Cunliffe David: Taxation (Business Tax Measures) Bill — In Committee 
Cunliffe David: Taxation (Business Tax Measures) Bill — In Committee 
[Volume:653;Page:2010] 
Hon DAVID CUNLIFFE (Labour—New Lynn) 
: 
 In some brief concluding remarks for this part of the discussion from our side of the Chamber I will do something that is unusual around this place and particularly thank our opposite numbers on the Finance and Expenditure Committee. I think the chairman Craig Foss has chaired the consideration of this bill extremely well. I thank the officials who have provided sound advice to us and responded quickly to our questions and indeed I thank the Minister in the chair the Hon Peter Dunne for his undertaking today in the Chamber that he would follow up on some of the committee’s suggestions in the forward work programme including the issue of the patent life deductibility. 
I would like to chip in on one matter of fact and that is in respect of revenue forgone in regard to the use-of-money interest payments. The Minister has rightly pointed out that if all use-of-money interest was negated the fiscal cost would be about $400 million. That is true but the particular measure that the Opposition has suggested today which was a relatively minor realignment to the Reserve Bank’s 90-day bill rate would on Inland Revenue Department advice cost only about $5.7 million. These are incremental steps but I think they are ones that would add positively to the measures that the member who has previously resumed her seat drew attention to. 
In that regard it is worth reminding ourselves that this is not a trivial bill. The fiscal cost of these measures is close to $500 million and I guess that is why there has been a little bit of discussion in the Committee today about the mixed parentage of this bill—the bipartisan parentage of the bill—and it is important to see that because the uplift measure on its own is worth around 20 times the stimulus of say the impact of the 9-day fortnight on jobs. That is a $20 million measure; this is a $450 million - odd measure. That gives us some order of magnitude about the power of tax changes that might sound reasonably boring but if one is doing the books of a small business then as Amy Adams said they are real. So this bill does matter. It matters to real Kiwis to real small businesses out there who are among the 99.5 percent of businesses that do not qualify for the 9-day fortnight under the rules that have been espoused. 
The final point I want to make—and I hope the Government members will forgive me if this reiterates an earlier theme—is that we do have to hold in our minds the relative magnitude of the changes that have been proposed. By my count the total value of the stimulus that is going through now is around $13 billion of which $10.7 billion was from the Labour Government’s 2008 Budget. Of the new stimulus from the National Government around $500 million ostensibly was from the infrastructure package and around $500 million was from this tax bill. That is why we are pointing out that of that $500 million a good whack probably a majority are matters that as the Minister and I have earlier discussed were either in legislation prior to the election or were on the officials’ work programme or were announced by Labour as part of its intention for this term of Government. 
But that does not matter as much as the fact that we are working together as a Parliament right across parties and right around this House to try to do something to take the pressure off ordinary Kiwi businesses during what we know will be a pretty rugged 2009. I have just been rereading the Governor of the Reserve Bank’s testimony around the quarterly Monetary Policy Statement—to the same committee that has deliberated on this bill. He reiterates that he thinks 2009 will be a pretty ugly year but that we will see an upswing in 2010. I hope he is right. I hope that New Zealanders can see their way through this and the Opposition is committed to providing constructive suggestions working with all parties to try to make that as good a reality as we can. Thank you Mr Chairman.