THE BEER DUTY

Otago Daily Times, Issue 22368, 15 September 1934, Page 12

THE BEER DUTY

The Lower House spent some hours yesterday in the discussion of the proposal to reduce the. excise duty on beer by threepence per gallon. The Opposition took the view that the duty/ would in effect represent a gift of over £IOO,OOO to the brewing interests of the Dominion. The duty at present is eighteenpence per gallon, and the amount which, it is contended, the brewers would gain through the proposed reduction is clearly arrived at by dividing by six ihe amount of the yield (£655,000) obtained from the duty in the past financial year. Necessarily the brewers would not get the benefit of the whole of this reduction. Some of it would go to the hotelkeepers since a reduction of the price of beer has been announced by the brewing companies. Whether the consumers will benefit, unless, as one of the members of the House feelingly suggested, larger glasses are used in the hotel bars, seems distinctly doubtful. The Minister himself expects that they will, because he believes that the revenue would be aided as a result of extra consumption. It is certain that the increase three years ago in the duty to eighteenpence was not helpful to the revenue. The increase of 50 per cent, in the duty at that time produced only an infinitesimal increase in the taxation yield. It was this raising of the duty that was the cause of the spread throughout the country of the practice of home-brewing. ■ Whether those who have formed the taste for home-brew can now be weaned from it can only be determined by the experience of a lower duty. In any case, as the police statistics show that sobriety in New Zealand is increasing, it is possible that Mr Coates may be disappointed in the expectation that the revenue will benefit by the reduction in the duty. He bases his proposal, however, less on revenue grounds than on the argument that it is justified, by the consideration that an impetus will be given to the hop-grow-ing industry. The value of the hops that were exported last year was not very considerable, being under £ 24,000, and we should not suppose that a great expansion of the export trade in the commodity is confidently to be expected. At a time, however,' when the principal export industry of the Dominion is encountering tremendous marketing difficulties, there is an undeniable force in the argument that the country should make every effort, even in a small way, to diversify its export trade.