Seanad Éireann debate -
Wednesday, 9 Dec 1931

Vol. 15 No. 1

Finance (Customs Duties) (No.4) Bill, 1931 (Certified Money Bill)—Report and Fifth Stages.

Question—"That the Bill be considered on Report"—put and agreed to.

Question proposed: "That the Bill do now pass."

Mr. Douglas

I do not wish to oppose this Bill, because, in the first place, it would be useless, and, in the next place, I do not think that any one—certainly I do not—wants to question the decision of the Government to have a supplementary Budget and the provision that has been made for a tax on petrol, but I would like to suggest to the Minister for Finance that should he by any chance be in position that he has to impose or adjust any further taxation that the motor car is taxed just about as much as if not more than, it can reasonably stand at the present time. Apart altogether from expensive cars that run into £700 or £800, on which a man could undoubtedly afford to pay a substantial tax, I suggest that taxation on a comparatively cheap car, such as a car that costs £200 or £250, is really too heavy at the present time, and that when times are better, if it is possible, something ought to be done to reduce taxation.

I made a somewhat rough calculation, but I think for practical purposes you may take it as correct. If a man buys a car for £250 and uses it for five years—if he uses it for trade or has to travel a great deal or if a farmer is using it in the country and gets 10,000 miles a year, which is not unreasonable —he covers 50,000 miles in the five years. Assume that he is fortunate enough to sell it at the end of five years for £40. Adding up the cost of the car, the road tax, petrol and say £25 on spare parts, which is very moderate for a car that type in five years—and if he gets 25 miles to the gallon—I have found that his total expenditure after deducting the £40 that he would sell it at would be about £490. The road tax, import duty and the tax on petrol would amount to £193, so that out of £490 in five years he actually pays £193. I could give similar figures for other cars, but I am taking the low priced cars and the English car, which pays a minimum duty, for my calculations. I suggest, if it is possible in the future, that some steps should be taken to make some concessions, at any rate, on the total amount of the tax attached to low priced cars.

Mr. Connolly

I would like to bring to the attention of the Minister a suggestion that I made here some time ago. I am not opposed to this petrol tax in so far as it affects motor cars, but there is a certain hardship which is reacting on manufacturing, commercial and business concerns, namely, what this increased tax is going to mean as regards the working expenses of delivery lorries. Commercial vehicles include buses as well as delivery lorries, but I want it understood that I am referring purely to delivery lorries. The suggestion I would make, if the Minister would consider it in view of the difficulties or practically the impossibility of differentiating between the petrol tax for one purpose and another, is that some concession might be afforded as regards delivery lorries in the annual tax that is contributed. I think that would go some way to meet the additional cost which is burdening industry at the present time in so far as those delivery lorries are concerned.

Mr. Dillon

I would like to support the representations made in regard to this tax, though for somewhat different reasons. In recent times it has become necessary for farmers to use lorries for all their outgoing and incoming traffic. The roads-have practically been taken over altogether for motor traffic. Horse traffic has almost ceased. For that reason our villages throughout the country are now being supplied in all their wants by means of lorries. I believe that the additional 4d. a gallon petrol tax coming on the consumers in these areas is excessive and I would ask the Minister if opportunity affords to do something in his next Budget to ease the burden.

Minister for Finance (Mr. Blythe)

It is recognised that the tax operates in such a way as to be rather more severe here than in Great Britain. It is more severe because, of course, the distribution costs of petrol are higher, or are alleged to be higher, and there is an extra price charged, also, because the vehicles are subject to an import duty. I do not see in the present financial circumstances any possibility of an early reduction in the petrol tax now proposed, and I do not see any possibility of reducing the import tax on motor vehicles.

With regard to a reduction of the road tax, the difficulty is that it is not so very long since we had loud and frequent demands for an increase in the tax on these very heavy vehicles. It was alleged everywhere that the ratepayer was being charged for the cost of maintaining roads for lorries and other vehicles that were doing harm altogether out of proportion to their contributions to the Road Fund. We had experience of that some time ago. There has been silence about it recently. I have no doubt that if the proposal were seriously put forward to reduce the road duty it would reawaken all that clamour. It may be that in city streets, for instance, the delivery van may not do a great deal of harm. Perhaps a light van may not do a great deal of damage but heavier vehicles I think do a very considerable amount of damage. I would not like to promise that we could at the present stage propose that a higher proportion of the costs of the roads should be thrown back on the taxpayers.

What Senator Douglas said with regard to the total burden of taxes is impressive in its way, but I am of the opinion that while of course there are many of the ordinary motor cars which are used mainly or even solely for business, an enormous number of them are mainly if not solely luxury vehicles. Every day I see people coming into town in motor cars who not long ago travelled on trams. They could go on the trams very well and not lose a great deal of time. So I regard these as luxury vehicles and quite suitable for a fair amount of taxation.

Question put and agreed to.