Wairarapa Times-Age WEDNESDAY, NOVEMBER 27, 1940. A PROTEST AND A WARNING.

Wairarapa Times-Age, 27 November 1940, Page 4

Wairarapa Times-Age WEDNESDAY, NOVEMBER 27, 1940. A PROTEST AND A WARNING.

ADDRESSING the annual conference of the New Zealand Manufacturers’ Federation at. Hamner yesterday, the president of that, organisation, Mr C. V. Smith, of Dunedin, elaborated in some detail a contention that in this country manufacturers, and particularly manufacturing companies, were being taxed on a scale which threatened to cripple and seriously restrict their operations. Air Smith submitted also that this state of affairs promised badly, not only for manufacturers, but for New Zealand. Leaving aside, for the moment, the question of the incidence of taxation, it is no doubt obvious to all that, this country has everything to gain from the greatest, possible expansion of manufacturing industry in satisfactory industrial and social conditions. Much more than that may indeed be claimed. If we are not to have a very considerable expansion of manufacturing industry, we are faced as a. community by the prospect of having to grapple painfully with the problem of unemployment and with the problems that result from our having to carry an almost overwhelming burden of debt, much of it domiciled overseas. Against our debts and the limits placed on our available resources, there is to be set the fact that the Dominion is potentially capable of adding to its population and production. These potentialities, however, will become tangible assets only in the extent to which they are developed and turned to account. The broad lines on which it is possible for economic development to proceed and for production and population to expand are defined pretty plainly. Our great farming industries on which we depend so largely are in the main export, industries. Inherently they are capable of enormous expansion, but in practice they can expand only in the extent in which additional markets for their products are made available. Even if the oversea marketing outlook were much more open than it is or is likely to be, we should be faced still, as a people, by the alternatives of building up the internal production and exchange of goods and services, or allowing a great deal of potential productive power to go to waste. The position was summed up very fairly by the president of the Manufacturers’ Federation when he said that: — The prospect of obtaining increased revenue from the farming community, as a result of higher prices, was, to say the least of it, uncertain. Industry (i.e„ secondary industry) on the other hand, provided the Dominion with a source from which increasing quantities of necessary- commodities could be obtained, a source from which employment' could be found for thousands, a source from which some, at least, of the problems of rehabilitation could be solved, a source from which a constant flow of revenue could be obtained. Air Smith contended, as has been indicated, that the present, adjustment of taxation was doing a great deal to close off this source and so was threatening, not only to restrict production and desirable employment, but to imperil the continued inflow of national revenue. A number of suggestions were advanced by the president of the Alanufacturers’ Federation as offering a remedy for this state of affairs. One was that in the long run taxation of the individual would be more effective (he might have said also more equitable) and less disastrous than taxation of the company. Another suggestion was that a small war tax should be imposed on a number of everyday articles. These proposals no doubt are highly contentious, but there is nothing either obscure or contentious about the fact that from the broadest standpoint of community welfare this country needs an unimpeded expansion of manufacturing industry. It is the responsibility of the Government and Parliament to raise revenue by taxation and in these days very large amounts of revenue must be raised. If,'however, for the sake of raising the greatest possible amount of revenue at a given time, our national, authorities cripple the development and perhaps even the maintenance of. vital industries, they are in a serious degree undermining and endangering the economic welfare of the Dominion. Whether manufacturers are being burdened unfairly, as compared with other sections of the community, particularly in the matter of company taxation, is a question to be determined on its merits. The root question, is that of maintaining, or failing to maintain, conditions in which it is possible for industries greatly needed by the Dominion to expand. Wider questions than that of taxation are involved. It is a matter, not only of enabling the country to make a maximum continuing contribution to the winning of the war, but of so control I ing" and adjusting the national economy that we shall be able to deal effectively with problems of after-war reorganisation and readjustment, when they arise. There can be no possible excuse for dismissing these problems for the duration of the war, with the Idea of dealing with them afterwards. A genuinely orderly and methodical organisation of the national energies and resources in furtherance of the war effort—an organisation which necessarily must look primarily to the maintenance and expansion of production —is precisely what is needed to ensure a practical and promising approach to the problems the people of the Dominion will have to face when the war is over. THE AXIS SETBACK. Apart f rom its impressive immediate effects, which are still extending, the Greek defeat of the Italian invading armies, and the blows Britain has struck at Taranto and elsewhere, arc inducing repercussions in the Balkans and in other places which it may be wise to regard meantime as tentative, but: which tend visibly to brighten the war outlook. One of the most interesting changes that has occurred is in Bulgaria. There is no reasonable doubt that until very recently Bulgaria was at least ah open corridor available to the Axis Powers, if not an ally prepared to do anything that might be asked of if in that capacity. Fairly convincing evidence is offered in messages received yesterday and amplified today that it would now be difficult for the Bulgarian Government to do anything else than seek to uphold its neutrality. There are at least fair prospects that this trend may be maintained. If it is, Nazi hopes of successful aggressive action in and through the Balkans evidently will not be strengthened. If Bulgaria decides to defend her neutrality, there is no doubt that. Yugoslavia will do the same, so that Germany would have to reckon ’with these countries, as well as with Greece and Turkey and whatever forces Britain could send Io their support, if she launched a south-eastern drive. The valiant achievement of the Greeks at the same time is producing excellent results over a much wider field, including the various Moslem States. It may be expected, 100, to help not a little to sway opinion and action in the French colonies in favour of General de Gaulle and against the deplorable policy of “collaboration” with tin 1 enemy to which the Vichy Government is committed. The results of the disaster to Italian arms in Albania may be not least important in Italy itscir. It ma.y be expected that they will deepen ami intensify the condition of affairs reported to have been summed up by Italian prisoners in the statement that no one in Italy wants the war.