The Wanganui Chronicle. "Nulla Dies Sine Linea." SATURDAY, MAY. 19, 1923. THE SMOKER PAYS

Wanganui Chronicle, Volume LXXXI, Issue 18785, 19 May 1923, Page 4

The Wanganui Chronicle. "Nulla Dies Sine Linea." SATURDAY, MAY. 19, 1923. THE SMOKER PAYS

Smoking, according to some people who do not indulge in the fragrant weed, is held to be a dirty, unhealthy habit. This indictment the smoker naturally resents, and is at least able to retort that, at any rate, it is a habit which relieves the non-smoker of heavy national obligations which he would otherwise have to bear. But not only

does the tobacco lover contribute huge sums to the revenue through the medium of what is essentially a class tax: the great manufacturers also levyheavy toll on the smoking man, and from him a contribution which enables shareholders to draw princely incomes every year. According to a cablegram published in these columns recently, the Imperial Tobacco Co. (Great Britain and Ireland) has decided to give its shareholders a bonus of one new £-1 share for every three shares held. This has been done by the simple device of capitalising £12,000,000 from the reserve funds—in other words, from the accumulated profits. Last year this powerful company made a net trading profit of £7,194,000, and was able to pay the magnificent dividend of 21j per cent., free of taxation. So that the reason for the distribution of bonus shares is painfully obvious. Next year, with the increased capital, the dividend will not ‘‘sound” so large, and so public suspicion will be allayed, while shareholders will be just as well, or even better, off. In Australia and New Zealand, the smoking public is also faced with the task of amassing huge profits for a powerful concern—the British Tobacco Co. (Australia) Ltd., which consists of an amalgamation of Messrs W. D. and H. O. Wills (Aust.) Ltd., the States Tobacco Co., and the British Tobacco Co. (Aust.) Ltd. In passing, it is of interest to point out the coincidence that whilst W. D. ajid H. O. Wills Ltd.'constitute one of the three partners in the Australian Co., Messrs G. A. Wills and H. H. Wills are prominent members of the Imperial Tobacco Co. (Great Britain and Ireland). Now, the British Tobacco Co. (Aust.) Ltd. has a paid-up capital of £6,502,746, and last year it made a profit of £792,831. Every year this concern pays a dividend of 12 per cent., which is quite a handsome one in its way, although not to be compared with that declared by its big brother in England. Our attention has been drawn to the subject by a correspondent who feels aggrieved at the price he has to pay for his “smokes,” and who is seeking information as to who or what is primarily responsible therefor. From inquiries we have made we think that both the wholesale distributors and the retailers are entitled to claim that they are not making exorbitant profits. Price lists disclose that what are known as “bread and butter” lines, that is the tobaccos in common use, the retailers’ “cut” ranges from 1/5 to 1/9 per lb., •while even on the more expensive, or fancy lines, the margin is round about 2/- per lb —obviously not a very large margin out of which to cover expenses and. provide profit. It is evident that the two factors largely responsible for the high cost of tobacco are, first, the big profit-earning toll demanded, by the “trusts,” and next the heavy duty levied by the State upon a commodity which for revenue-earning purposes is taxed as a luxury. For the year 1922 New Zealand’s imports totalled 2,645,000 lbs of tobacco and 889,000 lbs of cigarettes. The duty on pipe tobacco is 4/8 per lb for plug and 4/10 for cut, while fine cut-leaf

for cigarettes has to carry an impost of 10/- per lb. The cigarette-smoker has to pay a duty of 25/6 per 1000, or, roughly, 10/6 per lb. Averaging the tobacco duty at 5/-, and calculating cigarettes on the weight basis, it will be found that the smokers contributed approvimately £1,115,000 to the revenue for 1922. The Australian duty works out at from 2/6 to 3/- per lb., presumably inclusive of cigarettes, for we notice that the latest Melbourne retail quote for Capstan’s is £1 5s for 50 packets of 12 (there are only 10 in the packets of the same brand sold in N.Z.). Although the Australian smoker is so much better off than his New Zealand contemporary, he, too, is complaining of the high price of tobacco. Apparently it would seem that until the Commonwealth and New Zealand can produce sufficient high-grade tobacco leaf to meet the requirements of the local market there can be no hope of any substantial reduction of prices. Meanwhile the smoker may console himself with the thought that he is helping shareholders in great tobacco companies to grow rich and incidentally assisting his country by contributing a more than generous quoto to the public revenue.