Tax and Trade.

Evening Star, Issue 26136, 25 June 1947, Page 4

Tax and Trade.

.Thd Wider implications of double taxation relief, as foreshadowed iu the agreement concluded between Great Britain and New Zealand, details of which were released by the Minister of Finance (Mr Nash) yesterday, are of moire significance to New Zealanders than the immediate benefits conferred through a reduction in individual scales of taxation. Financial interests have for long sought an easing of the double tax burden, by which income in another Country is subject to levies by two taxing authorities, oven to the extent in some cases in this Dominion of absorbing up to 19s 6d in the £1 of income.

Industrial profits in particular will, under this agreement, be taxed in the country of origin. A long-recognised principle of taxation is thus confirmed, but the decision means also that the prospects of New Zealand business ventures must be enhanced. Our economy was built on the foundations of British investment, and the London market retains an active interest in the plans for expansion of Dominion industry. The flow of capital thus generated should increase as the result of this agreement.

The plan follows other agreements recently signed individually by New Zealand, Great Britain, Australia, and the United States. The result must be an easing of legislative barriers in world trade. The new agreement will help also in binding more closely the United Kingdom and New Zealand, an objective eminently desirable apart altogether from the incentive offered individuals and companies to produce more. .