TAX ON TALKIES

Sun (Auckland), Volume IV, Issue 1033, 25 July 1930, Page 8

TAX ON TALKIES

DISTRIBUTORS TO MAKE RETURNS OF RENTALS SCHEME EXPLAINED The Hon. G. W. Forbes, in present ins his Budget in the House of Representatives last evening, said that' in connection with the amount of additional revenue which it was deem d advisable to obtain from Indirect taxation in preference to other things. It was considered that additional duty should be placed upon cinematograph sound-films. , ‘As the value of films varies a great deal, to be equitable any increased tax atk>n should be upon an ad valorem and not a footage basis. The difficulty here, however, is that the value of a film is not known when it comes over the wharf. It may be explained that films are not sold, but are rented to the theatre proprietors, usually for a percentage of the gross theatre takings. Further, films are not dealt with singly, but in groups or ’blocks.' Under these circumstances an ad valorem cust.oms*fiuty in the ordinary way is hardly practicable, but it is proposed to impose the equivalent of an ad valorem duty in the shape of a film-hire tax. “Briefly, the proposal is that the film-distributing firms will be required to make returns monthly to the Com missioner of Taxes of the gross rentals received from sound-films and the administration expenses incurred in New Zealand, commencing as from July 1 last. After deducting these expenses, and also the percentage of gross rentals upon which income tax is levied, the residue will represent the value of the films, on which will be levied an ad valorem tax at the rate of 10 per cent, in the case of British films and 25 per cent, in the case of foreign films.”