Taxation (Transformation: First Phase Simplification and Other Measures) Bill — Second ReadingText is incorporated into the Bound VolumeTaxation (Transformation: First Phase Simplification and Other Measures) Bill — Second Reading[Sitting date: 12 April 2016. Volume:713;Page:10422. Text is incorporated into the Bound Volume.]Taxation (Transformation: First Phase Simplification and Other Measures) BillSecond ReadingDebate resumed from 31 March.GRANT ROBERTSON (Labour—Wellington Central): It is a pleasure to take a call on the Taxation (Transformation: First Phase Simplification and Other Measures) Bill and let us start out at the beginning. There is a problem with this bill in that the word “Transformation” is having the loosest ever possible meaning given to it in the history of the English language because there is very little about this bill that could be described as transformative.If one were introducing a transformative taxation bill it would rebalance taxation between hard-working PAYE earners and those who speculate in the property market. Or you would be transforming our taxation to create New Zealand as the taxation regime that the rest of the world looks at and says: “That is the highest standard of ethics right there and then—no loopholes for foreign trusts.” That would be transformative for the taxation system. Or it would be a taxation bill that finally said that we will ensure that multinational companies pay their fair share of tax in New Zealand and that hard-working wage and salary earners can rest assured that they are doing their bit and so are the other taxpayers. That would a transformative taxation bill. But that is not what is in front of us here today.This bill is utterly misnamed and once again the Government has complacently brought forward a piece of tax legislation without actually taking the time to think about what it could do right now today to help New Zealand grow a productive economy to ensure that people paid their fair share and to ensure that people are given a fair go. That is what tax legislation should be about when it comes to this House but unfortunately that is not what is in front of us.What is in front of us is a series of minor amendments to a range of bills: the Income Tax Act the Tax Administration Act the Goods and Services Tax Act the KiwiSaver Act the Child Support Act the Student Loan Scheme Act—which we amended just a moment ago—the Gaming Duties Act and the Accident Compensation Act. Some of the changes here are linked to the new and improved forms of communication of the Inland Revenue Department (IRD). That occupied a lot of the time of the Finance and Expenditure Committee—discussing the way in which technology could now be used for the IRD to communicate with taxpayers.As a general rule those of us on the Labour Party side of the House want to see that technology used and used efficiently and effectively. Although there will always be a need for rules around that it did become a little frustratingfor me in the select committee as we got into the real nitty-gritty of electronic signatures—were they safe and could we actually make use of email as a formal means of communication? Of course we can. As I said although we have to step our way through that appropriately it is important. And fair dos to the IRD. That was what it brought the bill to the committee to do—to move away from paper-based services and towards more digital services.As I said there were references in legislation to things being sent by post and at the risk of upsetting my former colleague Sir Michael Cullen not that many people are doing that any longer. So—Hon Ruth Dyson: I think he knows that.GRANT ROBERTSON: He has worked it out? Yes. So therefore the phrase “by post” has been replaced with phrases like “by writing”.This will appeal to some of my colleagues—particularly actually I am thinking here of my former colleague Maryan Street. We debated a three-tiered approach to the way in which the IRD seeks communications out from taxpayers. There were three tiers of verbs and we did have quite some debate in the select committee about the hierarchy of verbs. I can see that Mr Deputy Speaker knows that he missed out here—he missed out on this conversation. We do have a three-tiered approach with the use of verbs: to ask request or inform; to apply or notify; and to formally notify. So when the IRD is asking for things we now have a tiered approach to the way in which it asks requests or informs; applies or notifies; and then formally notifies. So these changes are big news in the world of taxation. We now have some clear and perhaps more modern language involved in that.As I said earlier electronic signatures were a particular topic of debate. We have now provided for documents such as tax returns to be filed under an electronic signature so it is easy for—I do not know—busy people like the Prime Minister. When the Prime Minister is doing a tax return the Prime Minister could apply an electronic signature to that. I think that on this side of the House we would be more than happy to take his tax returns with an electronic signature you know because we are not fussy about the form in which the Prime Minister’s tax returns find their way into the public arena. If he