Watts SimonSecond ReadingHon SIMON WATTS (Minister of Revenue): I move That the Taxation Principles Reporting Act Repeal Bill be now read a second time.Good tax legislation generally can improve a lot for the taxpayers in this country either by introducing favourable tax changes or in making tax legislation simpler and cheaper to comply with. The Taxation Principles Reporting Act 2023 does neither of these things. It also does not do what it set out to do: to provide a set of principles which would guide New Zealand to a fairer tax system. Instead the Act contains a set of taxation principles and establishes a reporting requirement on the Internal Revenue Department (IRD). The bill we are considering today will repeal the descriptions of those principles and the obligation on IRD to produce the reports on the performance of the tax system weighted against those principles. The Government is taking the step because those principles to be of value need to be reflective of the values which we can all sign up to and not the views of the earlier Government. Those views on what constitutes a fair tax system cannot be allowed to stymie the tax policy aspirations of a democratically elected Government.The honourable members of this House whatever their political conviction are united I'm sure in one fundamental objective: that we all want to see a fairer tax system. We also want to see increased transparency in the tax system but we have differing views on what fairness looks like and that is to be expected.The Act we are repealing purportedly was to achieve those objectives but in reality it simply gives the illusion of having achieved something. In fact it actually introduced some concerning problems which have negative implications for transparency for public understanding and to a principled tax policy development. The right of any elected Government to devise shape and implement its own tax policy must be preserved. A Government is elected by the public to carry out its stated tax policies. Had the Act been consulted on it is possible that it might have achieved consensus on what constitutes fairness in the tax system. Consultation would have also helped avoid the problematic descriptors of those principles. Repealing the Act will remove those problems. Another problem is the core requirement of the Act: the requirement for the IRD to produce reports on the performance of the tax system as gauged against those principles. First we don't think the reporting needs to be legislated for. Secondly to meet the reporting requirement the IRD is likely to need to collect more information from taxpayers on economic income for instance and this could impose unnecessary compliance costs. The final thing to mention is that I previously described the Taxation Principles Act as redundant". Once this bill we are considering has fulfilled its objective it too will become redundant. But rather than cluttering up the statute book with redundant Acts the bill contains a legislative housekeeping measure clause 3 which says that the repealing Act is itself repealed on 1 January 2025. So this bill first repeals the Taxation Principles Reporting Act with effect later this month and then having done its job the repealing Act repeals itself. There are many problems with the Taxation Principles Reporting Act. It's good therefore that this Act will be repealed and allow us all to move on and have a merry Christmas. I therefore commend this bill to the House."