§ Mr. Clemitsonasked the Chancellor of the Exchequer whether the effect of the convention between Her Majesty's Government and the Government of the United States of America on double taxation will be, that in the event of a maximum distribution of dividends, the effective corporation tax payable by a United Kingdom subsidiary of an American company will be 42 per cent. as compared with 52 per cent. if the parent company were British.
§ Mr. Robert SheldonMy hon. Friend has correctly stated the position, but I would remind him that under the proposed new convention the rate of withholding tax on dividends paid by American310W companies to United Kingdom parent companies is reduced to 5 per cent. from 30 per cent.—in the absence of a convention—or 15 per cent. under the existing convention.