DAIRY INDUSTRY

Otago Daily Times, Issue 22391, 12 October 1934, Page 10

DAIRY INDUSTRY

FORECAST OF LEGISLATION , s SALES TAX ON LOCAL BUTTER RE-CONSTITUTION OF BOARD (From Oub Parliamentary Reporter.) WELLINGTON, October 11. The overhaul of the dairying industry to be undertaken by the Government either this session or early next year may, it is understood, provide for a sales tax of 2d per lb on butter sold on the local market. A subsidy on exports is not likely in view of the exchange premium of 25 per cent. The producer is unlikely to receive all the proceeds of the sales tax. A pool for a proportion of it will probably be used to finance herd improvement, or perhaps for the establishment of a veterinary service with a view to the removal of tubercular cows and other unhealthy animals from milking herds. One proposal for avoiding uneconomic competition in the local butter market which will probably receive attention is the division of the Dominion into a number of zones. Under this system butter produced in one zone could not be sold in another. Any distribution to’the producers from the sales tax pool will probably be made through the factories on a tonnage basis. The sales tax scheme differs from the Paterson Plan, which ugtil recently operated in Australia. The Paterson Plan w'ns a voluntary marketing scheme sheltered by a protective tariff. All the contributory factories paid n levy on each pound of butter they produced, and the money was used for paying a bonus on each pound exported. Roughly, the effect was to make the value of a pound of butter in Australia equal to the value in London, 1 plus the value of the bonus. Consequently the price to the Australian consumer was raided. A re-eonstitntion of the Dairy Produce Board is another probable subject of legislation. The new board is likely to consist of four producers’ representatives (three from .the North Island and one from the South Island), and four Government representatives. It is expected that the New Zealand Co-opera-tive Daily Company will be allowed one representative on the board. Of the remaining North Island producers’ I’cpresehtatives, one will represent the North Auckland district and South Auckland interests other than the New Zealand Dairy Company, and the other the Taranaki. Rangitikei, Manawatu, Wairarapa and ‘ Wellington districts. Provision will probably be made in the amending legislation for : the coopting of scientists by the new board. It lias often been suggested that officers of the Department' of Industrial and Scientific Research should act as advisors to the board on questions relating to the quality of produce, the methods of manufacture, and scientific and technical matters generally. The compulsory steam sterilisation of dairying appliances will, it is believed, be considered in the drafting of the legislation. The problem of winter dairying, too, will not he lost sight of. It has been suggested that some effort might be made to arrange for a spreading of production more uniformly through the year. An increase of production, it is said, might be obtained in this way with no added capital cost. The legislation dealing with the industry, of course, will depend largely on the nature of the Dairy Commission’s report, _ which the Government expects to receive either to-mOrrow or on Monday. It is not yet known whether the complete legislation will be brought down this session or whether it will be postponed until early next year.