THE SALES TAX.

Waikato Times, Volume 113, Issue 18878, 23 February 1933, Page 2

THE SALES TAX.

DOMINION GOODS. CLAIM FOR EXEMPTION. NOT POSSIBLE TO INCLUDE. HAMPERING IMPORTS. WELLINGTON, Wednesday. In the House of Representatives to-day, reasons why the Government eould" not grant general exemption from the sales tax to all goods manufactured'or produced in New Zealand were explained by the Minister of Customs, Mr. Coates. Mr. W. Nash (Labour —Hutt) moved to insert in the schedule of exemptions, “all goods manufactured or produced in New Zealand. He urged the claims of secondary industries. “ The effect of the exemption would be immediately to place what is equivalent to o per cent, primage on all imports from Britain,” replied the Minister. Mr. Coates added that the Government could not and would not agree to a proposal whch had that effect. The sales tax was a tax on all goods and was not to be used as a form of preferential tariff. The Government • was already under an obligation to remove primage charged on British imports as soon as possible. It could scarcely go ahead and add what was equivalent to further primage. For those reasons, the amendment could not be entertained by the Government. The Minister’s remarks were criticised by the Leader of the Opposition, Mr. H. E. Holland, who said that although the Minister refused the amendment on the ground that it would Impose a further burden on British imports and clash with the Ottawa agreement, very recently by raising the exchange rate, he had imposed on British manufacturers what was equivalent to 15 per cent. Increase In tariff. The amendment was defeated by 40 jwtes to 24.

fV IMPORTANT CHANGES. \ ’ •—^— . ftEDBAPTINO OP CLAUSES. •BBS £)N CREDIT PRICE. y\r at*; private imports. WELLINGTON, Wednesday. Important changes to the Sales Tax Bill hevfl J>een made as a result of redrafted clauses, Introduced in the Route of Representatives to-day, and approved after a short discussion. The Minister of Finance, Mr. Coato% said that as the bill was originally framed goodB; imported by •wholesalers, retailers (including manufacturing retailers) and by the general publio for their own use were exempt from the sales tax. Since the bill was introduced the Government had concluded that it would be more satisfactory if the Mil were so framed as to Impose the tax in such cases. Cages of difficulty, could be dealt with as they, arose. , It was not at present Intended that the sales tax should be collected on everv packet, however small, Imported by post by private persons for their own use. That matter, along with many others, would be gone Into as soon as the bill was .passed. •Proposals contained in the amendments enabled manufacturers either to deduot from the sale value of manufactured goods the taxable value of the materials used, or to deduct from the sales tax payable the tax already paid on the materials. The new provision would be of great l assistance to retail manufacturers. Another amendment was designed to ensure that where an allowance was made on account of tax on materials a taxpayer would not be able to deduct the discount or any part of it a second A further new provision enabled Refunds of sales to bs made where warranted on materials used in making non-taxable goods. Alterations have been made to a clause which sets out the procedure for determining the sale value of goods for purposes of taxation. The object of oo« alteration is to provide that tax shall be paid on the credit price and not the cash prloe. Thus the pertinent part of that clause, as amended reads:—"Except in such oases as may be prescribed, the price for whloh any goods are sold or the fair market value of any goods shall be determined as if suoh goods were sold on credit, and no deduction shall be made from such price or from fair market value, as the case may be, because of any discount, rebate or allowance granted or offered In consideration of the payment of the purohase money at or before the time of sale or within any specified time thereafter."

Adjusting Exohango Values. Tn the original draft it was provided that in the case of goods imported into New Zealand and entered for home consumption, the sale value should he the equivalent, jn New Zealand currency of the value of those goods for customs duty, plus the amount of customs duty payable, plus a further 20 per cent. It is now proposed that this 20 per cent, should ba increased lo 25 per cent. A new provision states that except with..the consent of the Comptroller of Customs, granted subject, lo such conditions as ha thinks ill, no person shall he licensed as a wholesaler and as a manufacturing retailer at the same time.

The Minister has also arranged for the abandonment of the provision requiring securities when licences were being granted. ißy another alteration, the selling or manufacturing of goods by an unlicensed wholesaler shall involve a broach of the law only when taxable goods are traded. During the Committee discussion, the Minister promised, lo consider the question of allowing costs to an appellant'if ho' succeeded in his appeal against the assessment of sales tax made by a col Tec tor of customs. An amendment allows reasonable costs to bo obtained in such circumstances.

