SALES TAX WAGER

Poverty Bay Herald, Volume LXV, Issue 19758, 12 October 1938, Page 5

SALES TAX WAGER

JUDGE DECLARES DRAW

QUESTION OF EXEMPTIONS

"BOTH PARTIES CORRECT"

"Under the circumstances it appears to me that both parties from their own point of view ; are correct, and the only possible decision would be a draw."

This is the opinion of Mr. C. O. Hansen, manager of the Gisborne branch of the New Zealand Loan and Mercantile Agency Company, Limited, who was appointed judge of the sales tax exemption wager entered into at Waerenga-a-hika between Mr. W. C. Pilmer and Mr. A. G. Hultquist, M.P., Labour candidate for the Bay of Plenty seat at the elections. Mr. Hansen made his decision available to-day. He stated that as he was not present at the meeting at which the wager was made, he wrote to both Mr. Pilmer and Mr. Hultquist as follows: —

•'As I was not present at the meeting when the discussion regarding sales tax occurred, I would first require definite instructions in writing before deciding the point at issue. On perusing the list of articles exempted from sales tax, I need hardly point out that whilst tax may not be payable on the manufactured article, it is undoubtedly payable in many cases on the materials used in the manufacture. In such cases sales tax must be added to the cost and in effect borne by the farmer. It, however, seems to be that in the absence of an interview with both parties together, I must ask that the actual points of the discussion be put in writing and signed by both parties, when I would then be in a position to give an unbiased opinion." Mr. Pilmer's Contention .

"So far, it does not appear to have been possible for both parties to interview me," Mr. Hansen added in giving his decision. "Mr. Pilmer has, however, written me stating that Mr. Hultquist was having some lively interchanges with several of the front row over the sales tax. Mr. Hultquist stated that farmers hardly paid any sales tax, and rolled off by the dozen articles from a list, and the inference was that the farmers were receiving the sales tax exemption at the expense of the rest of the community. However, later he denied that, but the meeting ruled him out on the voices.

"At the mention of concrete posts, Mr. Pilmer interjected, stating Mr. Hultquist was not right, as there was an indirect tax. Therefore, _ the articles mentioned were not entirely tax free. Mr. Hultquist stated: 'Do you pay tax?' Mr. Pilmer said: 'Yes.' Mr. Hultquist wagered .-£lO. that Mr. Pilmer did not, and the latter accepted his wager. Mr. Pilmer's contention is that if the materials used in the manufacture of any of the articles are previously taxed, the farmers do pay, and that tax, direct or indirect, is just the same as far as paying is concerned. The manufacturer includes any previous tax and passes it on to the purchaser. Mr. Pilmer stated he was prepared to abide by my decision, win, lose, or draw, money to be paid to charity. Mr. Hultquist's Views "Although I have not received a written reply from Mr. Hultquist, I saw him yesterday, and he maintains that there was no discussion regarding any indirect tax. He states that he claimed that the list of articles from which he read and later handed to Mr. Pilmer were exempted from sales tax, and I was to give a decision only as regards this point. "Actually, this list is taken from the articles Gazetted as exempted from sales tax. It, therefore, appears to me that it is impossible to arrive at a decision as to Which party should contribute the £lO to charity. "I have endeavoured to make inquiries from persons who attended the meeting, but find their recollections of the wager at variance. Whilst some support Mr. Pilmer's contention, others are equally in favour of Mr. Hultquist.

"It is common knowledge that sales tax is payable on the materials used in the manufacture of many farmers' requisites, although not on the manufactured article. In these cases Mr. Pilmer's contention that an indirect tax is payable by the farmer is undoubtedly right. On the other hand, the list of articles submitted by Mr. Hultquist are undoubtedly exempt from any further sales tax. "Under the circumstances it appears to me that both parties from their own point of view are correct, and the only possible decision would be a draw, and I suggest each side might contribute £5 each to charity,"