TAXATION BURDEN

Dominion, Volume 32, Issue 261, 2 August 1939, Page 12

TAXATION BURDEN

Proposals Criticized By Opposition - INCREASED COSTS Not Likely To Encourage Production “The cry seems to be ‘.More money, more money; we want more money,’ ” said the Leaflet of the Opposition, Mr. Hamilton, during the discussion of the Customs resolutions in the House of Representatives last night. It would be difficult to debate the resolutions without a little more previous knowledge of their contents, he said, but the" Opposition would enter an emphatic protest at the substantial additions that had been made to taxation. The petrol -tax would apparently go on to all users, said Air. Hamilton, and would! immediately result in a substantial increase of the costs of agriculturists. If the money was to be spent for highways, it should be provided by users of the highways, and not by back country men who used a petrol engine, and dairy-farmers who milked with a petrol engine. “It seems a queer way of assisting to increase the production of the country,” he added. Air. Hamilton claimed that he did not know much about the beer duty or its possible effects, but said be was interested in the explanation of the Acting-Minister of Customs that when previous additions were made, there were increases in the consumption of both beer and petrol. “The petrol tax will add largely to the dairy-farmers’ costs,” he said. Air. O’Brien (Government, Westland) : They get it back through the guaranteed price. Air. Hamilton: 1 hope the honourable gentleman may be right. Air. Doidge (Opposition. 'Tauranga) : And -this is the Government that was not going to increase taxation. “They don’t look very happy about it,” said Air. Hamilton. “I thought when the additional fourpence was put on wages tax last year that that was quite enough additional taxation, but. we have had another £3,000,000 put on to us tonight.” The Minister of Industries and Commerce, Air. Sullivan : We give it nearly all back to the people. Air. Hamilton: The Alinister seems very apologetic. Air. Sullivan explained that the additional cost would go on to petrol in the morning. Effect on Production. The tax on petrol would mean a substantial increase in costs all round because transport entered so intimately into the life of the people, said Air. Forbes (Opposition, Hurunui). It was certainly not the way to obtain the increased production that the Government talked of. Air. Coates (Opposition, Kaipara) : Did I understand the Prime Alinister to say that the proceeds would go partly to the Alinister of Public Works to keep his fleet of bulldozers going or is it all to go for defence? If it is for the Alinister we will have something more to say about it. Air. Sullivan said that it was fairest to increase the price of petrol at once, because while some would benefit, it was fairest to all. To Air. Coates, he said that the increase of -Id. a gallon would roughly correspond to the increase in the amount to be spent on defence. “I think I am right in saying that the increase would not have been levied if it was not for the additional amount required for defence,” he said. Air. Bodkin (Opposition, Central Otago) said it was nothing more than a coincidence that the increase iu the revenue from petrol tax coincided with the extra expenditure on defence. Air. Sullivan: I wish the honourable member would accept what I have said.

Air. Bodkin: I think the Minister is not entitled to make that deduction. This extra 4d. is a revenue tax to be paid into the Consolidated Fund. It will be available for all avenues of Government expenditure. It will be a crushing tax as far as settlers in tlie back country are concerned.

No section of the community was so dependent upon motor transport as the backblocks settler. Air. Bodkin continued. The tax would, be passed on to the farmer. The Government stated that it was out to encourage production and then imposed taxes of a character that justified doubts of its sincerity. The Government was in a desperate position and had to get revenue. The proposed tax would lie easily collected and valuable to the Minister in balancing his Budget. The Acting-Leader of the House, Air. Fraser: In reply to the honourable member who has just spoken, it is in its very essence a defence tax. If there were no extra expenditure on defence there would be no extra petrol tax. If tomorrow the world situation clears up the tax comes off. (Loud Opposition laughter.) lam not going to promise the same thing about the beer tax. There should be, however, no difference of opinion as far as defence is concerned.

Air. Coates: Can it be called a tax purely for defence? Mr. Fraser: I would say yes. If there was no need for defence there would 'be no petrol tax. Air. dull (Opposition, Waipawa), said that while the extra tax represented a 40 per cent, rise in petrol tax to the ordinary motorist, it meant a rise of 100 per cent, to the farmer. "It. is an iniquitous proposal and 1 submit that no Government having regal'd to the decencies of taxation would continue such a proposal for a moment. Air. Polson (Opposition, Stratford), said that Hie Government that now proposed to raise the tax was the same one that had previously said it would not. think of adding to the burden of taxation. With sublime indifference to the primary industry rind with cynical disregard it put the increasing tax on the far.mer. “1 think the farming community will rise,” Air. Polson said.

From somewhere a voice cried "in rebellion,” and the Chairman of Committees, Mr. AlcKeen, alter a point, of order had been raised by Mr. Fraser, was engaged in it long and complicated discussion with Mr. Polson as to whether or not he bad used the words "in rebellion." .

"No one can put. words in my mouth, not even the Chairman of Committees, ’’ said Mr. Polson, amid cries of “Order.” “I said that the farming co.ininnnity would rebel against the tax and I repeat it.” A Government, member: Does the honourable gentleman mean — Air. Polson: I meant what 1 said. No more and no less.