Buyback ruling could hit 80,000 bank shareholders.

Australasian Business Intelligence, February, 2007

Byline: Stuart Washington

Feb 22, 2007 (The Age - ABIX via COMTEX) -- The High Court of Australia has found in favour of the Australian Taxation Office (ATO) on the taxation of a share buyback scheme. St George Bank, which had carried out the sell-back rights issue in 2001, funded the legal costs of a 92-year-old woman who had received $A514 worth of such entitlements. Her challenge against the tax being levied was initially successful in the Federal Court of Australia, but appealed by the ATO to the Full Bench, which overturned the judgment. The ATO's lawyers maintained the initial $A514 represented a capital gain or taxable income. The rights were later sold for $A576.64 on the stock market after the claimant decided no to take them up. As the case is quite...

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