Dunne Peter: Taxation (Annual Rates Trans-Tasman Savings Portability KiwiSaver and Remedial Matters) Bill — In Committee Third Reading 
Dunne Peter: Taxation (Annual Rates Trans-Tasman Savings Portability KiwiSaver and Remedial Matters) Bill — In Committee Third Reading 
[Volume:666;Page:13497] 
Hon PETER DUNNE (Minister of Revenue) 
: 
 I move  
That the Taxation (Annual Rates Trans-Tasman Savings Portability KiwiSaver and Remedial Matters) Bill be now read a third time 
. We have heard a lot over the last few hours about the contents of the bill as introduced and reported back from the Finance and Expenditure Committee; and one or two other things besides. The main feature of the bill is that it allows New Zealanders who return home permanently from Australia to bring with them the compulsory superannuation contributions they have made while working in Australia. This will include New Zealanders who have already returned from working in Australia and who will be able to retrieve their compulsory contributions and continue to save for their retirement through KiwiSaver. In the same way the reciprocal arrangement that the bill introduces or gives support to will allow KiwiSaver members who move to Australia to transfer all their savings in that scheme to an Australian-complying superannuation scheme including contributions from the Crown and any member tax credits. 
These are very positive developments for all concerned. For New Zealanders who live in Australia it can make the decision to return home easier knowing that they can bring their compulsory superannuation contributions with them and continue to build up their retirement savings. From the Government’s point of view it recognises the benefits that a skilled mobile labour force can bring to both countries. Once these measures pass through our own legislative process we look forward to Australia passing its legislation although the timing of that may have become a little bit more ambiguous given the turn of recent events in that country. Perhaps we should say we look forward to Australia having a Government first and then being able to introduce and pass the relevant legislation. 
The remainder of the bill as reported back to the House sets the annual tax rates for 2010-11 and takes into account the significant reduction to personal income tax rates that come into effect on 1 October this year. It also introduces a number of technical and remedial measures to improve the way the tax rules work and to reduce compliance costs for taxpayers. For example the KiwiSaver enrolment rules for those under 18 years of age are being clarified to give young people and guardians greater certainty about their obligations under the scheme. Similarly the rules around gifting amenities and artwork to local or central government now make it clear that these items are exempt from gift duty. Later this year the Government will be looking towards repealing gift duty altogether if concerns about creditor protection and social assistance targeting can be addressed. But in the meantime the provisions in this bill will give greater certainty to people who wish to gift items for public benefit. 
The bill now incorporates two recently tabled Supplementary Order Papers 156 and 157 which cover the GST transitional issues for 1 October 2010 and a number of other technical changes. The GST transitional measures focus on contracts that span 1 October. Certain successive supplies such as insurance finance leases and lay-by contracts that span the 1 October date are now able to continue at the 12.5 percent GST rate to reduce compliance costs. There is also a range of measures to better align the GST time-of-supply rules with business practices. A further provision extends the remission of late-payment penalties and the associated interest for GST returns to cover the period immediately before 1 October. 
Other measures in those Supplementary Order Papers include measures to assist bank liquidity to remove overreach from what are colloquially known as the “imputation credit shopping rules” and changes to the tax treatment of certain optional convertible notes to ensure they are not inappropriately taxed by a change in the tax rules. A number of arrangements involving these notes are subject to a dispute between the taxpayer and the Inland Revenue Department and as a result we have been very careful with this amending legislation so as not to prejudice these particular disputes as they go through due process. The remaining matters in the Supplementary Order Papers are more detailed and generally remedial in nature. Although I concede that the use of Supplementary Order Papers in this fashion is not ideal all of the items in these particular Supplementary Order Papers are time-sensitive and are either taxpayer friendly or remedial in nature. 
Finally in bringing the bill to its third reading may I place on record my thanks to the organisations and the individuals who have made submissions on the bill; to the officials who have developed the policy and worked their way through it with us as it has gone through its stages since its introduction last November; to the drafters of the bill who shaped the policy into the legislation we now have before us; and to the Finance and Expenditure Committee which scrutinised the measures in the bill to achieve their purpose clearly and accurately and which as usual has done a particularly good job in that regard. With those few comments it is now my great pleasure to commend this bill to the House.