Adams Amy: Taxation (International Taxation Life Insurance and Remedial Matters) Bill — In Committee 
Adams Amy: Taxation (International Taxation Life Insurance and Remedial Matters) Bill — In Committee 
[Volume:656;Page:6014] 
AMY ADAMS (National—Selwyn) 
: 
 It is my great pleasure to take a call on Part 3 of this mammoth legislation. Part 3 deals with consequential amendments to the Goods and Services Tax Act made as a result of the policy changes brought about in the bill. It includes clause 518 to clause 528. 
Essentially three main parts of the Goods and Services Tax Act need to be amended as a consequence of this legislation. The first of those has already been discussed on a number of occasions during the course of this debate. As I mentioned in my contribution on Part 1 the parts of this bill are divided by the various Acts that are to be amended so the same items of work come up in repeat parts. 
The first item in Part 3 that I want to talk about is the tax consequences of the emissions units and how they would work in relation to the Climate Change Response Amendment Act. That earlier legislation set out quite clearly that the Kyoto emissions units were to be zero-rated but the issue that arose and that needed clarification in this legislation— 
Hon David Cunliffe 
: I raise a point of order Mr Chairperson. It is with some reserve that I rise to question whether the member is focusing on Part 3 rather than Part 2. It is my understanding that the Kyoto matters fall under Part 2. 
The CHAIRPERSON (Eric Roy) 
: That is hardly a point of order. 
AMY ADAMS 
: It is clear which members have read the bill and which have not. As I mentioned Part 3 relates to amendments to the Goods and Services Tax Act. The point I was discussing was the GST treatment of emissions units. Clearly the Goods and Services Tax Act needs to be amended which is why it is in clause— 
Chris Tremain 
: 519(2)! 
AMY ADAMS 
: That is why it is in clause 519(2) as my senior whip has just pointed out—if that is any use to the finance spokesperson from the other side of the Chamber who clearly has not read the bill. I do hope that is helpful; we are here to help. 
Craig Foss 
: Written apology. 
AMY ADAMS 
: I will accept a written apology at any time. That would be fine. 
As I was saying before I was interrupted Part 3 clarifies the issue around the zero rating of the Kyoto emissions unit. It needed to be made clear that the zero rating did not apply to the transfer of emissions units by the Crown under earlier agreements—primarily the Project to Reduce Emissions. 
Interestingly enough what started off as a reasonably small technical part of this clause was one that the Finance and Expenditure Committee latched on to in some degree of detail as a response to the submissions we had received. It led us into an interesting debate about whether the zero rating of the Kyoto unit should be extended to the non-Kyoto units—sometimes called the grey market or unofficial units. This was discussed over a number of meetings of the Finance and Expenditure Committee and as a result the committee recommended to the House that the zero rating should be extended to the non-Kyoto units as well as the Kyoto units thereby tidying up an area of some potential confusion. That is one of the amendments we deal with in Part 3. 
The second amendment that I will touch on is the GST treatment of exported second-hand goods. The changes here ensure that in appropriate circumstances exported second-hand goods that will not be brought back into New Zealand are treated the same way as exported new goods. That was just a matter of ensuring that appropriate parity was maintained. Once more the work of the committee ensured that a number of important changes were made. Unlike the first example in this instance the issue was about ensuring that any potential future confusion could be minimised such as ensuring that words like “supplier” were switched for words like “registered person” to make clear that those provisions applied only when the supplier was a registered person. I think that part of the bill ensures there are quite clear rules around the treatment of GST on these exported second-hand goods. 
The final amendment I will touch on is one—I have to confess—that before this bill had never crossed my mind. It is the whole issue of how GST applies to loyalty points—air miles the Fly Buys scheme and the like. I will confess to being an avid shopper. I do tend to rack up a few royalty points; my husband will certainly attest to that. I know that the loyalty point schemes have been something of a phenomenon in recent years amongst avid consumers such as me—I do my bit for the economy—and the GST treatment of those schemes is a matter of some confusion.