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Govt. work on Tax and Volunteer Reimbursements

Government work on Tax and Volunteer Reimbursements Welcomed

Clarifying the tax laws on volunteer reimbursements and honoraria is long overdue, according to organisations in the Tangata Whenua, community and voluntary sector.

The organisations were responding to an issues paper on the tax treatment of volunteers’ reimbursements, released by Finance Minister Michael Cullen and Revenue Minister Peter Dunne.

Tim Burns, executive director of Volunteering New Zealand said current tax laws are unclear and inequitable: “The current tax law is effectively silent on how to treat reimbursement payments to volunteers and there are similar issues over payments of honoraria –particularly if a portion of an honorarium is intended to reimburse the recipient for costs incurred.”

Tina Reid, executive director of the New Zealand Federation of Voluntary Welfare Orgnanisations said nearly 90% of non-profit organisations are entirely reliant on volunteers to provide their services and activities:

“However, there is currently a real lack of clarity around the obligations of volunteers and Sector organisations, and the consequences if they fail to meet these obligations,” she said.

Thérèse Quinlivan, director of Community Housing Aotearoa said Sector organisations should have their say about the issues raised in the paper.

“It is important there is a strong response to the paper from Sector organisations so that any policy is robust and accurately reflects the complexity of volunteering in New Zealand.”

The issues document has raised some initial concerns among Tangata Whenua organisations, particularly around the definition of volunteering.

“Unfortunately, volunteering does not even begin to describe the scope of Maori giving to whanau, hapu and iwi,” said Tony Spelman Co-chair Community Sector Taskforce.

“The question is how the tax system can effectively recognise manaakitanga in terms that are relevant to Maori. Manaakitanga operates in the context of a helping and supportive relationship and cannot usefully be defined under the terms currently being used in the issues paper,”said Mr Spelman.

Hori Awa, Chief Executive Officer of the Waahi Whanui Trust said the term Mahi Aroha, produced by the Office of Community and Voluntary Sector, attempted to begin the conversation around definitions.

“But this is a complex concept that represents far more than activity that fulfils cultural obligations. Many would describe some of the activities undertaken as a cultural privilege that would never attract financial recognition/recompense.”

Iris Pahau, national development manager for the Community Sector Taskforce said Tangata Whenua organisations are looking to discuss what this issues paper means for them in the coming weeks.

“The matter has important and far reaching implications for all our people. Through engaging in dialogue these matters can be resolved but there is not much time as the submissions close on 14 December.”

Robyn Scott, executive director of Philanthropy New Zealand said New Zealand was trailing other comparative Commonwealth countries in promoting a culture of giving, ”to the detriment of everyone”.

“Sector organisations rely heavily on multiple support streams, including volunteering, and donations and philanthropic giving, to maintain the huge range of community services, from care for the elderly, to ambulances, and sport and recreation activities,” Ms Scott said.

Petra van den Munckhof, national coordinator of Health Care Aotearoa congratulated United Future leader Hon. Peter Dunne, in his capacity as Revenue Minister, for his role in getting the issue on the Government agenda.

“We welcome the fact that these issues are finally being discussed and there is an opportunity to get options on the table that will work for Tangata Whenua and Tangata Tiriti together,” Ms van den Munckhof said.

The full issues paper is available at: http://www.taxpolicy.ird.govt.nz


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