Massive IRD Cost Blowout for Child Support Changes

The Taxpayers’ Union is labelling a cost blowout by the IRD a shambles, highlighting official documents that show that taxpayers are in line to cop at least $163 million to roll back the 2013 reforms to the Child Support system. Executive Director of the Taxpayers’ Union, Jordan Williams, says:

"The latest tax bill introduced to Parliament last week proposes that a number of child support measures enacted in 2013 be repealed because of this cost blowout. The original cost estimate to implement the 2013 reform was $30 million. That’s now $210 million. The cost of the U-turn is forecast to cost at least $163 million.”

“$163 million is an extraordinary cost, more than $100 for every New Zealand household. Not a single dollar of that amount goes to vulnerable kids or struggling families."

"The officials say that the majority of the higher cost is the depreciation and capital charge associated with the capital expenditure. That’s bureaucratic code for an IT cost blow out.”

Details of the blowout are buried in the IRD’s Regulatory Impact Statement (refer to paragraphs 22 – 25 and option 4 of table 1). More details are available at taxpayers.org.nz.

ENDS

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