17. Insertion of new sections 123A and 123B of the principal enactment

The following new sections are hereby inserted immediately after section 123 of the principal enactment and shall have effect as sections 123A and 123B of that enactment :—

123A. Where any person is engaged in any secondary market transaction, involving any security or treasury bond issued under the

Registered stock and Securities Ordinance

(Chapter 420), or Treasury Bill issued under the

Local Treasury Bills Ordinance (Chapter 417), or Central Bank Security issued under the

Monetary Law Act (Chapter 422) ,referred to in section 122A on which the income tax has been deducted during any year of assessment at the rate of ten percentum at the time of issue of such Security, Bond or Bill or where such

Security, Bond or Bill has been issued prior to

April 1, 2002 such person is entitled to a notional tax credit at ten percentum of the grossed up amount of interest income from such secondary market transaction to an amount of one ninth of the same, if such interest income forms part of the assessable income of such person for that year of assessment.

For the purposes of this section “interest income from secondary market transaction”

means interest income accrued or received on a outright or reverse purchase transaction on such

Security, Bond or Bill from a date on or after the date of primary issue of such Security, Bond or Bill, less interest expenses on repurchase transaction with Securities, Treasury Bonds or

Treasury Bills from which such interest income was earned which has been certified by an approved accountant referred to in section 99

of this Act.

“A notional tax credit on secondary market transactions.

123B. Where any person has proved to the satisfaction of the Commissioner-General that such person has already paid income tax on any interest liable to income tax at ten percentum under section 122A or 122B within twelve months from the date of commencement of this Act, such person shall be entitled to a refund of such income tax paid by him on such interest income other than income tax deducted under section 122A or 122B.”.