BHP Inc. is an Australian listed firm that pays corporate tax rate of 30%. BHP is conducting an off-market share buyback under tax determination TD2004/22. On 10^th March 2023, BHP announces the buyback price to be $8.60 per share with capital component of $2.55 and the remainder treated as a fully franked dividend. The tender period opens on 1^st April 2023 and closes on 5^th May 2023, that is, all tenders must be received by 5^th May 2023.

Cindy Lee is an Australian resident for tax purpose. She purchased 1000 shares of BHP Inc. at $6.40 per share on 10^th January 2020. Cindy has sold 60% of her shares over the exchange on the announcement date at $8.75 and argues that she would get the same after-tax proceeds even if she sold the shares into the buyback, based on the information below.

	10th March 2023	1st April 2023	5th May 2023
5-day VWAP of BHP prior to the date	$8.62	$8.85	$8.92
Market share price of BHP	$8.75	$8.90	$9.10
Market Index	7446.5	7455.9	7893.29

Using the approach discussed in the lecture, what is Cindys marginal tax rate if her argument above is correct? (Round to the nearest 2 digits)

A) 44.55%

B) None of the other answers is correct.

C) 26.15%

D) 38.48%

E) 42.04%