WHAT MOTORISTS PAY

Evening Star, Issue 19710, 10 November 1927, Page 2

WHAT MOTORISTS PAY

SIR JOSEPH WARD COURTS THE COST PREMIER JUSTIFIES PETROL TAX . PROTECTION OP PRIMARY PRODUCER. [Feom Qua Parliamentary Kepcrier.] WELLINGTON, November 9. Crowded galleries listened to Sir Joseph Ward (Invercargill) and the Prime Minister (Mr Coates) juggle with hundreds of thousands of pounds in the House to-night, when the second reading debate on the Motor Spirit Taaxtion Bill was in progress. Wending his way through a maze of figures, Sir Joseph endeavored to show that motorists were being compelled to suffer a tremendous imposition. There were approximately 150,000 people interested in the ownership of motor vehicles in Now Zealand, he said, and those people were being asked to pay another £750,000 in taxation by way of the duty of 4d a gallon on petrol. Last year 45,000,000 gallons of petrol wore imported, and at 4d a gallon one got £750,000. If one capitalised that sum at 5 per cent., year after year, one found it was the equivalent of £75,000,000.

Sir Joseph said he would show what motorists had to pay- First, there was the tyre tax', which amounted to £180,000; next there wore license fees, which totalled £350,000; and, thirdly, the petrol tax, totalling £750,000. Then the Government ’had put a £400,000 duty on bodies last year. Thus, one found that the motorist was paying £1,608,000 annually. In the last two years motorists had paid £2,700,000. The Government was forcing this payment in order to save landowners and public bodies from paying their proportion of reading costs.

Were the motorists the only ones to pay? asked Sir Joseph. No one would deny that this new system would enhance the value of properties. Why should not money be raised by way of a lot n. The same reading system could be carried out without murdering the taxpayer.

A BETTERMENT TAX. Su - Joseph said there was a strong curicnl of opinion in the country that the tyre tax was being imposed to kill competition with the railways. Personally, he would not lend his car to such suspicions; but that was a general opinion. Mr Noswortby: It is absolutely incorrect.

Sir Joseph said that the Government was, in effect, doing what no Government would dare to do with the railways. It was putting the betterment tax on the user of the railways. Would anyone penalise a man because ho used the railways throe or four times a day? Mr Hawken: Of course, you do. You pay more in fares. Sir Joseph said that in this tax the motorists would pay more than was paid in land tax by the property owners from the North Cape to Bluff, and, comparatively speaking, it was not such a long way behind the total income tax. When one looked at the land tax and compared it with this tax on motorists, one saw that the petrol tax was out of all reason. It was a monstrous imposition. Why do it whoa everything that was wanted could he got in another way? It was unwise to try to run a mile a minute when one could only manage a quarter of a mile in three minutes. “TOTALLY INCORRECT,’’ SAYS PREMIER. The Prime Minister immediately rose to reply. Ho began by stating that the right hon. .gentleman from Invercargill was incorrect in hs reference to the capitalisation of £750,000. This point was argued out at some length between Sir Joseph Ward and Mr Coates, the member for Nelson (Mr Atraoro) coming into the dispute to uphold Sir, Joseph. Thereupon Mr Coates retorted that ho did not pretend to be a “ financial wizard,” but he did know that two and two made four, and what had been said was totally incorrect. Sir Joseph: Well, if you are not a financial wizard, you have got to remember that you are “ the man who gets things done.” Mr Coates; I have waited some time to hear the right hon. gentleman say that, and now he has said it. (Laughter.) The Prime Minister said he was sure the member for Invercargill would-not seriously advocate the borrowing of £1,000,000 as a satisfactory system for reading. That could not ho, because it was the hon. gentleman’s habit to belabor the Government for too much borrowing. There wero 9,400 miles of road, on which some £15,000,000 had been expended by nay of capital expenditure, and ifc was for the country to see that those roads Were maintained. Interest in £15,000,00 amounted to £750,000. Mr Coates then quoted a list of figures showing that, after the motorist had provided part of the money necessary, there was still a deficiency of £895,000, which could only bo found by the local bodies. Then there were some SO,OOO miles of road to be provided for, and those roads had cost local bodies and the Government about £20,000,000. Generally speaking, the Public Works Department had had good value for the money spent. When we came to say that we could maintain those roads at their present standard by simply dropping our hands into some imaginary bag full of sovereigns, we had to ask if the money was there. Of course, it was not there. BACK TO THE ARK. Mr Coates said that, after all, the petrol tax was only on the principle of the toll tax. If a roan used the road he paid, and if ho didn’t use the road he didn’t pay. Sir Joseph Ward; Oh! Have we got to go back into the ark again, and establish tolls ? Mr Coates said he thought the principle that the user should pay was a good one. What he wanted to avoid was piling up costs against the primary producer. Those costs could so pile up that the primary producer would bo no longer able to pay rating .costs. Mr Potter (Roskill): Never mind the secondary producer.

