BUTTER-FAT LEVY

Dominion, Volume 10, Issue 3107, 11 June 1917, Page 6

BUTTER-FAT LEVY

COIIPANT WHICH DOES KOT OBJECT. The Hongotea Co-operative Dairy Company, Ltd., has forwarded to the Minister of Agriculture (Hon. W. D. S. MacDonald) ;v copy of .a letter which it had sent to the secretary of the National Dairy Association on the subject of the butter-fat levy. The letter reads U3 follows :— ■ "In imposing the levy of Jd. per lb. butter-fat, the Government had a perfectly legitimate object in view—namely, to make good the loss which would have been sustained by those factories which, have consistently supplied the local market in the belief that New Zealand is honourably entitled to a fair proportion of their. output before {he butter 13 shipped Home. Whether the Government took the best method of meoting this difficulty is a question which the Govornment'on the one hand, and the dairy factories on the other, hold very decided and contrary opinions; but in petitioning the Government to refund the sum of .£300,000, the fact is ignored that this sum has not been retained by the Government,'but is being paid to those factories Supplying the local market. "In new of the enormous demands which will be made upon the Government on account of the war, we cannot support any proposal asking that the above sum (should bo appropriated from the Consolidated Fund. To talk about the laws of supply and demand., the right to open market values, etc., at a time when, if it were not for tho vigilance of our Navy, New Zealand butter would not be worth .£SO a ton owing to the submarine menace, does not to our mind show a just appreciation of the position. If 6ome dairy companies believe that an injustice has been inflicted through the imposition of a "class tax," wo can Tecall to mind several injustices in Europe since 'the outbreak of war which compel us to keep quiet. Our candid opinion is that tlie dairy companies of New Zealand as a whole have no reason to complain, and that they would be better employed concentraJting their energies towards bringing- about a revision of the Excess War Profits Tax in order to make its incidence more Equitable." ■ In forwarding the letter to the Minister the company wrote as under-.—"A great deal of the dissatisfaction engendered by this levy has been brought about by tho manner in which dairy coinpmAs have dealt with. it. We know cheese factories that were paying 18d. for butter-fat before the imposition of the levy. When the levy of Jα. per lb.on butter-fat was imposed these factories had two alternatives: (1) To declare their monthly payment of 18d. as before, but to deduct from each supplier individually the proportion of the levy due by him; (2) to decrease their payment to Is. 5Jd. net to the supplier. The trouble has arisen because eome companies took neither of these alternatives. They continued to pay the earaq figure as before, and made no deduction from their suppliers individually, so that tho levy became an additional charge on their working expenses. "This company has all along made each supplier contribute his portion of the levy. Any refund we have received from the Government for New Zealand Bales has been ear-marked and handed back to the suppliers in proportion to the butter-fat received from them. We enclose copy of a suppliers'-account, which makes this clear. By this method our suppliers know exactly at the end of the season how much they have contributed \inde.r tlie levy, and what proportion they have received back from the Government. We

hrfve found this method to work with complete satisfaction, and we have heard practically no complaints from our 120' suppliers. They are content, because they see month by month that each man is contributing his just quota."