PETROL TAX OPPOSED

Taranaki Daily News, 16 February 1933, Page 16

PETROL TAX OPPOSED

EGMONT COUNTY PROTEST. ALTERNATIVE REVENUE SOURCES. Strong opposition to the increase in the tax on benzine was voiced at the meeting of the Egmont County Council yesterday.' The subject was raised by Cr. Young, who asked if the recent tax on benzine would come before the next meeting of the Taranaki Local Bodies’ Association. He would like to protest against it as the tax would hit Egmont County very hard. It affected the small man in carrying out the contracts he had made. It was essential that they use motor lorries to carry their produce to the port Councillor Young moved that a very strong protest against the increase in the tax be sent from the council to the. Local Bodies’ Association. In seconding Cr. Tosland said that if the Government had taken steps to reduce the rate of interest it would have been a much greater benefit to the farmers. The present measures were of doubtful value and had created a lot of bad feeling. It was probable that the benefits would not be as great as was expected. He was opposed to the costs of transportation being pushed up. Councillor Farquhar said he recognised that the Government had to have money, but he thought a reduction of interest would be of more material benefit. Interest was far too high and he asked if the mover would add to the motion a clause favouring a reduction in the rate of interest.

Councillor Young said he did not feel like coupling his motion with the high rate of interest. That was a different matter altogether. It was questionable whether the increased tax would be of any benefit to the revenue. If the tax were put up less benzine would be used. The motion regarding interest should be a separate one. Mr. Gibson said if the Motor Union’s figures were correct motor spirit and the taxes cost 12.45 d per gallon, whereas the lowest retail price would be 29d. This left 16.55 d for freight, insurance and profits, which was a very big item. The Government said it could do "nothing, but that only seemed another instance of its incapability. Councillor Tosland: Mr. Polson has urged an inquiry into benzine prices. ) Councillor Gibson: They make these inquiries but they never get any further. The chairman (Cr. W. C. Green) pointed out that 12.45 d was the total actual taxation on benzine. To this had to be added the cost of the benzine and the cost of carrying it. The Government had increased the tax with the idea of getting more revenue, but he was afraid it was not going to get it. The reduction in the use of benzine would be very great next year if benzine was 2s 6d or 2s 7d a gallon. He asked what would happen if another 4d was put on. The consumption had gone down by 6,000,000 and 5,000,000 two years in succession when a former increase in tax was made. He considered the Government had one idea in view, and that was to force traffic off the roads on to the railways. Councillor Young emphasised the point that contractors had entered into contracts, and he did not think they would be able to carry out their undertakings under the new tax. They would have to obtain a release from the old terms and secure increase in the price. That was only fair as they could not expect contractors to honour their old contracts under the altered conditions. The chairman said the Government had been catering by good roads to get traffic off the rails, and now it wanted to get it back. There were plenty of other ways of getting money if money was wanted. But the Government did not want money; it was trying.to drive traffic back to the railways. This would enable those who used the rail to get cheaper freight, but that would be at the expense of those who did not use the rail and who would have to pay much more for their freight. “I can show them a way to get money,” continued the chairman. "The stamp duty on a receipt for £2 is 2d and it is the same if you pay £5OO or £5OOO. Why not increase this tax?” .. A councillor: That is not workable. The chairman: If it is not workable why have any stamp duty at all? Councillor Gibson: If it is a case of driving traffic back to the rail it is only another case of retrieving past blunders. H. G. Wells said that the countries needed a professor of foresight, but he thought they required a professor of common sense as well. The motion was then carried. On the motion of Mr. Farquhar it was resolved "That the council considers the Government could have better served the country by a reduction in the rate of interest.”