TARIFF REVISION

Otago Daily Times, Issue 22063, 20 September 1933, Page 5

TARIFF REVISION

SETTING OF COMMISSION DUNEDIN EVIDENCE CONCLUDED The- Customs Tariff Commission concluded its Dunedin sittings yesterday, all the members being present, viz.—Dr Craig (chairman), Professor Murphy, Mr J. B. Gow, Mr D. A. Pascoe, and the secretary (Mr J. P. D. Johnsen). ELECTRIC CONSUMING DEVICES. Albert Eden Russell, chairman of the Otago Electric Power Board, asked that the existing duty on electricity consuming appliances, and particularly electrie ranges, electric cookers, and all electrie heating elements, be abolished. One of the problems of the board was how to increase its revenue per consumer _in ■order to bring this up to the Dominion average of £l2. At the present time it ■was approximately £3 per consumer below that standard. The capital involved in the undertaking was £291,000, and before they could reduce their charges for .electricity to make them comparable with the city of Dunedin the Dominion average revenue per consumer must at least be attained. The source from which they should receive additional revenue was the domestic use of electricity for cooking and household requirements. At the present time expansion in that direction was greatly retarded by the high cost of electric ranges and cooking appliances, ine measure of income iu the farming aistricts of Otago had been greatly affected by the prevailing low prices for primary products, and it was contended that only by offering electric ranges and heating apparatus to their consumers at moderate cost could they be induced to install them and help raise the board's revenue from the domestic supply of electricity. The cost of bringing electric cookers from England into the Dominion was approximately 85 per cent, of the British manufacturers net charge, so that by the time a range reached the New" Zealand consumer of electricity its cost had probably doubled. The cost was more than doubled m the case of Canadian manufactured ranges. If, the duty were taken off both the British and Canadian ranges, the New Zealand manufacturer would still have 60 to 70 per cent, protection, and even that could be reasonably regarded as excessive considering the necessity for cheaper appliances. The capital expenditure involved in electricity schemes in- New ■ Zealand at March 31, 1952, was £32,000,000, in which the State was interested to the extent of £12,000,000 and local authorities' to £20,000,000. v ; In most of the- cities electricity was being sold to-day at prices competitive with other means of heating and cooking, but in the country districts, where the selling price of electricity had to be based on the cost of distributing it over long lines of reticulation, cheap coal, especially in Otago, was a powerful competitor for the favour of the farmer and his household. It could be contended that any loss in Customs duty would, be_ compensated for, &s far as rural power board consumers were concerned, many times over by the resultant stimulus to the production of commodifies for and the taxable revenue derived therefrom. It was also requested that consideration should be given to the existing epcific duty on electric lamps, which amounted to approximately 3d on lamps up to 80 watts. The admission of electric bulbs duty free would be of material benefit to the extension of the use of electricity, but in any case if was submitted that the duty should be altered from a specific to an ad valorem one. Mr Russell said that no antagonism to the New Zealand manufacturers of electric consuming devices was implied. Even if all devices were admitted free. New Zealand manufacturers would still have a substantial protection and should be able to sell the imported article. . . . What he had represented had been said from the point of view of a power board selling electricity in an entirely rural area, and of the people who constituted its consumers, but it was contended that the same remarks applied generally to the electricity distributing authorities throughout the Dominion, ivhether they purchased their power from State-owned schemes or local enterprise.

