Prime Willow-JeanWILLOW-JEAN PRIME (Labour): Thank you Madam Deputy Speaker. I'm pleased to speak to this bill on behalf of the Labour Party. The essence of the bill is that the bill is to deliver on our Government's vision of a better fairer New Zealand by ensuring that multinational enterprises pay their fair share of tax too.So we need to go back to what the problem is. What we know is that some multinationals are using aggressive strategies to pay little or no tax known as base erosion and profit sharing or BEPS and permanent establishment avoidance or PE avoidance. What we know from the reports that we've been given is that the IRD brought this to the attention of the previous National Government. Back in 2012-13 they went through three Ministers of Revenue and didn't address the issue. I am pleased that we are here today for the first reading of this bill to address this issue because what we can see is that there is an unfairness in the system.Sixteen multinationals have been identified as using strategies like transfer of pricing and PE avoidance and potentially we have about $100 million of tax being disputed but we also heard that the figures range from somewhere between $50 million $100 million $200 million $500 million and $1 billion. While the amounts vary the fundamental point is that we want to ensure that we have a fair and just and equitable tax system and that everybody is paying their fair share.The problem is also that we don't know how many more there might be. It is estimated that there may be up to 6000 multinationals globally that could come within this problem. The cases show our existing rules are vulnerable and the IRD considers that this could increase if weaknesses in the current rules are not strengthened. So a discussion document was developed and 16 submissions from key stakeholders were received. Submitters were met with and some were opposed—as you can imagine. Some argued that the proposals could have a detrimental effect on New Zealand being an attractive investment destination and should not be implemented.Multinational companies of course are a welcome part of our economy but they must abide by the rules and they must pay their fair share of tax. Most submitters accepted the need for measures to address the transfer pricing and PE avoidance issues identified in the discussion document. New Zealanders expect every company to pay its share of tax no matter how big or powerful that company may be. So I am pleased that this legislation is being introduced. It will bring fairness and equity back into the tax system. There was an OECD and G20 15-point action plan developed in 2015 to combat BEPS. It recognises that the issue is multifaceted and that there is no single silver bullet.To remain effective the tax settings must constantly evolve to keep abreast of changes in the economic environment interpretation of the law and businesses' practices. The Taxation (Neutralising Base Erosion and Profit Shifting) Bill contains proposals to ensure that large multinationals will pay their fair share of tax by the following four matters: strengthening the interest limitation rules addressing permanent establishment avoidance strengthening and transferring pricing rules and addressing hybrid mismatch arrangements.In terms of the strengthening and interest-limitation rules that is about multinational companies providing loans and charging massive interest costs which are considered a business expense. It is an easy way for a company to shift its profits from New Zealand to overseas and therefore not paying their fair share of tax on those. The changes in the proposed—Madam DEPUTY SPEAKER: Your five minutes are finished. I do apologise.WILLOW-JEAN PRIME: It is a split call. Thank you very much I'll conclude there. Thank you.