RATES ON CIGARETTES.

New Zealand Herald, Volume LXVII, Issue 20623, 23 July 1930, Page 15

RATES ON CIGARETTES.

ANOTHER PENNY A PACKET.

LOCAL TOBACCO MANUFACTURES REDUCTION OF CONCESSION. [BY TELEGRAM. —SFECIAT, REPORTER. ] WELLINGTON, Tuesday. " It is proposed to increase tho duly on cigarettes by about Id per packet of 10 cigarettes," said the I'rimo Minister, Hon. U. W. Forbes, in his statement on the tariff proposals. " The increase represents a duty of about 8s 3d per 1000 cigarettes, or 3s 3d per lb. The new rates proposed for imported cigarettes are 33s 9d per 1000 for cigarettes not exceeding 2ilb. per 1000 (which form the bulk of tho importations) and 13s 9d per lb. for thoso which exceed fliat weight. An equivalent increase is also proposed in the rate on cigarette tobacco and in the excise duties payable on the foregoing articles.

"As there have recently been considerable reductions in the retail selling prices of some of tho leading linos of cigarettes it is not considered that the increase will bear hardly on any section of the community. Even with the now duty tho public will be ablo fo purchase these linos of cigarettes at least as cheaply as they could, say, two years ago. A corresponding increase is made in the duty on cigars. Position of Raw Tobacco.

" It has been evident for some lime that some steps will have to bo taken to prevent tho inroads which the present scale of excise duties on tobacco is making upon the revenue. Between 1925 and 1929 the quantity of tobacco and cigarettes manufactured in tho Dominion has increased by over 275 per cent, lhe loss of revenue on these articles during 1929 was over £150,000, which represented about 10 per cent, of the total duty collected on tobacco during that year. " Further, tho duty on raw tobacco is supposed to operate so that the local farmer may receive a protection of 2s per lb. According to the information in my possession it appears that some years ago he actually received less for his product than the amount of tho protection, although I understand that tho average price now obtained by the grower is about 2s 2d per lb. There is evidence to show that in certain important lines at least lhe percentage of New Zealand leaf used lias decreased from about 70 per cent, to about 50 per cent. Tobacco Farmer's Position. "The only inference which can be drawn from tho facts in my possession is that the concession which has been obtained by the manufacturer has not had the effect of inducing him to increase the quantity of New Zealand leaf used, which in turn, has adversely affected the tobacco farmer. When it is realised that the average prico at lhe port of export from the United States.of leaf tobacco imported into New Zealand is about 23 2d per lb., it will be recognised that something must lio done to place the matter on a moio satisfactory footing. "In an endeavour to remedy this stato of affairs, it is proposed to reduce the duty on imported raw leaf tobacco by Is p°r 11)., and to increase the o\ciso duties by this amount.. The effect of these alterations will be best. se»n by considering the duty cm locally-manufac-tured cut tobacco under tJie old rate and the new. If a manufacturer who now uses half local and half imported leaf were so to increase the quantity of New Zealand leaf that be Uhed only the local product, he would pay practically the same duty as he does now. "If, on the other hand, such a manufacturer desired to continue the use of the same percentage of imported leaf, (ho total duty payable would bo increased from 2s 8d to 3s 2d per lb. It. is believed that this will result in the uso of a greater quantify of New Zealand leaf. Jt is considered that, tho concession at present granted on locally-manufactured cigarettes and cigarette tobacco is too great and it is proposed that about onehalf of tho concession thereon should be withdrawn."

YIELD OF THE TARIFF.

LAST YEAR'S INCREASE.

AMOUNT OF PETROL TAX. Tho actual yield of customs fnxnlion in the last three financial years has been m follows:

1927-28. 102.S 29 1020 III), Custom* .. £7,891.621 i.'7,tlM.2r>2 Excine .. C09.G21 (ill.tst c.2ii,:ii2

Totals .. £?,501j215 £fi.sC. r >,73ij j'9.M7,:i:,:i Tho total revenue last year was nearly £1,000,000 more than in either of tho previous years, Tho double primage operated from August 1 last year, tho total for which includes the extra tax for eight months. Primage on certain goods was reduced to 1 per rent, in April. The 2 per cent, rato lias been in operation for nearly four months, so that the extra taxation by that mcaus has to be added to the revenue that will bo secured under the new proposals dining tho remaining eight months of Lhe year. The Prime Minister has not given any estimate of the yield from tho petrol duty of 7d a gallon. It was introduced toward the end of 1927 and in the, few months of that financial year produced £143.516. For 1928-29 the revenue from tho 4d duty was £802,232. and for 1929 30 £960,000. G;i tho same quantity as was imported last year a duty of 7d, plus 5 per cent, surtax, would have produced £1,764,000.

SPIRITS TINDER PROOF.

ALLOWANCE ABOLISHED.

MORE DUTY ON DOMINION BEER. [BY TELEGRAPH. —SPECIAL REI'OItTF.I!. ] WE LLING TON, Tuesdn y. " For many years an allowance has been made for under-proof spirit as far as 16.5 under proof," said tlio IVinio Minister in outlining the tariff proposals. " It, is proposed to abolish this. Tlio ordinary bottled spirits nro imported willi a strength of less than 16.5 under proof, whereas bulk spirits are as a rule about proof. The inquiries which have been made show that, the cased lines arc as a general rule dearer per gallon than tho bulk lines. The effect of the present system of levying duty, therefore, is that the lower-priced lines pay a. higher duty per liquid gallon than tlio higher-priced ones. "The new system will also redtico tho amount of work at tlio ports connected with the entry and clearance of spirits. In Australia no Allowance is made if spirits nro below the strength of proof. " It is proposed to increase the basic duty on New Zealand-brewed beer from llid per gaUea & Is per gailou t 'i