FILM-HIRE TAX

Sun (Auckland), Volume IV, Issue 1068, 4 September 1930, Page 10

FILM-HIRE TAX

EXHIBITORS PROTEST TO MINISTER CONTRACTS BEING REFUSED THE SUN'S Parliamentary IZeportcr PARLIAMENT BLDS., Today. Requesting that ail inquiry he made into the film-hire-tax, and stating that the American distributors had refused to enter into film contracts in New Zealand, a deputation from the New Zealand Motion Picture Exhibitors’ Association waited on the Minister of Internal Affairs, the Hon. P. A. de la Perrelle, today. Mr. J. Robertson said the exhibitors had been officially notified that the American film distributors would give no further supplies of films and would not enter into fresh contracts on the ground that the tax was burdensome and prevented them from operating profitably. The deputation requested an inquiry. The Minister said he would place j the request before Cabinet and made | the following statement on behalf of j the Government: MINISTER’S STATEMENT “From the information before the j Government it is very questionable whether the action of the film renters is aimed wholly or even mainly at the film-hire-tax for the following reasons: (1) In Australia Sir Victor Wilson, president of the Motion Picture Distributors’ Association, estimated that the Customs duty placed on films during the present year would produce revenue of £447,000. From the figures available this amount appears to be approximately the same percentage of the Australian film rentals as the New Zealand Customs and the film-hire-tax together are of New Zealand film rentals; "(2) Figures supplied by Sir Vie-1 tor Wilson, which covered 95 per cent, of American film, showed the payment made for film in New Zealand by the exhibitors had increased in a considerably higher ratio than those in Australia. For the complete year 1929, the rentals paid In New Zealand represented 20 per cent, of the Australian rentals, but for the first six months of this year the New Zealand percentage had increased to 26.3 As the Australian rentals amounted to more than £1,000,000 the additional percentage paid by New Zealand exhibitors represents approximately £67,000. These figures are confirmed by the relationship between expenses and film hires in the two countries for the same periods. It would, therefore, appear that New Zealand exhibitors are paying in extra film hires not only j the whole of the film tax but a j considerable margin in addition; NET RECEIPTS “(31 The net receipts from film | hires in New' Zealand in 1927 as shown j in a statement published by Sir Vic- ! tor Wilson in that year were £170,000. ! The net receipts for the present year after paying all taxes will be at least double that amount; “(4) As the percentage of taxation to film rentals is approximately the same in Australia and New Zealand it is not considered likely that Hay’s organisation, which controls the American picture industry, would authorise any interference by local representatives of the industry in what is purely a matter of domestic i politics. The renting side of the film industry must recognise in common W'ith all other businesses that the country is going through a very difficult time and must bear a share of the necessary taxation. It would seem that instead of claiming to be hardly used it should congratulate itself on the fact that owing to the phenomenal success of the talking pictures it is in receipt of larger revenues in this time of depression than in the most prosperous davs of silent film. “As was explained when the tax was imposed, it is based on actual rentals received after deducting all expenses and the amount upon which income-tax is payable and as nearly as possible is equivalent to an ad valorem customs duty on film. The 25 per cent, tax on foreign film is not high compared for instance with the 47 per cent, on apparel and boots.