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A double tax agreement between New Zealand and Hong Kong is now in force, Revenue Minister Peter Dunne announced today.

Mr Dunne has welcomed the new agreement, which was signed in December last year.

“It will further strengthen New Zealand’s significant international cross-border trade and investment partnerships for the benefit of businesses, investors and taxpayers in both countries,” he said.

The Government has recognised the need for ongoing support of earthquake-ravaged Cantabrians and extended two temporary measures introduced after the September 2010 earthquake for a further year, Revenue Minister Peter Dunne announced today.

Interest on late payments
Inland Revenue has the discretion to remit interest on late payments where people were unable to meet their obligations because of the earthquake extended.

In introducing the Child Support Amendment Bill to Parliament today, Revenue Minister Peter Dunne said the changes it would bring would ensure the Child Support scheme was fairer and more efficient.

Mr Dunne said the Bill being taken to Parliament had been strongly shaped by an extensive public consultation process.

“People have very strong views on child support. It deals with the welfare of their children, and it needs to be a scheme that fits with the realities of parenting and raising and supporting children today.

Revenue Minister Peter Dunne today called for public submissions on certain remedial matters focused on simplifying aspects of tax administration and compliance.

Key areas include:

• Whether the determination of the value of a “benefit” in the Income Tax Act 2007 is a gross concept and whether the Act is consistent in its approach to the issue.

The burden of gift duty that cost New Zealanders $70 million a year to comply with for a tax haul of only about a million dollars annually was today lifted off New Zealanders’ shoulders.

‘The law removing it was passed in August and came into effect today, and is something I am delighted to have brought about under my watch,” Revenue Minister Peter Dunne said today.

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.

Revenue Minister Peter Dunne has tabled new student loan legislation in Parliament to make it mandatory to provide a New Zealand-based contact person when applying for repayment holidays, which will also be cut from three years to one year for those travelling overseas.

The Student Loan Scheme Amendment Bill introduced in Parliament today contains reforms announced in Budget 2011 and follows on from the Student Loan Scheme Act passed by Parliament last month which allows for defaulters’ loans to be recalled in full.

The law that will get rid of gift duty got its Royal Assent yesterday in yet another milestone in removing the antiquated tax, Revenue Minister Peter Dunne said today.

Two tax bills guided through Parliament by Revenue Minister Peter Dunne have now been enacted.

The Taxation (Tax Administration and Remedial Matters) Bill and the Student Loan Scheme Bill received Royal Assent yesterday.

Mr Dunne said both pieces of legislation are significant for New Zealand.

“As part of its economic strategy, the Government has a strong focus on reducing tax compliance costs and removing complexity. Both these bills help achieve that.” 

A successful government pilot programme to recover debt from student loan holders living overseas will be expanded to target a further 50,000 debtors in Australia and the United Kingdom, says Tertiary Education Minister Steven Joyce and Revenue Minister Peter Dunne.

The announcement follows an Inland Revenue pilot targeting 1,000 Australian-based loan holders which has, in the past 10 months, led to the recovery of more than $4.7 million.

Revenue Minister Peter Dunne has welcomed the Supreme Court’s decision in the Penny and Hooper case.

Mr Dunne said the decision by the Court to dismiss an appeal by Christchurch Surgeons, Ian Penny and Gary Hooper, and declare that their income arrangement was tax avoidance was the correct decision and a fair one.

“It is important to the integrity of New Zealand’s tax system that everyone pays their fair share of tax,” said Mr Dunne.

A discussion document released today for public consultation seeks feedback on options for addressing issues relating to goods and services tax (GST) as it applies to businesses trading with each other across borders.

Revenue Minister Peter Dunne welcomed the discussion document.

Dunne outlines key child support law changes

The way child support is calculated will be changed to reflect the actual cost of raising children today, the degree of shared care between parents and the income of both parents, Revenue Minister Peter Dunne announced today.

Speaking at the UnitedFuture conference in Wellington, with Prime Minister John Key in attendance, Mr Dunne said these and other changes would be in legislation introduced to Parliament in the next few months.

