ABSTRACT
Some preliminary explanation of the situation of the gold-mining industry of South Africa in the period after 1932 seems essential to the following discussion. Gold mining occupies a position of cardinal importance in the structure of the national economy of the Union of South Africa. The tax on gold mining down till 1932 had been a proportional income tax; that suggested by the Committee and adopted by the Government in 1936 was an income tax graduated after a special fashion. Moreover, even though the number of companies in the industry was small, no monopolistic restriction would occur in gold mining, for each mine is producing a commodity, the price of which in the short period is fixed irrespective of the output of the mine itself. The supply of capital to gold mining from foreign sources will, therefore, be perfectly elastic.
