NEW SURTAX ON GIFTS

Press, Volume LXXXVI, Issue 26092, 20 April 1950, Page 5

NEW SURTAX ON GIFTS

LIABILITIES OF TWO INDUSTRIALISTS

BIG ENCROACHMENT ON FIRMS’ GRATUITIES (N.Z. Pres* Association—Copyright)

(Rec. 9 p.m.) LONDON, April 19. The announcement by the Chancellor of the Exchequer (Sir Stafford Cripps) yesterday that gift payments to business executives would be liable to surtax will drastically affect two of the leaders of Britain’s motor industry. According to the “Daily Mail,” Sir John Black, who built up the Standard Motor Company into one of the “big six” in the industry, will be at least £1875 out of pocket on a gift of £lOO,OOO which his firm’s shareholders gave him last October. Under Sir Stafford Cripps’s new “gifts tax,” Sir John Black will have to pay more in surtax; than the gift is now worth. Sir John Black was given 100,000 Standard shares worth £1 each at the time. To-day each share is worth only 18s 7Jd on the stock markets, so that Sir John Black’s £lOO,OOO has dwindled to about £93,125. Sir Stafford Cripps will demand at least £95,000 in tax and surtax next January. Mr Leonard Lord, head of the Austin Motor Company, is in a more fortunate position than Sir John Black. Last November the Austin company’s shareholders voted Mr Lord , £25,000 in cash, plus 80,000 shares (then worth £77,ooo)—in all, £102,000. The value of Austin shares has since risen on the stock markets, and the gift is now worth £103,000. With surtax at 19s 6d in the £, it will be whittled down to £3550.