Gordon Campbell | Parliament TV | Parliament Today | Video | Questions Of the Day | Search


FBT on company-owned cars to be lowered

FBT on company-owned cars to be lowered

The government will reduce Fringe Benefit Tax on the private use of company-owned cars by reducing the rate used to value the vehicles from 24 per cent to 20 per cent of cost, Revenue Minister Michael Cullen said today.

“We will also raise the threshold at which FBT is paid on minor benefits, from $75 to $200 per quarter per employee and from $450 to $2000 per quarter for the employer,” Dr Cullen said, “and exempt employer-owned work tools, for example laptops and cell phones.”

These proposals are in a government discussion document released today and are part of a suite of moves to make the application of FBT more consistent, fairer and cheaper to comply with. The package will affect different businesses differently, resulting in savings for many but increased costs for some and will cost the government an estimated $10 million a year in forgone revenue.

Because around two-thirds of the FBT take comes from motor vehicles, many of the recommendations relate to the tax treatment of cars. Other vehicle-related amendments under consideration are:

allowing employers to elect the start time for their day for the purposes of calculating FBT to prevent private use of the vehicle within a 24-hour period being treated as two days’ use; allowing employers the option of calculating the FBT on the vehicle on the vehicle’s lower depreciated value rather than its cost, the equivalent rate being 36 per cent; bringing leased vehicles into alignment with company-owned vehicles to remove the incentive to lease; removing the inequities in the current treatment of car parks, where some are taxed and others are not. FBT would be applied more consistently to car parks but would largely be limited to central business areas, and hospitals, schools and charities would be exempted. Options as to the simplest way to achieve this are outlined in the discussion document.

The closing date for submissions is 27 February 2004. The discussion document, – Streamlining the taxation of fringe benefits – is on and

© Scoop Media

Parliament Headlines | Politics Headlines | Regional Headlines

Gordon Campbell: On Why Raising Corporate Taxes Has Become A Hot New Political Cause

Surprisingly, “raising taxes” has become a very fashionable political idea in 2021. That’s right. After decades of being seen (at best) as a necessary evil, higher corporate taxes are now being treated as the Great Good Thing that will revive the US economy, re-distribute wealth productively, help to build neglected and decaying public infrastructure, fund public health, address social inequality, restore a sense of community and generally make everyone feel better about the society in which they live... More>>


Government: The Duke Of Edinburgh

9 April 2021 Prime Minister Jacinda Ardern today expressed New Zealand’s sorrow at the death of His Royal Highness The Prince Philip, Duke of Edinburgh. “Our thoughts are with Her Majesty The Queen at this profoundly sad time. On behalf of the New ... More>>


Government: Delivers Next Phase Of Climate Action

The Government is delivering on a key election commitment to tackle climate change, by banning new low and medium temperature coal-fired boilers and partnering with the private sector to help it transition away from fossil fuels. This is the first ... More>>

Government: Independent Experts To Advise On Post-Vaccination Future

The Government is acting to ensure decisions on responding to the next phase of the COVID-19 pandemic are informed by the best available scientific evidence and strategic public health advice. “New Zealand has worked towards an elimination ... More>>

Health: Drug-Testing Law To Be Made Permanent

Interim legislation that is already proving to keep people safer from drugs will be made permanent, Health Minister Andrew Little says. More>>

World Travel: New Zealand Temporarily Suspending Travel From India - PM Jacinda Ardern

Travel into New Zealand from India - including for New Zealand citizens and residents - is being temporarily suspended because of high numbers of Covid-19 cases. More>>

Finance: Crown Accounts Again Better Than Forecast

Hon Grant Robertson Minister of Finance The economic recovery from COVID-19 continues to be reflected in the Government’s books, which are again better than expected. The Crown accounts for the eight months to the end of February 2021 showed both OBEGAL ... More>>




InfoPages News Channels