MR. COATES & PETROL TAX

Evening Post, Volume CVII, Issue 15, 18 January 1924, Page 3

MR. COATES & PETROL TAX

ANOTHER RED HERRING?

MOTORISTS' VIEW.

10 THE EDITOR.

Sir,—l n the "Evening- Post" of '16th inst; is a telegraphed report of an interr view with the Hon. J. G: .Coates in reference to his remarks on the guostion of a petrol t ax . According to this report, Mr. Coates takes the raptor trado to task for charging a profit on the duty paid on tires, and charges the trade with being the chief source of opposition to the institution of a petrol tax. On behalf of the motor trade of New Zealand, I crave your indulgence to reply to Sir. Coates on these two points. Mr. Coates is quite correct in his statement that the money paid by way of tire tax by the motorist does not all .accrue to.the fund earmarked for ; the Main Highways Account, but a portion o£ it is retained by the tire dealer as profit on his transaction. Under the circumstances, this is unavoidable. Duty must be paid in cash before the goods can be handled by ■ the importer, and this duty is just as much, a part of the oost of the" tire as the freight, packing or even the tire itself. During the past year over £150,000 was paid as duty on tires by the importers. This large 6um had to be found in cashend its return in sales is at the "least a matter of months. Docs Mr. Coates suggest that this large cum of money, should ;be financed by the tire importer' for months or years without a charge to cover interest^ bad debts, etc.? Such a supposition, is impracticable and ridiculous. The duty paid on tires must be regarded aa part of the cost of the tire and bear rto share of overhead and profit. Under present conditions this is unavoidable. If Mr. Coates can suggest a practical method of collecting the tire tax when the tire is sold as he hints .can be done with petrol, it might bo possible for the highways account .to receive the full amount paid by 'way of tire tax by tho motorist. When .Mr. Coates gets down to practical details, he will find many difficulties in the way of collecting a direct tax either on tires or. petrol. ■ In regard to the charge that the motor; trade is responsible for the opposition to the petrol tax, Mr. Coates is either making a wild guess or is badly informed. As a matter of fact, the motor trade ra not opposed to a tax on petrol in itself, and is in agreement with a good deal of what Mr. Coates has said in reference to it. What the trade is chiefly^concerned about is the multiplicity, of motor taxes and the deterrent effect of over-taxation on the development of motor transport. It Is agreed that the motorjet should bear a reasonable amount of taxation, more especially in respect to the provision of suitable roads. It is not generally realised, however, that the motorist is already heavily taxed, as' will be seen from the' following facts: — ■ :■•■ (a.) Every motor vehicle coming into New Zealand pays an advalorera duty of 25 per cent. with.a reduction of IS per cent, on motor vehicles of British manufacture. '■'■.■-'. ' (b.) All complete motor passenger vehicles pays flat rate body tax of from, £5 to £15 per body in addition. (c.) Motor, tires and parts/bear the same rates of duty as motor vehicles. (d.) Local bodies levy _ taxation on motor vehicles and motorists in varying amounts. In the case of private cars this is usually a nominal amount, but in some instances the tax is heavy. AU public motor passenger -vehicles and commercial vehicles pay a heavy annual tax. If "this, taxation' is analysed it will be found; that the New . Zealand, motorist is already heavily taxed. Because' tfefs tax is collected indirectly it is not realised by those who pay it, but if the amount collected annually under the above heads was collected by' means of a direct tax the motorist would be staggered at tho amount ho is already contributing.. Under these conditions the motor trade has considered it necessary to protest against the addition of extra taxation, more especially as the good roads. which have teen so long promised are still apparently as far off .as ever. During the past two years the tire tax has contributed somewhere about £300 000 to the Highways Fund: What has the Government to show for it? When the tire tax and body tax were instituted th* trade was. assured by the then Minister of Infernal Affairs .that the proposed flat rate^tax would only be a nominal amount, but when the Bill w»s down it provided for an annual tax of from £5 to £10 per annum. This raised such a storm of disapproval that the. Bill was dropped, and has got yet reappeared. In order to expedite the passing; of motor legislation last session, motorists agreed to a small annual flat rate tax on tho condition that it was to be the last word. Still the Bill did not materialise. ; The want of unanimity amongst motorists has been raised by the Government as an excuse for delaying motor" legislation. Now that this excuse cannot -be used it looks as though the Minister for PubhcJVorka was drawing a red herring across the. scent and, endeavouriri" to cause further dissention amongst motorists to provide excußes for further delay during tho coming session. Motor transport is becoming so im.portant a factor in the life of the' community that it calls for special consideration in the way of legislation, fete. What js required is legislation' with a much, wider scope than'is the case at present One taxing authority and one tax should be tho end sought for. . The regulation of motor traffic on a Dominion basis, is an urgent necessity and should receive immediate attention. The Government will bo' well advised to tackle motor legislation boldly and promptly; any further Uilly-snallyisif: will be deeply resented by motors* and the public generally. The question of revenue- is not the deterrent factor, and the motorist will do his share when the Government does its part.-I am etc j. F. COUSINS,' General Secretary.