CIS raises valid issues say Chartered Accountants

14 September 2006

Centre for Independent Studies raises valid issues say Chartered Accountants

The Institute of Chartered Accountants says that it supports the broad-based low rate approach for the tax system advocated in the "How to fix a leaky tax system" document released by the Centre for Independent Studies today.

"While we may not agree on all points of the report, the Institute agrees that the interests of all New Zealanders are best served by a tax system with a structure that is as low and flat as possible."

"New Zealand's tax system has moved away from this in recent years and the future is not looking too promising either," tax director Craig Macalister said.

"A tax system should be simple in its application, certain in outcomes and perceived as broadly fair. It should also be designed to minimise distortions to the economic behaviour of taxpayers. This means a tax system that taxes business as it finds it - rather than creating incentives for business to change itself to adapt to the tax system."

"While there will always be ideological debates about the level of taxes people pay, a complex system ultimately benefits few at the expense of all."

"Even those responsible for administering the tax system are warning about its fragility."

ENDS