INCOME TAX PROVISIONS.

Manawatu Standard, Volume LX, Issue 234, 31 August 1940, Page 8

INCOME TAX PROVISIONS.

TIGHTENING THE NET. (By Telegraph.—Special to Standard.) WELLINGTON, Au£. 30. “One of the most tricky things I have ever touched,” commented Hon. W. Nash, Minister of Finance, when explaining to t’he House of Representatives to-day the reason for a lengthy clause amending the income tax provisions relating to proprietary companies There had been previous legislation designed to prevent tax evasion by this class. of concern and, said the Minister, the experts of the department, and some who were called to advise from outside, considered no possible loophole remained ; but some of the cleverest people in the country had been concerned. A further amendment do the law was needed. It had been decided that where an interest in a proprietary concern up to one-fift'h washeld by one person or company, tlieD that income should be aggregated for the purpose of assessing the amount which should be paid. It had not seemed possible to get over that provision, but a short timeago the records were examined of a. number of companies being formed with some persons’ names appearing as being interested in them all. There was an operating company, a holding company, and a proprietary company. There was no purpose except that of 'holding shares. They could thus get through the meshes of the taxation net, but this amendment would stop the whole process. Mr A. E. Jul) : Why not have a marginal note to the clause td the effect that ‘ it is to capture clever people ? , The Minister : I am afraid we cannot have notes on clever people in Acts of Parliament.