Tax benefits outweighed

Cavalier Corp said the benefit from the reduction in the corporate tax rate in the Government's Budget would be more than offset by the removal of the ability to depreciate buildings and the removal of a depreciation loading for certain assets.

Both measures take effect from July 1 next year.

Cavalier said the group's deferred tax asset would decrease by an estimated $4 million, while deferred tax liabilities at 50 per cent-owned Cavalier Wool Holdings would rise by $2.6 million.

Together they would decrease the current year's tax-paid result for the group by $5.3 million.

- NZPA