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Is New Zealand First for Real?

“Winston Peters’ so-called minority report on the Finance and Expenditure Committee’s inquiry into the powers and operations of the Inland Revenue Department raises real questions about the competence of New Zealand First,” Revenue Minister Sir William Birch said.

Minority reports normally appear as part of the printed select committee report - New Zealand First’s so-called minority report appeared several hours later as a media release.

Its opening sentence was that New Zealand First had for eight years been pressing for a far reaching investigation into the powers of the Inland Revenue – surely a bit difficult when New Zealand First has existed for only just over six years.

Then New Zealand First goes on to refute IRD’s interpretation of tax law, particularly those relating to tax avoidance and evasion. “Fortunately for taxpayers, it is the courts not New Zealand First that have the responsibility of reviewing the IRD’s interpretation of the tax law. Also a bit rich considering it is Winston Peters who has personally blocked parliamentary consideration of five clauses intended to amend the Tax Act to prevent the abuse of foreign tax credits. These clauses, at Mr Peters’ insistence, have languished in the Finance and Expenditure Committee since 1994.”

Six almost impenetrable pages later, one finds that New Zealand First agrees with 24 of the 27 recommendations made in the Finance and Expenditure Committee’s report. The only three of the committee’s recommendations that New Zealand First does not agree with are:

 The recommendation that the Tax Administration Act be amended to provide a clear four-year time bar in relation to all taxes except where the Commissioner of Inland Revenue has reasonable grounds to suspect a return to be fraudulent or wilfully misleading. New Zealand First say there should be no time sanctuary for tax evaders, that is, that the IRD should be able to pursue taxpayers for ever.

 The recommendation that the Government review the process by which assessments can be challenged, placing particular emphasis on assessing the merits of establishing a time limit on the Commissioner of Inland Revenue when addressing a taxpayer’s Notice of Response. Again New Zealand First say that IRD should be able to pursue a taxpayer indefinitely.

 The recommendation that the ministerial approval thresholds for instalment arrangements and remissions be removed, but that the Commissioner of Inland Revenue be required to provide a regular report to the Minister of Revenue outlining applications for remissions and instalments in excess of $100,000. New Zealand First’s desire to retain the status quo would leave it difficult for the IRD to reach agreement with taxpayers on time-payment of taxes.

“On all three recommendations, the New Zealand First stance is taxpayer-unfriendly, making life more difficult for the taxpayer – surely quite the opposite of the situations that prompted the committee to carry out the inquiry.”

“I can only conclude that Winston Peters, having failed in both the Davison Commission and in the courts to establish a single case of fraud among all the Winebox transactions, is disappointed that other members of the Finance and Expenditure Committee did not allow him to rerun the Winebox in the course of the committee’s inquiry,” said Sir William.

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