Mi - Coates; He is different. He either goes on, or closes up, and ho does not have property. The country’s first consideration must bo for the great stable industry, and to see that costs are not passed on.

THROUGH SECOND READING

A LENGTHY DEBATE [Per U.n'iteb Press Association*.] 'WELLINGTON, November 9. Tn moving the second rending of th Motor Spirits Taxation Bill (the di; mission above being the confcributior of the two main speakers), Mr K. f Williams (Minister of Public Works reiterated tho reasons . justifying th introduction of tho Bill. Ho ah placed on record tho increase in ll general rates for reading purposes ) counties between 1914 and 1926. XJ figure in the former year was £661 477, whereas in 1926 it amounted i £1,501,145. .Regarding tho allocatk of the revenue to be derived from ti petrol tax ho said it might appear small amount that was going to I spent outside the cities. After listei ing to tho requests for better faciliti and tho inability of country settle; to meet the burden of local charge, he said he would have been failing i his duty had he not pointed out to th Government where the country wa getting to, ami the necessity for more equitable distribution of tax;, tion. It would depend upon tho n venue realised how far tho schcm proposed by the Government could. b proceeded with. It would not be sal to embark on too elaborate a schem until it was known how tho mono, was coming in. All tho users of petn except the users of the road would I) entitled to claim exemption. Mr T. .M. Wilford (Hutt) said h would have thought that tho first t protest against this changed policy e tho Government would bo tho large o importing companies, but, strange t say, this did not seem to have occurred One. of the most interesting feature in connection with the oil industr was the system of bulk distributur. which was as good in New Zeaaln as in any part of California. Bui distribution had reduced the price ; petrol, and, so far as he could seethe Government was putting on ti tho people by way of taxation th amount which tho oil companies rc ceatly took off. Tho trouble witi this Bill was the number of exemption; it contained. Personally,. he woule have no exemptions. By imposing r. tax of 2d per gallon on petrol sufficient revenue to maintain our roads would have been derived. For the vest he would impose a tyro tax. If those two taxes did not realise quite as much as the 4d per gallon proposed by the Minister, it would at least bo a just tax and would be paid by those who used tho roads. Ho believed the increased price of petrol would curtail development, and that would defeat tho purpose of the tax, which would be unfortunate so far as the maintenance of the roads was concerned. 11 this new system of maintaining (lie roads was to he substituted lor tbo the old system of voting .money on the Public Works Estimates for division amongst tbo counties, then he thought it was unfairly taxing one section oi tho community to raise money which should bo raised from the whole of. the community. Ho advised tho Minister to withdraw this petrol tax of 4d per gallon and impose a tax of 2d per gallon, supplemented by a tyre tax, and, instead of trying to construct main highways m breakneck spued, In go slower and spread tho expenditure over a longer period of years. Mr D. Buddo (Kaiapoi) also favored the reduction of the petrol tax to. 2d per gallon. The amount to be raised under tho Bill was 50 per cent, greater than it should he.

Mr 11. P. Hudson (Motucka) asked the Minister if he would consider the advisablenoss and justice of tho Government taking over the full responsibility for tho maintenance of. tho main highways, which at present imposed a heavy budreu on the settlers, who got comparatively little benefit from these roads.

