56
Table of Correspondence,—Continued.
Clause of
Source if any.
Bill.
Remarks.
14
No. 13 of 1940,
s. 12.
15
16
No. 13 of 1940,
s. 13.
No. 13 of 1940,
s. 14.
(1) In sub-section (1) "sections 9 to 13" have been substituted for "sections 9, 10 and 11",
(2) In paragraph (a) the salaries tax on the first five thousand dollars is raised from "four per cent" to "six per cent".
(3) In paragraph (b) the salaries tax
on the remainder is raised from "ten per cent" to "fourteen per cent".
(4) In sub-section (2) "four thousand eight hundred dollars" has been reduced to "three thousand six hundred dollars'
see note (3) to clause 8; and consequently in the proviso "$3,600" is substituted for "$4,800".
J
(1) This section dealing with profits tax bas been redrafted. The words "subject to the provisions of this Ordinance" have been added to the first line. The words "on the full amount of the profits of such trade or business which are made from transactions in the Colony of such trade or business, ascertained in ac- cordance with the provisions of this Ordinance at the rate of ten per cent" have been deleted and the following words have been substituted
"at the
of rate fourteen per cent, in respect of the profits arising in or. derived from the Colony from such trade or business". See Note (1) to clause 2 in this Table.
(2) It will be noticed that the rate of tax has been raised from "ten per cent" to "fourteen per
cent".
This clause has been redrafted as it provides for taxation of a trade, profession or business on different basis to that of the old business profits tax which failed to realize expectations. The replaced tax provided for the payment, on profits exceeding $10,000 and
not exceeding $100,000 of a tax of five per cent of the profits in excess of $10,000 and on profits in excess of $100,000 ten per cent of the excess. No tax was payable on profits which did
not exceed
$10,000. The new clause pro- vides for a tax at seven per cent upon the first $50,000 and at fourteen per cent upon the remainder, subject to a proviso for no taxation where the profits do not exceed $5,000. A second
Clause of Bill.
5
Table of Correspondence,—Continued.
Source if any.
Remarks.
17
No. 18 of 1940,
s. 15.
18
No. 13 of 1940,
8. 16.
19
No. 13 of 1940,
s. 17.
20
21
22
No. 13 of 1940,
s. 18.
No. 13 of 1940,
s. 19.
No. 18 of 1940,
$. 20.
proviso secures that the tax payable shall not be more than the amount by which the profits exceed $5,000, just as an in- dividual liable to salaries tax does not pay
more than the amount by which his assessable income exceeds $3,600. A third proviso deals with the aggrega- tion of profits of a husband and wife.
There has been no change in this
clause except the
necessary renumbering.
27
(1) This clause has been redrafted so as to put the question of the meaning of depreciation, for which reasonable allowance is made, on a clearer basis; also the expression "trade, profession or business" is substituted for the expression "trade or busi- ness but this involves no change as professions were treated as business concerns under the 1940 Ordinances. The word "asset" is substituted for "plant, machinery or fixtures".
(2) Paragraph (f) is new. It provides
for
allowance by way of deduction where sums are placed
reserve to
an
annually to
passages and/or leave pay.
cover
The words "or loans" have been added at the end of sub-section (2). It has been found in practice difficult to distinguish between partners' capital and partners' loans, so it is made clear that profits from partners loans are put on the same basis for interest as profits on partners' capital.
Sub-sections (1), (3), (4) and (5) are new and are intended to provide a more simple and easily under- stood basis of assessment in place of that provided by sub-sections (1) and (5) (as enacted by section 5 of Ordinance No. 29 of 1940) of the original Ordinance. Sub- sections (2), (3) and (4) of the original Ordinance are re-enacted as sub-sections (2), (6) and (7).
This clause is unchanged, except for
necessary renumbering.
do.
57
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