LIQUOR TRADE TAXATION

Taranaki Daily News, 13 July 1933, Page 7

LIQUOR TRADE TAXATION

appeal made for relief diminishing returns cited. CONTRIBUTIONS TO REVENUE. REDUCTION OF DUTIES SOUGHT. By Telegraph—Press Association. Wellington, Last Night. The general position of the licensed trade in New Zealand was placed before the Tariff Commission to-day with a view to a reduction in the excise and Customs duties. It was contended that the progresive increase in duties consequent on the fall in consumption and the drop in revenue might be taken as a ■ classic example of. diminishing returns due to over-taxation. The trade, it was stated, produced one-fifth of the total Customs and excise revenue, and had been called upon to carry a disproportionate load. Mr. Percy Coyle, general secretary of the National Council of the Licensed Trade of New Zealand, said that their main ground for the request for a reduction lay in the fact that the last increase in taxation had meant not an increase in revenue, but a loss. The decline was so marked that it could not be accounted for by depression influences, and in the case of spirits the 1931 increased tax imposed as a Budget-balanc-ing device had dragged the revenue down to the lowest figure for ten years. The beer. returns showed a slight rise in revenue, but the consumption drop was a record and was still unchecked. The revenue would inevitably follow it unless excise was lowered.

“Comparison with Great Britain, whose legislation we followed, showed the same diminution in returns due to high taxation,” Mr. Coyle said. He submitted that the trade deserved consideration as a contributor to the national income of from £1,000,000 to £2,000,000 annually. He contended it was fallacious to regard the licensed trade from a revenue viewpoint alone, for it kept an array of men and millions of capital in employment. Half a million pounds was paid annually in wages by the brewers alone. Mr. Coyle urged the Commission to take no account of the vexed question of the. morality or otherwise of selling and consuming liquor. This had been answered conclusively by the country in 1928.

An additional set-back, to the licensed trade had been caused by high taxation. Home brewing of ale had received a great impetus on accoimt of its cheapness. The State obtained little or no revenue from this source and the trade, which was expected to produce revenue, competed with an untaxed product.