LIFE POLICIES FOR DUTIES

Press, Volume XCII, Issue 27792, 18 October 1955, Page 10

LIFE POLICIES FOR DUTIES

Exemption If Assigned To Public Trustee SUGGESTION MADE TO GOVERNMENT A suggestion that life insurance policies taken out for probate purposes be exempt from estate duty if assigned to the public trustee for payment had been made to the Government by the Life Underwriters’ Association of Australia and New Zealand, said the president (Mr A. Wallace) at a meeting of the association in Christchurch yesterday. This was already being done in the United States r-.id Canada and the association was making similar suggestions to the Government in Australia, said Mr Wallace. He said that if such a scheme were instituted the Government would suffer some loss of revenue, but the compensating factor was that the estate would largely remain intact. This was of paramount importance to the economy of the Dominion. Mr Wallace said that in reply to the suggestion, the Minister of Finance (Mr J. T. Watts) had said that he was looking further into the representations. but they would involve a departure from the recognised basis, which means that the tax is levied on a person’s total wealth at the time of his death.

“If legislation were brought ip adopting this suggestion it would result in a substantial increase in the nremium income of all the life insurance offees,” said Mr Wallace. “This would in turn mean that more funds would be available for investment by way of mortgages on farm lands and house properties. At present these funds were in short supply.” Mr Wallace said that he hoped the Government would act on the suggestion, as present legislation could be regarded as almost a disinheritance tax.