TAXATION PROBLEM

New Zealand Herald, Volume LXXII, Issue 22185, 12 August 1935, Page 5

TAXATION PROBLEM

COLONIAL SUGAR SHARES AUSTRALIAN HOLDERS NO PARALLEL IN DOMINION An interesting position in regard to income tax has arisen through the issue of bonus shares last financial year by the Colonial Sugar Refining Company, Limited, states the Sydney Morning Herald. The company does not issue share certificates unless requested to do so. Since the bonus issue was made there has been a fair number of shares of the company sold. If the shares sold were the old issue and were purchased by'the seller prior to July 1, 1932, any profit which may have been made on them would escape taxation, but if they were old shares acquired subsequently to June 30, 1932, or if they were new shares, any profit made on the sale would be subject to taxation. The interesting point is how the seller of tho shares is to know whether he sold old shares or new shares if he had no share certificate, and, presuming ho ascertains the ago of the shares sold by application to the company, how lie is to calculate what profit, if any, lie ' has made. Shares of the company i immediately before the bonus issue had i a market value of £7B 2s 6d and immediately after the bonus issue a market value of £-10. The position is further complicated through a portion of each share of the bonus issue being subject to State income tax. Under New Zealand tax laws, such a position does not arise. In the Colonial Sugar case it has been decided that the bonus shares do not have to be brought in for assessment of income tax. !Jn any case, a New Zealand shareholder only brings in dividends for assessing the rate of income tax and the dividends themselves are not taxed. Any profit on the sale of shares is looked on as capital, except where it is a person's business to deal in shares. FOREIGN EXCHANGES LONDON RATES STEADY (Received August 11, 5.5 p.m.) British Wireless RUGBY, Aug. 10 The following rates on foreign exchanges were current yesterday, compared with the cabled quotations on August 8 and par: Aug. 9 Aug. 3 Par Montreal, dol. . 4.%% 4.90% 4.806 New York, dol. . 4.90 7 / ja 4.90%# 4.86(5 fr. . 74 15 / la 74'Vu 124.21 Brussels, belga 29.39 29.39 35.00 Geneva, fr. .. 15.17 15.16% 25.22 Amsterdam, fl. . 7.3-1 7.33 12.10 Milan, lire .. Berlin, r.m. .. 12.29 12.29 20.43 Stockholm, kr. . 19.39% 19.39% 18.159 Copenhagen, kr. . 23.39% 23.39% 18.159 Oslo. kr. . . 19.90% 19.90Y a 18.159 Vienna, sch. , . 2t; J a 26% 34.585 Prague, kr. . . 119' a 119% J64.25 Helsingfors, mark 220y a 220% 129.23 Madrid, pes. . . 3G% 3 3625.221 Lisbon, escu. .. 110% 110% 110 Athens, dr. .. 51(5* 516* 375.00 Bucharest, lei. . 625* (524 * 8 1 3.6 Rio de Janeiro, mil. 4%d* 4V<d* 5.899 d Buenos Aires, dol. 35d* 35d" 47.619 d Montevideo, dol. 39% d* 39V s d* 51 d Bombay, rupee . 18' ad 18% d 18d Shanghai, dol. . n l3 / tt d 17** d Hongkong, dol. . 20% d 25% d Yokohama, yen . 14% 3 d 14% 3 d 24.58 d i Batavia. fl. . 7.31% 7.32% 12.10 Belgrade, din. . . 216 216 276.31 'Sellers. (Received August 11, 5.5 p.m.) LONDON, Aug. 10 On the foreign exchange market today the following quotations ruled: — New York, 4.96J dollars; Paris, 752 francs; Batavia, 7.32 i florins, NEW ZEALAND QUOTATIONS The Associated Banks (other than the Bank of New South Wales) quoted the following elollar rates on Saturday, on a New Zealand currency basis, subject to alteration without notice:— Selling: United States Canada T.T 3.98 3.98% On demand .. 3.98% 3.98% Buying: On demand .. 4.02% 4.03% Following are the latest rates for purchases and sales of foreign exchange quoted by the Bank of New _ South Wales, Auckland. They are subject to alteration without notice: — T.T. On Demand To £1 N.Z. Currency Selling Buying Selling U.S.A. dol. .. 3.97% 4.03% 3.98% Canada, dol. .. 3.98% 4.03% 3.98% France, fr. .. 59.56 61.16 59.61 Noumea, fr. .. 58,81 62.21 58.86 Papeete, fr. .. 58.81 62.21 58.86 Belgium, belga .. 23.301 Germany, r.m. 9.666 Italy, lire .. .. 47.86 Switzerland, fr. .. 12.009 12.484 12.019 Holland, fl. .. 5.780 6.080 5.784 Java. fl. .. .. 5.762 6.037 5.766 Sweden, kr. .. 15.458 15.828 15.468 Norway, kr. .. 15.868 16,238 15.878 Denmark, kr. .. 17.878 18.248 17.888 Austria, sch. .. 20.47 Czecho-Slovakin, cr. 95.-11 N.Z. pence to— Japan, yen .. 17— Shanghai, dol. .. InJ1 n JV 32 229/„1 9 /„ 22"/,„ India, rupee .. 22 a % 2 22% a 22' J % a Ceylon, rupee .. 22 s % a 22 7 /-, a 22 9 % a Hongkong, dol. .. 31 '% 3 30"/„ 31"/,, Singapore, dol. .. 35% 34% a 35%« The cost in New Zealand currency of the pound sterling, and of the principal overseas units, on the latest quotations, is as follows: Present price Par sd. s d Australia, pound ~ 19 10.81 20 0.00 London, pound .. 21 10.(15 20 0.00 Fiji, pound .. „. 22 5.66 20 0.00 New York, dollar , ■ 6 0.1-3 4 1.31 Montreal, dollar ~ 5 0.08 4 1.31 Paris, franc .. ~ 0 3.98 0 1.98 .Berlin, reichmark .. 2 0,28 0 11.74 Copenhagen, krone .. 1 1.33 1 1.22 Yokohama, yen . . .. 1 5.61 2 0.58 CUSTOMS EXCHANGE RATES Rates of exchange ruling at the announced dates of departure of vessels named aro shown in the following table. They aro subject to confirmation by the Customs Department when the exact time of departure is learned on arrival of the vessel in New Zealand. Finally declared rates are marked*: — Brisbnno Mnru, Hongkong, dollara *26% d Brisbane Mnru, Japan, yen . . *l4%d City of Glasgow, America, dollars 4.95%,, Anglo Canadian, America,, dollars 4.00'/ 18 Niagara, Canada, dollara .. .. 4,96% Nnrbnria, India, rupee . . 18% d Melbourne Maru, Japan, yen . . 14% :1 d Canadian Planter, Cannda, dollars 4.96% QUILL, MORRIS, LIMITED FURTHER PROFIT SHOWN A profit of £1522 is shown in the report of Quill, Morris, Limited (in liquidation), wine and spirit merchants, Christchurch, for t/i« half-year ended July 25. Accumulated profits sinco the date of liquidation in 1932 are £8132. In his report, the liquidator states it is felt that the reconstruction of the company should be delayed until after the taking of the annual accounts in January next. BRITISH TREASURY BILLS (Received August 11, G. 5 p.m.) British Wireless RUGBY, Aug. 10 The total amount applied for this week in tenders for £40,000,000 worth of Treasury Bills was £60,605,000. The average rate per cent for bills at three months was lis 9.37e1, compared with lis 9.13 d a week ago.