GOLD EXPORT TAX

New Zealand Herald, Volume LXXV, Issue 23088, 13 July 1938, Page 14

GOLD EXPORT TAX

PLEA FOR REMOVAL BURDEN ON INDUSTRY THE MINISTER'S ATTITUDE CONSIDERATION NEXT YEAR [BY TELEGRAPH —SPECIAL REPORTER] WELLINGTON. Tuesday A plea for the removal of the gold export duty, which ivas imposed in 1933, was made by a deputation which waited on the Minister of Finance, the Hon. W. Nash, this evening. The speakers emphasised the serious effect the continuance of the duty was having upon the industry and urged the Government to take immediate action. The Minister in his reply said it was proposed to revise the whole incidence of taxation next year, when consideration would be given to the request for the abolition of the gold tax. The deputation was introduced by the Minister of Mi pes, the Hon. P. C. Webb. "Cinderella of Industries" Mr. R. T. Tosswill, president of the New Zealand Gold Producers' Association, said he represented the whole of the gold-mining industry, quartz, alluvial and dredging. In 1934 the association \yas formed, mainly to protest against the tax, which was a breach of the canons of sound finance, inasmuch as it was a tax upon production and was unique in its effect in New Zealand. They were still wondering why the Government persisted in inflicting the tax on an industry in which there were more than 6000 workers and approximately 25,000 others interested. "Gold producing," said Mr. Tosswill, "is the Cinderella of all primary industries, inasmuch as all others are assisted, protected or subsidised. In our case it is made the target for basically unsound taxation. The industry has never objected to paying its fair share of tax on profits and has always paid a high rate of wages. "Over the past two years wages have increased more than 30 per cent. It is evident to us that with the maintenance of the gold tax the industry will not only diminish, but will eventually die out, as it has done on various occasions in the past, when costs have exceeded the rewards obtained." Otago Employees' Views Mr. R. D. Eaton, speaking on behalf of gold-mining employees in the Otago district, said they were receiving less in wages than they should, as other centres were getting higher wages than 2s 2d an hour on a 48-hour basis. They had accepted those terms because they knew it was the utmost the employers could afford. They had had to choose between ruining the industry in Otago and acceptance of wages lower than the ruling rates. "If it was good enough for the men to help the industry, surely it is good enough for the Government to help the industry, too," said Mr. Eaton. "The most effective way it can assist is to remove the export tax, which is unquestionably a most unfair imposition and is resented not only by the mining companies themselves but also by the wage-earners and miners." The views of the gold reefing industry were presented by Mr. M. H. Wynyard, who said that if there was any justification for imposing the gold export duty in 1933, conditions had materially altered since then and they saw absolutely no reason why the tax should still be in force. A Promise Confirmed The return from the special gold duty was a little over £IOO,OOO a year, Mr. Wvnyard continued, and if the tax were abolished it would not be all loss, as the dividends which its removal would make possible would be liable to income tax. In any case it would be more than compensated for by the benefit to the community in increased employment and exports. The Minister said the Government had no desire to be unfair to any industry. He had promised that the gold export tax would receive consideration when the revision of the general taxation was being undertaken. That promise still stood.

"The revision of taxation will take place next year if we are given that privilege," added Mr. Nash. "It is no use starting to play with any taxation system until we have got thp whole picture. Wo are trying to make the picture and we will paint it properly in relation to the economics of the country."