New Gold Tax

May be Ultra Vires :: Method of Collection Criticised

IT is doubtful whether the Australian Government will be permitted to continue its wartime tax upon gold pro duced in New Guinea.

The mandate provides that any tax collected in the Territory must be used exclusively for the service of the Terri tory. This new gold tax is being taken by Australia for general purposes.

The gold-producers in New Guinea also are attacking the method of collecting the tax. It certainly appears tricky and unfair.

New Guinea gold is subject to an ex cise tax of 5 per cent. Now, in addition, it is taxed to the extent of 50 per cent, of the value in excess of £A9 per ounce.

The Australian Government, now, de ducts first the 50 per cent, of excess value, and then the 5 per cent, royalty.

The producers say that, legally, the pro cedure should be reversed —that is, the New Guinea Administration should take its 5 per cent, first, and that the Aus tralian Government then should take 50 per cent, of what remains to the producer in excess of £9 per ounce. It makes a difference to the producer of 4/6 per ounce, thus: —

As an average of over 30,000 ounces of gold per week comes out of New Guinea, it will be seen that the taxation proce dure is a matter of some importance.

Present Method Per oz. £ S. d.

Price of gold (Aust. currency) 10 10 0 Deduct 50% of excess over £9 0 15 0 9 15 0 Deduct 5% royalty 0 9 9 Leaving for producer 9 5 3 Suggested Method Price of gold 10 10 0 Deduct 5% royalty 0 10 6 9 19 6 Deduct 50% of excess over £9 0 9 9 Leaving for producer 9 9 9