Brownlee Gerry: Questions for Oral Answer — Questions to Ministers 
Brownlee Gerry: Questions for Oral Answer — Questions to Ministers 
[Volume:621;Page:16219] 
3.  
GERRY BROWNLEE (Deputy Leader—National) 
 to the  
Prime Minister 
: What is the nature of the inquiry into allegations surrounding the Hon John Tamihere and the Waipareira Trust established yesterday by the Government and can she assure the House that all relevant matters will be fully inquired into? 
Hon Dr MICHAEL CULLEN (Acting Prime Minister) 
: 
 It is to be an independent inquiry by Mr Douglas White a respected Queen’s Counsel with expertise in tax. 
Opposition Member 
: It sounds like a whitewash. 
Hon Dr MICHAEL CULLEN 
: I invite the member to accuse Douglas White of that outside this House; he may find himself a lot poorer as a consequence. If the Opposition member seriously thinks that Mr Douglas White is connected to this Government he should ask some of his friends about those matters. It is the intention that all relevant matters will be inquired into. 
Gerry Brownlee 
: Does the Prime Minister agree with the comments of Sir Geoffrey Palmer who stated: “I think it is also important to say that this is not a commission of inquiry. This is not a body that will hold public hearings. It does not have the power to compel evidence and to cross-examine people. It relies on the voluntary cooperation of the people about whom the inquiry is being launched.”; if she does how can the public be confident that Mr Tamihere will cooperate voluntarily when he has shown himself capable of saying one thing and doing the opposite in secret? 
Hon Dr MICHAEL CULLEN 
: On that particular matter I think it is important to remind ourselves that this inquiry is being carried out by a respected Queen’s Counsel that the two essential groups involved—that is Mr Tamihere and the trust—have both indicated very clearly that they will cooperate fully with the inquiry and that Mr Tamihere has every vested interest in cooperating fully in order to defend himself. I would of course like to refer to Mr Douglas White QC a number of matters relating to tax avoidance promotion by people like Mr Rodney Hide for example. 
Hon Ken Shirley 
: Would the Prime Minister expect the Inland Revenue Department to investigate a case of alleged non-payment of tax on a payment of the magnitude of that made by the Waipareira Trust to her Minister the Hon John Tamihere? 
Hon Dr MICHAEL CULLEN 
: If the member is familiar with the Tax Administration Act he will know that as well as being the Acting Prime Minister I am also the Minister of Revenue. Ministers are in no position to direct the Inland Revenue Department about what inquiries are undertaken. It will therefore be a matter for the commissioner to monitor what is happening in this particular instance. In this instance the issue is: did Mr Tamihere have good reason to believe the tax was paid at source? I would suggest the member waits for the evidence before jumping to a conclusion. 
Hon Ken Shirley 
: I raise a point of order Mr Speaker. The Acting Prime Minister did not answer the question. The question was not whether the Minister of Finance would instruct the department. The issue was: did the Prime Minister expect the Inland Revenue Department to investigate an allegation of that magnitude? 
Mr SPEAKER 
: That was the question that was asked. The Minister addressed it. 
Gerry Brownlee 
: How can the public or this House have any confidence in the inquiry when Douglas White QC has no statutory authority has no ability to subpoena witnesses documents or files has no ability to cross-examine witnesses and cannot look into any matter without the express permission of those being inquired into; and does that not lead us to assume it is a powerless toothless Clayton’s inquiry designed to whitewash the issue? 
Hon Dr MICHAEL CULLEN 
: No. Of course I am sure that if the inquiry comes out arguing that the allegations are correct that will be warmly welcomed by the Opposition members who will suddenly decide that Mr Douglas White acted fully independently as I am sure he will. As I said both the trust and Mr Tamihere have promised full cooperation on these matters. 
Rt Hon Winston Peters 
: Can I ask the Minister if whether or not tax was paid on the golden handshake at source it is not a fact that Mr Tamihere would have been required to declare the income that he received because it would have affected his overall tax rate with respect to his primary source of income? Yes it is! 
Hon Dr MICHAEL CULLEN 
: Absolutely not. I have excellent outside advice on that matter. Income incurred during the year 1999-2000 did not require a declaration to be made as long as the person who received the income had reason to believe that it was taxed at source. [ 
Interruption 
] There is the sound of glass houses cracking all over the place. There will be a vast number of members in this House who have not made a tax return for a number of years as a result of the law changes brought in in 1998 by Bill Birch. 
Rt Hon Winston Peters 
: If the tax on this golden handshake was paid at source without knowledge of the overall taxation of this one income earner would it not affect the taxation rate if it was not declared? 
Hon Dr MICHAEL CULLEN 
: The income was incurred during the tax year 1999-2000. The top marginal tax rate was 33 percent on income above $38000. Therefore if there was reason to believe that tax was deducted at that marginal rate then no further tax liability would have been incurred. 
Gerry Brownlee 
: Will the independent inquiry investigate the material concerning the six payments made by the trust when Mr Tamihere was the chief executive officer to five bogus companies matters concerning the vehicle made available to Mr Tamihere and aspects of his requirements to file accurate information on his ministerial interest return; and to whom will the inquiry report? 
Hon Dr MICHAEL CULLEN 
: The first two matters are the ones of course that are of significant issue. My view is that the terms already cover those particular matters but if Mr White is uncertain whether that is the case—and I will make sure that the officials contact him about this—then the final terms of reference makes it possible for the Prime Minister to refer those matters off and that would certainly be done. The report of the inquiry comes back to the Prime Minister and it will certainly be made public.