2 April 2001 Media Statement

Tax Bill targets R&D compliance costs

"Legislation introduced into the House today will allow an immediate tax deduction for all research and development spending expensed under generally accepted accounting practice," Revenue Minister Michael Cullen said.

"We will bring the tax laws into conformity with Financial Reporting Standard 13 so that expenditure which is immediately written off for accounting purposes will also be immediately tax deductible from the tax year beginning this month.

"The Government's announcement on R&D policy is the result of the open dialogue that I have had with business," Dr Cullen said.

Business will also benefit from other compliance cost reduction measures in the bill, which include:

ć Amendments to clarify and simplify the general interest deductibility rules. These will allow most companies to deduct their interest on business borrowings without having to go to the expense of setting up special taxation structures.
ć Amendments that reduce some of the compliance costs associated with the way that unit trusts operate, such as simplifying the shareholder continuity rules.

"These measures have been warmly received by tax practitioners and business and will introduce a lot more simplicity and certainty into the tax system," Dr Cullen said.

The bill also updates the legislation dealing with income tax assessments, to reflect the fact that today it is not Inland Revenue, but taxpayers who make the initial assessment of their own tax liability.

Detailed information on these and other matters in the bill can be found in the commentary on the Taxation (Annual Rates, Taxpayer Assessment and Miscellaneous Provisions) Bill. It is available on the web site of the Policy Advice Division of Inland Revenue at www.taxpolicy.ird.govt.nz.

ENDS

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Gordon Campbell: On the Sony cyber attack

Given the layers of meta-irony involved, the saga of the Sony cyber attack seemed at the outset more like a snarky European art film than a popcorn entry at the multiplex.

Yet now with (a) President Barack Obama weighing in on the side of artistic freedom and calling for the US to make a ‘proportionate response’quickly followed by (b) North Korea’s entire Internet service going down, and with both these events being followed by (c) Sony deciding to backtrack and release The Interview film that had made it a target for the dastardly North Koreans in the first place, then ay caramba…the whole world will now be watching how this affair pans out. More>>