FOUNTAIN PENS, PENCILS, BTC. _ Mr James Gordon Jeffery made application on behalf of Messrs Conway, Stewart, and Co., London., for a reduction of Customs duty on fountain pens, propelling pencils, and presentation writing sets (comprising fountain pen and propelling pencil) when of United Kingdom manufacture. The duties at present were:— United Kingdom, 20 per cent, ad valorem; Canada, 20 per cent, ad valorem, plus nine-fortieths surtax; and foreign, 45 per cent ad valorem, plus nine-fortieths surtax. The company employed a minimum staff of 400 wholly employed in the manufacture of the above goods, and it was estimated that nearly 100 were employed in the preparation of raw material, boxmaking, show-card printing, etc.. The capital employed was entirely British, and materials used were nearly 100_ per ■ rent, of British Empire origin. Rebel in duty charges would be welcomed, for, unless obtained, owing to the increased cost of gold, prices would, have to be raised, for, pending the bringing down of the new tariff, prices were being kept firm, at considerable loss to the principals and their agents. Fountain pens and propelling pencils were now recognised as essentials m all walks ot life —not luxury goods. Reduced duty charges would provide the equivalent of increased purchasing power. If tne above goods were made duty-free, notwithstanding increased cost of gold, they would be able to make substantial reductions in selling prices, . Mr Jeffery also submitted evidence on behalf of Messrs Perry and Co., Ltd., Birmingham, for a reduction of Customs duty on gold and also steel fountain pen nibs, steel nibs, penholders, rubber bands and erasers when of United Kingdom manufacture, and which items were at present included under Customs tariff item No. 305, present duties being :r- United Kingdom, 20 per cent, ad, valorem; Canada, 20 per cent, ad valorem, plus 9-40ths surtax; foreign, 415 per cent, ad valorem, plus 9-40ths surtax. The reason for asking for reduction in duties was so as to enable his principals and other United Kingdom'manufacturers to compete more successfully against severe Japanese competition, which had recently become very disturbing. None of the items mentioned 'was either made in New Zealand or likely to be made in New Zealand. Such duties, therefore, were purely revenue producing. By the lifting of the duties on United Kingdom goods British manufacturers would be able, however, to; hold the market for these lines against foreign competition. It was desired, if Budgetry conditions would allow of reductions in these revenue-producing duties, that the duties be maintained as at present on Canadian and foreign lines. Mr Jeffery further asked, on behalf of Messrs Joseph Egerton and Co., Manchester, for reduction of Customs duty on graphite pencils, copying pencils, chalk pencils, propelling pencils, and crayons in wood when of United Kingdom manufacture, and which items were at present included under Customs tariff item No. 305, present duties being:—United Kingdom, 20 per cent, ad valorem; Canada, 20 per cent, ad valorem, plus 9.40 th surtax; foreign, 45 per cent, ad valorem, plus 9-40 tbs surtax. None of the above items was manufactured in New Zealand, nor was it likely that manufacturing in New Zealand would be considered for at least very many years ahead. These duties, therefore, were entirely of a revenue-pro-ducing nature. At the present time British manufacturers were, suffering severe competition from Continental and Japanese sources, particularly in the lower priced lines. Although no proof was available it was understood that Continental manufacturers making these goods received an export bounty, and, regarding Japanese goods, the conditions under which these were made were only too well known. Under these handicaps British manufacturers were at a disadvantage. In the event of the revenue position having to be considered it was asked that at least a 10 per cent, ad valorum reduction be made. FRANKING MACHINES.

Albert Edward M'Dougall, representing the New Zealand Typewriter and Supplies Company, and New Zealand agents for the Roneo Neo-Post franking machines, asked for a reduction of the duty of 20 per cent, on the company’s manufactures. It was claimed that the number of franking machines made in New Zealand was not sumcient to warrant the protection. IMPORTERS’ REPRESENTATIONS. William E. Earnshaw, chairman of the Imports Committee of the Dunedin Chamber of Commerce, presented evidence on

