LOAN & MERCANTILE

Evening Post, Volume CXXXIII, Issue 44, 21 February 1942, Page 8

LOAN & MERCANTILE

DIVIDENDS GO IN TAXES

(0.C.)

LONDON. December 19,

"For every £1 received in dividend by the ordinary stockholder, they will have contributed over £10 in the form of taxation, and this takes no account whatever of surtax or other corresponding taxes which may be levied upon the individual ordinary stockholders by the British and Dominion Governments," said Mr. Harold G. Brown, chairman of the N.Z. Loan and Mercantile Agency Co. He informed shareholders at the annual meeting that, out of two years' profits amounting to £403,000, ordinary stockholders had received, after tax deductions, a net sum of £25,000. There would be no dividend paid on the ordinary shares.

"I do not want to over-emphasise this question of taxation," said Mr. Brown. "We shall all agree that the war must be won and the money to win it must be provided. I will, however, venture to repeat what I said last year, namely, that the higher taxation becomes the more important it is to see that its incidence is fair as between one taxpayer and another. I find it difficult to believe that taxation, as it falls on the ordinary stockholders in this company, is fair as compared with ordinary stockholders in many other companies."

Mr. Brown pointed out that when taxation gets to rates such as those now in force, and is calculated on profits shown after disallowing charges and provisions reasonably made by the directors,,it bore most hardly and unfairly upon the ordinary stockholders out of whose share of the profits all these disallowed charges had to come.