Wages Exemption. A clause in the original draft of the bill enabled the Crown to recover sales tax from a person owing money to a taxpayer. An amendment exempts wages from that provision. one amendment stipulates that any information for an offence under tlm proposed legislation must lx* laid within five, years of I lie dale of the commission of the alleged offence. Another amendment restricts the arrests of persons without warrant to suspected offenders about to leave New Zealand. explaining another amendment, the Minister said the hill, as introduced, enabled a person who had entered into an agreement after the taxes were

Imposed to add to the contract price the amount of any sales tax paid by him. As every person was, after the introduction of the resolutions, in a position to protect himself, it was considered that the clause should deal only with contracts entered into before February 9. Provisions to that effeot had accordingly been made. The object of another amendment was to provide that a wholesaler should show on his invoice the amount of tax payable on the goods. Provision of New Clause. It was also proposed that provision should be made by which a vendor might recover the amount of tax shown on the invoice. The Minister said it was understood that in Australia certain retailers refused to pay sales tax to wholesalers until a similar provision was inserted in the Commonwealth law.

A new clause provides that it shall be an offence to set out on invoices an amount representing sales tax when such tax is not payable in respect to such goods, or when the amount shown is greater than the amount paid.

\Vlth the object of giving the taxpayer the benefit of any alterations made in the basis of taxation between the introduction of the resolutions on February 8 and the passing _of the bill, a saving clause has been inserted allowing collectors of oustoms to make appropriate refunds. The final amendment provides that all Orders-in-Council, including regulations under the bill, shall be tabled In both Houses of Parliament Within 14 days of being gazetted if Parliament is in session, otherwise within 14 days of the opening of the session. Provision is made by which the House of Representatives may decide that any such Order-in-Counoil shall b@ revoked or varied. In the event of that course being taken, provision ismade for a refund of the excess sales tax.

EXEMPTED GOODS. REVISED SCHEDULE. MANY ARTICLES FREE OF TAX DAIRYING MACHINERY PARTS. (Times correspondent.) < WELLINGTON, Wednesday. Since the introduction of the S'ales Tax Bill about a fortnight ago there have been many alterations in the exemption schedule. Some of the items on the original list have been removed while other items have been placed on the list as a result of representations to the Minister of Customs, Mr. J. G. Coates. The amendment exemption sohedule contains the following additions:— Animal lats or oils, orude or refined. Box strapping, metal, suitable for binding cases, crates and similar articles, also seals for use therewith. Candles. Carbide of calcium. Chemicals, drugs and similar preparations approved by the Minister for use in public and privato hospitals, mental hospitals and other approved institutions, when such preparations are purchased exclusively for use thereat and not for resale. Cornflour.

Dairying machinery and applianoes, namely, vacuum .pans, vats or tanks, other than those lined with glass, porcelain or enamel (when sold to a dairy faotory or manufacturer of milk products), also the following articles made of rubber identifiable as parts of dairying machinery, namely, inflation tubing, milking maohne rings, washers, releaser coneotlons and similar rubber fittings.

Eggs, fresh or preserved, and egg pulp. Foods peculiar io use as stock and poultry foods. Cow, horse and pig hair In its natural state. Hemp 'and tow.

Hides, skins and pelts, raw. Hoops, metal, in short lengths, specially suitable for wool baling or similar purposes. Horns, hoofs and bones. Lime, Including quicklime, slaked lime and limestone. Malt. Meats, cooked. Dairy Utensils. Milk and cream cans.

Pasteurised, powdered, condensed or preserved milk, buttermilk powder. Cement co'ated nails.

Paper patterns. Rabbit poisons, namely, carbon bisulphide, phosphorised pollard, strychnine and similar poisons. Fowl grit. Sausage casing. Sodium Chlorate.

Spray pumps, foot or hand power. Tar. Tallow. Water. Wood wool. Wool, greasy, aliped, scoured or carbonised. Yeast The following additional classes of goods, whether produced or manufactured in New Zealand or imported, which, if Imported, would be included under the following items of customs tariff: — Rice, dressed or undressed; rlceme'al refuse and ricemeal. Anhydrous ammonia. Cotton piece goods, namely, tubular woven cotton cloth specially suited for use as meat wraps; cheese bandages or caps. Paper, n.e.1., cut or shaped, for wrappers, boxes or other receptacles. Cellophone, plain, in sheets, imprinted, n.e.l. Taper, unprinted, namely, true vegetable parchment; glazed transparent grease-proof paper, greaseproof Imitation parchment paper and similar paper of such qualities as may he approved by the Minister. Paper (other than wrapping paper), waxed, imprinted; also such paper printed and then waxed. Paper or cellophone wrappers, printed, litographed, or ruled, n.e.l. Wrapping paper, printed or unprinted. Cordage and twine suited for use as Ashing lines, and twine suited for use in tiie manufacture of netting and nets, of qualities- approved by the Minister.

List of Deletions. The following deletions have been made from the original list:— Articles and materials for the soli' use of a public hospital when purchased exclusively by such hospital, and not for resale. Lard and margarine. Surgical, dental and opticians’ instruments and appliances. Scientific ami philosophical instruments and apparatus. Cylinders for compressed gases. Electrical appliances peculiar to surgery, X-ray tubes. Arlitleers’ tools. Rill hooks, hush hooks, slashers and hedge knives.