1964_ESTATE_DUTY_ORDINANCE — Page 51

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CAP. 111]

Estate Duty

[1983 Ed.

application of s.s. (4) and (5) with adaptations:

1944 e. 23, s. 38.

meaning of exemption: 1944 c. 23, s. 38.

payable on the value of the shares or debentures, paragraphs (a) and (b) of that subsection shall apply as if that exemption did not operate and as if the duty had been payable on the value of the shares and debentures accordingly: (Amended, 44 of 1979, s. 2)

Provided that where-

(a) the exemption in question depends on a payment of any duty on an earlier death, or does not depend on such a payment but depends wholly or partly on any dispositions having been made; and

(b) since the date of that death or disposition, as the case may be, the shares or debentures have been substantially in- creased in value by reason of a transfer of property to any company by any person or by reason of the extinguishment of, or any alteration of the rights attaching to, shares in or debentures of any company,

then, unless the exemption takes the form of a deduction from the value of the shares or debentures of a fixed amount which is independent of the value of the shares or debentures, the references in paragraphs (a) and (b) of subsection (4) to the value of the shares or debentures therein mentioned shall have effect as if they were references to the value thereof reduced to the extent to which, in the opinion of the Commissioner, that value is attributable to that transfer, extinguishment or alteration.

(6) Where, by reason of an exemption from estate duty, that duty is payable on part only of the value of the shares or debentures, subsection (4) shall, with the necessary adaptations, be applied to the part of the value of the shares or debentures on which duty is payable and subsection (5) shall be applied to the part of the value of the shares or debentures affected by the exemption; and, where there are 2 or more exemptions from estate duty each of which operates on part only of the value of the shares or debentures and the exemp- tions are such that subsection (5) would operate differently in relation to them, then, whether or not there is any part of the value of the shares or debentures on which estate duty is payable, subsection (5) shall, with the necessary adaptations, be applied separately in relation to the parts of the value of the shares or debentures affected by each exemption.

(7) In this section, the expression "exemption from estate duty" includes any exemption conferred by any provision of this or any other enactment which has the effect of exempting property, in whole or in part, from estate duty, whether that provision takes the form that the property is not to be deemed to pass, or the form that the duty is not to be payable, or the form that a deduction is to be made from the value of the property, or any other form; and the reference in paragraph (b) of the proviso to subsection (5) to an increase in the value of shares or debentures includes, where those shares or debentures have been acquired in substitution for any other property, any increase in the value of any property which those shares or debentures directly or indirectly represent.