- A FALSE IDEA.
- In connexion with the conversion of the 5 per cent War Loan-there is one point which I think scarcely receives' adequate recognition. Because the interest is not deducted at the source, the matter is often referred to. as though the bulk of the recipients walked off with a- clear 5 per cent. interest. That, of course, is not' true ; the only persons of whom it can' be said are the Very small investors who, by reason of the , meagreness of their incomes, are not liable to taxation at all, and have- to make no subsequent refund to the Government. By far the greater number of holders of 5-per cent. War Loan have to return the dividends in their income tax statement and, of course, pay the- full 5s. in the £ income tax, which means that the net interest is only 3i per cent., while to the heavily penalized surfax• payer the net return is even less.
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