Forum Archive Index - August 2002

["allan potts" <pottsallan@hotmail.com>]

Dear Snoopy,

We have a system of double taxation over here that drives everone mad.  A 
Corp. first pays taxes on it's earnings (from which dividends come) and then 
we as investors pay full income taxes on the dividends  paid out.  Your gov. 
allows the corp. some type of credit to be  passed along to the investor 
(imputation credit) when they pay taxes on their earnings.  From our point 
of view this is a more just way to do things.  The supplemental dividend  
paid to overseas investors is to offset at least a portion of the 15% 
withholding tax that overseas investors are subject to.  Again, better than 
our confiscatory method.

I also especially like your system of allowing an overseas investor to op 
for a 2% Levy rate rather than a full 15% withholding rate for interest paid 
on money held in a bank for investment.  While the 2% is not recoverable, 
dealing with the smaller sums that I'm dealing with, it is much more 
convient than the 15%.   We in theory can get somewhat of a credit for the 
15% taxes NZ withholds, but I find in practice, there are so many 
restrictions and it is so immensely complex that in my income range it is 
best to ignore it and just pay the extra tax.
In other words I don't mind giving away 2% as opposed to giving away 15%

As to what your gov. could do to get more overseas investors trading there 
-- well that's a  puzzle, without interfering with your recent elections, 
and I will not go there.  I vote here, not in NZ.  I also think some changes 
to the stock exchange are in the making with your new chairman.  From what I 
read, he is talented, capable and knowledgeable in making changes that will 
cause more in the world to take notice.  At least that is my hope and 
expectation. And of course it never hurts to have a strong currency, both 
for overseas investors and your own citizens.  I realize that some do not 
subscribe to this notion, but history says a strong currency is best.

Didn't mean to be so long winded, but, I hope this answered you questions.  
I've been suffering with the flu since early this morning so I'll sign off 
no and go back to bed.

Allan




>From: "tennyson@caverock.net.nz" <tennyson@caverock.net.nz>
>Reply-To: sharechat@sharechat.co.nz
>To: sharechat@sharechat.co.nz
>Subject: Re: [sharechat] I am Looking for Cheap US$
>Date: Fri, 2 Aug 2002 12:09:45 +0000
>
>Hi Allan,
>
>
> >>
> >>If it isn't a rude question Allan, what attracted you to New
> >>Zealand as a place to invest?  Just curious!
> >>
> >
> >Way back in 1992, I had read several articles that NZ had changed
> >its system, discarding a good deal of what I'll call socialism or
> >the like and was coming up in the world standard of living wise and
> >of course economically.
> >
> >In Sept. of 92 my wife said she would like to go see NZ.  Since the
> >aformentioned was on my mind I said let's go.  We spent a month
> >driving the country, both south and north, met lots and lots of very
> >nice people and fell in love with it.
> >
> >
>
>
>
>Nice story Allan, and if it is still appropriate for someone who has
>been 'on ship' (so to speak) for 10 years or so already, welcome
>aboard!
>
>We keep hearing from our government about how they are trying to be
>friendly to overseas investors and I guess in your case it is
>working.  However, being somewhat wary of government spin myself, I
>hope you don't mind me asking....
>
>What is your view on how the NZ government treats overseas investors
>such as yourself?  I know, for instance, supplementary payments
>are made on dividends to overseas investors.   I think it is
>something to do with neutralizing the withholding tax regime.  Does
>this sort of thing come into consideration when looking at NZ as a
>place to invest?   Do you think the NZ government would be wise to
>be doing more than this for overseas investors, and if so what?
>
>
>
> >
> >
> >We had hoped to get a visit from some of these  people, but when the
> >Kiwi dollar tanked about 3 years ago, it really made it a very
> >expensive trip for them.  Perhaps now that things are getting a
> >little better that will come to fruition.
> >
> >
>
>
>
>Looked at another way the currency risk must also be something that
>weighs on your mind as an investor in New Zealand shares.   How do
>deal with  the currency risk on NZ investment yourself?
>
>SNOOPY
>
>
>
>
>
>
>---------------------------------
>Message sent by Snoopy
>e-mail  tennyson@caverock.net.nz
>on Pegasus Mail version 2.55
>----------------------------------
>"Stay on the upside of the downside,
>Anticipate the anticipation!"
>
>
>
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