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Wednesday, 3 June 1942


Mr CHIFLEY (Macquarie) (Treasurer) (11:32 AM) . - I move -

That the amendment be agreed to.

Under clause 21 as it now stands, a company which pays to a non-resident individual depositor or debenture holder, in the year of income, interest amounting to less than £157, is not liable to pay tax in respect of that interest But, should it pay interest amounting to £157., or more to any non-resident individual, it is liable to pay tax at the rate of 6s. in the £1 in respect of every £1 of such interest. The company is empowered to recoup itself by deducting the tax before paying the interest to the non-resident depositor or debenture holder. As such a provision would create anomalies, and impose hardship in some instances, it is proposed that a company shall be liable to pay tax only on so much of any interestpaid to a non-resident individual as exceeds £156. The effect of the proposed amendment will be that, generally speaking, the amount of tax paid by the company and borne by the individual non-resident in respect of interest so paid will be substantially similar to that payable by a resident taxpayer deriving the same amount of property income. In any case, the act gives to the Commissioner the right of assessment. The non-resident taxpayer may accordingly be assessed on the actual amount of interest paid to him, and be allowed a rebate of the amount of tax paid by the company on that interest.

Question resolved in the affirmative.

Clause 26-

Section one hundred and sixtyc of the principal act is amended -

Senate's amendment.- After the words " is amended " insert - " (aa) by omitting paragraph (i) of subsection (1.) and inserting in its stead the following paragraph; -

(i)   all taxes which are paid in the year of income -

(a)   under this or the previous Act;

(b)   under any Act passed by the Parliament imposing a war-time tax upon companies;

(c)   under any law of a State or of a Territory being part of the Commonwealth imposing a tax upon incomes, if the taxes have not been allowed or are not allowable as deductions under section seventy-two of this Act in any assessment for any financial year; or

(d)   inany country out of Australia in respect of income of thecompany which is taxable under this or the previous Act, less any refund received in the year of income of any tax to which this paragraph refers;':".

Section proposed to be amended - 160c. - (1.) For the purpose of the further tax imposed on that portion of the taxable income of a companywhich has not been distributed as dividends, that portion shall be ascertained by deducting from the taxable income of the company -

(i)   all taxes which, in the year of income, are paid under this or the previous act. or under any act passed by the Parliament imposing a wartime tax upon companies, or paid in any country out of Australia in respect of income of the company which is taxable under this or the previous act less any refund received in the year of income of any tax to which this subparagraph refers;







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