MOTOR TAXATION.

New Zealand Herald, Volume LXII, Issue 18951, 24 February 1925, Page 12

MOTOR TAXATION.

MOST EQUITABLE SYSTEM. DEFECTS OF PETROL TAX. BRITISH METHODS SOUND. MONEY MUST BE FOR ROADS. Motor taxation from the point of view of the State and the motorist is discussed by Sir Robert Walev Cohen. After reviewing home and foreign methods Sir Robert indicates the difficulties that moved the. British Government to substitute the horse-power tax for the petrol tax. Managing diiector of the Anglo Saxon Petroleum Company since its formation 18 years ago, the Asiatic Petroleum Company and the Shell Transport and Trading Company, Sir Robert Walcy Cohen speaks with a knowledge of tho expert in discussing matters relating to the most modern and economic form of inland transport. "A large and representative committee in Great Britain has been examining the question of the motor taxation," he says, "and the conclusion it reached was that the present method followed in the United Kingdom, the horsepower tax on the motor-car, and the proportion of weight for commercial motor vehicles, were the most suitable forms of taxation. I do not recollect, all the considerations that led to that conclusion, but jI know that the prima facie preference was for a petrol tax. The Royal Automobile Club and the various non-techi-eal opinion were in favour of a petrol tux because it appeared to be the fairest, as it was based on the proportion of the use of the road. Objections to Petrol Tax. "The main 'objections to the petrol tax were first that it was very unfair to a large number of people, and I think there is a larger proportion here in New Zealand who used petrol in stationary engines such as on farms. There are people also who use it for industrial purposes, such as a solvent and so on, and there will be a steady increasing number who use it in connection with aviation. Thosn are the people who use petrol for purposes that have no connection with the roads, and if you begin exempting- them you will have to have a most expensive organisation, because it comes to taxing a product that it- not straight but is dependent on the purpose for which if is used. That entails following on through to the consumer, which is a very expensive process. This particular set of arguments was strongly pressed by the Customs Department of Great Britain. " Secondly, there is a difficulty in defining petrol. There is an almost imperceptible gradation from a very light spirit through heavy spirit and mineral turpentine to kerosene. It was found that if there was a tax on petrol and none on kerosene there, would be, various mixtures made which would lead to a large amount of evasion of the tax. Petrol, in fact, is not an exact term; it is a generic term, and as knowledge changes so a product which will go under the generic term of petrol changes and becomes very awkward to tax. Straight Tax the Cheapest. "The objection to the horse-power and weight tax is that it falls hardly on a mart who uses th 3 motor only a small amount. He has'to pay the same as the man who has a similar motor-car but is constantly on the road. but I believe investigation proves that the deviation from the average use of the road by any given motor-car is not very large, and that the amount of hardship resulting from the straight tax is therefore very much less than, the inconvenience and difficulty of the petrol tax. It is claimed, however, that the horso power and weight tax is very cheap, and a simple one to collect, whereas a petrol tax is expensive and involves raising the price of petrol by some 10 to 20 per cent, more than the tax itself. We had the petrol tax in England during the later years of the war. It, was 6d a gallon, and after it was taken off tho price of petrol was reduced by 7d a gallon. It was found that the loss by evaporation and leakage and the general expense attached to the tax involved a cost of Id a gallon more than the amount of the tax itself. Economy of Good Roads. " The vital principle, in whatever (firm of taxation may be imposed is that, itshould be definitely earmarked by law to he expended on the roads. if that is done I think motorists and motor transport interests would be found to bo very willing to submit tf> a comparatively heavy taxation, for the reason that the saving in wear and tear on vehicles is so large that it compensates them fully, ' Sir Robert illustrated this point by quoting the case of a motor-car costing about £3OO. On rough roads its life might be, three vears with a few broken springs, while on a modern bitumen road, as in England, it would last ten years. He calculated the difference ii, wear and tear at £7O a year, and allowing for that, (he cost of springs and the economy in time due to the bitumen road, and the advantages to towns and villages thvough roads being rendered dust-less, there would be a saving <>f £IOO a year by having that car on a bitumen road. " That is one advantage, but. thore is another. ho said, in conclusion. " A bitumen road costs almost nothing to keep up. whereas a road with a loose surface is a constant expense to the public, authority. Summing it all up I think it is fair to say that nothing but a very rich country determined to waste its resouices can afford to leave its roads in the rough condition. Ihc hi turner rosids will carry hwvj vehicles, and the economy to the heavy transport interests is relatively even greater than that enjoved by the motorist. It is not necessary for me to emphasise what that means to the farmers throughout the country in the saving involved in getting their produce to the railway or to the coast, and their supplies on the return journey. I am confident that if it were realised what that meant to the community generally there would be no difficulty'in the State collecting by way of taxation a largo proportion of the money value of the economy realised by motorists and transport interests lo enable it to provide good roads and that quickly,"