TWOPENCE PER GALLON ON MOTOR SPIRIT.

Horowhenua Chronicle, 7 October 1931, Page 2

TWOPENCE PER GALLON ON MOTOR SPIRIT.

Effect on Dominion Tobacco Growers

Replying to Mr. Black, Mr. Stewart said that the dhtics on both imported and local tobaccos would be increased by the same amount, so that local industry would be in as good a position as formerly. It had been pointed out that owing to the higher duty on cigarettes considerably less revenue had been obtained through people purchasing cigarette tobacco in preference to made-up cigarettes. The resolution would to some extent remedy this position. The increased duty was expected to raise an additional £60,000, but even now it would be lower than in most countries.

Mr. Black asked whether the Government was prepared to negotiate to ensure that New Zealand tobacco would receive fair treatment in the Empire markets.

Mr. Stewart: When the opportunity occurs.'

Mr. Fraser asked whether the Government had considered taking the opportunity of the increase in duties to give assistance' to local growers. Mr. Stewart said local growers had already been given considerable assistance. It seemed that their position depended, upon local manufacturers, and until there was a satisfactory export market he did not know how the local grower could become independent of the local manufacturer. Mr. Black asked whether the Government had considered the position regarding the importation of Iron from Australia. He said the time was opportune to recognise the Onakaka iron industry. He contended that as a result of the position of the exchange rate Australian iron was being dumped in this, country.

- Mr, Stewart said he had not anticipated the question of iron being raised. He would look into the position. Replying to Mr, Black, Mr. Stewart said he understood that representations from interested parties would be heard should it be desired before the Customs Bill confirming the resolutions was introduced, Mr. H. E. Holland: When will the bill come down?' Mr. Stewart: I cannot say at the moment. . Oil Companies and Added Tax Mr. Jorda'n asked whether the oil companies would carry any of the increased taxation on motor spirits. Mr. Rushworth asked whether the proceeds of this extra taxation would go to the Consolidated Fund or to the main highways account. Mr. Felctcher ’said he did not think the House should agree to the extra motor spirit taxation until it knew what the companies were going to do. He contended that the companies could well afford to pay the extra taxation and that New Zealand ;was simply be- ■ ing fleeced for the benefit of the oil trusts in America. Mr. Fraser asked whether the Government had made inquiry into the profits of the oil companies. He said reliable'evidence had been submitted in the Arbitration Court to the effect that substantial profits were being made.' Mr. MacMillan said that a report on the landed cost and distribution costs of petrol should be placed before the House prior to the introduction of the bills. Mr. Armstrong said that if the additional petrol taxation was for the purposes Of the Consolidated Fund and not for the highways there would be strenuous opposition from the cities, and boroughs. Mr. Walter Nash said the cost of imported spirit was sd. per gallon. The companies ought* to bear the extra fox-

Eightpence Per Pound on Cut and Plug Tobacco. Additional Customs Duties. Will Petrol Tax be Passed On ? WELLINGTON, Last Night. Before presenting the supplementary Financial Statement, Hon. Downie Stewart moved that urgency, be accorded the passage of the Customs resolutions which later would be moved and this was granted. Having completed his Statement, Mr. Stewart submitted the Customs resolutions providing for the following alterations to become effective on October 7:— Import and excise duties on cut and plug tobacco increased by a further eightpence per pound. Duty on motor spirits increased by twopence per gallon.

ation; their profits were tremendously high. Mr. Harris suggested that an ad valorem duty should be imposed instead of a flat rate. This would be a way of getting at the landed cost.

Mr. Forbes said the investigation into the cost of petrol was not yet completed, but he hoped to present a report to the House before the Customs Bill was introduced. So far, the investigation did not reveal abnormal profits. He did not know what the companies would do. They had not been aware of the, extra duty until the resolutions were submitted.

Mr. W. Lee Martin: They were making preparations all day. Mr, Forbes: I feel sure the companies will do the right} thing.

Mr. Fraser: What is the right thing? Mr. Forbes: 1 think they will treat the public fairly. The leader of the Opposition asked whether the Government proposed to postpone the election. The Minister of Finance had been silent on that point. M. Holland suggested that the statement made by Mr. Clinkard, of the Industries and Commerce Department, to the Economic Committee regarding petrol be made available to the House.

Mr. Forbes said the information given to the committee was. confidential. The Customs Bill would be brought down as early as possible, but time must be left for representations to be made regarding the; new taxation.

A member: You won’t allow it to delay the elections? (Laughter.)

Mr. Forbes* There won’t be any delay in connection with any business before the House. (Eenewed laughter.) The Customs Bill would probably be brought down next week, he added. Other members urged that the companies should be forced to carry the additional petrol taxation. Mr. Fraser said that if the companies did not do so additional hardships would have to be borne by the small farmer. He asked whether there would be any exemption granted to commercial vehicles.

Mr,, Wright said the Prime Minister’s statement that so far the investigation did not reveal abnormal profits had been regarded as a hint. “I hope our people are not going to be bluffed,” he said. .“I hope ways and means will be found to tax the companies so that they cannot pass it on.” ' Mr. O’Brien, submitting that crude oil ; was competing with New Zealand fuel, suggested that if there was to be an increase at all the taxation on it also should be increased. ’ He asked whether preferential treatment regarding the petrol tax would be given to farmers in dutlying districts; especially when they were not served by the railway, bn which they would otherwise be granted free carriage of fertilisers, etc. Mr. MacMillan expressed regret that the Industries and Commerce Committee had not yet submitted a report on the oil companies’ profits. Mr. Langstone; They’ve g&t sleeping sickness; Mr. Ansell said it was obvious from the investigations made in Australia that the petrol companies were able to bear the additional taxation, and he urged that they should: be compelled to do so. The resolutions were adopted. Mr. H.‘ E. Holland again asked the Prime Minister whether the Government had reached any decision as to when the general election would be held. Mr. Forbes said he would make a statement on the subject at the earliest possible opportunity. ; k - The House’ rose at 10.15 p.m. until 2.30 to-morrow afternoon.