English Bill: Taxation (Annual Rates Venture Capital and Miscellaneous Provisions) Bill — In Committee 
English Bill: Taxation (Annual Rates Venture Capital and Miscellaneous Provisions) Bill — In Committee 
[Volume:622;Page:17363] 
Hon BILL ENGLISH (National—Clutha-Southland) 
: 
 The Minister when he got up could have answered the question that my colleague Mr Connell raised about clause 134. I think the answer to the question may be that new section 45(1) in clause 134 states in part: “the Commissioner must refund an amount that a person has paid as tax if—(a) the Commissioner is satisfied that the amount represents an excess over the amount properly assessed”. I presume that the proper assessment does include the interest rates that apply on tax unpaid or tax paid according to the normal Inland Revenue Department schedule. I think that we would both be grateful for that clarification because one can easily imagine a situation where the taxpayer made a mistake and paid too much tax and over a 4-year period—or as the Minister is suggesting perhaps an 8-year period—there would be considerable interest accrued and I would hate to think the department had the use of the money and was not paying interest when it should have done. 
I would not have thought that intent when the tax is paid is relevant to whether interest is calculated as part of the assessment. If I overpay because I overestimate my provisional taxpayer’s income it should not make any difference that I did that because I or someone else made a mistake. I hope the Minister can get up and tell us a bit about clause 134 because the amounts involved could be very significant and I would hope that the intent or the reason for the overpayment is not relevant to the interest calculation. I might come back to that. 
There is another section for which I want to indicate support for a change but again I would like the Minister to explain the rationale for it. That is clause 141 where we see an amendment to the Taxation Review Authorities Act and a change to the small claims jurisdiction of authorities. The shift from $15000 to $30000 which looks to be extending the scope of a small claims jurisdiction is almost certainly the right thing to do. But I wonder whether the Minister can relate that shift to his general tax policy because this shows an understanding that for relatively small amounts of money a whole great big process is not needed to sort out the claims. The fact that the threshold for the jurisdiction has been doubled seems entirely inconsistent with the Government’s policy that it will not move any other tax threshold. 
So here we see the threshold being moved from $15000 to $30000 in recognition not just of the procedural efficiency that can be gained but I presume in recognition of the fact that people are simply paying more tax. Smaller claimants find themselves paying more tax. How does it fit with the overall approach to thresholds in the tax system? The Minister’s own coalition and confidence partners have put it to him that he ought to be shifting tax thresholds in recognition of the same kind of phenomenon. GDP has grown incomes have grown—they have to because that is how GDP grows—and more people have moved into higher tax brackets. It is reflected in this particular change but not reflected in the rest of the tax policies. So the Minister could explain that. 
There is another clause that I am interested in—and I have to say that I have approached this as a layman and the Minister may be able to help explain. 
Hon Dr Michael Cullen 
: I’m a layman too. 
Hon BILL ENGLISH 
: Well we pay the Minister to know about it so he can show us whether he does. I am interested in clause 136 regarding people who are treated as registered. I thought someone was registered if he or she was registered.