Company in tax strife
Changes to taxation laws have helped land a Christchurch rental vehicle company in strife. Carthy Motors, Ltd, wants a rental service licence for leasing 50 new motorvehicles to industrial and business clients for sixmonth to three-year periods. The No. 9 Transport District Licensing Authority, Mr D. L. Hogan, has reserved decision on the
application. "It seems to me that this is solely for the purpose of avoiding paying tax,” he said.
The general manager of Carthy Motors, Mr R. A. H. Drayton, said it was more than a taxation problem. “It is a company knocked out overnight,” he said. If the application was approved the company proposed to renegotiate its leases at the end of every
six months under new agreements which also allowed more maintenance costs to be built in.
Representing the Ministry of Transport, Mr D. R. Murray said new leasing arrangements which exceeded six months legally did not require the company to be a licensed rental operator. However, without the change clients might not be able to claim leasing charges as tax deductions.
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Press, 9 May 1983, Page 6
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180Company in tax strife Press, 9 May 1983, Page 6
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