MOTOR TAXATION

Evening Post, Volume CV, Issue 123, 26 May 1928, Page 18

MOTOR TAXATION

THE BRITISH SYSTEM HANDICAP ON MANUFACTURE (From "The Post's" Representative.) ' LONDON", 18th April. Sir-Robert Home, in a long letter to "The Times," deals with' the subject of British ,cars in' the' Dominions, and ho comes to the conclusion, as so many have already done, that the timo has arrived for taxing petrol Instead of power in this country. ' ■. "So far as British manufactures arc concerned in the markets of Australia and New Zealand," ho says, "the motor-car is assuming the character of a test of our efficiency and capacity Nor is this surprising. In thos%, thinly populated regions, where •■ communities are remote from each other, and, the construction of railways is in many cases a luxury, motor vehicles have become a necessity." Speaking of the towns he says: "The workman saves for it; «uid the clerk, in the office also; and everyone scrutinises the cars in the street, and wonders which model he will buy. I ask you to imagine the effect on the psychology of people who find that in -this, the latest triumph of the mechanic's craft, in which they had always believed Great Britain to excel, the stream of cars perpetuaJly flowing past their eyes is over 80 per cent, American— ' advertising, day in and day out, in the most insinuating fashion, American skill, American efficiency, American enterprise." -. ■ | Sir Robert Home goes on to give j facts and figures of >'the trade in Aus- ! tralia and New Zealand. j THE TAX HANDICAP. • j "There is one factor in. the problem which is a definite handicap to the British producer," he Bays, "and as it is the result of legislation it can only be altered by Parliamentary action. It was the universal and most strident complaint macle to me throughout all my travels, that the British cars in the cheaper ranges have 'not sufficient power. Not only in Australia and New Zealand but in Burma and Ceylon +his criticism was pointed and persistent. But who can wonder at this lack of power? We tax our ears on their power—the more power the greater the tax; and British builders have naturally made it one of their objects to design and construct their cheaper cars so as to attract as little taxation -as possible. In the result they make an engine admirably suited to run on the majority of. British roads, but very ill-equipped to' perform the more arduous task of confronting the rough and steep conditions which prevail oversea even in the immediate vicinity of large'centres of population. I ventured to point this out in the Budget debates of last, year, and my opinion has been confirmed by , everything which I have learned since : then. My mind was first directed to the question by a casual remark made to me by a representative of one of the largest American motor-car organisations. He said: "You will never get into your colonial markets until you take your tax off the power of the car.' My conversations in the Dominions have only too forcibly endorsed this observation. . "A moment's reflection shows the cogency of this view. The British manufacturer cannot afford to make different types of car—one for use at home and another for use abroad. If he does so, he loses all the benefit of mass production and his costs of construction' are increased. The Amorican is selling the saino engines in the United States as in our Dominions and turns them out in vast numbers. Even' though the tax on the.'power of the car be removed —which I hopo may be soon—it will still require all the preference which tho Dominion markets afford us to .enable, us to maintain a successful competition against the. advantage which the American enjoys in the colossal size of his home market. If, however, the British manufacturer ' is, contrary to all reason, still left with this handicap upon his efforts, I'see but little hope for him. : ' ,' TAX ON PETROL. :'I shall content myself with saying that a tax on tho petrol consumption of motor vehicles would be at once a better and fairer method of raising the* necessary revenue. It is tho method pursued in New Zealand at the present time, where it is wqrking successfully and easily and without any complaint from those who use petrol for other purposes, who are'refunded the amount of the duty on their purchases. But whatever alternative may be adopted, if we are to have any chance of retrieving for ourselves a position in markets which are of all others^, the most favourable to us, and in connection with an industry which holds out more promise to our great engineering communities than an. other to-day, it is imperative.that we should alter the present incidenco of the, motor tax that our manufacturers may bo left free to design, both for home and foreign: use, a car 'of moderate price with sufficient power to attract the, large and/ increasing number of motor-purchasers in tho external markets of tho .world."