§ On the matter of avoidance, we took a long step forward last year when the introduction of the Corporation Tax automatically put an end to some forms of avoidance by companies. But others remain, and I am proposing certain amendments to the Corporation Tax this year that fall within the category of anti-avoidance legislation. For example, there is the so-called "Siamese Twins" device. This is a two-fold security made up of an ordinary share plus something which purports to be a debenture. The object of the manoeuvre is to enable the company to get a deduction, in computing its profits for Corporation Tax purposes, for that part of the distribution to the shareholders which has been dressed up as debenture interest. But the whole of the distribution is really a dividend, and I shall propose legislation to treat it as such and so defeat this transparent tax-avoidance device.
§ I also have two proposals to combat avoidance of Estate Duty. The Ralli case recently established a new means of avoiding Estate Duty on the death of a life tenant of settled property. I propose to close this gap. Secondly, I 1435 propose to stop the exploitation by persons domiciled in this country of the exemption from Estate Duty which is given to certain Government securities when they are beneficially owned by persons not domiciled or ordinarily resident in this country.