XN000022-1981-05-13 — Page 10

WEDNESDAY, MAY 13, 1981

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MR SWAINE SAID IT WAS NOT THE INTENTION OF THE GOVERNMENT TO LEVY STAMP DUTY ON MORTGAGES AND THAT WOULD NOT BE CAUGHT BY THE PRESENT DEFINITIONS OF IMMOVABLE PROPERTY, CONVEYANCE AND LEASE.

LETTER B LAND EXCHANGE ENTITLEMENTS ISSUED BY THE NEW TERRITORIES ADMINISTRATION WILL ALSO REMA IN EXEMPT FROM DUTY AS THEY ARE RIGHTS ONLY AND NOT IMMOVABLE PROPERTY WITHIN THE DEFINITIONS OF +CONVEYANCE+ AND +CONVEYANCE ON SALE+, HE ADDED.

DEBATE ON THE BILL WAS ADJOURNED.

STAMP DUTY BILL TO BE AMENDED ****

THE HON DAVID NEWBIGGING URGED THE GOVERNMENT TO CONSULT THE COMMITTEE ON UNIT TRUSTS AND MUTUAL FUNDS WHEN AMENDMENTS TO THE STAMP DUTY BILL ARE INTRODUCED IN THE AUTUMN.

THE CALL WAS MADE WHEN HE SPOKE AT THE SECOND READING OF THE INLAND REVENUE (AMENDMENT)(NO. 2) BILL AND THE STAMP DUTY BILL IN THE LEGISLATIVE COUNCIL TODAY.

HE SAID THE AD HOC GROUP OF UNOFFICIALS SET UP TO EXAMINE THESE BILLS HAS INDEED SPENT CONSIDERABLE TIME AND EFFORT RECEIVING AND REVIEW ING REPRESENTATIONS BOTH FROM THE FINANCIAL COMMUNITY AND FROM THE GOVERNMENT.

+HAVING PARTICIPATED IN THIS PROCESS I HAVE LITTLE DOUBT THAT A SIGNIFICANT SAVING OF TIME- AND POSSIBLY AVOIDANCE OF DAMAGING UNCERTAINTY AS WELL - COULD HAVE BEEN ACHIEVED IF THE COMMITTEE ON UNIT TRUSTS AND MUTUAL FUNDS - A BODY SET UP UNDER GOVERNMENT SPONSORSHIP HAD BEEN INCLUDED IN CONSULTATIONS PRIOR TO THE PUBLICATION OF THESE PROPOSALS, HE SAID.

ON THE QUESTION OF LIABILITY OF THE TRUSTEES OF UNIT TRUST FUNDS TO TAX ON TRADING PROFITS, MR NEWBIGGING SAID THE PROBLEM LIES WITH THE UNCERTAINTY AS TO WHAT IS AND WHAT IS NOT A TRADING PROF IT

IN THE CONTEXT OF THE OPERATIONS OF A UNIT TRUST.

UNIT TRUST MANAGERS MUST BUY AND SELL UNITS AT REGULAR INTERVALS, OFTEN FORTNIGHTLY OR MONTHLY, AT PRICES BASED ON THE NET ASSETS OF THE TRUST.

IT IS OBVIOUSLY IMPRACTICAL TO AWAIT THE OUTCOME OF POSSIBLE LEGAL PROCEEDINGS BEFORE DECIDING WHETHER OR NOT TO INCLUDE A TAX LIABILITY IN THIS CALCULATION, HE SAID.

+ THE FINANCIAL SECRETARY MAY WITH JUST IF ICATION POINT OUT THAT THE POSITION IS NOT AFFECTED ONE WAY OR THE OTHER BY THE PROPOSED LEGISLATION.

FLWEVER THE

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