wants to be transparent and if he wants to be open to this then we would be more than happy to see an electronic signature - based return and that is now possible under this piece of legislation.I do want to spend a couple of minutes talking about an issue that I did not think would take the select committee very much time but amazingly enough it did—that is the question of secrecy in a co-location environment. The IRD is now co-located in a number of centres in New Zealand with other Government agencies and when they are together there are all kinds of efficiencies for the consumers and for citizens to be able to visit and work with Government agencies. We had a long discussion about whether there were adequate secrecy provisions in place for both IRD employees and employees of other Government agencies that were working in a co-located environment.In the end I was sounding a little bit cynical when I introduced this part of my speech but actually this is a serious matter. The IRD deals with the sensitive information of all New Zealand taxpayers and in a co-located environment it is possible that someone takes something to the photocopier they put it on the photocopier they get interrupted something happens and they leave a page behind. Under the secrecy requirements that are currently placed on IRD staff if another IRD staff member was to walk up and pick up the piece of paper they would be covered by the same rules. If you then look into having a co-located environment you might have as an example a staff member from the Ministry of Social Development or ACC or something like that who is co-located but is not governed by the same secrecy provisions as the IRD staff member.We had a long discussion in the committee about how we would deal with this. In the end we upped the requirement on IRD staff to be aware of their own secrecy provisions. They have to have a higher duty of care essentially when they are working in that co-located environment and there are some amendments that have been made by the committee to enable that.There were some good discussions—and this is a good element of the bill—around how we can help support employees who have the possibility of share purchasing within the firms that they work for. The benefits to employees under share purchasing agreements have not always been clear to people and have not always been easily identified and as part of an IRD discussion process on this the amendments in the bill allow the treatment of the amount of benefit from a share purchase agreement as extra pay and allow employers to choose to withhold tax on the value and would require the employer—whether choosing to withhold or not—to disclose the value received via a monthly schedule. So it is just making more transparent and more open the way in which employee share schemes operate. They are now a much more common part of people’s remuneration and it is important for the IRD’s processes and policies to keep up with that.More broadly there was a range of changes around information sharing which continues to be a very important part of what the IRD does. Also around KiwiSaver there are a series of changes there to ensure that the rules are clear for everyone. One that again attracted a lot of attention was around minors—that is minors with an “o” Mr Deputy Speaker not miners with an “e”—who join KiwiSaver when they are signed up by their parents and perhaps they have been incorrectly enrolled in a scheme. They have until their 19th birthday to opt out. Members who choose to opt out would receive their employee contributions but not their member tax credits kick-start contribution or their employer’s compulsory contributions.We did ask officials whether this was a major problem in that there were armies of young people being signed up to KiwiSaver unwillingly and then being desperate to get themselves out. There are not but obviously where the situation exists that people when they turn 18 want to remove themselves from KiwiSaver—we hope that they do not but should they choose to—that provision is being put in place.It is a bill that completely fails on its own title—it is not transformative at all. It could have just been called the “Taxation and Other Measures Bill” and you would be accurate. But I think what the events of the last couple of weeks have highlighted on this side of the House is that legislation like this is missing the point when it comes to taxation. We need a tax system in New Zealand that the average working person can be confident in and when they make their contributions and do their fair share they know that others are doing the same. We do not have that in New Zealand at the moment. We have a system where large multinational companies are not paying their fair—Mr DEPUTY SPEAKER: Sorry to interrupt the member but his time expired some time ago.ALASTAIR SCOTT (National—Wairarapa): Mr Deputy Speaker I was hoping you would give Mr Robertson a little extra time because I was just waiting for him to explain his proposed transformative policy—Grant Robertson: Oh!ALASTAIR SCOTT: With what? Well with this $11000 that we are giving every person over the age of 18—how he was going to fund the $11000 that apparently everyone is going to receive. Because—Hon Ruth Dyson: