§ Mr. Cope
asked the Chancellor of the Exchequer if he intends to amend the law relating to the taxation of dividends on fixed rate preference shares issued before 6th April 1973, in view of the situation created by the judgment in Sime Darby London Ltd, v. Sime Darby Holdings Ltd. and Others; and if he will clarify the 221W Inland Revenue's statement of 18th July 1975.
§ Mr. Denzil Davies
I confirm that it is the Government's intention to include legislation in the next Finance Bill which will amend paragraph 18 of Schedule 23 to the Finance Act 1972 and give to it the meaning which was generally accepted before the recent High Court judgment in the case of Sime Darby London Ltd.v. Sime Darby Holdings Ltd. and Others. The legislation will be expressed to have effect from 5th April 1973. Until the legislation is enacted, each company and its directors will have to decide in the light of its own legal advice on what basis to pay any relevant dividends following the judgment.