefits— The conference decided to recommend to the Government that housing benefits (apart from rehabilitation cases) granted to individuals at public expense should be paid from the Social Security Fund and should be subject to a continuing means test. The conference aconsidered that the present administration of housing benefits was an unscientific way of dispersing publicassistance and an improper way of dealing with public funds. It was said that those who qualified for assistance when they first obtained housing benefits in many cases improved their positions beyond the point where assistance from their fellow taxpayers was needed or justified.

It was felt that when the rate of interest or 1 rent charged by the State was below market value a continuing benefit was being provided by taxpayers for an arbitrarily selected few. The conference believed that the concessional rate of interest should be subject to an annual application to the Social Security Commission and to a continuing means test. The conference also decided to urge the Government to authorise a proportion of State Advances housing loans to be made available to buyers of older houses in good condition. Charitable Gifts—

The conference deplored the fact that gifts for charitable, educational, and research pur-

poses were not, under New Zealand legislation, deductible items for income-tax purposes.

; The conference considered that i welfare legislation could never j fully replace many of such institutions, for which Government grants never met all needs. It was also felt that it was to the good of any country that the development of a public-spirited outlook should be encouraged and that the cardinal virtue of charity “should not be stultified as at present.” Scholarship Fund— The conference approved in principle the establishment of a senior scholarship award fund. From this fund suitable applicants wanting to pursue higher commercial studies in New Zealand or abroad may be given financial assistance. - The conference directed the incoming executive to bring down no later than the 1961 meeting a definite proposal for the scholarship. The conference approved in principle of the fund as a lead to other intorested parties to insist on higher education for future business executives. > Bank Holidays— The chambers are to continue negotiations with the New Zealand Bankers’ Association to have trading banks open on the same days as retailers and other businesses. particularly at Christmas and Easter. Immigration— The reasons given by the Government for reducing the immigration programme in 1958 were no longer valid, said a committee report to the conference. “Immediate action is necessary to set up the machinery necessary to select desirable categories of migrants and to maintain and even expand this programme at a consistent level.” continued the report. “It is also desirable that the proportion of European migrants should be increased, and in this regard time is running out. as improved economic conditions in Europe are reducing the availability of the type of immigrant that should be sought to introduce into New Zealand the skills, outlook, and culture which are proving beneficial in Australia.”

New Zealand’s expansion would be greatly retarded if an adequate labour force was not built

up to man industry. Air Rights— With the increase in tourist potential through the advent of the jet age there was ah urgent need to do everything possible' to facilitate the entry into New Zealand of overseas tourists, said another report. “At present New Zealand is being by-passed by overseas airlines because they are not permitted to carry passengersj across the Tasman without re-i striction as to stopover or des-; tination.

“The great American tourist market of 180 m people is now only 16 hours away by air, and an endeavour should be made to permit these overseas airlines to be granted the rights to land in New Zealand ,and continue to Australia without their affecting unduly the operations of T.E.A.L.,” the report said.

“The conference feels that this could be achieved by an arrangement whereby aircraft from America with passengers for New Zealand could pick up an equivalent number of passengers in New Zealand for carriage to Australia or to have a restricted licence to carry passengers from New Zealand.

‘‘lf the way was opened to bring these extra air passengers into New Zealand it is felt that T.E.A.L. would not suffer but in the long run would increase its Tasman business through a greater number of tourists travelling on to Australia after a stop in this country. The conference is not in favour of these overseas airlines being permitted to operate in and out of New Zealand without restriction, as some form of protection must be given to T.E.A.L. to continue the fine work it is doing in fostering tourists from-Australia.” Car Insurance—

The present system of dividing motor-vehicle insurance into class 4 and class 5 could create a serious position for a businessman who might in an emergency use his wife’s or some other private car for business purposes, said a report from the general and administrative group. ‘‘lt could be said that there are few private cars which are not occasionally used for business purposes,” said the report. “The conference feels that the amalgamation of the two classes would remove complexities and difficulties. and it directs that further representations to that end be made by the executive.” The report was adopted. Import Control—

The present system of import control constituted an unwarranted interference in private business and with the democratic rights of the individual trader to deal freely tvith overseas suppliers, saicl a report by a taxation and finance group of the chambers. I The decisions of individual (businessmen working within flexible limits were a more effective way of ensuring the proper use of available funds than detailed decisions by Government ollicials said the report. "The Government's attempt to deal in such detail with matters of such complexity has caused I delays, injustices, and unnecessary inroads on the time of departmental officers, whose services could be better employed, elsewhere.” the report added. i The report was adopted by the] conference. Its views will be' forwarded to the Government. I