REPORT BY THE SECRETARY AND INSPECTOR OF CUSTOMS RELATIVE TO THE COST OF COLLECTING THE CUSTOMS REVENUE.

Appendix to the Journals of the House of Representatives, 1873 Session I, H-22

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1873. NEW ZEALAND.

REPORT BY THE SECRETARY AND INSPECTOR OF CUSTOMS RELATIVE TO THE COST OF COLLECTING THE CUSTOMS REVENUE.

Presented to both Houses of the General Assembly by command of His Excellency.

Customs Department, Wellington, 17th September, 1873. Sir,— With reference to the remarks you recently made to me, regarding the opinion that is stated to be very generally entertained, that the Customs revenue in this Colony is collected at an expensive rate (though I am aware that you are not of this opinion), I have thought it desirable to have returns prepared, as stated below, which contain the fullest information on this subject, in order that you may have them made public if you consider it advisable to do so : — I.—Abstract of all Duties and Revenue collected by the Customs Department during the financial year ended on the 30th June, 1873. IL—Return showing the amount expended by the Customs Department for salaries and all other expenses during the financial 3-ear ended 30th June, 1873. lll.—Return of revenue collected by the Customs Department at the several ports of New Zealand during the financial year ended 30th June, 1873, and showing also the charges of collection thereon, and the rate per cent, of cost of collection. IV.—Statement showing the gross receipts of Customs duties and other revenue collected by tho Customs Department in each financial year, from 1861 to 1873 inclusive, with the charges of collection thereon, and the rate per cent, of cost of collection. It will be seen that the cost of collection last year, including the gold duty, was .£3 18s. 9d. peicent., and exclusive of that duty £i 3s. Od. per cent. I have shown the gold duty separately, because it is territorial revenue, and though collected by the Customs, it is paid in as soon as received to the " Provincial Account" of the Province in which the gold is obtained. Having regard to the large number of ports in New Zealand, I think it will be admitted that the Customs revenue is not collected at an expensive rate, especially when it is remembered that this rate includes the cost of the supervision of distilleries. With regard to the distilleries, I may here remark that the adoption of the plan I recommended of combining the Excise with the Customs, instead of making a separate department of it, has, up to the present time, worked well, and has proved to be an economical arrangement, whilst it has also had the effect of simplifying the business of that branch of the service. This Colony, I believe, is the first place in which this plan has been carried out. In the United Kingdom, and in those British Colonies in which there is a duty on home-made spirits, the Excise is conducted as a separate department. In the United Kingdom the cost of collecting the Customs revenue in 18G9 (the latest year I have the returns for), was £3 6s. 3d. per cent., or only 12s. 6d. per cent, less than it was in New Zealand in that year. Considering the small number of articles (40) on which duty is levied in Great Britain, and the facilities for economical administration that are afforded there by the concentration of the greater portion of the trade to a few large ports, when contrasted with the distance by which the principal ports in New Zealand are separated from each other, and the very largo number of articles (250) included in the tariff of this Colony, I submit that the cost of collection here bears very favourable comparison with the cost in the United Kingdom. I have on several occasions pointed out to the Government how much the cost of the Department is increased by opening additional ports of entry, that this increase of expense leads to no increase of revenue, and that, in most cases, it benefits only a few individuals. At most of the small out-ports there is no direct trade whatever with places outside of the Colony, the snuill amount of revenue collected at them being almost exclusively on spirits, tobacco, and other high-duty goods removed coastwise under bond from the larger ports. The return, No. 3, appended hereto, exhibits very plainly the high cost (ranging from 10 to nearly 35 per cent.) at which the Customs duties are collected at the out-ports. This is entirely an extra and, so far as the mere collection of the revenue is concerned, an

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\mnecessary expense, because the goods on which duty is collected at the out-ports are, as I have just stated, removed under bond from the large ports, where an account of them has already been taken and entered in the Customs books, and'where they could be cleared and delivered for duty 'with much less trouble than is caused by their being cleared for removal coastwise. Of course there are places where it is necessary to station officers for the protection of the revenue, and whether such places be declared Ports of Entry, and whether any revenue be collected at them or not, is a matter of little moment, so far as the cost to the Department hi concerned, as the revenue of the whole Colony is benefitted by the prevention of any place from becoming a rendezvous for smuggling ; but there are ports now open which have no value whatever as preventive stations, and which, I think, should be closed, at any rate before any more ports are opened. The number of Ports of Entry already established (28) is altogether excessive, if considered in relation to the trade and population of the Colony (being more than there are in Scotland, and one-third more than in Ireland), and from the frequent urgent applications that are constantly being made from various parts of the Colony, this number, I fear, will rapidly increase, unless the Government firmly discourage such applications, and decline to entertain any that are made on behalf of districts where the trade and population are not sufficient to justify the increased expense to the Department that would be caused by opening additional ports of Entry. I have the honour to be, Sir, Your most obedient Servant, William Seed, To the Hon. the Commissioner of Customs. Secretary and Inspector.

No. 1. ABSTRACT of all Duties and Revenue collected by the Customs Department during the Financial Year ended the 30th June, 1873.

