XN000022-1973-02-28 — Page 42

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Wednesday, February 28, 1973

The Financial Secretary estimated the cost to the 1973-74 revenue

of the new allowances, the new platforms of net chargeable income and schedular

rates and the consequential extension of the period of effectiveness of

allowances to be $21 million.

There was therefore, he said, "ample margin of extra relief" to

cover the withdrawal of the dependent parent's relief and deductions for

life insurance and similar payments.

As regards the dependent parent's relief, he said experience showed

that the risk of abuse and the cost of administering this allowance did not

justify its continuance,

Estimated savings in a full year would be about $2.5 million.

Life Insurance

On deductions for life insurance and similar expenditure, Mr. Haddon-Cave

saw "no reason why this particular form of thrift or personal expenditure should

attract relief, particularly with the increased allowances now proposed."

Savings in a full year would be about $3 million.

Arguing the case for abolishing the present four selective allowances,

the Financial Secretary said that if these further proposals for new allowances and

new schedular rates were accepted, most taxpayers would eventually have received

"two successive reductions of tax."

He described as "quite justified" the loss of unwarranted selective

allowances in a situation where there was no real case for an overall reduction

of taxation.

/Finally,