Aurora critical of machinery tax

Press, 24 February 1977, Page 18

Aurora critical of machinery tax

PA Wellington I Criticism of the sales-tax [of ten per cent on machinery was made by the . chairman of Aurora Group. . Ltd (Mr J. E. Gillingham) at the annual meeting I. "I believe that this bright [idea was developed by the [ Prime Minister’s ‘think (tank’ w : thout any thought as to what its effect, both short and long term, would • be or how it would be inter- ’ I preted by the Customs Department,” Mr Gillingham said. ■. “In both the quarrying ‘i and concrete business, the Hreplacement cost of wearing “parts is one of the major “costs of processing. l f “While I can understand | the Government wishing to “restrict the purchase of new • equipment. I cannot see any J benefit, other than the imimediate revenue, in taxing [wearing parts. I “The tax must be passed .[on to the ultimate consumer, • which in this particular lease, is usually the GovernIment, local bodies or the. ' owner of houses or buildI lings. I “In addition to the sales-tax, we are faced with a rather absurd position (where heavy transport pays I sales-tax at 40 per cent, while a range of cars, of 'which a number could be [classed as sports or luxury cars, pay tax at 30 per cent, [or 25 per cent less,” Mr GilHingham said. I “The cost of transport is! iborne by nearly all products used in our society and here] again, a substantial propor-[ tion of the cost is created! bv this excessive sales-tax.” I 'The group's quarrying and! building-products divisions;

i suffered considerable losses during the December 20 .(floods in the Wellington >iarea, and repairs were still ' being carried out. ■ Since the end of the year IVibrapac Masonry (Wellingjton) Ltd, and Cement Products, Ltd, had merged the ; manufacturing. marketing • and distribution of their in the Wellington I region. „• This has been done bv .(transferring Cement Prod-i Jucts from Lower Hutt to the i premises of , Masonry, and by the formalition of a separate company,. JVibrapac Masonry (Cement • [Products) Ltd, in which Aur- | ora holds a majority interpest, with premises at Para- , [paraumu and a manufac-l r turing plant. Pyramid Con-j • Crete Industries Ltd, at Wai.kanae. • > Demand for the group's [rented space remained firm.; land the group was at , present negotiating for ten-

s ants in the proposed nev Jibuiiding at 38 to 42 The Ter i race, Wellington. 1' Figures for the motor di vision over the past fou: r months were also up sub •Istantially . n last year. - Mr Gillingham said that ? the question of inflation wa: t in the minds of investors • and it was interesting t< ijlook at the history of t share in Aurora Group. Ltd from the time when the ■ I company was known ai ‘Medical Chambers, Ltd. 1 “The company was former • in 1926 with a paid-up capital of 25.650 pounds. A (Shareholder who subscribed • for 100 shares of one pounc (for say $2OO will, including the proposed bonus issue ol ■ll for 10. but without am [further investment, but less .'the sale of any rights, would now hold 2113 shares. • ; “The sale of rights to cash .[issues would have returned more than his original investment.

w "If he had taken up all r-1 cash issues, he would have I invested, at various periods i-!since 1960. a further sl9*s ir and hold 5113 shares 5- “In both cases, he would have received a dividend in it every year of the company's is existence,” Mr Gillingham s, said. :o; "It is always difficult to a accurately forecast the fut, d.'ure. However, trading figures ie are holding up well and proiswided there are no major economic upsets, there is dievery prospect that the curi- rent year should show an A improvement.” he said. i! d