matters mainly affecting importers. He said the representations dealt chiefly with questions of law and administration. Dealing with the duty on_ goods of foreign origin, Mr Barnshaw said it was requested that the value for_ Customs duty upon goods of foreign origin be ascertained by converting into sterling at the par rate of exchange the home consumption price of the exporting country. The present method of assessing the value at the bank rate of exchange caused violent fluctuations in duty and caused difficulty in costing goods to sell forward. Owing to vessels shipping goods from many foreign porta, arrangements had to be made to fix rates at those ruling somo time prior to actual final sailing. The rate fixed could not be ascertained until after arrival at first port of discharge. By fixing at par rate considerable help would be given to business firms and more confidence inspired. The original protection granted by the tariff was not interfered with. Countries with depreciated currencies were now given an advantage which to a large extent destroyed the protection intended to be given to British goods. This matter had been brought before the Minister of Customs on previous occasions, but was not dealt with owing to the possibility of the question being considered fully at the Ottawa Conference In respect to the revision of specific and dual duties, Mr Barnshaw said it was considered by the chamber that specific and dual duties should be abolished where feasible, and ad valorem duties substituted. Specific duties were inelastic, and failed to reflect falls or rises in world market prices. Specific duties were operating very heavily on certain lines to-day in that world prices had fallen considerably, but these duties tended to retard the. fall in living costa and costs of production here. The same applied to dual duties, and they considered both these classes be revised to bring them more into line with present-day world prices and, if possible, be replaced with duties on an ad valorem basis. The revision along these lines would simplify the tariff and be of great assistance to importers. Mr Earnshaw said it was also considered that catalogues, price lists, and show cards issued by British manufacturers trading with New Zealand importers, also their circulars, posters, and similar advertising matter relative to their production which in the normal course of trade were used as sale helps and not sold as ordinary merchandise and had no real sales value, be admitted free of duty. The removal of duty on this class of advertising material would not unduly affect revenue, as the full use of such material would stimulate imports and in a large number of cases increase the amount of duty collected. The removal of the duty would greatly foster interimperial trade and be quite within the spirit of Ottawa. The Chamber of Commerce would not press for the removal of duty on advertising lines of a utility nature, such as advertising jugs, trays, ash trays, etc., as these lines competed with ordinary trade importations, and, if over-imported, would affect revenue. Importers generally _ urged that they should be given the right of appeal to the court in all cases where a dispute arose as to the meaning and application of any terms used in the tariff. Under the Customs Amendment Act, 1921, section 20, this right was greatly curtailed, and the practice had been since that date to print more and more items in the tariff so that they would be covered by this section of the Act, and any decision on this made by the Minister must be final. Chambers of Commerce have had correspondence with the Minister of Customs on the question of repeal of this section (!20), and the matter was to be considered when the next alteration took placl in the Customs .laws. It had been decided that a protest should be made against the Minister overriding the decision of Parliament with regard to the rates of duty levied under Customs tariff. The tariff definitely laid down duties for various groups of goods, and any special items under these groups were separately mentioned if they were to be at some different rate # of duty. It had been the growing practice of the Minister or Customs Department by decision to take articles out of their group and class in some other group at a higher rate of duty. Example: Tariff heading 214 and 215 read as follows:—" Chinaware, earthenware, and porcelain ware — viz., bowls, cups, saucers, - plates, jugs, dishes, teapots, and such similar articles suited for table use as may be approved by the Minister.” China ware, earthenware, porcelain ware, and stoneware n.e.i., duty, 20 per cent. British; duty, 45 per cent, foreign. Tariff heading 225, read: —“Glassware, n.e.i, globes, and chimneys • for lamps,n.e.i, globes, and terns, and lampwick n.e.i.” Duty, 20 per cent. British; duty, 45 per cent, foreign. By decision 14/62 the following are classed as fancygoods and toys—viz,, "Vases, rose bowls, jardinieres, and similar articles of china,-glass, glass, metal, and other material.” Duty, 25 per cent. British,' duty, 60 per cent, foreign. The fancygoods heading No. 239 in the tariff reads: —“Eancygoode and toys, sporting, gaming, and athletic requisites n.e.i., including billiard requisites n.e.i., . fishing taclde n.e.i. Including artificial flies and other baited hooks, walking sticks, combs —hair and toilet. It was contended that it was nob the intention, of Parliament to class earthenware, chinaware, glassware, vases, etc., as fancy goods, otherwise they would have included them under heading 239. There were numerous other, instances of lines intended to pay duty under the hardware n.e.i. item No. 356—20 per cent. British and 45 per cent, foreign—which had been so dealt with and by decision of the Minister brought under the fancygOods heading at the higher rate. This closed the sitting of the commission in Dunedin,