Investors, Brokers Had ‘Black’ Year

Press, Volume CVII, Issue 31542, 2 December 1967, Page 18

Investors, Brokers Had ‘Black’ Year

The last financial year will be long remembered as the blackest posh war year for investors and brokers alike, the retiring chairman of the Christchurch Stock Exchange, Ltd (Mr D. G. Hamilton), said in his address to the annual meeting yesterday.

“Investors have been subjected to their privacy of investments through their sharebrokers being invaded for the first time, by income tax department inspectors ostensibly looking for profits made from the repatriation of overseas funds through the medium of share transactions.

“Many investors have now received assessments from the income tax department on the supposed profits earned in 1963,” says Mr Hamilton.

“The Stock Exchange Association has sought expert opinion from tax consultants who disagree with the opinion of the income tax department, that profits so derived are in fact taxable. ■.

“Any in this position should seek expert advice -before meeting any demand. “Both the association and the tax department would like to see a test case determined in Court to dear up this vexed question as soon as possible,” he said. Many broking firms had. been subject to the Reserve Bank investigations with some eventual prosecutions for breaches of the Reserve Bank regulations, which were confusing and appeared ambigious to the profession. "Some investors have been confused as to what Hie regulations mean to them un-

der certain circumstances. They have referred to their brokers who in turn may ask the local Reserve Bank for a ruling, only to be told the local bank will need to refer this question to the head office in Wellington. “Surely this must show it is time the Reserve Bank reviews its regulations with the object of simplification so that not only brokers, but the average investor, clearly understand what is and is not legal.”