Dunne: New tax bill to give more flexibilityRevenue
Revenue Minister Peter Dunne says a tax bill tabled today will simplify tax filing requirements for individuals and support businesses in handling their tax obligations electronically – all in line with feedback from an extensive online public consultation last year.
He said the Taxation (Annual Rates, Returns Filing, and Remedial Matters) Bill was the latest piece of tax legislation aimed at making the tax system simpler for people and businesses.
“Last year’s public consultation showed strong support for giving people and the business sector more flexibility around using online and electronic media for managing their tax affairs.
The bill also contains a measure to ensure that expenditure on software development is deductible if the software cannot be used and the project is abandoned.
”This is an important element in ensuring that tax law does not discourage or become an obstacle to investment and innovation," Mr Dunne said.
Two measures announced in Budget 2011 – increasing the KiwiSaver minimum contribution rates for employees and employers and increasing the minimum equity holding for foreign-owned banks – are also contained in this bill. From 1 April 2013: the minimum employee contribution rate will rise from 2 per cent to 3 per cent, and compulsory employer contributions will also rise from 2 per cent to 3 per cent.
In addition, the bill makes changes in a range of areas with the general intention of improving fairness and integrity in the tax system such as:
- taxing bonus shares issued by companies under profit distribution plans
- ensuring recent GST changes on “phoenix” fraud schemes and apportionment of input tax deductions operate as intended,
- clarifying the GST treatment of late payment fees
- introducing changes in relation to fees charged for binding rulings and depreciation determinations and
- clarifying entitlements to Working for Families tax credits.
Full details of the bill are available on Inland Revenue’s tax policy website www.taxpolicy.ird.govt.nz