WEDNESDAY, FEBRUARY 25, 1987
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HALF PER CENT CUT IN PROFITS TAX SOUGHT
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THE FINANCIAL SECRETARY, THE HON PIERS JACOBS, TODAY (WEDNESDAY) PROPOSED A CUT IN THE RATE OF TAX ON CORPORATE PROFITS FROM 18.5 TO 18 PER CENT,
THE NEW CORPORATE RATE, HE SAID, WOULD APPLY TO PROVISIONAL AND FINAL ASSESSMENTS FOR 1987-88.
*THE COST OF THE REDUCTION PROPOSED IS $135 MILLION IN 1987-88 AND, FOR A FULL YEAR, $310 MILLION.+
MR JACOBS SAID THAT SOME PEOPLE HAD ARGUED FOR A MORE SUBSTANTIAL CUT IN THE RATE ON THE GROUND THAT THIS WOULD PROVIDE A STIMULUS TO THE BUSINESS SECTOR, BUT I DO NOT CONSIDER THAT WE SHOULD MOVE TOO SHARPLY AT THIS STAGE+.
+ BUT I HOPE THAT THIS CLEAR INDICATION OF THE DIRECTION IN WHICH I WOULD LIKE TO MOVE WILL PROVIDE, IF NOT A STIMULUS TO THE CORPORATE SECTOR, THEN AT LEAST SOUND REASON FOR CONFIDENCE THAT WE REMAIN DETERMINED TO MAINTAIN A LOW TAX REGIME IN WHICH BUSINESS CAN FLOURISH.
+GENTLE PROGRESS WILL SERVE US BEST.+
MR JACOBS SAID THE REDUCTION PROPOSED IN THE STANDARD RATE WOULD AFFECT THE AMOUNT OF PROFITS TAX TO BE PAID BY UNINCORPORATED BUSINESSES, AND REDUCE YIELDS FROM PROPERTY TAX AND INTEREST TAX.
+TAKEN TOGETHER,
ESTIMATE THIS WILL COST À FURTHER $35 MILLION IN 1987-88 AND $75 MILLION IN A FULL YEAR,+ HE SAID.
THE NEW STANDARD RATE WOULD APPLY TO PROVISIONAL AND FINAL ASSESSMENTS FOR 1987-88 ON UNINCORPORATED BUSINESSES, TO PROVISIONAL AND FINAL ASSESSMENTS FOR THE SAME PERIOD IN RESPECT OF PROPERTY TAX, AND ALSO TO FINAL INTEREST TAX ASSESSMENTS FOR THAT YEAR, HE ADDED.
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