Dunne Peter: Taxation (Annual Rates Trans-Tasman Savings Portability KiwiSaver and Remedial Matters) Bill — First Reading 
Dunne Peter: Taxation (Annual Rates Trans-Tasman Savings Portability KiwiSaver and Remedial Matters) Bill — First Reading 
[Volume:659;Page:8298] 
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 first time. 
 Later I shall be recommending to the House that the bill be referred to the Finance and Expenditure Committee for consideration. 
The main feature of the bill is a very positive measure for New Zealanders who have been working in Australia and who wish to return home permanently. Currently they have to make compulsory superannuation contributions to an Australian complying fund. Those funds are then locked into the scheme until that saver reaches retirement age. For New Zealanders who have worked in Australia for some years this can present a significant financial dilemma when they make the decision as to whether to return home. New Zealanders who spend a period of time working in Australia are required at the moment by Australian law to make contributions to an Australian complying superannuation fund which they are then locked into. When they make the decision after some years as to whether to return home they are faced with a significant financial dilemma because of the fact that their funds are locked into Australian complying funds. 
The changes proposed in the bill will help resolve the problem. They will allow New Zealanders with retirement savings in certain Australian superannuation funds to transfer their funds to KiwiSaver when they come home permanently. Conversely KiwiSaver members who want to move to Australia will be able to transfer all of their savings in the scheme to the Australian complying superannuation scheme. This includes their New Zealand Crown contributions and any member tax credits that they might have. These changes will remove one of the obstacles facing New Zealanders who want to return home by allowing them to consolidate their financial affairs in their chosen country of residence. The changes also represent a positive step towards improving the movement of labour between our two countries and are the result of an agreement signed with the Australians in July this year that recognises the broader close relationship that we have. 
The remainder of the bill focuses on a number of smaller but important technical measures. All of these measures are intended to improve the way the tax rules work to make them easier to understand and to reduce compliance costs for taxpayers. In this respect a number of enhancements are being made to the KiwiSaver rules. Those enhancements include clarifying the enrolment rules for those under 18 years of age so that guardians and young people themselves have greater certainty about their future obligations under the scheme rules. Members may be aware of a number of issues that have arisen already where there has been confusion. People under the age of 18 have been enrolled in the scheme in a very well-meaning way by parents guardians and relatives only to discover a little later on that they have picked up an ongoing liability. The changes will also allow scheme providers to send members annual reports via an email hyperlink if the member agrees in order to reduce the compliance cost for providers while members will get the information that they need in a form that they increasingly prefer. It also removes a technical obstacle affecting the eligibility of certain members who apply for the KiwiSaver first home deposit subsidy. Taken together all these changes will make the KiwiSaver rules easier for people to understand. They reduce unnecessary compliance costs and they ensure that the rules work in the way that they were intended to. 
This bill also makes technical changes to the rules on gift duty. In particular the bill introduces a number of changes to remove uncertainties around whether gifts such as amenities and artworks made to local or central government or to approved donee organisations are subject to gift duty. The change will make it clear that these gifts are exempt from gift duty and will be welcomed by those who want to contribute to their communities by gifting items such as artworks or other items for public benefit. A previous uncertainty about whether donations made to public organisations would be subject to gift duty could be seen as a barrier to making such donations. We had the absurd situation whereby for example gifts made to the Auckland Art Gallery were subject to gift duty and gifts made to Te Papa were not. There was no logical reason; that was just the way the law had developed over time. These changes will clarify that situation. 
Finally the bill makes some other technical amendments to make the tax laws easier to apply. They include changes to the legislation on binding rulings which set out how the Inland Revenue Department will apply tax laws to give greater certainty about the tax implications of business decisions. Other changes contained in the bill are of a remedial nature and remove certain unintended consequences following on from earlier reforms. 
When taken together all the taxpayer-friendly changes in this bill will help improve the way our tax rules work and they will reduce compliance costs for taxpayers. Therefore I am happy to commend the Taxation (Annual Rates Trans-Tasman Savings Portability KiwiSaver and Remedial Matters) Bill to the House.