4. Question No. 4—FinanceHon AMY ADAMS (National—Selwyn) to the Minister of FinanceQuestion No. 4—Finance4. Hon AMY ADAMS (National—Selwyn) to the Minister of Finance: Does he agree with the Prime Minister's comment in relation to any changes to tax legislation we want to make sure that there's simplicity in our system and of course we want to make sure that we don't see some of those perverse incentives that might lead to an accountants' boom"; and in his view would a capital gains tax increase the compliance costs and complexity of our tax system?Hon DAVID PARKER (Associate Minister of Finance) on behalf of the Minister of Finance: On behalf of the Minister of Finance I agree with the Prime Minister's full quote. I also agree with the view of Australian tax expert Professor Chris Evans who said the design features of any capital gains tax (CGT) "can either increase or decrease tax compliance costs" which of course will be taken into account in any decisions we make.Hon Amy Adams: Well if he agrees with the Prime Minister that he wants to ensure simplicity in the tax system and he also agrees with Professor Chris Evans whom he's just quoted is he also aware that Chris Evans has gone on to say "it is almost universally accepted that [having a capital gains tax] is very hard to justify on the grounds of simplicity"?Hon DAVID PARKER: I have two other quotes that I would reply with from Professor Chris Evans because I think the member gets them out of context. He says of a CGT "It affects very few people relatively in Australia—4 percent of personal taxpayers and just over 3 percent of companies have to deal with the CGT" and then he says "Sensible design can mitigate most of these problems and certainly any suggestions that the revenue will be outgunned by losses"—and efficiency losses in the economy he means—"completely misses the point" as the member does.Hon Amy Adams: Well does he agree with the views of the dissenting members of the Tax Working Group who have said and I quote "The main beneficiaries of a capital gains tax will be accountants lawyers and valuers. The losers will be businesses of all sizes who will need to comply with very complex legislation with small businesses bearing the highest compliance cost burden".Hon DAVID PARKER: No I don't and I would give three reasons. First contrary to what the Leader of the Opposition said yesterday one of the valuations methodologies is the Government valuation which costs zip zero not $10000. The second reason I would give is in respect of accountants—[Interruption]SPEAKER: Order! Order! I am going to interrupt. The member for the West Coast and member for Ilam are yelling at each other like they've got the Alps between them. Can they please just settle down.Hon DAVID PARKER: The second of the three reasons I would note is that if you're worried about accountant growth the number of accountants in New Zealand—and I can say this because I've got an accounting degree—they—[Interruption] It's not an insult to accountants; they're very worthy people. The number of accountants under the last Government grew 12 percent between 2000 and 2017 because of the enormous burden of compliance costs placed on them. Third point: administrative efficiency is important. The Labour Party and our coalition parties—we agree that administrative efficiency is important because compliance costs must be reasonable. But it's no justification for gross unfairnesses between taxpayers or income types.SPEAKER: I am going to remind the member that he is answering on behalf of the Minister of Finance and therefore he has to be careful about his phrasing before he attributes qualifications to the Minister of Finance that I'm pretty sure the Minister of Finance doesn't have.Hon Simon Bridges: On the basis of that vast experience he has who has more small business experience: him or the Prime Minister?SPEAKER: Order! Order! I effectively ruled out that part of the answer and therefore the question is out of order. If the member wants to rephrase it he can or we just won't count it.Hon Amy Adams: If he agrees with the Prime Minister who said that a capital gains tax needn't be overly complicated what does he say to Paul Glass of Devon Funds Management who says that a capital gains tax would "add huge complexity to one of the world's simplest tax systems"?Hon DAVID PARKER: I would say (1) no decision has been taken and (2) any decision that is taken will be done in a way that would have appropriate minimisation of compliance costs which have been terribly misrepresented by the Opposition this week including the suggestion that you'd have to spend $10000 to get a valuation of land when you can use the Government valuation which is available for nothing.Hon Amy Adams: How can he deny that a capital gains tax would create a field day for accountants when the user guide alone for a similar regime in South Africa is this mighty tome which comes in at over 900 pages of complexity?Hon DAVID PARKER: I can be confident in that regard because actually New Zealand would have last-mover advantage because just about every other OECD country has already got one and we could learn from their experience if we were to take that decision on which no decision has been taken."