CO-OPERATIVE SOCIETIES

Poverty Bay Herald, Volume LX, Issue 18063, 13 April 1933, Page 9

CO-OPERATIVE SOCIETIES

TO BEAR TAXATION TRADING COLOSSUS LONDON, Feb. 28. The committee appointed last year to inquire into tho position of the cooperative societies with respect to in-come-tax recommends the withdrawal of the exemptions which the societies have so long enjoyed, and urges that they should be treated in exactly the same way as the ordinaty trading companies with which the) are in direct and growing competition. The redress of this anomaly, repeatedly demanded by the Aasaciaijn of Chambers of Commerce, was strongly recommended by tho Colwyn Committee on income-tax in ’.>2o, and this, indeed, is the only logical and reasonable view to take.

When the societies were originally given preferential treatment they w-ere small and unimportant, and their social aims attracted support. Nor were they then politically minded. To-day they have 0,500,000 members, and their trading figures for the last available year show a surplus of £21,000,000 net. It is calculatctd by the Board of Inland Revenue that on tho basis recommended by the report the amount obtainable in income-tax may bo as much as £1,200,000, allowing “divi” to be regarded as a trade expense of the societies, but making the recipients of distributions of interest, “directly chargeable in accordance with their individual liabilities.” The societies would thus pay their distributions without • deduction of income-tax; but members who are liable to income-tax would be required to include what they receive in their returns.