Mr W. E. Parry (Auckland Central) expressed the opinion that while' a vigorous road improvement policy was needed, there must bo a limit to the taxation which in this case was an inequitable imposition on'the motorists, and would be dillienlt to collect. The petrol tax of id, plus the existing tyre tax and the registration fee, was too. much unless the registration fee was dispensed with. Twopence on petrol, without .exemptions, should suffice to meet the requirements. The additional tax would mean that many motorists would have to abandon their vehicles, and as a result the income from the tax would fall far short of expectations. The Minister of Lands. (Mr A. D. M'Lcod) said the first question to be «sked was: Who was making tho greatest demands for road improvement? The answer was the users of the motor car, including the backblodcs people. Good roads meant a saving to motorists ; consequently they should not feel the proposed tax as a burden, singe with it the ■cost of petrol would bo no more than it was, say, three years ago. Though the roads had been improved the motorists were still calling for further improvements throughout tho country. This work on the highways had started with a large accumulation of funds, and had progressed to such an extent that last year tho expenditure exceeded the revenue by £250,000. Tho Bill was an attempt to equalise the burden of taxation over all the motor users of the road. The genera! opinion to-day was that the proposals did not go far enough, so far as the country people were concerned. _ With the enormous increase in motors in this country it was manifest that the rural roads could not possibly stand up to the stress of the additional traffic, and local ratepayers were faced with an alarming amount of local body taxation. To try to keep tho roads in repair tho Government was now making an attempt to provide for a renewal of the roads as they became worn out. No one desired to see tho general condition of our highways go hack. Therefore additional funds were necessary to maintain them, and at the same time to extend better roads. Mr D. G. Sullivan (Avon) considered it would ho most difficult to collect the tax owing to the exemptions, since the farmers, for instance, mostly had motor cars as well as milking and other machinery, and they Would find it hard to define the proportions used in the cars and for other purposes. Mr Sullivan thought tho tax was more than _was_ warranted. The country, like the individual, should not undertake a greater burden than it could afford; that was to say, in this case the dominion must_ ask itself if it could afford the reading policy laid down. He considered they should hasten slowly, and engage in highways extension and improvement only so far as they could afford to do so. Probably 50 per cent, of the tax would bo collected from tbe city users of motors, and they would get a very much smaller proportion in return for city road maintenance. Tho restriction on municipalities regarding expenditure on the highways within their boundaries ought to be modified. Sir George Hunter (Waipawa) said the greatest ‘‘need of the hour was a restriction on the use of motors in this country, and greater care should he exercised in tho issue of licenses to drivers of motor vehicles in view of the . number of accidents occurring. Sir George was proceeding to elaborate this argument, but the Speaker called him to order.

Mr E. P. Lee said it was refreshing to find the member for Avon showing so much concern for the country’s ability to bear the burden of expenditure. That was a change from the Labor point of view when asking in the past for various social amenities. Roads wore needed; there was no doubt about that.. Therefore the money must come from somewhere to provide them. There was no suggestion that the expenditure on the highways was being undertaken wrongly, but: there seemed to be a 'disposition on

the part of the city representatives to try to shelve an undue share of tf'e cost of road maintenance on to the country taxpayers. The most equitable tax was a petrol tax, which fell on those who used the roads and was in a measure self-imposed. If the motor owner found the . burden too great he could reduce his use of his car. Mr M. J. Savage (Auckland West) said the fundamental principle of this system of taxation, was wrong, because it was too easily passed on. Big firms could afford to pay this tax and would do so for the purpose of running the small man off the road, and once having got him off the road the public would he made to pay. If 4d per gallon was to he imposed then some of the other taxes on motorists should be removed. Failing that, the petrol tax should be reduced by half, and if more money were required there should be further increases on big incomes.. At 1.45 a.m. the Minister of Public Works replied to the debate, during the course of which he said if this extra charge had been put on by the seller of benzine they would have heard very little about it, and he did not think that it would in any degree reduce the consumption of benzine or the traffic on roads. The Bill was read a second time. The House went into committee and passed the short title. Progress was then reported, and the Houso rose at 2 a.m.