Stuart Nash
MP for Napier
Police Spokesperson

MEDIA STATEMENT

19 August 2016

Government’s Tax Law undermines common law principles

A tax amendment being snuck in under the radar allows changes to tax issues to be driven through by the Government without Parliamentary scrutiny, says Labour’s Revenue spokesman Stuart Nash.

“The amendment allows any part of the Tax Administration Act to be changed by Order in Council. In layman terms, the Government can change tax law without any consultation or without going through the parliamentary process.

“This is wrong, unconstitutional and is open to abuse. The change should be withdrawn.

“The Regulatory Impact Statement (RIS) prepared by the IRD states that the proposed change to the Tax Administration Act ‘risks the separation of powers and fundamental common law principles’, which is totally unacceptable.

“The RIS goes on to say that ‘no wider consultation was undertaken on the proposal because of time constraints’ and that ‘the lack of wider consultation raises the risk that potential problems with the proposals have not been fully identified’. This is not the way to develop good robust tax policy.

“The issue this is trying to remedy is that if there are to be any changes to the Tax Administration Act, they must go through the parliamentary process which, according to the IRD, ‘can be complex and time-consuming’. While this is true, there is a very good reason for this: tax law is complex and deserves to be debated by Parliament and submitted upon by interested and affected Kiwis.

“The Government needs to urgently withdraw this SOP and undertake proper process when considering changes to tax legislation. The fact that they think that tax changes shouldn’t be scrutinised by Parliament and the wider public is astounding and shows how arrogant and out of touch with tax payers they have become” said Stuart Nash.

Background:

The Tax Administration Act 1994 covers a wide range of tax administration processes and rules including:

Rules relating to the role of the Commissioner, taxpayers and intermediaries
Processes around information collection, record-keeping and tax returns
Secrecy rules
Disputes procedures
Assessment processes and rules
The processes for binding rulings and determinations
The rules around the charging of interest and penalties
The process for challenging a tax assessment
The rules for recovering and transferring tax

ends

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