TAX DODGING.

Pahiatua Herald, Volume XLIV, Issue 13640, 26 August 1937, Page 3

TAX DODGING.

TRANSFER OF CAPITAL. LONDON. Latest manoeuvre of the incometax dodger is to transfer a large part of his capital to a friend or relation who is either living in the Channel Islands, or who can be persuaded to take up his residence there in order to help the swindle. His method of procedure is to transfer investments by deed of gift to the Channel Islands resident, who can then claim repayment of the w hole of the income tax' deducted from dividends and interest payments HANDS IT BACK. Having obtained repayment, the supposed “holder” of the investments then hands the money over to the real holder. Cases have come to light where large sums of capital have been so transferred, one recent transaction involving capital of many hundreds of thousands of pounds. On the other hand, while such large-scale tax evasion is being practised by big moneyed interests, the n an In the street is being squeezed to the lit incest fod payment of additional income tax. Inland Revenue authorities are challenging every claim lor allowances, legal or otherwise. EVERY PENNY. Strict interpretations o* the* Income Tax Act are being applied, with the result that claims admitted freely in the past are now disputed, although the taxpayer may be morally, if not legally, entitled to them. It is clear that the Chancellor of the Exchequer has instructed the income tax authorities to raise every penny piece in the current fiscal year. Thus the cost of tlie Government rearmaments programme is being | driven home to the man who honestly tries to pav his way. H arassing the small income taxpayer is of no use while existing legislation is so full of loopholes that big investors are able to escape payment of income and surtax by such simple means as outlined above. It has been announced that attempted income tax frauds and evasion in 371 eases, involving .£5,188,000, were dealt with by the 4 special branch of the Inland Revenue Department in 1935. Altogether 2400 cases “ranging from inndvcMiture through wilful neglect to deliberate fraud” were 4 proved by income tax inspectors and detec ti\es.