INEQUALITIES FEARED

Dominion, Volume 35, Issue 45, 17 November 1941, Page 3

INEQUALITIES FEARED

N.S.W. Company Taxes

The proposed new wartime company tax in Nev South Wales is viewed with considerable misgiving by busll^ s ? and manufacturers, who tear that it will be inequitable, and may place some companies in a difficult financial P The president of the Sydney Chamber of Commerce, Mr. A. E. Heath, said t a be had reviewed a number of specific instances of the operation of the tax, and thought that it might have disastrous effects on some companies, ltb ? u4 achieving its main object of checkins profiteering, because the circumstances and mode of operation ot companies differed widely. A company operating on a small margin of profit and a quick turnover might need onlv a relatively small amount ot capital and would be heavily penalized, whereas a company doing a different type of business, involving a heavy overhead, would normally show a lower ratio ot profits to capital, and might escape lightV lt was utterly wrong to take 4 per cent, on capital employed as the starting point for such a tax. Ibis was barely more than the return on Commonwealtn bonds, and' left no margin to compensate for business fluctuations am. losses. Many companies, he pointed out, were obli'-ed’ to pay more than 4 per cent, to holders of debentures or preference shares, and 6 per cent, had been taken as the fair standard of earnings for such enterprises as gas companies. No u° unt ry in the world had .carried such a “ e asuie below 6 per cent. Eight per cent, could be considered fair and reasonable, and the progression on earnings m excess thFs could be made steeper than the ex--ISt‘‘The should be suefi that while sufficient revenue is secured for the Com monwealth, a company s hnaneial position will not be jeopardized. he con C 1 An d 'illustration of the tax is afforded bv a large manufacturing company in Sydney, which would pay £6OOO under the present wartime company tax, but would pnv £27.000 under the new proposals. Under Mr. Fadden’s Budget.tins company would pay, m all, £3u,000 of Commonwealth taxation but MrC’hifley's plans will raise the amount to £57,800.

Marcus Clark & Co. Ordinary dividend payments are being resumed by Marcus Clark and Company, Limited with a rate of 3 per cent, tor the j ear ended August 2. This is the same rate as for 1937-38. No dividend was paid for the next, two years. Net profit of £56,051 is an increase of £0264, aitei providing for "greatly increased taxation ami £8485 for depreciation, against £8273 last year. First preference dividend of 6 per cent, amounts to ±lB,OOO, second preference of 6i per cent, to £19,360, and ordinary dividend to £12,’145.

Stock And Share indices (Bv Telegraph.— Press Assn.—Copyright.) LONDON, November 14. “Financial Times'’ stock and share indices, with previous quotations, are (October 15, 1926, equals 1060) Govt. Home Indus- Gold

sec’s. Rails trials mines. Peb. 4 .... 112.3 43.9 88.5 173.4 Mar 112.3 42.3 85.6 170.5 A pl. Mar 113.2 45.2 85.4 173.9 2 113.2 45.2 84.3 167.3 Jun. 113.1 45.1 87.4 170.0 July 2 .... 113.8 47.3 88.3 168.5 1 .... 113.5 49.0 93.3 171.8 Sept 113.6 52.4 96.7 176.2 Oct. i .”1 114.0 51.5 98.1 177.8 Nov. i.... 114.1 50.9 99.7 172.5 Nov. 114.0 50.8 100.2 175.0 Nov. 10 113.0 51.2 100.6 175.1 Nov. n .... 113.9 51.4 100.8, 175.0 Nov. 13 .... 113.9 51.5 101.1 1 75.4 Nov. 14 .... 113.9 51.5 101.5 176.3