Responding to Paul Goldsmith’s promise that the National Party would “definitely look at” taxing charity-owned businesses, New Zealand Taxpayers’ Union spokesman Louis Houlbrooke says:

“We’re welcoming this commitment from Paul Goldsmith and will be holding him to it if he’s made Finance Minister. The fact businesses like Sanitarium enjoy a tax exemption is incredibly unfair on their competitors. And as a general rule, the taxes can be made lower when the burden is spread across the economy.”

“As we explained in our submission to the Tax Working Group, companies owned by charities have an unfair commercial advantage, because they receive a tax exemption on all of their earnings, not just the portion distributed to the charitable cause. There is a risk that charities may reinvest any distributed earnings from the companies they own and therefore avoid their tax obligations.”

“While he’s at it, Paul Goldsmith should also investigate the special tax status of iwi-owned enterprises, which face a lower corporate tax rate and therefore are able to squeeze out competitors.”

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