That’s nonsense.ALASTAIR SCOTT: It is not nonsense; it is absolutely a brain explosion from the Labour Party leader that would be transformative. It would totally be transformative because it would have to be funded in some way. I understand that the proposed method of funding the transformative idea is just to wipe out benefits—wipe out benefits.The universal benefit that has been proposed would be very transformative but I would also like to hear from the Labour Opposition how on earth that would be funded—this transformative idea from the Labour Party. How would that $11000 handout—which is all it is—be funded? You talk about a simplification and that brings into the discussion the other word “simplification”. If it is so simple then let us hear where tax rates and GST rates would be if everyone was given a handout of $11000 per annum.Mr Robertson also commented on creating and legislating fair honest—making sure people pay their fair share of tax. That is exactly what we discussed in the last bill just a few minutes ago where the Taxation (Residential Land Withholding Tax GST on Online Services and Student Loans) Bill was discussed in Committee. That is exactly what we are passing in this House: taxation legislation that is fair and ensures that people pay their fair share.Mr Robertson I would invite you to take a call and explain how the transformative idea of the Labour Party which is to give out $11000 which will solve everyone’s problems somehow—forgetting the people who are most in need. It comes back again to the tax system that we have which supports those who are most in need; not just giving them all the same. You do not give an 18-year-old single male the same benefit as a single mum with four kids. That is just an absurd idea and one that should be totally discounted by the sensible people who are in the Labour Party when they hear such a ridiculous suggestion from their leader. I suggest that those members continue to talk about simplification and transformation. I look forward to hearing more from the Opposition.STUART NASH (Labour—Napier): The last member who spoke on the Taxation (Transformation: First Phase Simplification and Other Measures) Bill Alastair Scott asked some very interesting questions and I have some answers for him. His first question was how we are going to fund what we want to do—keeping in mind that the universal benefit is something that we have discounted. But let me give the member one idea. This is transformative. It may be quite hard for the member to get his head around but how about this one: everyone pays their fair share of tax. How about that? Pay your fair share—imagine that.We have the New Zealand Herald journalist—I am not dismissing the journalist. Matt Nippert is a very good journalist but he is a journalist. He is not a member of the Inland Revenue Department (IRD) and not a tax expert but a journalist who has uncovered tax rorts to the tune of about $500 million. This is just the top 20 companies—uncovered by a journalist. But wait there is more. Down the other end of the scale the real experts say that we could be missing out on $7.1 billion a year for our tax base due to these large multinationals avoiding and evading tax. That is a transformative idea: everyone pays their fair share.The good thing about the New Zealand tax system is that we do not want people to pay more than their fair share. We are not asking them to hand over all of their profits; all we are asking them to do is pay their fair share and if it is company tax it is only 28 percent. It is not a whole lot of money. They are still left with a whole lot of money in their back pocket that they can repatriate back to the States. But the interesting thing is that National’s Minister of Revenue has come out and said there is no problem here—we have not got a problem in New Zealand.The amazing thing about this is that the Obama Administration tax officials who know a little bit about tax—“Trust me I am from the IRS.”—say there is a big problem. In fact President Obama himself called these companies traitors. David Cameron has come out and said: “We are going to change the law because this is wrong.” Even the New Zealand Prime Minister has come out and said: “This is morally wrong.” But the revenue Minister has said: “There’s no problem. Don’t worry about it. Nothing to see here.” Well I do not know what planet the revenue Minister is on when we are $7.1 billion down on what we should be because companies are engaged in aggressive tax planning that sees them transfer all their profits offshore and not pay any tax in New Zealand. Mr Scott I think everyone paying their fair share is pretty transformative. I think it is a pretty good idea too.The thing that gets to me is when National Ministers and National members stand up and defend these large multinationals at the expense of hard-working middle New Zealanders who actually pay their tax. You know something is wrong. You know they are a little bit out of touch. I would guess but I am not going to put my house on it that if I went into Mr Scott’s electorate and I walked down the main street of Masterton and I asked these middle New Zealand families “Did you pay your tax?” they would say: “Absolutely.” In fact they would be