SALES TAX BILL

Rotorua Morning Post, Volume 2, Issue 464, 23 February 1933, Page 5

SALES TAX BILL

("Post" Special Commissioner.)

NEW AMENDMENTS packages ithrouch post will not be liable revision of measure ji

Wellington, Wednesday. Apart from changes in the list of exemptions, twenty further amendments have been made in the Saies Tax Bill. These were introduced in the Hous'e this afternoon hy Rt. Hon. J. G. Coates. Many of the changes are to improve the maehinery of the bill, the principal alterations beingv to provide for the collection of tax on all taxable imp'orted goods whether intended for home consumption or otherwise and a.n increase in the pereentage allowed on imported goods in ascertaining the sale value' of five per ' cent. i In the original bill, goods imported ! hy wholesaleris, retailers (including i manufacturing retailers) and by the i general public for their own use, were exempt from the saies tax. Changes which have been made imposo the tax in all such cases. In explaining the reason for this, the Minister said the Government had gone into the matter and had come to the conclusion that it would be more satisfaetory if the bill were so framed as to impose tax in these cases. "No douht cases of diffieulty, administrative and otherwise, will occur under the amended proposals, but any isuch' matters can be dealt with as they arise," added the Minister. "It is not at present intended that the saies tax should be collected on every packet, however small, imported through the post hy private persons for their own use as it is considered that the cost of collection . would probably be greater than the tax which would be collected. This matter, along with many others, will hq gone into as soon as the bill is passed.

Clause Deleted There is now no need for the clause throwing the onuis on the importer to show that the goods are not for sale and this has accordingly been dropped. Further simplification of the method to be used in assessing the tax to be paid by the manufacturing retailers, is provided in anoth'er new clause. Under it, manufacturers are entitled either to deduct from the sale value of the manufactured goods, the taxable value of materials used, or to deduct from the saies tax payable, the tax already paid on the materials. Simplify Records The Minister said he considered this would be of great assfetance to manufacturing retailers. Had the original provisions not been altered, it would have been necessary . for many manufacturers to keep separate records of those materials upon which the tax had been paid after February 8 and those which were in istock prior to that date. ■ An addition has also been made to the clause providing for the deduction of saies tax on goods used in manufacture to ensure that where allowance is made on this account, the taxpayer will not he able to deduct diseount or any part of it a second time.

Refunds of Tax An important additional provision jjermits refunds of saies tax to be made where warranted on material used in tlie manufacture of goods which, when complete, are not taxable. The method of arriving at the sale value of goods imported for home consumption, has been changed to provide that sale value shall be the sum of the equivalent in New Zealand curreney and duty plus 25 per cent. In the original bill, the additional amount was 20 per cent but it is considered hy the Government that the percentage did not do relative justice between wholesalers and retailers. Tax on Credit Price A new clause has been added to this section providing that saies tax shall be paid on the credit price and not on the cash price. No deduction shall be made beeause of any diseount rebate or allowance granted in consideration of payment of purchase money at or before the time of sale or within any specified time thereafter.

If the credit price were not taken as a basis, said the Minister, grave inconvenience would be caused to recognised commercial practices. The bill gave authority to a person who had entered into a contract after the taxes were imposed, to add to the contract price, the amount of any saies tax paid by him. As every person was in a position to proteet himself, the clause haff been amended to extend this protection only to contracts entered into before February 8.

Reeord On Invoice "Every wholei-aler must show on his invoice the amount of tax payable on the goods," states another new -clause. "This is advisable, not only in the interests of the purchaser of the goods and of the Department, but it enables the manufacturing retailer to know the amount of tax aetually puid on his materials . and for which a claim may be made." "It is also just that provision should be made by which the vendor may recover the amount of thb tax shown, on the invoice. It is understood that in Australia, certain retailers refused to pay saies tax to wholesalers until a similar provision was inserted in the Commonwealth' law. "A new offence is created hy an amendment which provides that no invoice shall show saies tax which is not payable." False Tax Shown The Minister said that it had come to the knowledge of the Government that certain business firms were issuing invoices showing as saies tax, amounts in excess of those aetually paid or payable.