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Thursday, 27 November 1941

Senator KEANE (Victoria) (Minister for Trade and Customs) . - I . move -

That the bill be now read a second time.

This bill imposes the rates upon gifts which will become liable for duty under the provisions of the Gift Duty Assessment Bill. That bill, when enacted will be incorporated andread as one with this measure. The rates of duty are the same as those imposed for estate duty purposes. This scale of rates has been adopted because the second main purpose of the imposition of a duty upon gifts is to protect estate duty by deterring persons from dispersing their assets amongst relatives and others while still alive. The rate will commence at 3 per cent, on gifts in excess of an aggregate value of £500 made during the statutory period of three years and up to the value of £10,000. Thereafter it increases by three one-hundredths of £1 per cent, for each £100 by which the value exceeds £10.000 until the rate of 6 per cent, is reached at £20,000. Thereafter it increases by two one-hundredths of £1 per cent, for every £100 by which the value exceeds £20,000 until the value of £120,000 is reached, where the rate is 26 per cent. Thereafter it increases by one two-hundredths of £1 per cent, for every £1,000 by which the value exceeds £120,000 until the maximum of 27.9 per cent, is reached, where the aggregate value is £500,000. Although the rates imposed under this bill follow the same scale as the rates imposed under the Estate Duty Act, the actual amounts of duty imposed upon any particular gift Will usually be less than the estate duty that would have been imposed upon the property comprised in the gift had it formed part of the estate of the donor at the time of his death. This is due to the fact that the rate of gift duty is ascertained by reference only to the aggregate value of all gifts made by the donor within the period of three years; whereas in the case of estate duty the rate depends upon the aggregate value of the whole of the donor's assets as at the date of death. It is not likely that the donor will give away the whole of his assets before his death and within the period which permits the aggregation of gifts for the purpose of arriving at the rate to be applied thereto.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without requests or debate.

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