affronted at any suggestion that they did not pay their tax. If I said to them “Do you think it’s right that these large multinationals are paying no tax?” I guarantee 95 percent of people whom I interviewed on the main street of Masterton would say that it is about fairness. What I argue is that what the multinationals are doing at this point in time to the New Zealand tax base simply is not fair.Yes Mr Woodhouse we do have a problem. It is recognised by every single OECD country that we have a problem. Where the difficulty lies is in the solution. But what we think we must do is at least quantify the problem. At least get a panel of experts in. Not just one—Mr Shewan—but let us get a panel of experts in to understand the extent of the problem. Then we will know how much we should be investing in this. I can vouch that the IRD has a number of incredibly capable people in its ranks. It has some of the finest tax experts I believe in the world. In fact I know that the IRD is co-opting some of its staff to help the OECD.I will tell you what I know about the IRD officials who appear in front of our Finance and Expenditure Committee. They are passionate about what they do but they are also passionate about New Zealand. They also understand that the integrity of the tax system is fundamental to a sound economy. I believe that if the Minister said to his officials in a public way “We have a problem here.” they would say: “Yes Minister. We know that. We’ve been telling you this for a while.” If he said to them “Can you go away and quantify the value or the extent of the problem we have here?” they would take to it to like—I was going to say “a robber’s dog” but that is probably not the right description for the IRD. But what I am saying is that everyone recognises this is a problem except the revenue Minister.Then within about 2 weeks we have this overseas trust issue. I believe that a country’s brand—in fact any brand—is based around how people perceive that brand. Mr Key and Mr Woodhouse may say “It’s not a tax haven. We’re not operating any sort of tax schemes.” but the international press come out and say that if it smells like a rat if it looks like a rat and if it tastes like a rat then it probably is a rat. I think that the way the Prime Minister should have handled this—if he did not know already and there is a suggestion that he had been warned because articles were published in the National Business Review detailing exactly how this worked—is that the Prime Minister should have come out and said: “Wow we did not understand the extent of this problem. I am going to work day and night to close this down because for me the integrity of our country the integrity of our brand and the integrity of our tax system is paramount.”But instead what the Prime Minister did was try to defend multinational organisations and those who are attempting to avoid tax. The thing about that is the vast majority of New Zealanders—middle New Zealand—pay their tax. In fact if any part of middle New Zealand works to avoid their tax the IRD comes down on those people like a ton of bricks yet when a multinational organisation avoids—I am not saying evades; I am saying avoids paying its tax or when overseas dictators or arms’ dealers or oligarchs or whoever because we do not know seek to avoid paying tax the Prime Minister defends them.My personal view is that the Prime Minister has lost touch with what middle New Zealand cares about. Middle New Zealand cares about fairness.The interesting thing—I have got four children—is that almost the first concept that children learn is fairness. Those of you with children will know where I am coming from. When my little son is aggrieved by his sister he comes up and says: “Dad this isn’t fair. It’s just not fair.” Fairness is the first concept that children learn. I think it is what makes New Zealand such an egalitarian society or it used to be. It is because we value fairness.We expect everyone to do their fair share and pay their fair share. When the Prime Minister and his Ministers stand up and put the interests of multinational companies and overseas oligarchs before the interests of middle New Zealand then I think we have a problem. I think we have a Government that has turned arrogant and I think we have a Prime Minister who has lost touch with what New Zealanders really value and that—Mr DEPUTY SPEAKER: Anyway back to the bill.STUART NASH: —is fairness. Thank you very much.BRETT HUDSON (National): For the edification of the member Mr Nash who has just resumed his seat I might get on to a bit of the English language and some comprehension which might help him. But before I do that I would just like to note that that member levied a pretty serious accusation against some foreign companies. I believe he used the term “tax evasion”. I would encourage him to leave this House—Stuart Nash: I said “avoidance”.BRETT HUDSON: He said “evasion”. Check the Hansard. The member said “evasion”. I would encourage him to leave this House and to levy that accusation out in public. He might just find that his personal tax structure gets put to the use that he actually claimed in the media he set it up for. It is a very very dangerous statement to make and one that should be made only with