Media statement
Wednesday, February 25th, 2004

Government back-down needed on border security tax

The Government's search for ways to soothe angry voters should look no further than the $20 million border security tax it is proposing to levy on the country's international traders.

"With the economy facing a downturn and exports hit by the high dollar, our overseas traders don't need more costs such as the border security tax," said Alasdair Thompson, chief executive of the Employers & Manufacturers Association (Northern).

"Border security is not a 'user pays' issue. It's to protect all New Zealanders and should be paid of from general taxation.

"More taxes like this can cost the jobs of voters and seriously damage our chances of sustaining the business growth that will pay for the Government's Budget spend up to be announced in May.

"The Government has constantly stressed the need for New Zealand to export but at the same time it is prepared to layer on another cost on businesses heeding the message.

"Prime Minister Helen Clark and Finance Minister Dr Cullen should signal an immediate retreat on this misguided tax. It goes to the heart of the on-going issue of whether Government is genuine about trying to be business friendly.

"It's not just exporters who are angry. Importers are being asked to contribute to the $20 million cost of installing X-ray machines at all ports and help pay for the 130 extra customs staff required to run them.

"The double whammy on our international trade ignores clear evidence that the increased border security measures should be classified as a 'public good' and paid for out of general taxation.

"The point will be hammered home tomorrow morning at a meeting of the Select Committee due to report back to Parliament next month.

"Members of the committee will hear a tough-talking submission from the 35-member Travel and Trade Industry Coalition of which EMA is a member.

"Exporters don't deserve a smack in the face from a poorly thought-out tax that will hurt the people trying to help the country pay its way. The Government need not wait until next month to revoke the tax."

ENDS

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