Budget 2014: Extra $132m for tax complianceRevenue Budget 2014
Budget 2014 will allocate $132 million to Inland Revenue over the next five years to bolster its tax compliance activities and for chasing up unfiled returns, Revenue Minister Todd McClay says.
Of this, $48.6 million is cash for Inland Revenue to undertake these activities. The remaining $84 million is to cover tax being written off where this is unlikely to be paid, he says.
“It is estimated that the new funding in Budget 2014 will generate a gross increase in Crown revenue of $297.5 million over the next five years.”
This initiative builds on the success of the Budget 2012 unfiled returns initiative, which focused on reducing outstanding tax return volumes and targeting returns with higher revenue values.
“The great majority of New Zealanders meet their tax obligations voluntarily,” Mr McClay says. “However, when people do not meet their obligations, it is not fair on their neighbours who do.
“When that happens everyone suffers because tax avoidance means less money for health, education and other essential government services that benefit our community.”
Government funding for this work in Budget 2012 has been a worthwhile investment, Mr McClay says.
“Since 1 July 2012, Inland Revenue’s focus on unfiled returns has generated an extra $106 million.”
“Turning a blind-eye to tax non-compliance is not an option – we all must pay our fair share,” Mr McClay says.