SOURCES OF REVENUE.

New Zealand Herald, Volume LXVII, Issue 20599, 25 June 1930, Page 13

SOURCES OF REVENUE.

PETROL TAX AND CUSTOMS. POSSIBILITY OF INCREASES. REGULATION OF CLEARANCES. The knowledge that the Government needs more revenue and is alive to the possibilities of the customs duties and the petrol tax is causing much specula tion as to the goods which are likely to be affected. Petrol, spirits, tea, sugar and imported foodstuffs wliich can be manufactured in the Dominion are among the items which business men believe may be affected. However, it .appears that no movement has yet taken place for the clearance of bonded stocks. Probably it is believed that the field of possibilities is so wide that attempts to evade the payment of the higher duty or tax would be too liable to lead to costly mistakes. Before the revision of the tariff in 1927 large quantities of whisky and other spirits were taken out of bond, and the duty was not raised. Another possible check on such acts of anticipation on this occasion is the recent statement by the Prime Minister, the Hon. G. W. Forbes, that the Government would seriously consider making any increased duties retrospective if it was satisfied that abnormal clearances oi goods had been made. Proposal by Minister in 1927. It is interesting to recall that legislative provision for protection of the re venue in this way was proposed by the Hon. W. Downie Stewart when the Customs Amendment Bill of 1927 was framed. When the bill was before the House the clause in question was deleted. Mr. Stewart asked that this should be done for the reason that it introduced a new and very far-reaching principle into the customs law, and the commercial community and chambers of commerce had not had an opportunity of considering it. The Minister said there would be ample time for the introduction of such a clause within the next few years, before the tariff was again revised.

An increase of 2d a gallon in the petrol tax. to operate about ten days or a fortnight after the opening of Parliament, is an expectation which is held by some Auckland business men who are interested in the various branches of the motor trade. The likelihood of a heavier tax being placed on petrol has been so freely canvassed in recent months that the idea appears to be firmly fixed in ihe public mind that the Governmenthas resolved to adopt this course as one of the means of obtaining the necessary additional revenue. No Action Taken by Cabinet. However, the Prime Minister said at the end of last week that it should not be taken for granted that the petrol tax would be increased. He said that the Cabinet had not yet considered the question and that motorists would be given an opportunity of placing their views before the Government if they wished to do so.

Tea and sugar may be considered suitable items on which to impose a duty for revenue purposes, as large quantities of both now escape all but the 1 per cent- primage duty. Tea from British sources is admitted free in bulk, and pays a duty of 2d a pound if in packazes of less than 51b. Foreign teas are liable to duty of 2d a pound in bulk and 4d a pound in packages. Large quantities of British tea are imported. Certain grades of refined sugar, including that which is most used in the household, are subject to a duty of one farthing a pound. Other grades, and raw sucar, are acLaitted free, except for 1 per cent, primage duty, which applies in each case. As practically the whole of the Dominion's sugar requirements are met by local manufacture, it would be necessaiy to impose a duty on the raw material should it be decided to seek to collect revenue from this source.