Mr. LAWSON:

The income of a nonresident-owned investment corporation is determined not by what it pays out but by what it takes in. The rates for a non-resident-owned investment corporation are half the corporate rates for a domestic corporation.

Mr. LAWSON:

I quite agree that under our present act that $100,000 could be paid out to a non-resident in salary and deducted as an expense of operation before the tax was received by the government, but I do not think that that is what happens in practice. In fact the non-resident-owned investment corporation pays the tax before paying out any money in the form of salaries.

Mr. LAWSON:

Except what is paid to a book-keeper or someone of that kind.

Mr. LAWSON:

Would the minister give a specific instance or an illustration as to just what this amendment will apply? It strikes me that this is another amendment like 32b which we had last year. We were told in the House of Commons that that meant one thing; then the minister stated in the newspapers that it meant another thing, and later the commissioner came out with a statement that it meant something else. I do not think many of us are certain yet as to what 32b does mean.

Mr. LAWSON:

That may be as a matter of administration.