HEAVY ON MOTORS

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

HEAVY ON MOTORS

PETROL TAXATION

MR. ANSELL'S PROTEST

REVIEW URGED

Taking the view that motor taxation was already heavy and that' it was practically impossible to tap the motor industry for further revenue, Mr. A. B. Ansell (Government, Chalmers) appealed to the Minister of Customs in the House of Kepresentatives last night to reconsider the Government's de^ cision to increase the petrol tax by 3d a gallon. Mr. Ansell prophesied that the tax would not yield the revenue estimated, and said that it would place a further heavy burden on. the section of the people least able to bear it —those engaged in industry. Luxury motoring, he said, had. already diminished. He also urged the necessity to maintain roads, submitted that the oil companies- should be asked to carry a share of the tax/ and expressed the opinion that the time had arrived when a thorough investigation should bo carried out into transport generally. Mr. Ansell congratulated the Minister of Customs on having exempted fishermen from the tax, and pointed out that this class of the community would receive a much-needed relief. He said that he recognised the Government's difficulty in regard to the .raising of revenue, but in so far as its efforts referred to the petrol tax, he considered that it had gone about the matter in the wrong way. He prophesied that the Minister would be sadly disappointed when he estimated that he would receive half a million pounds from the petrol tax. Every gallon less of petrol used would not mean 3d but UJd, Customs revenue would decrease, and the extra taxation ■would tend to increase unemployment. The position was 'vexy seirious. Mr. H, Atmore (Independent, Nel-' son): Will it be serious enough to affect the party vote? Mr. Ansell: The hon. gentleman will get his answer when the bells ring. BACKBLOCKS WILL SUFFER. Continuing, Mr. Ansell said that luxury motoring had been reduced, and the Government was now attacking motor transport in industry. People in the backblocks particularly would' suffer, as they were dependent on motor transport. In his own electorate, the people were totally dependent on motor transport; they had no railway service, yet they were forced to carry their share of the loss on the railway service. Now with this tax they had to beir an additional burden of the Consolidated Fund's requirements, and he contended that they were being treated very unfairly. . Motorists were very heavy payers of taxation, and the organised motorists had stood up to the difficulties of the Government and assisted if in a creditable manner. Taking into consideration the amount paid by way of Customs revenue, in three years motorists had contributed nearly eight million pounds to the national revenue. He thought it could be concluded that there was sufficient evidence that additional taxation on motorists would not produce further revenue. It should be apparent that the reservoir .-had been practically drained dry. He suggested that the Government should reconsider the question of the petrol tax. THE OIL COMPANIES. Mr. Ansell said that, the oil companies had been referred to. What did the Minister intend doing in regard to them? Two or three years ago the House had a report from a Select Committee, but as far as he knew nothing further had been don© than the tabling of the report. During recent years the companies had absorbed a portion of the taxation that had been imposed by the. Government, and they were justly entitled to credit for that. •At the same time, he considered that there was still room for negotiations between the Government and the petrol companies with a view to the companies accepting a portion of the tax that the Government had levied. Mr. Ansell referred to the fact that in recent, years there had been a drift to the cities, and said that motor transport had enabled people to leave the cities and make their homes in the suburbs. It was quite evident that if these costs "were to increase, the time would come when people would be forced back to the cities,' and that would be a very undesirable development; It was foreshadowed by ; the increased costs witnessed during the last few years. BAIL v. ROAD. Another question that the taxation brought into prominence was that of rail versus road. It had been suggested in some quarters that the" Government had intentionally placed the tax on petrol to protect the railways, but he disagreed with that statement. He was quite certain that the Government's intention was not coloured by railway interests, though they happened to be the interests of New Zealand. He believed it was time that a thorough investigation, was made into the whole system of transport in regard to road costs, taxation on motor transport, and whether the transport was, or was not, contributing sufficient to the cost of road maintenance. From the methods being adopted today it could not be gauged whether transport was being utilised in the most efficient manner. A fair basis of competition for each' form of transport must be established before the most efficient manner could be determined* He contended that motor transport was being unfairly handicapped. .If an economical basis were to be found for the various methods of transport, each form must be placed on a fair competitive basis. The Minister had said he hoped to get £500,000 from the Highways Fund, but Mr. Ansell said he would suggest that sufficient provision be made for road maintenance. It would be disastrous if the roads deteriorated, and he would like an assurance from the Minister that he would undertake that the maintenance of the roads was kept up to.a high standard. Last year a certain amount was taken from the Highways Fund to assist the Consolidated revenue, and in the opinion of those qualified to judge the highways had suffered as a result. DIMINISHING EETXTKNS. Mr. Ansell appealed to the Minister to at least make a reduction in the tax. He based his argument largely on the fact that the law of diminishing returns must apply; the figures showing the reduction in the use of petrol were sufficient evidence. The national income had already afiected the use of petrol, and the heavy taxation now proposed would tend to a further decrease. He was speaking on behalf of the motoring section of the public— those who were dependent on motor transport, tradesmen, people living in the suburbs, and working people who had to use buses. The natural outcome of the increased. taxation would be that the bus owners would ask for permission to increase their fares, and that would place a burden on the section of the people who should not be asked to bear any further burden in the meantime. "I am satisfied that the taxation is so severe that tho Government revenue will suffer very seriously as a result of the extra imposition," he said. , MB. McCOMBS'S CHARGE. A chargo of inconsistency against Mr. Ansell was levelled by Mr. J. McCombs (Labour, Ly_ttelton)j the. grounds, for

the charge being that although Mr. Ansel! now spoke against an, increased petrol tax, he had voted for an artificially high exchange and for. the sales tax, two measures which made the increased petrol tax necessary. Eeferring to Mr. Ansell's statement that the Government ■would not get the anticipated increased revenue from the additional petrol tax on'account of the law of diminishing returns, and Mr. Ansell Js plea that the Government should persuade the petrol companies' to shoulder a portion of the burden, Mr. McCombs said that the same law would prevent the petrol companies from assisting. However Mr. Ansell voted on this Bill, he had already voted for two measures which mado it necessary. The Government expected to get £3,040,000 from additional taxation, and the amount required through the high exchange was £3,800,000, so that even with tho further taxation, there would be a shortage of £760,000. Somebody else was going to get the money which was being obtained from the additional duties. It was going to be taken from the rich and poor alike, but it meant £10,000 to the Eiddiford family. The Hon. A. D. McLeod (Government, Wairarapa): Bunkum. Mr. McCombs: It means £10,000. If it meant only £1000, it would only mean twopence a sheep. Mr. McLeod: Bunkum. Mr. McCombs: If it only means twopence a sheep, it is not going to be of much benefit to the small man. "A DIFFERENT THING!" Dealing with a statement which had been made that in 1930 the Labour .Farty voted for an increase of threepence in the petrol tax, Mr. McCombs said that the proposal to increase the tax by threepence was changed to an increase of twopence as the result of speeches from the Labour benches among others. This was a different thmg altogether. The increase of. twopence was to provide backblocks roads: create™' * ™ *° &U ' gap artifi°W rJ!7VS^ 0 USe for Mr- Ansell to Pretfl? « ?\° motorißts > as no doubt he will that he was one of the heroes who fought against this tax^ for he is one oi those responsible for it by his two previous votes," concluded Mr. Me Combs.