The Southland Times. PUBLISHED EVERY MORNING. Luceo Non Uro. THURSDAY, AUGUST 29, 1929. WHO WILL PAY IT?

Southland Times, Issue 20865, 29 August 1929, Page 4

The Southland Times. PUBLISHED EVERY MORNING. Luceo Non Uro. THURSDAY, AUGUST 29, 1929. WHO WILL PAY IT?

The Minister for Internal Affairs is to be congratulated on the skill with which he prepared the case for the doubling of the primage duties, but congratulation on this point must not be taken to include any admission that his arguments are sound. Although it looks well, the case presented by Mr de la Perrelle is not strong enough to surmount the obstacle that this duty is to extract £400,000 this year from the pockets of the people in addition to what is already paid under this duty. From the Liberal standpoint it is a violation of the principle of the “free breakfast table.” Mr de la Perrelle may say now that in twelve months the householder will be required to pay no more than twopence farthing extra on dried fruits, he may show that in five weeks the working man’s tobacco will cost only one penny more; but he studiously avoids the accumulative effect of these increases which will bring into the revenue account £400,000. The tale does not end there. Much of the original primage duty was not passed on because it was too small, but there is already evidence that the doubled primage duty will be passed on, and this means that the effect on the consumer will be greater than that which would result from a direct payment of £400,000. When earnest people console themselves with the thought that the Customs duties is not passed on to the taxpayer, they should remember that this form of taxation affects the costs of wholesaler and retailer, and if we can imagine that business men who are suddenly confronted with the task of adding £400,000 to their administrative costs do not include them in their assessment of charges, we are fitted with minds that can see pictures they wish to see and not pictures of things as they are. To say that this primage duty is to be borne by luxuries is to put up a smoke screen. What are luxuries? And what effect do they have on the general cost of living ? There are many motor cars bought every year as part of the annual equipment of business. These are not luxuries, but they must bear their share of the increased taxation. And if the cost of the motor car is increased, if the cost of its tyres is increased, if its petrol is more expensive as a result of this primage duty, these items are reflected in the operating costs of the business and are passed on to those items which can bear the additional burden. It is cute, but not clever, to discuss the primage duty in terms of individual items. It is unwise to limit one’s consideration of it to the sum of £400,000, because by the time it reaches the consumer that sum will have been substantially increased. It has been estimated that the addition to the primage duty will cost the consumers more than double the £400,000 it is to give to the Consolidated Fund. We do not know whether this is an under-statement or an exaggeration, but we say confidently that it is the height of absurdity to suggest that £400,000 can be raised by extra taxation on importations without the cost of living being affected. It is passible, of course, that in some particular instances there will be no apparent increase in the price charged to consumers, but if the doubled primage has prevented any reduction in price, the effect is the same—it is depriving consumers of benefits which would otherwise have accrued and eo has raised the prices so far as their practical application is concerned. The primage duty on a reel of cotton may not be sufficient to advance the price of that reel of cotton, but the loss sustained by the merchant and retailer in the cotton reel transaction will probably go on to some other item where it can be passed on with confidence. The whole argument must be reduced in the end to the blunt face that the Government is going to take £400,000 more out of Customs taxation by increasing duties and that the consumers will pay this sum and, in addition, those charges which have a habit of attaching themselves to these imposts as they proceed from the Customs clearing shed to the consumer’s account.