McKelvie Ian; Williams PotoIAN McKELVIE (National—Rangitīkei): Thank you Madam Assistant Speaker. Well most things that need to be said sensibly have been said so I'll talk about some other things tonight. I joined this select committee during the latter stages of this bill and took a while to pick up the threads of it. I was impressed with the way the committee worked through this very complicated piece of legislation.I also want to make comment on Therese Turner who was the adviser appointed to that committee. In my experience in this Parliament wherever we get a well-qualified independent adviser appointed to a committee to assist with complicated pieces of legislation it gives the committee great confidence going forward because as has been said by a number of people tonight it's quite a complicated piece of legislation and I don't think too many of us pretend to be tax experts. A lot of us have a lot of trouble with the tax department but we're not tax experts and I think there's quite a difference. So I was really impressed with the advice the committee received and the way that Therese Turner particularly made her points. I thought it was really worthwhile and I think the committee accepted that pretty well.As has been said the bill originated with the National Government under Judith Collins. It was written to pick up recommendations from some work done by the OECD. It's an attempt to tax and consequently prevent multinationals from using various accounting methods and other methods to ensure their New Zealand branches pay no tax. Having said that it shouldn't be taken from those comments that all multinationals in New Zealand behave in that manner because many of them are very good corporate citizens of New Zealand and behave as you'd expect them to. Of course some of these things that happen with taxation happen—I guess they're almost accidents of history. So you'll get interpretations of taxation law that change over time and the IRD clearly have great difficulty keeping up with some of the interpretations that are used by numerous very talented tax experts around the world. Obviously these companies as has been said already tonight employ the very best operators I guess not to avoid tax but to minimise their tax exposure and I think most people do the same sort of thing.So it's been estimated that up to $200 million in tax may be collected—in fact we just heard a much larger figure than that—but I think it's very unlikely as the earliest estimates of the previous Government were as low as $50 million. I suspect that somewhere between the $50 million and the $200 million will be the amount that's collected. But no matter what that amount is it's important that we use the principle of applying firm and fair tax law that doesn't impact on international confidence in the New Zealand economy. So we have to have tax law that's fair and acceptable by international standards. I think this bill probably meets that measure.Taxation's an ongoing challenge for the IRD and for the Finance and Expenditure Committee as tax law needs constant revision. As I said every new generation of tax expert finds another way of short-circuiting the tax law that's in place and consequently we've got to update and upgrade our tax law. Some of the tools that companies have been using to deal with this or to avoid paying tax are the ability to charge excessive interest to their New Zealand arms and consequently lower their profits or take the profit completely out of the country. There are plenty of other artificial methods of overstating costs which can be used quite easily. Some related-party transactions are designed to ensure profits are not generated here.The other interesting thing that really interested me—and I want to concentrate on it a little bit longer tonight—was the issue of the provision of information to the IRD and how the IRD goes about getting information from those foreign-domiciled companies. That's a challenge in lots of pieces of legislation—not just tax law in New Zealand—where we need to get information from the foreign owners of New Zealand operations of all sorts. So I was quite intrigued by the bill's approach to try to find or try to get that information. So the revised bill requires that the requested information relates to an investigation of a multinational group's tax position. This reduces privacy concerns because the bill as originally written could've requested information from a natural person such as a bank customer who is not part of a multinational group. So there were some changes made to the way in which the IRD or the investigating body could go after the information but none the less it's cleared it up pretty well and I think it's come up with a very fair solution to that challenge.So the chairman of our committee said earlier that this will work and that some of the bigger companies are changing their practices as a result already. I just hope that they're changing their practices in a positive manner and not a negative one because they think well forward a lot of these people and so it is easy to change the intent of some of these pieces of legislation if we're not careful how we handle it.So I look forward to the discussion in the committee stage and I commend the bill to the House. Thank you Madam Assistant Speaker.ASSISTANT SPEAKER (Poto Williams): I understand this is a split call. Tamati Coffey—five minutes.