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MONDAY, JANUARY 22, 1979
INTEREST TAX
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EXEMPTION RATE IS 5-1/4 PER CENT
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THE RATE UP TO WHICH INTEREST ON BANK DEPOSITS IS EXEMPTED FROM TAX IS 5-1/4 PER CENT, NOT 7 PER CENT OR 7-1/2 PER CENT AS SOME NEWSPAPERS HAD REPORTED OVER THE WEEKEND.
A GOVERNMENT SPOKESMAN SAID TODAY (MONDAY) THE PRESS REPORTS HAD CAUSED +SOME CONFUSION+. HE SAID THE 5-1/4 PER CENT EXEMPTION RATE ANNOUNCED ON JANUARY 2 REMAINED IN FORCE.
HE SAID THE INLAND REVENUE (AMENDMENT) (NO. 2) BILL 1979 PUBLISHED IN THE GOVERNMENT GAZETTE LAST FRIDAY MERELY RAISED THE CEILING ON THE POWER OF THE FINANCIAL SECRETARY TO SPECIFY THE RATE OF EXEMPTION FROM TIME TO TIME: IT DID NOT SET THE ACTUAL LEVEL OF THE EXEMPTION CURRENTLY IN FORCE.
HE SAID THAT LEVEL WAS NORMALLY SET AT THE RATE OF INTEREST PAYABLE BY THE EXCHANGE BANKS' ASSOCIATION MEMBERS ON SAVING ACCOUNTS.
+WHEN THAT RATE WAS RAISED ON JANUARY 2 FROM 4-1/2 PER CENT TO 5-1/4 PER CENT, THE EXEMPTION RATE WAS ALSO RAISED, HE SAID.
THIS WAS DONE, HE SAID, USING A TEMPORARY ORDER UNDER THE PUBLIC REVENUE PROTECTION ORDINANCE, PUBLISHED IN AN EXTRAORDINARY GAZETTE ON JANUARY 2. THE BILL WHICH WILL RECEIVE ITS FIRST AND SECOND READINGS IN THE LEGISLATIVE COUNCIL ON WEDNESDAY IS EXTENDED TO CONFIRM THE EFFECT OF THIS ORDER.
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