XN000022-1973-04-25 — Page 24

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Wednesday, April 25, 1973

This, he said, would result in such a considerable reduction of tax.

Consideration of reform along these lines must await an increase in the

standard rate of earnings and profits tax,

Mr. Haddon-Cave stressed that "a low standard rate of tax is fundamental

to our objective of maintaining a high growth rate of the economy."

"Our ability to maintain a low standard rate of tax will depend

upon the efficiency with which our present tax laws are administered," he added.

Mr. Haddon-Cave regarded the administrative resources that would be

released by this tax reform package as important in this connection for there

were areas of taxability within the existing tax law to be explored in more depth.

He deplored the "unjustified outcry" which occurred recently over the

Commissioner of Inland Revenue's notice following upon the reference he made

in the budget debate to the tax liability of habitual dealers in the market for

shares.

"Without passing any judgment whatsoever on the right level of the

market at any time, these references to the tax position of habitual dealers

undoubtedly led, furthermore, to an irrational over-reaction by the market as

reflected in the volume of activity and the movement of prices," he added.

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