A CHANCE FOR THE FINANCE MINISTER

Dominion, Volume 10, Issue 3169, 21 August 1917, Page 4

A CHANCE FOR THE FINANCE MINISTER

At Auckland recently some very interesting facts wore disclosed in the Arbitration Court regarding a feature of municipal competition with private companies and firms. The Auckland Gas Company has a formidable rival in tho Auckland City Council's electric light supply system. Tho Gaa Company is called on to pay taxes to the State, while -ts competitor, the municipality, . fscapes taxation. AVhat this means is shown by the fact that under tho new taxation proposals tho Auckland Gas Company will be taxed to tho extent of 4.7 d. on every ■ 1000 cubic feet of gas it sells. That is to say, tho municipality and tho users of electric light are given this unfair advantage over the Gas Company and the consumers of gas. The same thing applies here in Wellington and in other centres. Tho now and heavy scale of taxation has been necessary to bring this question into public prominence, but it is surprising that it has escaped the eye or tho ear of the country's different Financo Ministers for so long. The taxation paid by the gas companies at Auckland, Wellington, and Christchurch on a pre-war basis and the estimate of what they will bo called; on to pay under tho present proposals serve very well to illustrate the increased hardship arising out of the position.

Auckland Gas Company. Bates and Per 1000 taxes. feet of £ ■ gas. igjl 7,052 2.2 pence. 1917 19,385 5.7 pence. Wellington Gas Company. 'I axes only. £ 1911 2,382 1.50 ponce. 1917 10,500 6.30 ponce. Christchurch Gas Company. Taxes only. S, liUi 2,123 1.61 pence. 1917 10,470 8.59 pence. It will be noted that the Auckland

figures include rates as well as taxes paid, whereas the Wellington and Christ-church figures refer to taxes only. We aro not discussing the matter with any idea of suggesting that tho gas companies should be placed under the same exemption as the municipalities which compete against them. On tho contrary, we are seeking to bring under the notice of the Finance Minister a legitimate source of revenue which it is only just to taxpayers generally and to tho gas companies in particular that he should tap. There ia not the slightest justification for the State exempting the profits of municipal trading concerns from taxation. To do so is to favour the few at tho cxpenso of the many. Why should the users of electric light in Auckland, for instance, escape their share of taxation on the electric light they purchase from tho municipality at the expense of tho farmers in the country districts and the people in the towns who do not use electric light \ And so on throughout the whole of the Dominion. A municipal enterprise or a State enterprise which competes with private business firms or companies should do so on an equitable basis and not at the expense of the taxpayers generally. The absurd position is created under existing conditions rf shareholders in gas companies and consumers of gas having to pay taxes which enable their rivals to compete with them at an advantage. In England ;md elsewhere municipal trading enterprises pay rates and taxes as a, matter of course. Tho Birmingham Corporation, for instance, in 1914 paid £60,000 a year in rates and taxes on its gas supply system, and Manchester paid over £6-1,000. To-day under the increased scale of taxation they of course pay enormously greater sums in taxation. But Sin Joseph Ward should not require this evidence on the subject. He needs all the revenue he can obtain legitimately, and tho justice of taxing municipal and Stat" (.radii"? lindcrliikings which benefit :i section only of tho community and which compete with private β-ntorpriecs which

pay taxes is too obvious to call for elaboration. In the past, when llic taxes were comparatively light, the injustice was treated as a matter of small importance. To-day, with taxes in prospect ranging, land and income combined, up to 10s. and even 15s. in the A! of income, it assumes an importiinco which should ensure immediate redress.