Tuesday, April 16, 2024

Tax system fairness Bill tabled

A Bill requiring facts about the fairness and efficiency of New Zealand’s tax system to be reported and published annually has been tabled in Parliament today.

Revenue Minister, David Parker (pictured) said the Taxation Principles Reporting Bill would ensure that tax information is reported against a set of fundamental tax principles.

“Inland Revenue’s recent High-Wealth Individuals Research Project revealed a startling disparity between the effective tax rates paid by the super-wealthy compared with other New Zealanders,” Minister Parker said.

“This bill continues the good work of shining a light on the fairness of our tax system. The public deserves to have this information, so people can use it to assess claims made by politicians about tax fairness.

“Successive governments have made changes to the tax system in the name of fairness – but without facts, the idea of fairness can be subjective, and manipulated to suit political arguments.

“So today, the Government is cutting that away. Collecting and publishing information on tax system fairness will allow New Zealanders to make their own judgements based on facts, rather than opinions.”

The Bill sets out principles to be reported on annually. They include horizontal equity (people with similar income should pay similar amounts of tax), and vertical equity (the system should be progressive – people on higher incomes pay a higher proportion of their income in tax).

The other principles are: revenue collection efficiency; minimising compliance and administration costs; revenue integrity, certainty and predictability; and flexibility and adaptability. Inland Revenue will collect any information that it does not already hold to enable accurate reporting on the principles.

“I have written to all political parties inviting them to sign up to this principles-based approach to reporting tax information. We are willing to work with other parties on refining the wording of the reporting principles.”

New Zealanders deserve to know that this will endure through successive governments. I challenge all parties to support this Bill,” Mr Parker said.

Latest Articles