The value of dividend imputation tax credits in Australia

A dividend imputation tax system provides shareholders with a credit (for corporate tax paid) that can be used to offset personal tax on dividend income. This paper shows how to infer the value of imputation tax credits from the prices of derivative securities that are unique to Australian retail markets. We also test whether a tax law amendment that was designed to prevent the trading of imputation credits affected their economic value. Before the amendment, tax credits were worth up to 50% of face value in large, high-yielding companies, but Subsequently it is difficult to detect any value at all. (C) 2003 Elsevier B.V. All rights reserved.

The Evolving Nature of Small-Scale Forestry in Australia

Two forms of small-scale forestry are developing in Australia, each with different impacts on rural communities. One is based on growing short-rotation Eucalyptus globulus (blue gum) for pulp and the other on production of higher-value products from longer-rotation native hard-woods. Several impediments exist to further development of small-scale forestry, including the lack of a small-scale forestry culture, concerns over harvest rights, lack of market development, the long wait for returns, and satisfaction with current land uses. Nevertheless, the rapid increase in farm woodlot establishment in the past five years has paralleled the strong increase in the private industrial plantation estate. As markets develop and hindrances are overcome, landholders not previously interested in small-scale forestry may consider ita worthwhile land use.