WARNING TO MERCHANTS

Sun (Auckland), Volume IV, Issue 997, 13 June 1930, Page 1

WARNING TO MERCHANTS

CLEARANCES OF GOODS FROM BOND RETROSPECTIVE TARIFF Press Association * WELLINGTON, Thursday. A statement regarding possible increases of taxation, particularly concerning the revenue received through the customs tariff, was made by the Prime Minister, the Hon. G \y. Forbes, today. "It has come to the knowledge of the Government," said Mr. Forbes, "that many commercial firms and others engaged in trade in the Dominion are anticipating increases in the rates of customs duties on articles in which they are interested. As I publicly intimated recently, the Government is faced with the necessity during the present financial year of raising extra revenue to balance the national budget, but so far we have not come to any decision in detail as to the methods by which this additional revenue is to be derived. The proposals of the Government in this respect will bo submitted to Parliament for consideration in due course.

"Considering the present financial exigencies of the country, it would be extremely inconvenient :.£ merchants forestalled the Government by making extensive clearances of goods from bond, and thus possibly avoiding aay increased rates which Parliament might impose. "I desire to say. therefore, that in connection with any increases in rates of customs duties which may be approved by Parliament, the Government will seriously consider making such increased duties retrospective if it Is satisfied that abnormal clearances of the goods affected have been made in anticipation of Parliamentary action.” NO MOVE TO CLEAR AUCKLAND FIRMS NOT ACTIVE INQUIRIES IN CITY This is the first time in New Zealand that the Government has threatened to make tariffs retrospective. Inquiries in many quarters in the city this morning show that there has been no move to clear goods from bond in anticipation of an increase in the tariff. Canada provided the necessary legislation some time ago to make tariffs retrospective, thus covering the State from loss when large quantities of goods were removed from bond before the increase in duty came into operation. Usually, when an increase in customs duties is foreshadowed, retailers are apt to get into a panic and order large supplies of goods through their merchants. This, in turn, forces the merchants to clear larger quantities of goods from bond than they would do otherwise. On the last occasion when the customs duties were increased, large quantities of merchandise were cleared from bond before those duties became operative. By doing this the Government lost very large sums in revenue. Mr. J. Mclntosh, Collector of Customs, stated this morning that so far there has not been the slightest change in the quantities of goods cleared from bond in Auckland. He couid not speak for Wellington or any of the Southern centres. , Any big increase in clearances would ! immediately be indicated by the change in figures in the average of goods cleared through the Customs. In Canada the duty which is collected is based on the average clearances of firms, therefore it would not save the merchants anything if they did rush goods from bond in anticipation of an increase in the tariff. It was suggested by one city man this morning that the Prime Minister’s statement regarding retrospective tariffs might be a “try-on.” He recalled that on several occasions in the past the State revenue had benefited considerably by a suggested increase in tariffs being made known to the public. The rush to clear from bond had increased the Customs revenue considerably just at a time when money was needed. Afterward, when the increases were actually presented to Parliament, some of the goods which had been cleared were not altered nor, .apparently, was there any intention to do so.

A special law would require to be passed to make the tariff retrospective in New Zealand.