COMPANY NEWS DEPRECIATION ALLOWANCES
“Revision Of Rate Necessary”
(New Zealand Press Association) AUCKLAND, April 29. Now that speciaF depreciation is no longer available, some revision of ordinary depreciation must take place if industry is to operate on, a sound basis, said Mr 11. M. Rogerson, chairman of Auckland Laundry and Dry Cleaners, Ltd., at the annual meeting of shareholders today. Some announcement from the Government on the introduction of a revised rate was still being awaited by the company, he said. The laundry industry was one of the many industries in New Zealand which had a large proportion of their shareholders’ funds invested in fixed assets. The cost of replacement of these assets on a continually rising market substantially exceeded the depreciation which could be deducted under the present schedule rates.
For s some years past, assistance had been available under the procedure which permitted the deduction of special depreciation.
This had now ceased, and companies must either set aside the necessary funds for assets replacement out of tax paid profits, or limit the provision to present authorised rates and meet the shortage by the provision of additional capital when replacement became necessary. “Unfair, Unsound” “To meet the shortage out of tax-paid profits is unfair to the shareholders, and places this type of industry at a disadvantage, while to provide the replacement out of additional capital is unsound, since'the industry has increased capital without a' corresponding increase in productive capacity. “The attention of the Govern- t ment has been drawn to this prob- ! lem many times over the last few ! years—by the Taxation Commit- j tee in 1951, by the Monetary Com- I mission in 1956, and from time 1 to time by financial writers and 1 in annual reports,’’ said Mr Rogerson. ‘‘A continuation of the present schedule rate can gradually undermine industrial stability, and may ( well become a matter for national 1 concern. Amendment to the rates now now becomes urgent, and it 1 is to be hoped that the Government will act promptly.” U.K. TAXES ON SHIPPING Cunard Chairman Welcomes Relief (N.Z. Press Association—. Copyright) LONDON, April 29. The chairman of the Cunard Steamship Company, Mr Denis 11. Bates, today welcomed the doubling of the investment allowance for shipping announced in the British Budget earlier this month. In his annual statement for 1956 Mr Bates said: “This reinforcement will prove most helpful, as it will postpone the effective date of the advantages under a tax-free Bermudian company, and will ?ncourage British shipping to fight on in Britain.” Mr Bates was referring to what has been called the "drift to Bermuda,” a recent move by about a dozen companies to set up subsidiary companies in Bermuda, so as to overcome the effects of taxation. He said that taxation had forced the Cunard Company to delay unduly the provision of new tonnage arid to try to maintain some services with passenger vessels built in the 1920’5. “This replacement problem has caused Cunard to examine relief obtainable through a flag of convenience based on ownership abroad in, say, Bermuda.” Effect of Suez Crisis Mr Bates referred to the effect of the Suez crisis on Eastern trade routes. “The current year of 1957 will have to bear the full impact of the longer voyage in our Eastern
services via the Cape, instead of through the Suez Canal. “While the deviation has been ,met by a freight surcharge, the number of voyages per annum per ship will be reduced accordingly.” N.Z. Guarantee Corporation Directors of the New Zealand Guarantee Corporation have advised shareholders to withhold their shares from sale in the meantime. United Building (Auckland). —Interim dividend is 3 per cent., ex April 18.— (P.A.) Dalgety.—An interim dividend of 3J per cent, (less tax) is payable on May 20—ex April 29. Last year’s interim of 3J p/?r cent, was followed bv a final payment of 8J per cent.— (PA.)
Lane, Walker. Rudkin.—The 2J per cent, interim preference dividend is payable on May 31. <’X Mav 2. (P.A J . McLeod Bros.—An unchanged interim dividend of 8d a share is navable on May 10, ex May 3. Total navment last year was Is lOd, or 9 1-6 per cent.—(P.A.) Alloy Steel (N.Z.). Ltd.—Recommended final dividend is 4 per cent., making 71 per cent, for the year. A bonus of Is Gd a share is added, making the total payment 15 per cent, for the year, compared with 12 per cent, last year. Dividend is payable on day 29, ex May 23.
Drugs And Pilots. — The United States Army has grounded pilots who use the new “tranquil Using drugs. Lieutenant-Colonel Spurgeon Neel, an Army Aviation medical officer has said that the order was issued after it had been learned that some pilots treated wjtU the drugs for high blond pressure, were renorting for duty “just because their pressure was down,”—Washington, April 28. ‘
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Press, Volume XCV, Issue 28264, 30 April 1957, Page 20
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807COMPANY NEWS DEPRECIATION ALLOWANCES Press, Volume XCV, Issue 28264, 30 April 1957, Page 20
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