Taxation (Annual Rates for 2017–18, Employment and Investment Income, and Remedial Matters) Bill..

Taxation (Annual Rates for 2017–18, Employment and Investment Income, and Remedial Matters) Bill..


by their party I call the dr. Duncan Webb thank you madam Speaker what a pleasure it is to rise to speak to this excellent piece of legislation and what is a socialist piece of legislation just Texas fundamentally socialist it is about a fear system can I also say what a pleasure it was to work on the Select Committee on this piece of legislation particularly with dr. Taub Deborah Russell who is an expert in text much unlike the former speaker who of course had to try and clean up member Collins’s mess when she suggested that there was a relationship property issue here and what’s worse that Sweeney tried to clean up that mess by referring to the investment property in the beach house he just made a dog’s breakfast of it if people are going to have investment properties and of course they should be caught by the bright-line rule in what’s more is the very rule he’s complaining about there’s a rule put in place by the National Party to address this so it’s a zone caveat we’re ridiculous look it’s astounding as it may seem it’s no surprise there on that side of the house look but tax law is difficult it’s onus and we do need to strike a balance and as we all know tax law is complicated and the balance between fairness clarity simplicity in brevity is hard to strike but I think we’re working hard on it here because good tax includes not just madam speaker good tax policy and good text settings but good tax administration and while we’ve been talking about the bright line wall I actually want to talk about some of the other things that are going on here because the Inland Revenue is working on its transformation its business transformation and this is part of that transformation this legislation largely instituted by the former government is about progressing that business transformation I do want to say however that there will be some pain in that transformation some of the amendments made in select committee are about evening that paint out I also want to identify that the change within IRD will be hard on its people and indeed in its annual review this was made clear and I would implore the revenue to be very careful as it transforms its business to look after those hard workers within IRD who do such valuable work but really what this is about is about reforming the administration of the tech system to make it much much more workable so if we look for example even at some things which might appear technical like the payroll subsidy a subsidy which has paid to txt intermediaries to assist smaller businesses now the original bill had this being abolished at the in one fell swoop but after listening to advice and I must say the advice given at the independent advice giving to the committee was extremely useful it was became readily apparent that a rapid cutting off of this would cause considerable chaos particularly amongst smaller businesses so whilst the subsidy ought properly go it’s going to be phased out over time so that there can be that additional period of time for businesses to get used to it to let those wider changes be done and it really is those smaller employers in particular that we need to look out for payday reporting was the other thing that really cropped up this is the idea that employers need to report as to in as timely manner as possible dear PA why obligations and of course the better reporting occurs the more efficient tax collection is so what we’re really aiming towards is getting the most timely and accurate reporting we can so that the tax paid most accurately reflects the employees actual obligations and that’s got to be a good thing as we move hopefully towards a system where there is a weir a little adjustment as possible in those end-of-year Tex returns however we again have to remember that there are businesses very small businesses and in fact on the other side of the house they did a good job in pointing out that many rural businesses actually have considerable difficulty in using for example online returns simply because of the lack of internet access and the committee listen carefully to submitters and and took that on board so when we come to payday reporting there were some substantial changes made that will affect small businesses so that they don’t have to report quite as frequently and in fact twice a month as satisfactory on a routine payment not when not necessarily in perfect sync with payroll but at the 15th of the month and at the end of the month particularly when they’re still using paper we’ve got to recognize that indeed some people still we will use paper whether that be because they’re really believe it or not quite up to using web-based applications but also dead internet access in very remote remote areas so you know there is a really useful a useful amendment made by the committee and I commend the committee for the hard work it did and also for the submitters and the advice given the other important aspect technical but important was resident withholding tax and there was useful discussions around the fact that interest payments are frequently made sometimes substantially even between family members now when there’s a for example a family loan what a lot of people perhaps wouldn’t realize is that the person who is being paid that interest needs to report that as well as the payer of their interest so this is the reason withholding tax framework and of course we know that we have to give our IIP numbers to the bank so that they can report the interest they’re paying us but we don’t realize that in many transactions even amongst family members small businesses friends and colleagues those transactions also ought to be reported in their interest actually sits in there as income obviously in some of those situations the the compliance of that reporting would be unduly onerous and so the Select Committee imposed a $5,000 threshold on the on the increased payments there so a lot of those smaller family loans and the like now won’t be captured so look what this really is about is about getting our tax settings right getting a system which doesn’t catch people by surprise a system where people’s tax obligations are as easy as possible to comply with but also modernizing our tax system so that the tech system can be administered in as real time as possible using the best technology available we’ve got to bring a whole lot of people along with us to do that and I know the IRD itself and the Commissioner is working hard on that the employees of the IRD are working hard on that and it is the place for us in this house to really support that through getting these settings as right as we can to make the transition as easy as possible so that we don’t unduly burden small businesses in particular rural businesses in particular in those hard-working New Zealanders who really are trying their very hardest to earn a living so that they administration costs there are reasonable they’re not flying through the paperwork and not doing the jobs that they’re actually being paid for and that’s what this bill does mr. speaker so what we have here is a very thoughtful tweaking and admitted it admittedly an administration act but it is good that we come back to this house regularly to readjust these settings and to think carefully every time about our tax policy and our text settings and the administration of our tax act to say let’s make it as workable as we possibly can because when we do that what we will get is greater compliance more timely payment of tax and what we will get indeed is that as a responsive revenue so look what we have here as a vast liam and I can’t I can’t conclude without saying that the that the bright line five-year test is also a significant improvement because the National Party recognized that steps were needed here the step they took was not enough the property market remained rampant and so we as we should end must as a regard good socialists would was we changed it so that it worked properly we extended that period to five years because that will make a significant difference because this government has said time and again and I’ll say it again is committed to bringing the housing market under control so that ordinary New Zealanders can afford their own home they can buy their own home and this is just yet another plank of this government’s aim to do exactly that so not only there’s a great improvement to the system of tax administration it’s another step forward of this government to making housing affordable in New Zealand Thank You mr. speaker the question is that the motion be agreed to those of that opinion will say aye to the contrary no the eyes heaven Taxation annual rates for 2017-18 employment and investment income and remedial matters bill second reading this bill a sit down full committee stage next sitting day call on government or dureth of the day number four and five education tertiary education and other matters amendment

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