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IRD ruling poses another skill shortages hurdle

John Key MP
National Party Finance Spokesman
1 November 2006

IRD ruling poses another skill shortages hurdle

A draft IRD ruling that tax will apply to travel and relocation costs of overseas workers coming to New Zealand undermines Labour’s claim that it’s addressing skill shortages, says National Finance spokesman John Key.

“Socking businesses and state agencies with an additional fringe benefit and income tax cost as they struggle to fill skill gaps in their workforces is unhelpful and counterproductive.

“This draft ruling should be overridden by an immediate law change.

“It makes no sense for the Labour Government to go around talking about addressing skill shortages in the economy and then let IRD come up with a ruling like this.

“If the Government was serious about its commitment to addressing skill shortages, it needs to rein in IRD to reflect its wishes. Failure to do that is tantamount to support of IRD’s ruling.

“Putting another roadblock in the way of addressing the critical skill shortages in our economy is not the way forward.

“New Zealand firms are already having to compete aggressively on the world stage to attract migrants, and it would be unfair for them to have to incur even greater costs to do so.

“The Government is in a position to act on this issue and it should do so.”

ENDS

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