TAXATION OF SHIPPING.

Otago Daily Times, Issue 18906, 5 July 1923, Page 7

TAXATION OF SHIPPING.

SIR W. JOYNSON-HICKS’S PROPOSAL.

SHIPOWNERS GRATIFIED.

BENEFIT TO THE DOMINIONS,

Press Association—By Telegraph—Copyright LONDON, July 3. (Received July 4, at 8.45 p.m.) In reference to Sir W. Joynson-Hicks’s new clause in the Finance Bill relating to the shipowners’ double income tax, the shipowners express the opinion that the new clause is the first result of a worldwide movement in favour of the abolition of all double taxation on the ground that such taxation seriously restricts tho development of trade. The subject is being examined by the League of Nations’ Committee, and by. the International Chambers of Commerce. Tho new clause is primarily due to the offer of tjie United States not to tax British ships if Britain does not tax American-owned ships. It is learned that the subject may be raised at the Imperial Economic Conference in the hope of making arrangements with the dominions to avoid the present system. It is admitted that the position of the dominions is different, none having dominion-registered ships trading to Britain except tho Commonwealth Line, which as State property does not pay taxation either in Britain or in Australia. Nevertheless, tho owners express the opinion that it will ultimately be to the advance of the dominions which are chiefly primary produce exporters to assist in removing the burdensome taxation on shipping, because only by reducing the running costs can a reduction of fares and freights be made possible. At the present time the shipowners engaged in the Australian trade complain of the vmfair Australian taxation under which they have to pay both a I ederal and a State tax on an assumed profit of 10 per cent, on the gross takings whether they make a profit or not. The owners suggest that though a reciprocal agreement similar to the AngloAmerican one is impossible in the case of Australia it would eventually benefit the Australian producers if Australia either did not tax the British shipowners at all or received from the British Government a portion of the taxation which the owners paid to the latter. It is argued that if the dominions abandoned taxation on British lines they would have an irresistible claim for a reduction of fares and freights which are eventually paid by tho dominion peoples. The shipowners believe that the ideal system of removing the hampering restrictions on trade would be one under which all shipowners would be taxed only in the country of the ship's registration.—A. and N.Z. Cable.

The proposal made by Sir W. JoynsonHicks (Parliamentary Secretary to the Treasury), was the insertion of a clause to remedy the grievance regarding the double income tax on the profits of the shipping business. He proposed, he said, to take power by an Order-in-Council to exempt the profits of foreign shipping businesses, conditional upon a reciprocal exemption clause being agreed to.