High Taxes, Rising Costs

Hawke's Bay Herald-Tribune, Volume 81, Issue 29, 28 October 1937, Page 6

High Taxes, Rising Costs

-Pxess Association.)

INDUSTRY'S BURDEN gow Can N.Z. Compete with Imports? EMPLOYER'S REVIEW

fBv Teleeraph.-

f WELLIN GTON, This Day. - > Mr A. G. Mitchell, in Ms presidenjthd address at the annual meeting o£ the New Zealand Employers' Federation, xeferred to the extent of rearm"araent and mobilisation ia Europe, add— 5ng: "It Is difficult for us, so far rejaoved from the seat of aetual hostilities, fully to xealise the gravity of the "jrituation, but the precautions being taken "by the Imperial Government inSicate that it ia fnlly alive to the danger and is taking all necessary steps $o meet it. • * - "It canaot, however, be overlooked fhat, in the event of Britain becoming involved in any international complicaffivng of a serious charaeter, our very igxistence is immediately threatened, ifciid our safety and material welfare are entirely dependent on the protecjion of oux commerce and our ability to delivex our produce to the British mariet at a price which the British public can alford to pay. It behoves us, then, to ash ourselves whether our present policy is directed along the right chants to achieve our object." Mr Mitchell said that the legislation *>f the present Government _was all tending in the clirection. of increased costs and prices. Probably few would aeriously question the sincerity of purpose or good intentions of the Government, but there was a large and rapid-ly-increasi^g volume of public opinion yrhich definitely challenged the states* jnanship of the Government policy. mcrease in Imports * 'Manuf acturing costs have risen to tach an extent that the value of impoxted goods increased by over £1,000,000 per month for the first five months ©f t.hip year, for which the returns are available," he added. "In many buSinesses increased taxation has resulted in 50 per cent of the year's total nett income now being paid to the (Government in land in income-tax alone — an amount in excess of that available for payment of a return to the giiareholders, who provide the whole oapital in the nndertaMng. " Mr Mitchell paid that, so far as injdustries in which labour represented any appreejable proportion of the cost .wero concerned, ono who tried to perfuade .himself that we cOuld with impunity introduce a 40-hour week with a substautial increase in wage rates and the other expensive concessions alxeady granted without prejudice to our ability to compete successfully against the manufactured produets of other countries worMng longer houxs and at lower rates of pay was harboixring a jfielusion.- . It was interesting to note that Franee, which has adopted the 40-hour week in industry after its introduction by legislation in this country, was reported by cable as having been compelled to reconsider its 40-hour week policy as a measuxe of economic necesjaty in order to speed np production. No Taxation Belief "As a non-political organisation .whose membership comprises men of all shades of political opinion, ' ' Mr Mitchell added, "it ie our definite policy not to ciiticise any legislation which might be intxoduced by the Government of the day other than that which directly affects industrial relationships between employers and. workers. JLn that cat-e-gory, I may express profound regret that the Government has made no provision for xelief from the present oppressive load of taxation, but, on the contrary, the amount to be collected this year xepresents an increase of £10,476,000 over that collected two years ago. "Part of this very large increase is, of course, accounted for by the improv- . ed position of the country 's finances, hi ;gler wage rates and the increase in saies-tax returns, but, ln combination with the proposed expenditure during the cuxrent financial year by the Governm^it of a total of £34,728,000, tho impression being created that, instead of being able to look forward with conlid'ence to a reduction in taxation, industry might conceivably be called upon to pay a still larger amount of its earnings under that heading — and that condition, combined with anxiety as to ,the maintenance of present prices for wool and other exportable coxnmodities and uncertainty as to the future policy of the Government in xespect of industries generally, is tending seriousto cartail pnvate industrial development and, incidentally, is slowing up re-employment of surplus labour."