HOWLS OF ANGUISH GREET TAX CHANGE
The immediate direction of Australian participation in
international capital markets has been clouded by the federal
government's decision on July 1 to scrap withholding tax exemptions
for most offshore raisings. Confusion, despair and considerable anger
greeted the move, leading to a sharp marking down of both Australian
dollar issues and the already frail dollar.
The confusion stemmed from the lack of detail which accompanied
what has been the greatest blow for Australian borrowers overseas in
years. Despair came from the blow Australia's standing might take
among international investors after the dust from the decision has
settled. The anger flowed from the fact that there appeared to be
little consultation by the authorities about the impact of the decision
on the market at home or abroad.
"This was a political decision that had just not been thought
through," said one banker. Ian Martin,...
