Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


IRD gets to keep $127.5M GST payment from forest sale

IRD gets to keep $127.5M GST payment in central North Island forestry sale

Nov. 28 (BusinessDesk) - The Supreme Court has upheld the Inland Revenue Department's bid to keep $127.5 million goods and services tax on the 2003 sale of 170,000 hectares of central North Island forestry.

The long-running tax dispute stemmed from KordaMentha's Michael Stiassny and Grant Graham, as receivers for Forestry Corp and Citic New Zealand, paying the tax bill in 2003 when selling the forestry assets of Central North Island Forest Partnership for US$621 million. Stiassny and Graham paid the bill amid concerns they may be held personally liable as CNIFP wasn't in receivership.

Bank of New Zealand and CNI Forest Nominees, as additional appellants, believed their charges over the sale gave them priority over the tax department.

Justices John McGrath, William Young, Robert Chambers, Thomas Gault and Peter Blanchard unanimously dismissed the appeal, saying while the receivers weren't personally liable for the charge, it wasn't recoverable because the tax department gave "good consideration" to the payment of GST, which was due and payable.

"More importantly, the claim fails because the Crown gave good consideration by accepting the payment in discharge of a debt which the partnership did owe," the judgment, delivered by Justice Blanchard, said. "There was no unjust enrichment of the Crown at the expense of the partnership."

BNZ and CNI's claim was overridden because the partnership owed the GST, trumping their priority as secured creditors.

The court awarded costs of $40,000 payable to the tax department.

CNI Forest Nominees parent Tenon said it was disappointed with the outcome, but the decision wouldn't have an impact on its existing tax position.

"There was only potential upside to Tenon in taking the action, and no downside to Tenon results from the court’s decision today," said Paul Gillard, Tenon general manager corporate.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

ETS Review: Modelling Documents Released

Three technical documents are being released to help New Zealanders engage with the Emissions Trading Scheme (ETS) review, Climate Change Minister Paula Bennett says. More>>

ALSO:

Northland: Govt Plan Targets Transport, Web, Maori Assets

The government has released a 10-year plan to attract investors and lift economic growth in Northland, a region that perennially underperforms the rest of the country even while being endowed with natural beauty, productive land, minerals, a potential workforce, scope for manufacturing, forestry and aquaculture, and proximity to Auckland. More>>

ALSO:

Statistics: Unemployment Rate Falls To 5.3 Percent

The unemployment rate fell to 5.3 percent in the December 2015 quarter (from 6.0 percent), Statistics New Zealand said today. This is the lowest unemployment rate since March 2009. There were 16,000 fewer people unemployed than in the September ... More>>

ALSO:

Employment: Labour Urges Talley’s To End AFFCO Lockout

Labour has urged Talley’s to resolve the ongoing industrial dispute with AFFCO workers which is having a severe effect on the employees, their families and their communities, Labour’s Workplace Relations spokesperson Iain Lees-Galloway says. More>>

ALSO:

Three Kings: Govt To Oppose Appeal Blocking $1.2B Auckland Housing Plan

Environment Minister Nick Smith and Housing New Zealand have joined legal proceedings in support of Auckland Council and Fletcher Building opposing a bid by community groups to only allow low-rise housing in a $1.2 billion housing redevelopment on the disused site of the Three Kings quarry. More>>

ALSO:

Transport: Jetstar Expands Regional Network With Three New Routes

More New Zealanders than ever before will have access to Jetstar’s affordable flights when new services take off today from Auckland to New Plymouth and Palmerston North, and Nelson to Wellington. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news