FILM HIRE TAX DISPUTE

Hokitika Guardian, 24 September 1930, Page 2

FILM HIRE TAX DISPUTE

OFFICIAL STATEMENT. EQUIVALENT OF CUSTOMS DUTY. WELLINGTON', September 22. A reply was issued by the actingPrime Minister, the Hon. E. A. Ransom, this morning to statements made by Sir Victor Wilson, president of the Motion Picture Distributors’ Association, concerning the film hire tax. “Sir Victor Wilson states that I had admitted to him that the tax is not a net tax,” said Mr Ransom. “This is merely a play on words. This film hire tax is certainly not an income tax on profits, hut as already pointed out, is the nearest possible equivalent to ad valorem. Customs duty based on the net rentals re eived in New Zealand. By net rentals is meant the gross rentals received by renters, less the amount on which income tax is payable and administration expenses in New Zealand. To have further deducted production costs would have the tax on income tax, a fid, as I have just stated, it is intended to be the equivalent Of Customs duty;

“Sir Victor Wiisoit challenges mb to publish ft message which I have deceived concerning the attitude of British film intcresbi. I take strong exception to this, as it is not the practice of the Government to make statements not based on fact. The cablegram from British Dominion Films, Ltd., that I referred to is dated September 10, and states inter alia that ‘We intend to continue trading in New Zealand, fully anticipating that vour Government is making provision for substantially modifying the. exiting legislation, thereby demonstrating their desire to encourage rather than destroy cur efforts to assist the British film industry.’ To this, I have replied ‘The question of reviewing' this tax will he considered when it has been in operation for a reasonable time.’ ” SIR VICTOR WILSON IN REPLY. WELLINGTON, September 22. Replying to the Acting-Prime Minister’s statement concerning the film tax, Sir Victor Wilson said that Mr Ransom had published the text of that part of the cablegram from British Dominions Films lie said lie had referred to in his statement to the Press last week. The Acting-Prime Minister had contrasted the action of British Dominions Films in regard to the proposed taxation with that of American producers with the clear intention of leading the public to assume that British 1 distributors did not resist the tax.

‘‘A fair paraplinse of that Cablegram,’’ continued Sir Victor Wileioit, “is as follows: ‘Will continue to oper* ate as before having reason to believe Government will alter their taxation in order to show a desire to help British him industry, and not to destroy it, as would be done if their present taxation proposals are persisted in.’

“Is this cable an admission by Brij tish Dominions Films that the proposed taxation will not ruin them, or a clear indication that the Government will realise that it will ruin the British film industry in New Zealand and therefore not persist in it?” asked Sir Victor. “The cablegram sent to the Prime Minister by British Dominions Films which I had in mind when I made my rejoiner to the Acting-Prime Minister reads as follows: ‘As the only absolutely British company in the dominions handling British films exclusively, and having lost more than £20,000 last year in our strenuous pioneer work on behalf of British films, we respectfully but strongly urge that the proposed taxation on British films will have the most disastrous results in regard to British films. IVe appreciate the necessity of your Government obtaining revenue, but would respectfully suggest that a revenue tariff of increased duty on foreign films should be substituted.—Turnbull, managing director British Dominions Films, Melbourne.’ “The Acting-Prime Minister has had this cablegram before him,” continued Sir Victor. “Its meaning is clear. Does the latter cablegram show a change of opinion on the part of British Dominions Films. Do not both cables mean that the proposed taxation will ruin the British film industry? And does not either men, go on with this taxation and you will kill a business which has been set up to foster British films?”