Nash Stuart: Taxation (GST and Remedial Matters) Bill — In Committee Speaker Recalled In Committee Procedure Third Reading 
Nash Stuart: Taxation (GST and Remedial Matters) Bill — In Committee Speaker Recalled In Committee Procedure Third Reading 
[Volume:669;Page:16175] 
STUART NASH (Labour) 
: 
 I will talk about a couple of clauses in Part 7. They include clause 105 which my learned colleague—sorry not my learned colleague because he does not like the title “learned”. Does it really apply only to lawyers? 
Hon Trevor Mallard 
: Someone is learned if they are a lawyer.  
STUART NASH 
: Is that right? How can they say lawyers are learned? 
Hon Trevor Mallard 
: It’s part of the British tradition. 
STUART NASH 
: I did not realise that. I will talk on clauses 105 and 106. I will start with clause 105 and I will take the Committee through the process the Finance and Expenditure Committee went through when deliberating on this clause because it caused quite a bit of debate. Mr Norman and Mr Cunliffe will remember this clause and Sir Roger Douglas will certainly remember it because it created a lot of debate within the select committee around how we should do this and whether we should be able to do it.  
I remember bringing up a case that is very close to me. I have a very good friend who married someone she thought was a very nice gentleman. He was an osteopath and was very respectable and very charming. She did not know at the time of the marriage that he had problems. He had gambling and drinking problems he certainly had a problem with lying and she suspects he might have had drug problems. But that does not matter; the bottom line is that he had problems.  
She entered into the relationship pretty much owning a house—not all of the house because she had a small mortgage—and some investments. The gentleman whom she married—I should not call him a gentleman because he was not—entered the marriage with not much at all. She was a little naive but in love and often when we are in love we can be a little naive and tricked by the lies told by partners— 
Hon David Cunliffe 
: It’s a chemical thing. 
STUART NASH 
: It is a chemical thing. It is irrational. He ended up— 
Hon Trevor Mallard 
: It’s actually hormonal. 
STUART NASH 
: Hormonal chemical—whatever love is it is a wonderful thing at times but it can cloud the judgment. He ended up taking her to the cleaners. She did not know that he was signing away guarantees against the house going to the bank and taking money out of the joint account. He left and then the bank said to my friend that it was foreclosing on her loans. She said: “What loans? I don’t have any loans.” The bank said that she did and that there was a guarantor against the joint bank account who was her husband. She threw up her hands in dismay and said that she did not know anything about it. The bank said that there was nothing at all that it could do about it. At that stage she had no assets. She either declared herself bankrupt or went through a no-asset procedure because this guy ripped her off and told her a whole lot of sweet nothings when she was in love with him.  
I brought this case up with the Inland Revenue Department and asked whether this sort of thing could happen. The Inland Revenue Department said that it could not because it was talking about the Inland Revenue Department not banks. I will clarify this matter. Mr Burns also brought up a case in which one of his constituents had been ripped off in this manner. The Inland Revenue Department explained what was happening under current law—that is people who owed tax were simply transferring tax to a joint bank account and there was no way the Inland Revenue Department could get hold of this money.  
I am not talking about the average New Zealander who owes $1000. I am talking about people who according to the Inland Revenue Department owe significant amounts of money. This was a loophole. These people were simply transferring money into the account of Mr and Mrs John Smith and it was completely untouchable. There was nothing the Inland Revenue Department could do. The people who owed significant amounts of money were sitting there and saying it was not their money so the department could not touch it. They had no assets that the department could touch. The Inland Revenue Department said that all it was doing with clause 105 was bringing it in line with other tax legislation. 
Hon Trevor Mallard 
: But this doesn’t show that the money has actually gone into that account. Nothing in here requires the money to be followed from the defaulter into the account. It could be someone else’s money completely and it could have been there for 20 years. 
STUART NASH 
: Yes it could be. This is the point that the select committee brought up: how can we make sure that this person has control of this money? It said that there needs to be an element of control of that money. The Inland Revenue Department made a couple of assurances.