SALES TAX

Evening Post, Volume CXV, Issue 47, 25 February 1933, Page 12

SALES TAX

PASSED BY COUNCIL

NECESSITY FOR REVENUE

Tho necessity for the Sales Tax Bill was generally recognised by speakers who took part in tho second reading debate on' tho measure in the Legislative Council yesterday. The Bill was put through all stages. Continuing the debate after "The Post" had gone to press, the Hon. W. H. Mclntyre said tnat he was sorry the Government had not placed a tax on crudo oil, as a very small duty would bring in a large amount. The effect of tho tax would not be felt. ; The Minister of Education (tho Hon. R. Masters): This is a sales tax, not a Customs tax. Mr. Mclntyre: Yes, but I am suggesting a method of raising money. A tax of 2d per gallon on crudo oil would .bring in between £300,000 and £400,000, and the Government would then be able to lift the tax from certain articles which are being used by the working people. - The Hon. D. Buddo said that the New Zealand taxpayer was fairly heavily burdened now, and added to that was the substantial drop in the turnover of business. However, the money had to be found, and one had to accept tho inevitable. Both Australia and Canada had sales taxes in operation, so New Zealanc". was in good company. It was hoped that the necessity for the tax would soon disappear. ALTERNATIVE SUGGESTED. The Hon. W. Snodgrass said that it was unfortunate that tho Government had been forced to impose a new class of taxation. It would have been better to have imposed a primage tax on imports. It had been. suggested. that the Ottawa Conference had been responsible for the abolition of tho primage duties, but in his opinion the raising of tho exchange ana the sales tax had been, the outcome of the concessions made at Ottawa. In his Opinion it would have been better to have imposed a 5 per cent, primage du^y -with an extra 5 per cent, on foreign goods. This would have brought in the amount required. The Hon. O. J. Carrington congratulated the Government on the wise course it had taken in endeavouring to help the primary industry to the best of its ability, ' • , Mr. Masters said that in the main the Bill had been weil received, and it was gratifying to see merchants and others offering their assistance to the Government in the carrying out of the legislation. The Government had been generous in making the exemptions contained in the schedule. Due consideration had been given to. the "working people and foodstuffs had been exempt as far as possible. The commercial people had implicit faith in the Comptroller of Customs (Mr. Craig), and would be satisfied with any decision he made. Sir James Allen: Tho Minister may not be guided by him. Mr. Masters said that the suggestion of an independent board to make decisions would receive careful consideration by the Government. The timber industry had already benefited by the raising of the exchange, and it was thought that it would not have objected to the sales tax. If , they exempted timber they would be compelled to exempt cement, bricks, iron, and building materials. This would result in a considerable drop in revenue. USE OF CRUDE OIL. If they imposed a tax of 2d per gallon on crude oil they would be imposing a tax of between £180 and £200 per day on tho shipping companies. The shipping companies had been practically compelled to adopt crude oil because of the attitude of the seamen. The companies and the public had become heartily sick of the way in which ships had been held up. The sales tax was more equitable than a primage duty, which would impose a hardship on the working people. The Bill waa read a second time, put through the Committee stage, read a third time, and passed.