Russell DeborahHon Dr DEBORAH RUSSELL (Labour): This is an unusual bill for this National-led coalition. It's an unusual bill because it's got a regulatory impact statement. Famously they said a couple of weeks ago that they weren't going to have regulatory impact statements for matters that were being repealed under urgency but this bill has one so a little bit of consistency from the National-led coalition Government would be quite nice.However setting aside that I suppose minor point I think I do want to draw something out of it which is that having worked with the officials at Inland Revenue myself in recent years having in past times been one of those officials at Inland Revenue Department I have a very very high regard for their integrity and professionalism for their intellectual commitment to an excellent tax system in New Zealand and for the work they do to preserve it. I think it's a mark of their integrity and their professionalism that despite that Government's rush to do away with regulatory impact statements the hard-working and able officials at Inland Revenue nevertheless produced one.I understand that perhaps a draft regulatory impact statement was prepared for one of the bills that—which bill was it that there was a draft one?Hon Barbara Edmonds: EVs—Clean Car Discount.Hon Dr DEBORAH RUSSELL: Yeah right OK; the one repealing the electric vehicle discount scheme. There was a draft regulatory impact statement for that but it wasn't brought to this House—they didn't want to see that one in the House. We'll be requesting it under the Official Information Act of course. But this one has at least got into the House so I'm grateful for that.I just wish to repeat back some words which members of the Government have said in respect of our tax system. So first of all welcome to Nancy Lu. I believe that might have been the first time that Nancy was speaking in this House. She brought to the table her previous experience in the tax system which of course having come from that that space myself is always valuable to have in this House. Nancy Lu said quite correctly that what New Zealanders want—and indeed this is what I know Inland Revenue works toward and the tax community works toward—is a fair simple easy and transparent tax system. Of course! Of course that's what we all want. And Simon Watts the Minister of Revenue said that we all want to see a fairer tax system and we want transparency. Those were words coming from members of the National-led coalition. Of course we all want that. The point is: how would we know? How could we assess whether that is the case?This is exactly what the Taxation Principles Reporting Act sets out to do. It sets out to give us a way of assessing the fairness and simplicity the easiness the transparency of the tax system. It sets up some principles. It sets up some ways that they are to be measured. And then it sets up a reporting requirement for Inland Revenue so that those of us—and I take it that we've got broad agreement across the House on this that we want to have a tax system that is fairly simple easy and transparent. It sets up a way that we can actually get some information about that as to whether our tax system really is fair whether it really is simple whether it really is easy whether it really is transparent. That is exactly what the Taxation Principles Reporting Act was enabling us to do.By doing away with this Act the National-led coalition Government is working against us understanding the fairness the simplicity the easiness the transparency of the tax system. What a shame—what a shame. As my colleague James Shaw rightly pointed out we're pretty sure that the hard-working Inland Revenue Department officials hard-working people of great integrity have almost certainly already prepared the very first interim report on the tax principles. And yet nevertheless we're not even going to get that interim report. What a shame. So two things: doing away with the reporting requirement and doing away with the work that has already been done to assess the fairness simplicity and easiness and transparency of the tax system.Mr Watts went on to talk about a democratically elected Government. Indeed in the broad sense we are all part of the governance of New Zealand. We are all part of this democracy. But democracies thrive on transparency. They thrive when citizens understand what is happening. They thrive when people can participate meaningfully in democratic processes. They thrive when people have the information to do this. Now as someone who has worked in the tax system I know that tax is not easy. Look when I was a tax lecturer one of my first tasks every year was to stop my students being scared of tax. A lot of them found it quite confronting and hard to deal with. My first task was always—always—to help them to understand how tax worked and to get them to be familiar with it so that even if it wasn't easy they could at least get under way with working on it.Now if it was hard for students who had already done some basic accountancy if it was hard for people who wanted to know about the tax system how much harder for the rest of the country? Some of us in this House have specialised knowledge about taxation and we can bring that knowledge to bear in debates in this House but what proportion of New Zealand actually understands our tax system? I'm going to say it's probably not a very high proportion. That's a shame because tax really matters. It matters because democratically elected Government quite rightly asks their citizens to contribute to the running of the country. And how much they ask from each citizen is a matter for debate constantly and especially in elections. But how much better that debate would be how much better our democracy would be if we had the information we need about our tax system rather than just the very very basic level that people mostly have. So that is why this Taxation Principles Reporting Act would have added to our democracy. I wish I had had time in this speech to go through each of the principles and to talk about why each of the principles is important. Actually this is one of the things that would have been examined and in fact was examined in a select committee process. [Interruption]ASSISTANT SPEAKER (Maureen Pugh): I'm sorry to interrupt the member. Can I just ask for these conversations to be taken outside the House thank you. Apologies.Hon Dr DEBORAH RUSSELL: Thank you Madam Speaker. There was a select committee process where as always happens in select committee processes—Chlöe Swarbrick: Great report.Hon Dr DEBORAH RUSSELL: Great report. The wording of the bill at that time was changed in order to meet the concerns of submitters. Now of course not everything went the way that some submitters wanted but nevertheless there was an ongoing discussion about the content of those tax principles and about which tax principles should be in the bill and which ones should be measured. In fact it came off the back of a standard consultation process. It's one of the correct things about the IRD's policy process the generic tax policy process. It is an extensive process of consultation of exposure drafts and so on. So the principles in the ACT were extensively consulted on. Nevertheless all that work is going to go to waste. What a shame.I'm hoping that my colleagues on this side of the House will perhaps pick up some of the challenges that were issued by the Minister of Revenue. He said that we don't even agree on what fairness is in a tax system. That's simply not the case. Actually we do have a fairly good grasp on what people think is fairness in a tax system. We do know from survey research and so on that most New Zealanders think that we should have a progressive tax system that those who earn more should contribute more to the wellbeing of the country. Now there might be disagreement about how much there might be disagreement about how that is calculated and so on but most New Zealanders buy into the basic principle of a progressive tax system.So that's a vertical equity. Most New Zealanders buy into the notion of horizontal equity and I'm hoping that my colleagues on this side of the House will talk about these principles a little bit more. But there is actually fairly widespread agreement about what a tax system should look like and it's agreement within New Zealand—quibbling around the edges some detail and nuance but some broad agreement there. There's broad agreement in the tax literature about what a good tax system should look like. The only thing is we actually need to measure how it's working in this country and that National-led Government will not allow that to happen.