The changes included:

Two issues papers released today for public consultation continue the Government’s focus on ensuring fairness in the tax system, Finance Minister Bill English and Revenue Minister Peter Dunne say.

The issues papers, which were announced in Budget 2011, provide options for making the tax system fairer in two areas:

Livestock valuation - this paper presents options for fairer rules covering livestock valuation elections. Mr Dunne says the current rules appear to be too loose, allowing farmers to switch between valuation methods providing an unfair tax advantage.

Revenue Minister Peter Dunne has welcomed the passage this evening of legislation that will make the tax system more efficient, reduce compliance costs and finally abolish gift duty.

Revenue Minister Peter Dunne today welcomed new legislation allowing the student loans of serious defaulters to be recalled in full.

Speaking as the Student Loan Scheme Bill was passed in Parliament this evening, Mr Dunne said the vast majority of domestic based student loan borrowers met their loan requirements and had no reason to be concerned.

Revenue Minister Peter Dunne today announced new, lower non-resident withholding tax rates on dividends and royalty payments under New Zealand’s double tax agreements with Chile and Mexico.

The new reciprocal withholding tax rate on royalties arising in New Zealand and Chile is 5%, down from 10%.

For dividend payments arising in New Zealand and Mexico, the new withholding tax rate has been reduced from 15% to either 5% or zero, depending on the size of the investor’s shareholding in the company paying the dividend and certain other criteria.

Revenue Minister Peter Dunne has welcomed the coming into force of the new double tax agreement between New Zealand and Turkey, saying the agreement “is good news for businesses and investors in both countries”.

“Double tax agreements provide trade and investment advantages for businesses and investors by regulating how transactions should be taxed between the two countries,” Mr Dunne said.

Revenue Minister Peter Dunne has applauded the release of Inland Revenue’s compliance focus report, released today.

The report, Helping you get it right: Inland Revenue’s compliance focus 2011-12,  is aimed at helping New Zealanders meet their tax obligations and highlights areas of non-compliance such as aggressive tax planning, under-reporting of income and operating outside the tax system and fraud and identity theft.

Payroll Giving donations have hit $3 million since the scheme’s inception 18 months ago, Revenue Minister Peter Dunne said today as he applauded Telecom for being the first major corporate to join the scheme.

“It is completely fitting that such a large and cornerstone New Zealand corporate as Telecom has decided to give its employees the chance to donate to charities directly from their pay packets,” Mr Dunne, the architect of the scheme, said.

He said more than 1000 employers had now signed up for Payroll Giving.

Replacing assets lost in the earthquake will become more feasible for Canterbury businesses, Revenue Minister Peter Dunne said today.

A Supplementary Order Paper to the Taxation (Tax Administration and Remedial Matters) Bill released today by Mr Dunne provides roll-over relief for depreciation recovery.

Mr Dunne said that the release of the Supplementary Order Paper was another step towards providing taxpayers with relief from taxation on windfall gains on depreciation recovered resulting from the earthquakes. 

Seven in ten people responding to the Government’s consultation on the child support scheme want comprehensive changes to the system, Revenue Minister Peter Dunne said today in releasing a summary of more than 2000 public submissions.

“The submissions generally reflect the strongly held views in the community that the scheme can be fairer to all parties and of more direct benefit to the children it is set up to support,” Mr Dunne said.

“I intend to deliver on that,” he said.

Foreign scammers might have over-stepped the mark with the latest target of their tax refund email scams, says Revenue Minister Peter Dunne.

Mr Dunne and members of his staff received emails today telling them they had tax refunds waiting for them and only had to click on the given link and fill out a claim form to get them.

“Needless to say, I am not clicking on the link or filling in any form and I can only repeat Inland Revenue’s regular warnings on such email requests.

Education Minister Anne Tolley and Revenue Minister Peter Dunne have today launched a new tax education online curriculum tool for school students.

The Citizenship and Tax Education tool is designed for Year 7-10 social studies classes.

“This will be a welcome addition to the resources currently available to schools,” says Mrs Tolley.

“It’s a useful and practical programme and it’s aligned to the new curriculum, so students and teachers will benefit.”