He»d ol Receipt. Amount Collected. Spirits Do., New Zealand Cigars and Snuff Tobacco Do., Sheepwash Wine Ale and Beer, in wood Do. do., in bottle Tea Coffee, Cocoa, &c. Do., ground Sugar and Molasses Fire Arms .. .. Powder, sporting Shot Goods by Measurement Do. by Weight Opium Ad Valorem Other Duties not specified above £ 283,956 17,423 12,096 92,813 291 34,450 2,585 13,252 55,798 6,675 776 91,540 154 553 665 147,034 53,790 2,177 3,961 35,824 £ Bents, Seizures, &c. .. .. Bonded Warehouse Duty " Merchant Shipping Act" Fees " Arms Act " Licenses Lighthouse Dues Pilotage Fees " Oyster Act" Licenses " Distillation Act" Licenses Other Receipts .. .. 855,813 471 4,128 789 1,675 6,845 11,909 10 636 - 873 Gold Duty 27,336 47,499 Total Duties and Revenue £930,648

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No. 2. RETURN shewing the Amount expended by the Customs Department on Salaries and Other Expenses during the Financial year ended the 30th June, 1873.

No. 3. RETURN of Revenue Collected by the Customs Department at the several Ports of New Zealand dm-ino- the Financial Year ended the 30th June, 1873, and shewing also the Charges of Collection thereon, and the Rate per cent, of the Cost of Collection.

Heads of Expenditure. Amount Expended. Salaries Gold Allowance Extra Tidewaiters £ 31,925 711 1,015 £ 151 Contingencies Travelling Expenses, and Passage Money for Removal of Officers Books and Instruments Expenses for Protection of Revenue, viz., —Rewards for Seizures, and for Suppression of Illicit Stills, and Expenses of Revenue Cutter "Ringleader" oo,uu± 1,201 482 198 1,108 2,989 £36,640 Total amount of Departmental Expenses for the year ended 30th June, 1873 .—Thi :ies and ex] lenses of the Secreti and Insi lector's Office are included in thi above return.

Rate per cent, of Collection and Supervision. PORTS. Gross Receipt?. Receipts, exclusive of Gold Duty. Charges of Collection. On Gross Receipts. On Receipts, exclusive of Gold Duty. Auckland Thames Russell Mongonui Hokianga Wangarei Kaipara Poverty Bay New Plymouth .. Wanganui Wellington Napier Wairau Picton Havelock Kaikoura Nelson Westport Greymouth Hokitika Okarito Lyttleton Akaroa Timaru Oamaru Dunedin Invercargill and| Bluff Harbour j Riverton Chatham Islands £ 192,408 12,316 1,741 697 1,733 9 Nil. 2,007 7,112 19,244 80,029 28,816 5,027 2,003 817 713 37,033 22,940 44,656 43,138 1,281 113,452 269 13,156 7,822 262,128 £ 182,983 12,316 1,741 697 1,733 9 £ 6,039 669 246 170 268 182 50 253 548 882 2,965 1,308 304 210 143 153 1,946 1,033 2,052 1,991 332 4,181 29 636 539 7,398 £ s. d. 3 2 9 5 8 8 14 2 7 24 7 10 15 9 4 £ s. d. 3 6 0 5 8 8 14 2 7 24 7 10 15 9 4 Nil. 2,207 7,112 19,244 80,029 28,816 5,027 1,824 817 713 35,897 18,878 37,432 36,271 952 113,447 269 13,156 7,822 244,300 12 12 1 7 14 1 4 11 8 3 14 1 4 10 9 6 0 11 10 9 8 17 10 1 21 9 2 5 5 1 4 10 1 4 11 11 4 12 4 25 18 4 3 13 8 10 15 7 4 16 8 6 17 10 2 16 5 12 12 1 7 14 1 4 11 8 3 14 1 4 10 9 6 0 11 11 10 3 17 10 1 21 9 2 5 8 5 5 9 5 5 9 8 5 9 9 34 17 5 3 13 9 10 15 7 4 16 8 6 17 10 3 0 7 25,213 24,769 1,510 5 19 9 • 6 1 11 4,888 4,888 291 312 5 19 1 5 19 1 Totals Gold Duty £ £ 930,648 883,149 47,499 36,640 3 18 9 4 3 0 930,648 DISTILLATION.—Duty i Distill on New Zealand S; lation Licenses lirits.... £17,423 636 £18,059 1,453 COST PEE CENT. FOR SUPERVISION. £8 0s. Id. Salarii es and Expenses (i icluded above) ..

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No. 4. STATEMENT shewing the Gross Receipts of Customs Duties and other Revenue collected by the Customs Department in each Financial Year from 1861 to 1873 inclusive, with the Charges of Collection thereon, and the Rate per Cent, of the Cost of Collection.

Receipts, exclusive of Gold Duty. Rate pel Colle. ■ cent, of ■liun. Years ended 30th June. Gross Receipts. Charges of Collection. On Gross Receipts. On Receipts, less Gold Duty. 1861 1862 1863 1864 1865 1866 1867 1868 1869 1870 1871 1872 1873 £ 205,784 396,322 553,568 689,091 692,703 892,021 944,234 881,061 906,657 904,806 831,965 878,490 930,648 £ 204,992 340,163 490,456 619,126 640,129 799,669 872,416 796,230 827,646 832,372 756,899 799,823 883,149 £ 17,005 20,200 29,393 38,927 38,990 46,464 48,655 38,527 35,991 35,024 35,749 34,484 36,640 £ s. d. 8 5 3 5 1 11 5 6 2 5 12 11 5 12 6 5 4 2 5 3 0 4 7 5 3 19 4 3 17 5 4 5 11 3 18 6 3 18 9 £ s. d. 8 5 10 6 18 9 5 19 10 6 5 8 6 19 5 16 4 5 11 6 4 16 9 4 6 11 4 4 1 4 14 5 4 6 2 4 3 0 By Authority: George Didsbcry, Government Printer, Wellington. -1873.