some real evidence.We will move instead on to one of the hardest tasks that you could possibly have with Opposition members in this Parliament which is helping them to understand English. The bill is called the Taxation (Transformation: First Phase Simplification and Other Measures) Bill. When you have a title that says “First Phase” it would automatically suggest that there are further phases to come. Therefore you probably would not read the bill and say: “This is the entirety of the inland revenue transformation programme.” In fact the natural response would be that this is not the entirety of the inland revenue and tax transformation programme.The title also says “Simplification”. Therefore looking at the measures of the bill one would expect one of many phases or one of several phases to be about simplification which in itself is a positive thing but not necessarily wholly transformative. That is precisely what the bill is seeking to do such as helping people to get their tax refunds a little sooner and adjusting thresholds so that things can happen automatically and it will help to reduce time and costs for both small businesses and salary and wage earners.This bill is a step—a step on the transformation journey. We know as the Inland Revenue Department has told us and as the Minister has told us that the transformation project with the department is a business-driven tax transformation. It will take some years and some effort. I look forward to this bill passing through the House and I look forward to the subsequent phases of the taxation transformation. Thank you.JULIE ANNE GENTER (Green): I rise to take a call on the Taxation (Transformation: First Phase Simplification and Other Measures) Bill. The Green Party of course supports this bill. It is largely non-controversial. It is certainly nothing earth-shattering. It makes a number of small administrative changes to the tax system that will hopefully result in it being a bit simpler and will enable Government departments to work more effectively through sharing information.I have to say that I really agree with what my colleague Grant Robertson said earlier tonight though. The name of the bill suggests that it could be doing quite a bit more. Obviously transformation and simplification would be quite welcome I think by many members of this House when it comes to the tax system. I can speak on behalf of the Green Party and say that a simpler fairer tax system is one way that we can address the two major challenges that are facing us: growing inequality in this country and climate change. Changing the tax system making it simpler and fairer is one way that we can reduce the growth in the gap between the very rich and everyone else but especially those who are doing it incredibly tough right now.It is another way that we can send signals to business and consumers and transition to a cleaner smarter economy—one that is not going to leave us susceptible to the challenges of climate change. We can reduce fossil fuel use we can reduce pollution—all of that can be done through the tax system and of course that is a challenge that unfortunately our National Government has completely failed to take up in its nearly 8 years in Government. All it has done with the tax system is tinker around the edges. I have to say that the work on this bill was done by officials—it is good work; nothing to criticise other than that there are some omissions—but ultimately the officials’ priorities are determined by the Government of the day.It is interesting because last week we heard from the Prime Minister that the Inland Revenue Department (IRD) had not been able to progress changes to the rules around New Zealand foreign trusts to avoid the use of New Zealand as a tax shelter by individuals who live overseas because the IRD had other priorities. But I think that is really shifting blame because it is the Government of the day that directs the officials in what their programme of work should be. It determines their priorities and gives them the resource to be able to undertake that work. So I would say that certainly something that is missing from this bill—which would be very appropriate given all of the news around the Panama Papers in the last week and a half—would be amendments that would simplify the work that the IRD would have to do and does have to undertake if and when other countries request information from us about New Zealand foreign trusts.At the moment the situation is this: we have got these New Zealand foreign trusts and somebody who does not live in New Zealand and does not earn money in New Zealand can set up a foreign trust which they can use to hide assets and avoid paying tax or even worse hide criminal activities. Of course there are legitimate purposes for these trusts as well but because of the secrecy around them it is inherently attractive to those who would want to hide criminal activity or avoid paying tax in their home country.Last week the Prime Minister claimed that there was full disclosure there was no problem to change it and the IRD was collecting or requiring the trusts to keep all of this information. What he did not say was that unless the other country is Australia if any country in the world was to ask us for