Industrialists And Retailers Praise Budget Provisions

Press, Volume XC, Issue 27410, 24 July 1954, Page 8

Industrialists And Retailers Praise Budget Provisions

(New Zealand Press Association)

WELLINGTON. July 23. Measures introduced by the Prime Minister (Mr Holland) in his Budget were praised today by the acting-president of the New Zealand Manufacturers’ Federation (Mr J. H. Manning). “Manufacturers will congratulate Mr Holland on producing such a realistic Budget which will give ’ widespread relief, especially to the lower wage groups, and which continues the policy of supporting our elderly people, who have Already made their contribution to the nation.’* he said. . “At the same time, the Prime Minister has recognised the need to give greater incentive to industrial enterprise anc * individual endeavour. ‘Manufacturers, along with consumers. applaud the removal of sales tax from a wide range of their products. iTney trust that the distributors, in whose hands this matter mainly rests, will ensure that the price reductions made possible by this move are. in 'act. passed on completely to the public. the present trend, it seems inevitable that the sales tax receipts must exceed the estimates,” Mr Manning said, “and it is hoped that the Government will not wait until the next Budget to make further reductions.

. P® e raajor item I have in mind which affects the family budget and manufacturers’ ever-increasing costs is the sales tax on public transport. Its removal would be of considerable ?*pent to all sections of the community. Mr Manning concluded. The tax reductions in the Budget definitely welcome, said the president of the New. Zealand Retailers' Federation (Mr D. A. Smith) in Wellington today. Retailers generally were “pretty about the Budget, and were delighted that exchange controls would be lifted at the end of the year, said Mr Smith. This would be of great assistance to the trade in planning overseas buying. The sales tax exemptions were also welcome, and he would give an assurance that goods affected by the removal of sales tax would be cheaper to the public. Mr Smith concluded. Chamber of Commerce View While there are points for criticism j®. j must be acknowledged that this year’s Financial Statement is a sound and realistic document which will commend itself as being of benefit to all sections of the

icommunity.” said Mr J. Boyd-Clark. J president of the Associated Chambers .of Commeice of New Zealand. ! "As the Prime Minister says, to abolish one tax entirely would be to limit the relief which could otherwise be given to other taxpayers. “My association advocated abolition of land tax, and would have preferred to see this courageously tackled, but the concessions given constitute, at any rate, some contribution to the relief of business firms faced with greatlyincreased land tax payments arising from higher land valuations that are still in progress,” said Mr Boyd-Clark. “We warmly congratulate the Government on abandoning exchange control, which is in fulfilment of its promise to restore freedom of trade to traders at the earliest possible date. “The maintenance of the favourable balance of payments next year will depend on the restraint and common sense of the importing community, to whom I would take this opportunity of appealing to collaborate fully with their trading banks when the control is lifted.

Mr Stuart Hay, president of the New Zealand Stock Exchange Association, said in Auckland that he agreed with the Prime Minister’s policy of limited borrowing overseas, as reliance on the New Zealand market would absorb “risk” capital which would be more suitably employed in industrial development. The tax concessions in the Budget were, in the aggregate, quite considerable, and would give some needed relief, Mr Hay said. Investors would welcome the elimination of the “A plus B” system of taxing dividends, which was grossly unfair Although not great, the assistance to companies would, to some extent, help them in making provision for obsolescence of plant and buildings, Mr Hay said. Sales Tax on Hardware

Commenting on the removal of sales tax from hardware items, Mr W. N. McCallum, president of the Auckland Provincial Retail Hardware Association, said that most hardware retailers were carrying big stocks, on which they had paid sales tax. Therefore it would probably be three or four months before they could sell goods minus the sales tax.

If some retailers began now to sell at the reduced prices, the competition could result in big losses for those carrying large stocks bought from the wholesalers at the old prices, Mr Me-