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

 

Scoop Business: NZ Dollar Catches Breath After "Goldilocks" Slump

The New Zealand dollar edged up following its dramatic slump yesterday after the Reserve Bank confirmed speculation it intervened in the currency market last month and PM John Key suggested a “Goldilocks” level far lower than at present. More>>

ALSO:

Biosecurity: Kiwifruit Claim To Hold Officials Accountable For Psa

Kiwifruit growers have joined forces to hold Biosecurity NZ accountable in the courts for its negligence in allowing 2010’s Psa outbreak that devastated New Zealand’s kiwifruit industry and exports. Foundation claimants representing well ... More>>

ALSO:

Poison: Anglers Advised Not To Eat Trout In 1080 Areas

With the fishing season opening in just a few days (1 October 2014), anglers are being warned by the Department of Conservation(DOC) not to eat trout from pristine backcountry waters and their downstream catchments, where the department is conducting 1080 poisoning operations. More>>.

ALSO:

Quotas: MPI Swoop On Suspected Fraudulent Fishing Activity

Ministry for Primary Industries (MPI) compliance officers swooped on a Hawkes Bay fishing enterprise today to secure evidence in an investigation into suspected fraudulent activity... “The investigation involves activity throughout the commercial supply chain – catching, landing, processing and exporting.” More>>

ALSO:

Scoop Business: Fonterra Slashes 2015 Milk Payout, Earnings Tumble 76%

Fonterra Cooperative Group cut its forecast 2015 milk price payout by about 12 percent, citing weaker global dairy prices and said there is a risk of further declines given strong global milk production. More>>

ALSO:

Scoop Business: RBNZ Keeps OCR At 3.5%, Signals Slower Pace Of Future Hikes

Reserve Bank governor Graeme Wheeler kept the official cash rate at 3.5 percent and signalled he won’t be as aggressive with future rate hikes as previously thought as inflation remains tamer than expected. The kiwi dollar fell to a seven-month low. More>>

ALSO:

Weather: Dry Spells Take Hold In South Island

Many areas in the South Island are tracking towards record dry spells as relatively warm, dry weather that began in mid-August continues... for some South Island places, the current period of fine weather is quite rare. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand

Mosh Social Media
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news