information about foreign trusts that have been set up in which the settlor is resident in their home country the IRD would not be able to give them that information because the IRD does not collect the information. It would have to go through the 12000 New Zealand foreign trusts that are registered here. You can imagine that huge burden of bureaucracy. It would actually be impossible for us to effectively share information with other countries even those that have a double tax agreement with us. Of course there are about 40 countries that have a double tax agreement with New Zealand and another 12 that have some information-sharing arrangements with us but fundamentally because of the nature of the New Zealand foreign trusts and the information collected by IRD at the point at which they are set up the only information that needs to be given to the IRD is the name of the trust—Mr DEPUTY SPEAKER: Come back to the bill.JULIE ANNE GENTER: —which may have no bearing whatsoever on who the settlor is or what the activity is or even the date that it has been settled.Mr DEPUTY SPEAKER: Back to the bill.JULIE ANNE GENTER: So one way that this bill could be improved—because it is about transformation first phase simplification and other measures—would be to have provisions in it that set up more complete disclosure and a registry so that when the IRD collects that information it would then be much easier for it to share information with other countries and prevent tax avoidance and other criminal activities. I am sure that is something that New Zealand would want to be doing.The Prime Minister himself said that we are working with the OECD and that we are trying to crack down on people who are avoiding paying tax here in New Zealand—although unfortunately of course we have heard just in the last few weeks as well that the Government has no idea whatsoever about how much tax it is missing out on from multinational companies that avoid paying tax in New Zealand. We have had estimates anywhere from half a billion dollars a year to a billion dollars a year—potentially more. This is a lot of revenue that this National Government has simply failed to prioritise while just earlier today we were going through the Committee stage of a bill that is setting up a regime amending the student loan scheme so that we can get more information about people who have outstanding student loans who are living overseas and chase down the money that they owe the Government—those students—rather than chase down the revenue that is owed by big multinational corporates that earn huge profits.So I think that what is missing in this legislation and what has been talked about in the House earlier in another bill that we heard at the same time really demonstrates the priorities of this National Government. Ultimately it is protecting the status quo. It is tinkering around the edges but fundamentally is committed to an economy that is unfair and unsustainable.Mr DEPUTY SPEAKER: Order! I will just remind the member—she will be seated while I am speaking—that this is not a general debate speech. It is specifically about this bill in relation to taxation. The fact that she spent some time talking about what it is not does not actually address the bill. So I invite her to come back to the bill please.JULIE ANNE GENTER: I raise a point of order Mr Speaker. I think that of all the speeches that we have heard tonight on this bill mine is straying no more from the bill than any other speech.Mr DEPUTY SPEAKER: Well that is not the point. The point is that I have asked you to come back to the bill. The fact that you are saying that you are sinning to a lesser degree than other speakers does not bring your speech into order. The fact that I may have gone to sleep while somebody else was giving their contribution does not necessarily allow you to have a similar amount of lack of attention from me. So please come back to the bill.JULIE ANNE GENTER: As I said the Green Party will be supporting this bill. It does not make any radical changes to our unfair tax system which the National Government is continuing to support. With all the different issues that have been in the news in the last few weeks I do think that the National Government should be rethinking its priorities and looking out for average New Zealanders and looking to making changes to the tax system that are actually going to deliver a fairer greener society here in New Zealand.RIA BOND (NZ First): It is a pleasure to stand and speak to the Taxation (Transformation: First Phase Simplification and Other Measures) Bill on behalf of my colleague Fletcher Tabuteau tonight.I wish to begin by commending the Finance and Expenditure Committee for a detailed and comprehensive analysis and commentary on another Government taxation bill which amends a total of eight Acts. It is extremely important that an omnibus bill passing through this House contains no errors oversights or unintended consequences. This bill aims to transform simplify and improve the administration of our taxation system and how the Inland Revenue Department (IRD) engages and interacts with taxpayers. The main policy measures in this bill provide for easier communication with and by the IRD simplified tax rules and the sharing