THE FINANCE BILL

Otago Daily Times, Issue 23200, 26 May 1937, Page 9

THE FINANCE BILL

DEFENCE CONTRIBUTION TAX ON BUSINESS PROFITS SEVERAL MODIFICATIONS (United Press Association) (By Electric Telegraph—Copyright) LONDON, May 24. The Finance Bill, issued to-day, contains substantial modifications to the national defence contribution. It brings 1936 into the years on which the profits standard is based. Profitstaxpayers will be given the choice of taking as their profits basis the average profits of any three out of the four years 1933-1934-1935-1936, or any two out of the years 1933-1934-1935. Relief is given where capital is small or business is accompanied by exceptional risks. Any system under which the charge is graduated is altered. The concessions may diminish the first yields, but will not modify the ultimate value of the tax.

CHANGE IN GRADUATION

(British Official Wireless* RUGBY, May 24. (Received May 25, at 5.5 p.m.)

The House of Commons reassembled after the Coronation and Whitsuntide recess. It is generally expected that Mr Baldwin will have an interview with the King on Thursday or Friday. The Finance Bill aroused unusual interest from the fact that it embodies changes in the Budget proposals for a national defence contribution, foreshadowed by the Chancellor of the Exchequer before the Whitsun recess and resulting from consultations he had in the interval with representatives of industry, commerce and finance. The graduation of the tax has been modified. A tax at the rate of one-fifth will be applicable to profits in the zone of 6 per cent, to 12 per cent, of capital instead of 6 per cent, to 10 per cent., and one-quarter rate will be applied to the zone 12 per cent, to 16 per cent., instead of the zone 10 per cent, to 15 per cent. The Bill contains provisions under which any class or subdivision of trade or business may apply for an increase of the statutory percentage allowed on capital on the pounds of exceptional risks incurred or of any exceptional wastage of or exceptional deferment of the yield on capital employed therein. Where a class or subdivision obtained an increase of the statutory percentage for the purposes of wartime excess profits the duty on such increased percentage shall provisionally be allowed pending confirmation or variation or revocation of the order giving effect to such increase.

The Chancellor of the Exchequer estimated the number of concerns liable to pay the national defence contribution at approximately 35,000.