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Wednesday, 20 May 1936


Senator A J McLACHLAN (SOUTH AUSTRALIA) (Postmaster-General) . - I move -

That at the end of paragraph (q) the following words be inserted: - "For the purposes of this paragraph, a taxpayer shall be deemed to be liable to pay royalty or export duty in any country outside Australia if he satisfies the commissioner that he sold the goods in that country to another person for export from that country, and that the price for which the goods were sold was less, by the amount of the royalty or the export duty, as the case may be, than the price which the taxpayer could have obtained from the sale of the goods outside that country;"

This amendment is designed to remove an anomaly which has been brought under notice as existing in connexion with the copra trade of the Mandated Territory of New Guinea. An Australian company is producing copra in that Territory, but does not export and sell it in the copra market outside the Mandated Territory. The company sells the copra within the Territory to a purchaser who exports and sells it elsewhere. The actual exporter is obliged to pay an export duty to the Government of the Mandated Territory, and hence he is entitled to the exemption granted by sub-clause (q) now under consideration. The actual exporter, however, usually depresses his purchase price for the copra by the amount of the export duty and. thereby transfers the burden of' the duty to the producing company. This company is not, in the technical sense contemplated by sub-clause (q), an actual payer of the export duty to the Government concerned. It merely bears the burden of the duty through the ordinary operations of trade as they are influenced by the export duty. Consequently, the Australian company is technically subject to the Commonwealth Income Tax. This result was never intended by the Parliament when the provision in the existing law which corresponds to sub-clause (q) was enacted. The amendment now proposed will cure the defect.

Amendment agreed to.

Clause, further verbally amended, and as amended, agreed to.

Clauses 24 to 33 agreed to.

Clause 34 (Cost price of natural increase) .







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