Forum Archive Index - February 2003

["tennyson@caverock.net.nz" <tennyson@caverock.net.nz>]

Or maybe even the decade!

I'm amazed at how little press coverage this has got, considering the 
huge implications for all investors.  At last progress on the double 
taxing of dividends for companies operating trans-Tasman.

Perhaps the reason it has made so little impact is that the whole 
issue has been dragging on for so long.  We aren't quite at the stage 
where the New Zealand government recognizes Australian franking 
credits yet, but this development is most welcome.  I quote from 
yesterday's 'Herald'' article

"Under the planned solution, New Zealand shareholders
would be able to claim their share of the imputation 
credits generated by the tax the company paid here, 
eliminating the double taxation."

"Australian taxpayers in a New Zealand firm paying tax
across the Tasman would be able to make use of their
share of the associated imputation (Australians call 
them"franking") credits."

For NZ investors this means imputation credits will be availabler on 
such companies as ANZ bank, Onesteel, Harvey Norman, Goodman Fielder, 
Lion Nathan and just maybe even dear old Telstra, if that 
'TelstraClear' vehicle ever makes a profit ;-)

For Australians it means franking credits on 'The Warehouse', 'Sky 
City Casino' (provided that Adelaide Casino moves into the black this 
year), 'Contact Energy', 'Nuplex'  and maybe even dear old Telecom NZ 
if that AAPT oufit in Australia ever makes a profit ;-) 

Because the NZ market is trading at much greater earnings yields 
there will be a big incentive for Australian investors to come in and 
snap up our high yielding shares.  This should prove a huge boost 
for our market, much more so than the other way around.   So don't 
day ol' Snoopy didn't warn you.

SNOOPY



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