of information.During the second reading I would like to address a number of those policy measures on behalf of New Zealand First. During the first reading New Zealand First expressed concerns about how the co-location of IRD staff with other Government departments might impact on the security of personal information and data. The select committee’s report identifies a number of options that were considered by the committee to ensure the secrecy and safety of taxpayer information. It noted that clause 117 in the bill as drafted might have incentivised reckless or negligent behaviour. We would support the select committee’s recommendation that this clause be amended to specify that among other conditions an IRD employee does not breach secrecy conditions if they do not intend the breach and took reasonable care in respect of the place and conditions to prevent it. But this should not preclude court action for flagrant or deliberate breaches either.A core part of this bill deals with a range of provisions to facilitate and formally recognise digital and electronic communication between the IRD and taxpayers as the department moves away from paper towards digital services. This bill also sets out a three-tiered approach to communication and changes to the language used that are proposed in this bill. Information sharing using accepted business software as a means of communication must not breach the secrecy provisions in section 81 of the Tax Administration Act. New Zealand First notes the recommendations from the Finance and Expenditure Committee that this bill be amended so that a new subsection is inserted into the Tax Administration Act to ensure that transmitting information in this way does not constitute a breach of privacy.This bill also deals with the use of taxpayer voice biometric information. The bill as written specifies that the data could be released only with the taxpayer’s consent and only for the purpose of verifying the client’s identity. New Zealand First supports the select committee’s recommendation that an additional safeguard be included whereby the Minister of Revenue should be notified when biometric information is shared.When discussing communication within the context of this bill the select committee reviewed the use of common verbs within legislation. Given the intent of this bill it is simply about how Kiwis interact with the tax department. New Zealand First shares the select committee’s concerns that the use of common verbs to signal specific methods of communication has the potential to confuse taxpayers defeating the whole purpose of simplification. We would support the select committee’s recommendations that common verbs be added to the defined terms list in every section of the Income Tax Act that contains them. Taxpayers must have absolute confidence as to what words like “notify” actually look like in reality. Vocabulary is again an issue with the potential to create an unintended consequence in section 91EE of the Tax Administration Act amended by clause 140. Replacing the word “requested” with “required” suggests that an offence could be committed if that instruction is not followed. This was not the intention of the bill as it was introduced. We would support the Finance and Expenditure Committee’s recommendation to amend the affected clauses.When addressing special tax codes the bill as introduced made several amendments. The select committee has identified legislative error regarding “no notification” tax codes. That needs to be corrected. It also identified a legislative oversight concerning special tax code certificates. New Zealand First strongly endorses making these corrections and amendments.A drafting weakness was also identified by the select committee when reviewing the legislation as it applied to automatic enrolment criteria under provisions relating to KiwiSaver. The wording of the bill as introduced appears to treat an automatic enrolment as a mistake only if there is a failure to meet all criteria. Clause 207 needs to be more specific because the bill’s original intention was that the automatic enrolment “would be treated as a ‘mistaken’ enrolment if one or more of these criteria was not met.” Other provisions in the bill relating to KiwiSaver refer to the opt-out criteria for minors who have been incorrectly enrolled before their 19th birthdays. New Zealand First agrees with the select committee that minors should be protected from being automatically enrolled. We also agree with the select committee recommendation to amend clause 210 to specify that the bill’s opt-out provisions would not apply when a person has contracted directly with a provider and they are still a minor. This change to the relevant section of the KiwiSaver Act 2006 is common sense.New Zealand First supports legislation that is robust well supported by empirical evidence fit for purpose and achieves its intended aim. New Zealand First is happy to support this legislation with the changes as recommended by the select committee. Thank you.Mr DEPUTY SPEAKER: The question is that the motion be agreed to. Those of that opinion will say Aye—[Interruption] I am sorry. I have put the question. [Interruption] I am sorry I have put the question.Bill read a second time.