Clause 7

by deleting subsections (1) and (2) and substituting the following subsections:“(1) The Minister may by regulations prescribe that any income of an approved venture company derived by it from making approved investments —

shall be exempt from tax; or

notwithstanding section 43, shall be taxed at such concessionary rate, not being more than 10%, as the Minister, or such person as the Minister may appoint, may specify for each year of assessment.(2) Regulations made under subsection (1) may provide for the determination of the amount of the income of an approved venture company to be exempted or taxed at a concessionary rate and for the deduction of losses otherwise than in accordance with section 37. (2A) The exemption from tax or tax at a concessionary rate of the income of an approved venture company under regulations made under subsection (1) —

shall be for such period, not exceeding 10 years, as the Minister, or such person as the Minister may appoint, may specify; and (b)in any particular case after the period referred to in paragraph (a), shall be for such further period or periods, not exceeding 5 years at any one time for each period, as the Minister, or such person as the Minister may appoint, may specify.(2B) The total period under subsection (2A)(a) and the further period or periods under subsection (2A)(b) shall not in the aggregate exceed 15 years.”;

by inserting, immediately after the word “tax” in the second line of subsection (4), the words “or taxed at a concessionary rate”;

by inserting, immediately after subsection (5), the following subsection:“(5A) Where the income of an approved venture company is taxed at a concessionary rate under regulations made under subsection (1) —

any expenses, donations, allowances or losses referred to in subsection (4) shall only be deducted against such income, and any balance of the expenses, donations, allowances or losses for any year of assessment shall, subject to sections 23, 37 and 37B, be available as a deduction against any other income of the company for that year of assessment and for any subsequent year of assessment; and (b)notwithstanding subsection (5), where the income of the company was exempted from tax immediately before being taxed at a concessionary rate, the balance referred to in subsection (5) shall firstly be deducted against the income taxed at a concessionary rate and thereafter shall be available for deduction against any other income of the company for the year of assessment which relates to the basis period in which the tax exemption ceases, and subsequent years of assessment, in accordance with section 23 or 37, as the case may be.”;

by deleting the words “issue to an” in the second line of subsection (6) and substituting the words “for which the income of an approved venture company is exempt from tax under regulations made under subsection (1) issue to the”;

by deleting subsection (9) and substituting the following subsection:“(9) As soon as any amount of the income of an approved venture company has been exempt from tax or subject to tax at a concessionary rate under regulations made under subsection (1), the amount of the income exempted or the net amount of the income after deduction of the tax shall be credited to a special account (referred to in this section as the account) to be kept by the company for the purpose of this section.”;

by inserting, immediately after the word “tax” in subsection (16)(a), the words “or subject to tax at a concessionary rate under regulations made under subsection (1)”;

by deleting the words “, the Comptroller may, at any time within 6 years from the date of the statement referred to in subsection (6)” in the ninth, tenth and eleventh lines of subsection (16) and substituting the words “or taxed at a concessionary rate for any year of assessment, the Comptroller may, at any time within 6 years after the expiration of that year of assessment”; and

by inserting, immediately after the definition of “investments” in subsection (18), the following definition: “ “tax exempt period” means the period during which any income of an approved venture company is exempt from tax under regulations made under subsection (1);”.