SALES TAX OPERATION

Taranaki Daily News, 26 September 1933, Page 10

SALES TAX OPERATION

QUESTION O# BAD DEBTS. NO REFUND POSSIBLE. “It is regretted that the Government cannot see its way to amend the Sales, Tax Act to allow of a refund being granted of the tax paid on goods the sale of which results in bad debts,” stated the Minister of Customs, the Rt. Hon. J. G. Coates, in a letter received by the Auckland Chamber of Commerce. The letter was in reply to a request by the chamber that a refund should be made in cases of bad debts. The Minister stated that the matter had received very careful consideration.

“The business community will be disappointed to learn that the Government has stated definitely it cannot see its way to amend the Act,” said Mr. Harvey Turner, president of the chamber. “The Australian business community is protected to this extent, an allowance being made for bad debts. It certainly seems unreasonable that sales tax should be collected on goods which are never actually paid for by the purchaser.” The following further letter has been sent to the Minister by Mr. Turner on behalf of the chamber: —

“When the Sales Tax Bill was brought before the House of Representatives it was officially intimated that it would be reviewed after about six months’ trial. While the chamber realises the sales tax is inevitable, it considers that in some respects, in the light of experience now accumulated, the provisions might be simplified and rendered more equitable. It urges that the necessary amendments to the Act and regulations should be prepared forthwith. In particular, the following points appear to warrant special attention: — “The absence of provision to secure a refund of tax paid when a wholesaler sells to a retailer in cases where the retailer. subsequently resells from stocks to a second wholesaler. “The cumbrous nature of the procedure necessary to secure a refund when a retailer sells taxable goods to a wholesaler for resale by him or for use by him in the manufacture of goods for sale. Perhaps recovery of the sales tax could be permitted computed as a flat percentage on the values of the sales, and without the necessity for the retailer to furnish details for each sale involved; this percentage to be determined officially at a fair average figure after due investigation.”