TAXATION OF PREMIUMS

Taranaki Daily News, 2 June 1934, Page 7

TAXATION OF PREMIUMS

ECHO OF LOAN CONVERSION. REQUEST TO THE GOVERNMENT. By Telegraph—Press Association. Wellington, 7«ast Night, The decision that Government should be approached with a request that it exempt from taxation premiums due to the conversion of Government stock last year, in view of the fact that the conversion was a forced one and that the amount of the premium was not received by the bondholders in cash but was capitalised, was made by the executive of the Associated Chambers c~ Commerce at a meeting to-day. The Auckland Chamber of Commerce asked what action the executive was taking with regard to the decision of the Commissioner of Taxes to tax premiums. The chamber said there was no disguising the fact that the reduction in interest had been compulsory. The decision to charge income tax on the premiums seemed unfair and unwise.

The president of the association (Mr. A. M. Seaman) said it was a legal question whether the tax was enforceable, quite apart from legal considerations. However, he thought the case was one where the Government should give exemption from taxation owing to the special circumstances.