PETROL PRICES

Rotorua Morning Post, Volume 1, Issue 64, 6 November 1931, Page 3

PETROL PRICES

("Post" Special Commissioner)

SUGGESTED CONTROL APPLICATION OF SPECIAL TAX TO IMPORTERS NOT EASY QUESTION OF PASSING ON

WELLINGTON, Thursday. A proposal was advanced in the House of Representatives early this morning by Mr. J. S. Fletcher (Independent, Grey Lynn) that the incidence of the additional twopence per gallon petrol tax should be altered was not favourably received by the. Minister of Customs, the Hon. W. Downie Stewart. Mr. Fletcher suggested that the impost should be carried by the petrol importing companies and that the consumers should be further protected by the Government fixing the selling price of mote? spirit. In reply the Minister said that a law might be passed fixing the selling price of petrol, but he did not know how it would work out in practice unless there were s?me control of the source of supply. Moreover, he did not know how a foreign corporations tax, such as had been suggested by the Select Committee on Highways Finance could be made to lie in the direction desired. How an increased petrol' tax could be imposed on the importing companies with the certainty that they would bear it was not obvious to him. The companies might bear it, or they might not. Unless there were power for the. Government to take over the industries, or import motor spirit itself, or secure sufficient competition from other companies he was not clear how the tax could be. imposed with any guarantee that it would lie where it was wanted to. The Minister said he had made inquiries as to the proportion of the tax the companies carried and their argument, he understood, was that owing to adverse exchange and the depreciation of our currency they had to meet an extra charge of 3d or 4d, although the 2d they were passing on was the amount of the additional impost. Mr. F- Langstone (Labour, Waimarino) : "They will go bankrupt next week." Mr. W. Lee Martin (Labour, Reglan) : "They are pastmasters at bluff." "They are not bluffing me because I have not approached them," retorted the Minister. "And I am not going to plead with them. I am only passing on to the House the. information that reached me. I realise the feeling that exists on the question, but I do not agree with the suggestion that it is a simple matter to impose a tax and see that the companies carry it." Mr. H. M. Rushworth (Country, Bay of Islands, urged the Minister to reconsider the matter and suggested that it would be feasible to place a tax on benzine and then apply a maximum selling price. The Minister referred to the difficulties of the price fixation and said he did not see any simple method of handling the question until some true competition was set on foot.