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Tuesday, 20 October 1931

Mr FORDE (Capricornia) (Minister for Trade and Customs) . - I cannot accept the amendment of the honorable member for Swan (Mr. Gregory), which is to wipe out altogether the excise on cigars. The Tariff Board carefully inquired into the industry, and recommended a reduction in excise on condition that the manufacturers reduced the price of the cigar, and did not benefit as a result of the reduction. Representations were made to the honorable member for Maribyrnong (Mr. Fenton) when he was Minister for Trade and Customs, and in November, 1929, he gave effect to the recommendation of the Tariff Board. The reduction in the price was made operative forthwith, and the reduction in excise was made operative from about the middle of 1930. The Tariff Board, in its report, stated -

Furthermore, in connexion with the possibility of the employees' union setting up fresh demands for increased wages and piece rates, the Tariff Board was assured that the workers were conscious of the fact that the future of their industry, and its expansion (for which the request for reduction in excise was being submitted), depended solely on the possibility of supplying the consumer with the 7d. Australian-made cigar at 6d., and the 3d. cigar with a fuller weight of leaf. And to do this it was essential that all four contributors to the final disposition of the product - the manufacturer, the worker, the retailer, and the Government - must co-operate to the one end, and that if one or other fail in their part the desired end cannot be achieved and the sacrifices by the Government (if made) of £60,000 of revenue would be absorbed by one or other of the factors other than the consumer. Under the circumstances, the Tariff Board is now satisfied that all factors are prepared to make a sacrifice in order that the consuming public may have the opportunity of obtaining a cigar at a convenient figure, and is prepared to recommend that the request be granted for the reduction in the excise duty from 2s. 8d. to 3d. per lb. on hand-made cigars.

Mr Paterson - What is the date of that report?

Mr FORDE - It is the last report of the Tariff Board and was made about the middle of 1925.

Mr Paterson - There was no depression then.

Mr FORDE - As a matter of fact the depression has adversely affected the cigar industry, because there has of late years been a continual falling off in the consumption of cigars and in the number of men employed in their manufacture here. Their numbers have fallen from 1,400 to about COO. The cost of the Australianmade cigar has increased from 4d. to 7d.

Mr Martens - The evidence before the Tariff Board was to the effect that the cigar consumption throughout the world had fallen off.

Mr FORDE - That is so. The excise has been reduced in an. effort to rehabilitate this dying industry, which at one time was employing 1,400 hands. I was surprised when I visited a factory in Melbourne to find that 300 men were still making hand-made cigars. There is another factory at Perth.

Mr Gregory - What is the average Wage paid in the industry?

Mr FORDE - The wage is decent and reasonable.

Mr Fenton - The men are not now on full time.

Mr FORDE - Unfortunately, that is so. No government has hit the tobacco monopoly more than this Government has by increasing duties. We have made substantial increases in duties, and I resent the suggestion that this reduction in excise is a gift to a huge monopoly. No man knows more than the honorable member for Maribyrnong the condition of this industry. When he was Minister for Trade and Customs he made a careful investigation before reducing the excise.

Mr Fenton - It was reduced to give the industry a chance to live, and to bring about more employment.

Mr FORDE - This reduction is in accordance with the recommendation of the Tariff Board, which inquired into the conditions of the industry.

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