MOTORING TAXATION.

New Zealand Herald, Volume LXIX, Issue 21118, 27 February 1932, Page 10

MOTORING TAXATION.

DIVERSION OF PROCEEDS.

RELIEF FOR COUNTIES,

REPEATING LAST YEAR'S RAID

[by rELEGKArn. —SPECIAL reporter.] WELLINGTON. Friday.

A call upon the Main Highways Fund to assist country ratepayers, possibly to a greater extent than was tho case last year, is believed to be virtually certain, although it i% not thought that the Highways Fund will be absorbed for general purposes by tho Consolidated Fund, as motoring organisations had feaicd. Tho desperate state of the .treasury gave rise to apprehensions lest tho Main Highways Act should be rendered nugatory. It was also remembered that the Prime Minister, the lit. Hon. G. W. Forbes, had stated last session that personally he did not favour special taxation for special purposes.

Inquiries to-day indicated that the Act will remain intact, but that taxation fiom motorists, comprising the petrol and tyre tax and registration and licence fees, will be used to provide a large sum toward relief of other sections of the community.

Last year £250,000 was handed over and applied to the 12£ per cent, reduction in county rates. This year it is understood the amount is not likely to be any less, and will possibly be greater. The money will probably bo applied to similar purposes, for country ratepayers are in 110 better position than they were when the last allocation was made. Motorists arc afraid that the Government may be contemplating imposing further taxation in view of the difficulties which the State accounts have encountered, but it is believed that official circles have not considered this question. Motorists themselves consider further taxation would bo intolerable, and they claim that they arc carrying as much as they possibly can at present, and any further burden would immediately cause the law of diminishing returns to operate, with the result that the State would lose rather than gain revenue.

Suggestions have been made by motoring organisations that relief could be given from the Main Highways Fund in the direction of spending money on road constructioo for future use. The Government is so placed financially, however, that all construction works of a comprehensive nature are to cease for the present and the money devoted toward keeping roads in proper repair.