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Aspects of Renewal Costs

4th December 1936
Page 31
Page 32
Page 31, 4th December 1936 — Aspects of Renewal Costs
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Which of the following most accurately describes the problem?

WHETHER or not readers agree with all the views expressed by the special contributor who wrote the article in this issue, entitled " Renewal Costs that Cripple Operators "—it might almost have been called the Charge of the Law Brigade—it must be admitted that some simplification of the administration is desirable. At present the small operator is in danger of being frightened off any attempt at expansion by the possibilities of heavy expense if a case should go to appeal.

The writer has naturally been concerned with th,e exceptional rather than the normal, but there must be many instances where renewal costs have made a serious hole in the profits, especially in those of smaller establishments, or have even turned the balance on to the wrong side. Traders who offer increased traffic to their customary carriers may quite reasonably expect the extra to be carried at the same rates as the basic tonnage, but it would seem that there are cases nowadays where applications for variations are not worth while, because the expenses would swallow up so large a proportion of the anticipated return if ordinary rates be continued.

More serious are the differences that apparently exist in allowances for income-tax purposes, but there appears to be some hope that this position may be clarified in the near future. Nevertheless, small operators,. whose expenses in any endeavour to obtain variations stand out clearly on their accounts, may be permitted to wonder how large companies are dealt with at present when they have complete legal departments, the duties of which must be almost impossible of accurate analysis. What happens to the railways in like circumstances? Definite rulings that are applicable to all would undoubtedly be welcomed by the whole transport community.

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Organisations: Law Brigade

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