LEGISLATIVE AMENDMENTS

Greymouth Evening Star, 19 December 1933, Page 4

LEGISLATIVE AMENDMENTS

SALES TAX PAYMENTS.

[PEB PBESB ASSOCIATION.]

WELLINGTON, December 19

In connection with the sales tax, it. has been found that in some industries it is the practice for a merchant owning material to forward such material to another merchant to he made up into manufactured articles, the material remaining the property of the first mentioned merchant, and a charge being made by the latter merchant, merely for the cost of manufacture. Doubts have arisen as to whether such transactions are covered by thei definition of “manufacturer” in the Sales Tax Act, and opportunity has been taken in the Amendment -Bill introduced in the House to-night to remove such doubts. This provision is retrospective. Considerable difficulty has been experienced by both merchants and the Department in cases where taxable goods are sold by retailers to wholesalers for resale by the latter. Under the existing law, when a retailer sells goods to a wholesaler he is entitled to a refund of tax from the Department, provided he sells the goods imported by him at a price exclusive of the sales tax and that he can satisfy the Department as to the actual amount of tax paid on the goods. No such provision however, exists in cases where goods sold by a retailer are New Zealand-made goods which had been imported by persons other than the seller. In such cases, it is necessary for a retailer to sell to the wholesaler at a price inclusive of sales tax and to advise the latter as to the amount of. sales tax included in the price. The wholesaler then deducts the amount of such sales tax from the amount payable by him when the goods are eventually resold. These methods of adjusting the tax paid by retailers have caused serious inconvenience to both retailers and wholesalers owing to the large amount of detail work required. In some instances, it involves disclosing buying prices to competitors and in some cases it is impossible owing, inter alia, to the number of hands through which goods have passed, for the retailer to advise the wholesaler .as to the amount of the tax. It is now proposed that when the taxable goods arc sold by a retailer to a wholesaler for resale or for use as material in: the manufacture of goods for sale, the wholesaler may deduct from the sale value of goods sold by him to any ono month, the tax inclusive of the price paid to the retailers. A wholesaler will of course pay the tax on the price at which he sells the goods. Similar provision is alsb being made in cases where manufactur-

iilg retailers purchase taxable materials from another retailer. Difficulties have arisen in respect to the position of receivers under the Act. A liquidator who enters into possession of assets of a company is required by the Act to set aside such sum out of the assets as appears necessary to provide for any sales tax that is or may become payable by the company. It is now proposed to require similar action on the part of a receiver who enters into possession of the assets of a company on behalf of the debenture holders. It has been found desirable for the convenience of traders to make definite statutory provision for the collector to accept returns in respect of ordinary monthly accounting periods of merchants, in lien of calendar months, and this is effected in the Bill. It is also proposed in another clause to amend the. law to remove any possible misconception as to when the tax becomes payable, and finally in. order Io simplify procedure, it is proposed to make provision for, the collector to sue for the tax which has become payable.

NATIVE LAND AFFAIRS. The steps contemplated by tho Government in order to exercise more effective control over Native land development schemes are indicated in the Native Purposes Bill introduced in the House, to-day. It is now proposed that control of the operations of Maori Land Boards and the Native Trustee should be vested in the Native Land Settlement Board. After the Board determines any form of expenditure it requires authorisation by the Minister of Finance. Several consequential amendments are necessary as the result of this proposal. It is made clear that the Public Service Commissioner is to sanction all appointments. At present the Minister of Native Affairs is responsible for signing contracts but provision is now made or a body corporate to do that. ’ In future, the Native Land Settlement. Board is to control the following matters in place of the Native Minister. Advances upon mortgage by Maori Land Boards; till expenditure by Maori Land Boards in the direction of making advances to Natives, the guaranteeing of accounts of Native Dairy farmers, purchase of and farming of lands, subdivision of land for settlements, provision of funds for compensation for improvement:.,. apportioiiim.n!. of liability "f advances made for developments.

CROWN LESSEES

'['he extension of the existing legislation authorising remission or postponements of rent in cases where this had been granted to any Crown lessee for the full period of five years is provided for in the reserves and

other lands disposed Bill. The period during which this legislation can be granted expires on June 30 next, and it has been deemed desirable to extend its operation for another year from that date.

In view of the continuance of unstable conditions in connection with prices for farm produce, and the consequent dificulty of determining farming land values, the existing provision suspending revaluation of rural Crown and settlement lands has been re-enacted. The suspension period is now extended until July 1, 1935. The Bill also suspends until the same date the power to revalue certain small grazing areas held under renewal leases granted between February 28, 1919. and February 11, 1922.