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Need for Tax Grab Submissions

Cullen Forced to Accept Need for Tax Grab Submissions

ACT Finance spokesman Rodney Hide said today that it was pleasing that taxpayers are now likely to at least have a say about the largest retrospective tax grab in New Zealand’s history.

“Michael Cullen announced the grab on Monday, after submissions on the relevant tax bill had closed last Friday. The Minister’s announcement was clearly timed to stop the many people affected from voicing their opinions about this retrospective $200 million tax grab. Now pressure from ACT has forced the Minister to back down and accept that the Finance and Expenditure Committee may well choose to follow my advice and re-open the Bill for submissions.

“The extra tax on the tourist industry is estimated at $150 million and the extra on schools is estimated at $50 million. This is a huge sum to claim retrospectively.

“The argument is that the Government doesn’t have the power nor the right to this money. This money has been taken unlawfully. Rather than give it back, this cash-strapped government is changing the law retrospectively so that it gets to keep it.

“This is legally, economically, and morally absurd. How can anyone pay their taxes with confidence if the tax laws can be changed to a taxpayer’s disadvantage back 15 years? The move is bad economically because it sends a powerful signal that doing business in New Zealand is a big risk because this government shows itself to be quite prepared to raise taxes upon taxpayers retrospectively. It is morally wrong because the money taken has been taken unlawfully and this government just won’t up and admit it.

“The anomalies created are huge. Schools that never paid the GST on foreign students won’t have to pay it. Those who paid the GST but received their lawful refund by 14 May will get to keep their refund. But those who have paid the tax and have yet to receive their refund will lose out. This is arbitrary, highly discriminatory and just plain unfair.

“I will be pressing for the committee to hear submissions. There certainly is time.

“The ACT party will be fighting this $200 million retrospective tax grab every step of the way. I just hope for the country’s sake, that we can make the government see sense on it,” said Rodney Hide.


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