TE AWAMUTU COURIER Printed on Mondays, Wednesdays, and Fridays MONDAY, 3rd NOVEMBER, 1947 WILL O’ THE WISP

Te Awamutu Courier, Volume 75, Issue 6441, 3 November 1947, Page 4

TE AWAMUTU COURIER Printed on Mondays, Wednesdays, and Fridays MONDAY, 3rd NOVEMBER, 1947 WILL O’ THE WISP

BY a theoretic transference of figures the Minister of Finance relies on the dollar exchanges when he adopts an internal policy which should in any case have been adopted long ago. The removal of sales tax is long overdue; it was introduced in an emergency which ceased in its effect very many years ago, but the emergency lived cn in Government policy for revenue purposes. Now, with the lifting of subsidies, the Government has to seek a means of relieving the soaring price index, and the Finance Ministry offers a sales tax adjustment. In itself, all that is perfectly understandable. The effect of subsidy withdrawal would affect the family spending power in every home, and the Government would very naturally seek to avoid unpopularity. By removal of sales tax on some essential food items there is. a convenient and useful means and a ready explanation for those who would have upbraided the Government. To that degree there is political strategy in this will-o’-the-wisp treatment of the public accounts. What the Government had gained by relief from subsidies could be surrendered by abolition of sales tax without loss to the net total of public revenue. But it did not rest at that. The Minister of Finance seeks an additional revenue of £759,09Q to £1,000,090 by increased duty and sales tax on imported tobacco leaf. In effect, there is developing taxation and a swelling of the public revenues. Actually in the whole process involving subsidy withdrawal and sales tax adjustment, the Government imposes a greater burden on the community as a whole, changing only the channels of taxation. In explanation the Minister offers “relief for Britain” by a saving in dollar exchanges—a speculative argument and one which is very open to question. If, however, the Minister is so anxious to save dollars, there is one perfectly obvious and very direct way in which he can do so. All too frequently American ships may be seen around the New Zealand coast discharging cargoes of American coak the cargoes and shipping charges both involving dollar exchanges which add positively and directly to Britain’s difficulty, and all the time there is coal in the Dominion. If, therefore, the Government really seeks to assist Britain by saving dollars, is not Government importation of coal a squandering of all that is implied when taxation is stated to be a means for saving dollars ? In any case the internal policy of this country should not be confused with the economic difficulties of Britain. On that score at least political expediency in New Zealand bears no relation to economic necessity as it exists.