Clark David: Taxation (Residential Land Withholding Tax GST on Online Services and Student Loans) Bill — In CommitteeText is incorporated into the Bound VolumeClark David: Taxation (Residential Land Withholding Tax GST on Online Services and Student Loans) Bill — In Committee[Sitting date: 12 April 2016. Volume:713;Page:10415. Text is incorporated into the Bound Volume.]Dr DAVID CLARK (Labour—Dunedin North): I have been waiting for a while so I appreciate getting the call. This part of the bill of course tidies things up as my colleague Stuart Nash has pointed to and I want to speak specifically to new section 24BA(1C) in clause 71 which relates to when there is no requirement for the normal procedures to apply in respect of due diligence in terms of anti - money-laundering. I will read it out for those who are following this outside the House: “Subsection (1) does not apply to a person for whom a reporting entity under the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 has conducted the customer due diligence procedures required for customer due diligence under that Act and regulations made under that Act.”So this is an exemption we are talking about in the law for people who have already complied with anti - money-laundering and countering of financing of terrorism procedures. We would understand that often these kinds of exemptions are in place to avoid duplication. That is why these kinds of exemptions are in the law. But I raised this in an earlier stage of the bill and I want to raise it here again because again we have a similar instance where we have a piece of law in place designed to make sure that there is not duplication of a service and I would like to ask the Minister what checks and balances are in place.On the one hand there is the juggling of the intention to make sure that we have people paying their fair share of tax so we want to make sure that the rules are fair and persistent and catch out those who would wish to do wrong. On the other hand there is the balancing act where we do not put undue compliance burdens on people who would want to trade and do business with New Zealand. The question that is raised here as in the previous part of the bill is whether we have got that balance right. That is all drawn into particularly sharp focus today as we have just learnt that the Prime Minister has some tax interests that we previously did not know he had or that he uses a vehicle—and I am only just catching up on the detail of what was declared in his—Kris Faafoi: So is he.Dr DAVID CLARK: —register of pecuniary interests and so is he by the sound of it. His tax affairs seem to be more complicated than even he realises and I am sure we will hear more to come on that. But over recent days and probably more pertinently we have seen the Panama Papers come out and they raise serious questions about New Zealand’s integrity and the integrity of our tax system and our reputation more than anything else. We heard the Prime Minister of course say immediately that $24 million—The CHAIRPERSON (Lindsay Tisch): Order!Dr DAVID CLARK: —was raised. I will come to the point—The CHAIRPERSON (Lindsay Tisch): Yes back to the bill.Dr DAVID CLARK: —which is about whether we have the correct measures in place in new subsection (1C) of section 24BA whether the tests in place are stringent enough whether they are avoiding unnecessary duplication or whether they in fact too lax because we are finding that New Zealand’s reputation is under threat. If New Zealand’s laws are too lax we risk having people come through New Zealand’s system who are participating in money-laundering and the financing of terrorism and that is terrible for our reputation. We have heard that in these Panama Papers there are 60000 instances—The CHAIRPERSON (Lindsay Tisch): Order!Dr DAVID CLARK: —where New Zealand is mentioned.The CHAIRPERSON (Lindsay Tisch): No no.Dr DAVID CLARK: In this bill here—The CHAIRPERSON (Lindsay Tisch): Order! I have ruled previously. I ask the member to come back and focus on what the bill is about. You can mention those things in passing but do not spend the whole speech on examples that are outside the scope of the bill.Dr DAVID CLARK: I will bring it back because the point of those references is to ask whether here in this bill we are creating more loopholes. If people have complied with the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 requirements once are they exempt for ever? For how long are they exempt? If somebody has proven themselves in one jurisdiction or in New Zealand to have complied with the law in that respect are they for ever protected? If they have arranged their affairs in such a way that it is not detected on the first time through are they protected for ever?If the Prime Minister—to use a hypothetical—denies having any of this kind of involvement in one instance and it later transpires that he has arranged his affairs differently and he is captured by this does that have an effect? Is that something that is protected by this bill? Does it have tests that can be applied again and again or are we saying here—and the Minister will I am sure be able to direct us—in new subsection (1C) that this is a once-and-for-all test? Is this a test that applies for ever into the future or is this test is a one-off? I think that burden of proof is something we need to look at again.