Shanks Katrina: Taxation (Annual Rates of Income Tax 2007-08) Bill Taxation (Business Taxation and Remedial Matters) Bill Taxation (KiwiSaver) Bill — Third Readings 
Shanks Katrina: Taxation (Annual Rates of Income Tax 2007-08) Bill Taxation (Business Taxation and Remedial Matters) Bill Taxation (KiwiSaver) Bill — Third Readings 
[Volume:644;Page:13786] 
KATRINA SHANKS (National) 
: 
 It is a pleasure to take a call on the third readings of the Taxation (Annual Rates of Income Tax 2007-08) Bill the Taxation (Business Taxation and Remedial Matters) Bill and the Taxation (KiwiSaver) Bill. 
First of all I acknowledge the Minister in the chair for the Committee stage Peter Dunne. He sat in that seat and listened very carefully to what the debate was about and he responded on a very regular basis in order to address the concerns we had in relation to the original Taxation (Annual Rates Business Taxation KiwiSaver and Remedial Matters) Bill. I realise I am new to this House and I have spoken few times compared with everybody else but it is not often that I have watched a Minister sit there listen intently to the debate respond and add some value to the debate as a bill has gone through the Committee stage. That is what he did and I acknowledge that because we appreciate the respect he showed in paying attention to what we were saying during the debate. 
At the same time I apologise to the officials who normally would be sitting on those seats by the Chair. They sat here all last night until 10 o’clock—because we sat until 10 o’clock on this legislation—and they listened and took notes. Then they came back into the Chamber this morning to listen to the rest of the Committee stage. Obviously they did not realise that this debate on the legislation would come up now. The legislation is being rushed through—that is what happens in urgency; things are pushed through this House instead of being planned out—and they have not been able to make it back for the third readings. I apologise to those officials. They do good work for this Parliament and this Government and they work long and hard to try to make legislation as good as they can for the Government at the time. I apologise to those officials who have done the long yards for us and who are not here today. 
I must say that during the Committee stage I was expecting the Labour MPs to take a lot more calls than they did. I think one call was taken by Charles Chauvel in over 2 hours of debate this morning and that is disappointing because this legislation is really important for New Zealanders. The fact that Labour members did not give it enough respect during the Committee stage to get up to speak to it and support it says something about this legislation. 
I have been sitting here during these third readings and I have been disappointed again in the personal attacks happening in this House—the attacks Michael Cullen made against Lockwood Smith—and I really think we can do better for New Zealanders. I think New Zealanders are getting frustrated by the personal attacks that are happening in this House. It is about time we raised the level of debate in the House. 
I come to the taxation bills that we are here to talk about. This legislation is very comprehensive and it has taken a long time to come before the House but the thing that strikes me about it is that there is nothing about personal taxes. People are coming to our constituency offices to talk about how they do not have enough money and how they find it hard to make ends meet. One would think this legislation would address that at some level but no there is nothing about personal tax cuts in it. In fact soon this Government will not have to worry about it because 40000 people a year are leaving this country to go where they can get tax cuts—Australia. More and more people are leaving. Steve Chadwick over there is laughing her head off thinking it is funny but it is not because what we are losing are the people we want to keep—good hard-working New Zealanders. We want them to stay in New Zealand and get ahead under their own steam because we have a good environment for them. 
Moana Mackey 
: Oh yeah it was fantastic in the 1990s. It was wonderful. 
KATRINA SHANKS 
: We hear Labour members say “What about 1990?”. I do not actually care about 1990. I care about the future. I care about the future for myself my family and my children. If that member wants to sit there and talk about 1990 and live in the past she should please do so because next year in 2008 when the people of New Zealand get to have their say they will not say that they want a worn-out tired Government which you are because you have no answers to any of these issues— 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Order! 
KATRINA SHANKS 
: My apologies Mr Assistant Speaker. The people of New Zealand will be asking for a change of Government and they will put National on to the Government benches. That is what will happen because they are sick of this Labour Government interfering in their lives and not delivering what Labour said it would deliver. Take for example the “chewing gum tax cuts”. Where are they? Where are they in this tax legislation? They are absolutely nowhere. Many many more people will be joining those 40000 people who left last year to go to Australia to get the tax cuts that they deserve because they are hard-working New Zealanders. The Government over there does not believe in building the kitty like the Government here does. 
I looked at this tax legislation in quite a bit of detail the other day when I knew I would be speaking on it and I could not figure out where the long-term strategy for tax was. Where are we going with our taxation policies in New Zealand? The Minister of Revenue is in charge of this legislation. He has advocated for 24 years for income splitting—that is his passion. He has been in charge of this legislation. He has charged ahead taken the lead and gone out there but there is nothing in this legislation about his passion. There is nothing about what he really believes will make a difference to New Zealanders which is income splitting. He has put together this tax legislation but he has not put in it what he believes in. So how much is his heart in it and does he really have a long-term strategy considering that he thinks he will change this legislation in a year’s time? That is not what the people of New Zealand want. They want to see a Government that is committed to a long-term tax strategy that will get us ahead in the years to come. 
At the same time the Government should be interested in protecting its revenue base. That is very important for this country if we want to get ahead as a country. What we do not realise when we look at this legislation is that the New Zealand Government is the biggest business in New Zealand. It takes the most money—it has the biggest revenue—of any business in all of New Zealand. Given that it takes in the most revenue in New Zealand and it has no long-term strategy what does that tell us about this legislation? It tells us quite a bit. It tells us that it has no direction and that it is piecemeal legislation. I truly believe that is what we are seeing here today. 
This legislation addresses four or five main issues. They are the new research and development tax credits; a reduction in corporate tax rates; the KiwiSaver employer tax credit and compulsory employer contributions; moving the rebate cap on charitable donations which is what the National Party talked about last year and which this Government has picked up on; technical changes to portfolio investment entity rules which have already had changes; offshore portfolio share investment rules; and amendments to tax penalties which are interesting in themselves. When I was out there in my previous life as a chartered accountant I talked to those poor business people who try their hardest to keep it together and run their businesses. They have a passion for their small businesses. They are trying to make ends meet which is really hard for many small businesses out there and they wear every single hat one can imagine. They do HR they do finance they do law they import—you name it they do it in their businesses—and then they forget to file a GST return on time. 
Or they make simple errors because they cannot afford accounting systems. Many small-business people do not know how to use accounting systems which is even more important; they do not have the time to sit down and learn that because they are busy trying to run their businesses. So they input a spreadsheet backwards on to a GST return inputs become outputs and outputs become inputs—it is very easy to do and many people do it in New Zealand—and all of a sudden they are slammed for a false return or for a return that is dated incorrectly or for a return that is on the wrong form. Many businesses do Internet banking today and they may draw down the wrong form off their Internet banking website. All of a sudden they find that there are a zillion transfers between all these accounts to make up the differences—which the Inland Revenue Department automatically does—and before they know it they have got a muddle and they cannot get out of it. It is such a common theme coming through which I saw as a chartered accountant. All of a sudden one has four or five different tax accounts within the Inland Revenue Department—one for GST one for annual tax one for provisional tax and so the list goes on. Then one has PAYE and student allowances. It is really difficult for people out there. 
To conclude I would like to say that this tax legislation that the Government has put together for New Zealanders is disappointing.