Higher Taxation, less Revenue

Horowhenua Chronicle, 13 July 1933, Page 7

Higher Taxation, less Revenue

THE BURDENS OF BEER. DEMAND FOR REDUCTION IN DUTIES WELLINGTON, Last Night. The general position of the Licensed Trade of New Zealand was placed before the Tariff Commission to-day with a view to a reduction in Excise and Customs duties. It was contended that the progressive increase in duties and the consequent fall in consumption and the drop in revenue might be taken as a classic example of diminishing returns due to over-taxation. The trade, it was stated, produced onelifth of the total Customs and Excise revenue and had been called upon to carry a disproportionate load.

Mr. Percy Coyle, general secretary of the National Council of the Licensed Trade of New Zealand, said that their main ground for a reduction lay in the fact that the last increase in taxation had meant not an increase in revenue but a loss. The decline was so marked that it could not be accounted for by depression influences, and in the case of spirits the 1931 increased tax imposed as a Budgetbalancing device had dragged the revenue down to the lowest figure for ten years. Beer returns showed a light rise in revenue but the consumption drop was a record and was still unchecked, while the ' revenue would inevitably follow it unless excise was lowered. *'A comparison w r ith Great Britain, whoso legislation we had followed, showed the same diminution in returns due to high taxation.” Mr. Coyle submitted that the trade deserved consideration as a contributor to the national income of from one to two milions annually. He contended that it was fallacious to regard the licensed trade from a revenue viewpoint alone, for it kep an array of men and millions of capital in employment. Half a inilion pounds were paid annually in wages by brewers alone. Mr. Coyle urged the Commission take no account of the vexed question of the morality or otherwise of selling and consuming liquor. This had been answered conclusively by the country in 1928. An additional setback to the licensed trade had been caused by high taxation in that the home brewing of ale had received a great im-’ petus on account of its cheapness. The State obtained little or no 'revenue ffrom this source aiid the trade which, was expected to produce revenue, competed with an untaxed product.