Nash Stuart: Taxation (Consequential Rate Alignment and Remedial Matters) Bill — In Committee Third Reading 
Text is incorporated into the Bound Volume 
Nash Stuart: Taxation (Consequential Rate Alignment and Remedial Matters) Bill — In Committee Third Reading 
[Sitting date: 24 November 2009. Volume:659;Page:8247. Text is incorporated into the Bound Volume.] 
STUART NASH (Labour) 
: 
 I rise in support of the Taxation (Consequential Rate Alignment and Remedial Matters) Bill for the last time in this debate on the third reading. It is basically a technical bill but it is a very necessary one. I was a little surprised and disappointed to hear the Green speaker Sue Kedgley say that they are voting against the bill. The Green member on the Finance and Expenditure Committee Dr Russel Norman never once voiced any concern or any prejudice against this bill. Perhaps if he had at any stage we could have addressed some of his concerns. But not once did he articulate any concerns so it is a bit of a shame to hear that the Greens are voting against it. I thought we had full consensus on the committee. The bill is not about cutting tax at all; it is just about aligning tax rates. In fact this bill will probably make it a lot easier for taxpayers. But that is democracy. 
As articulated by the chair of the committee and my colleague David Cunliffe I would like to thank the Inland Revenue Department officials and the independent advisers for the work they have done on the bill. It is greatly appreciated and I think we have good legislation here. People talk about technical and non-technical bills. However in my very brief experience every tax bill is technical in nature because tax by its very nature is complex. Even though the mandate of the Finance and Expenditure Committee and the Inland Revenue Department is to make tax legislation as simple as possible tax is not simple. Simple is an education Minister standing in front of a secondary school teachers union conference and reading them a children’s story and telling Parliament it was a very good read. It might be at the same intellectual level as those on the Government side of the House but I tell members that it is not for those on this side. Simple was also putting forward a bill that will cost every New Zealander around $45 a week up to 2050—such a liability of a legacy for future generations. That is simple but this tax bill is not simple. That is why we are very reliant on the advice and the excellent work done by officials and advisers and I thank them very much. 
This bill has “remedial matters” in its title because it contains remedial amendments to the Income Tax Act 2007 the Income Tax Act 2004 the Goods and Services Tax Act 1985 the Tax Administration Act 1994 the Income Tax Act 1994 and the Maori Trustee Amendment Act 2009. That is why I am a little disappointed in the Green member because this bill makes tax just that much easier for taxpayers. It meets the six tests that any tax legislation should meet: economic efficiency revenue adequacy revenue integrity simplicity of administration and compliance coherence and equity and fairness. As I mentioned and as all my colleagues alluded to there were concerns over the equity and fairness of the bill and the Labour members of the committee have a slight level of disquiet over the fact that so many people—I think it is around 1.4 million New Zealanders—will still be overtaxed on their interest as a consequence of this bill. People asked where the 1.4 million figure comes from. Children from 0 years of age and all the way up whose parents have set up their bank account pay resident withholding tax as well so there are a lot of taxpayers who are affected by this. However I think we have come to a good compromise. There are a lot of people who will be overtaxed but the Inland Revenue Department has assured us that it will put education strategies in place that will mitigate the risk of overpayment. We have accepted that and we will follow progress with interest. 
The main issue that the bill addresses is to align resident withholding tax on interest paid to individual taxpayers with the new marginal tax rates. I spoke at length about it in the second reading debate— 
Hon Darren Hughes 
: Very well actually. 
STUART NASH 
: Thank you very much I say to the senior whip. I urge the 1.4 million New Zealanders who will be taxed at the incorrect rate to contact your bank and get your resident withholding tax rate changed. That includes you Mr Speaker; I said “you” on purpose there because it also includes every MP. So make sure you contact your bank and sort that out. There are other provisions of this bill that did not receive nearly the time and effort put into the resident withholding tax issue. They were debated though when debate was necessary. They have been spoken about in this House today and in the first and second reading debates. I probably do not need to allude to them again. As I mentioned I think this is good legislation and I commend it to the House. Thank you very much.