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The Government has allocated funding in Budget 2014 to increase the collection of Child Support from liable parents and improve the promptness of payments, says Revenue Minister Todd McClay.

“Around 73 per cent of liable parents currently do not make their first child support payment on time and 44 per cent of Child Support debt is not under any payment arrangement at all,” Mr McClay says.

“That is not fair to children relying on Child Support.”

Cheque duty will be abolished from 1 July 2014, Revenue Minister Todd McClay says.

“The Government’s focus is to ensure the fair treatment of taxpayers and to reduce customers’ compliance costs wherever possible,” he says.

“Cheque duty is a relic from a previous age and no longer serves the function it was intended for. It is also distortionary in that other methods of payment do not have an equivalent tax.”

The Government is extending the parental tax credit to help many lower- and middle-income families at a time when they most need it - the birth of a new baby, Social Development Minister Paula Bennett and Revenue Minister Todd McClay say.

Budget 2014 includes the following changes:

Innovative Kiwi businesses investing in research and development (R&D) will benefit from two new tax measures as part of Budget 2014, Science and Innovation Minister Steven Joyce and Revenue Minister Todd McClay say.

As a result of Budget changes, loss-making start-up companies will be able to cash out all or part of their tax losses from R&D expenditure, while all businesses will be allowed tax deductibility for R&D “black hole” expenditure that is currently neither deductible nor able to be depreciated.

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.”