Clause 5

by deleting the words “at the rate of tax under section 43(1)(a) of the Income Tax Act” in subsection (2)(b) (4th and penultimate lines), (d) and (e) (6th and penultimate lines) and substituting in each case the words “at a different rate of tax under this Act or the Income Tax Act”;

by deleting the word “and” at the end of subsection (2)(d);

by deleting the full-stop at the end of paragraph (e) of subsection (2) and substituting the word “; and”, and by inserting immediately thereafter the following paragraphs:“(f)any unabsorbed donation for that year of assessment shall be deducted in accordance with subsection (3) against the other income of the company subject to tax at a different rate under this Act or the Income Tax Act; and

the balance, if any, of the donations after the deduction in paragraph (f) shall be available for deduction for any subsequent year of assessment in accordance with section 37 of the Income Tax Act firstly against the qualifying income, and any balance of the donations shall be deducted against the other income of the company subject to tax at a different rate under this Act or the Income Tax Act in accordance with subsection (3).”; and

by deleting subsections (3) and (4) and substituting the following subsections:“(3) Section 37B of the Income Tax Act shall apply, with the necessary modifications, in relation to the deduction of the allowances provided for in sections 16, 17, 18, 19, 19A, 20, 21 and 22 of that Act, the losses or donations under section 37 of that Act in respect of qualifying income of the post-pioneer company and such part of its income as is subject to tax at a different rate under this Act or the Income Tax Act.(4) For the purpose of the application under subsection (3), any reference in section 37B of the Income Tax Act to income of a company subject to tax at a higher or lower rate of tax or income of the company subject to tax at a higher or lower rate of tax, as the case may be, shall be read as a reference to its qualifying income.”.