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Wednesday, 3 June 1942


Senator KEANE (Victoria) (Minister for Trade and Customs) (6:10 AM) . - I move -

That, after thewords "is amended", the following new paragraphbe inserted.: - " (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 wartime 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)   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 paragraph refers;';".

By clause 8 of the bill it is proposed that the deduction for State and territorial income taxes be withdrawn. This means that State and territorial income taxes paid by taxpayers during the year ended the 30th June, 1942, will not be allowed as deductions from income derived by them during that year. This proposal follows the recommendation of the special committee which, in arriving at its recommendations regarding the rates of uniform tax which it suggested shonld be imposed-, took into consideration the fact that such deductions would not be allowed under a system of uniform income tax. Representations have since been made, however, that State income tax paid in respect of the financial year 1941-42 should be allowed as a deduction from taxable income for the purpose of ascertaining the amount upon which tax on the undistributed income of both public and private companies should be levied. This is considered a reasonable request, and it is proposed, by the amendment I have just moved, that it be acceded to. The effect of the amendment is that State and territorial income taxes which have not been allowed as deductions in any assessment for any financial year will be allowed as deductions from taxable income for the purpose of ascertaining the undistributed income of a public company.

Amendment agreed to.

Clause, as amended, agreed to.

Clauses 27 to 31 agreed to.

Title agreed to.

Bill reported with amendments; report adopted.

Bill read a third time.







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