Tobacco Taxation

Dominion, Volume 28, Issue 96, 17 January 1935, Page 11

Tobacco Taxation

Sir, —To encourage the consumption or cigarettes (imported aud usually manufactured from tobacco grown by negro labour in America) the Government recently reduced the duty thereon by no less than 42 per cent. Simultaneously the excise duty on tobacco locally manufactured was increased to 4/11 a pound, and cigarette papers, then retailing at threepence per book of 120 leaves, were increased to sevenpence. In 1930 the excise duty was 1/S a pound, and the same brand of cigarette papers retailed at less than threepence a book. Representations made by. interested parties brought about a slight reduction. Thus excise duty (1/8 per lb. in 1930) was fixed at 4/6 in 1934 —an increase of approximately 400 per cent. This increase levelled against a growing local industry, together with a reduction of 42 per cent, in connection with imported cigarettes, made from foreign loaf, is extremely difficult to understand. More so perhaps when one reads in your financial column of to-day’s date that the profits of a British tobacco manufacturing firm, after meeting all charges, amounted to £804.942. the_ dividend on the ordinary capital being 35 per cent. —an unchanged rate. To a layman it would appear that the Government was seeking to cripple the local industry and to swell still further these magnificent profits. I will admit this may not have been tlie motive behind the recent tariff: nevertheless, the injustice of the result might well lead smokers to believe that such wns the case. It occurs to nw that, if fostered and given a reasonable chance to live, the local tobacco industry could employ many of our unemployed in profitable industry.—l am, etc.. SMOKER. Wanganui. January 14.