Woodhouse Michael: Taxation (Transformation: First Phase Simplification and Other Measures) Bill — Third ReadingText is incorporated into the Bound VolumeWoodhouse Michael: Taxation (Transformation: First Phase Simplification and Other Measures) Bill — Third Reading[Sitting date: 31 May 2016. Volume:714;Page:11531. Text is incorporated into the Bound Volume.]Hon MICHAEL WOODHOUSE (Minister of Revenue): I move That the Taxation (Transformation: First Phase Simplification and Other Measures) Bill be now read a third time. As the name suggests this bill focuses on removing some of the more immediate legislative obstacles to the Inland Revenue Department’s (IRD) reform of our tax system. Over the next few years the department’s Business Transformation programme will be implementing more customer-focused business practice and new technologies to make it simpler for people to complete their tax affairs and get them right.Making it easier for businesses to get their tax obligations right and harder to get them wrong forms the basis of the Government’s new small to medium sized enterprise- friendly tax reform package included in Budget 2016. That is part of two very important budgetary measures that were announced last week. The first was $857 million to underwrite the IT system that will form the basis of these changes and of course the $187 million measure effectively sees the end of provisional tax for small businesses that choose to use their systems to meet their tax obligations not have to comply with Inland Revenue Department’s systems which will change to suit small businesses.This is a small measure. The measures in this bill are actually small—I am sure we will hear Mr Nash and Mr Cosgrove talk about what giant leaps these are not and indeed they are not really intended to be. But the train is very much on the track for the transformation that is required and we have now committedover the next few years to the sorts of changes that can only take place with those IT changes and with the Business Transformation project successfully implemented. It is a very large project—probably the largest Government IT project embarked on in real terms for a very long time but I am confident—Hon Clayton Cosgrove: Since INCIS.Hon MICHAEL WOODHOUSE: Yes it may well be since INCIS—not the exemplar I would suggest and certainly those sorts of things are learning experiences that I know IRD and the Government Chief Information Officer have taken on board. I am confident that we are very much on track to deliver the solution that will enable the small business community—in fact all businesses and taxpayers—to as I said make it easier to get it right and harder to get it wrong.Briefly the changes in this bill will make it easier for employees to participate in employee share schemes where an employer can make source deduction payments rather than rely on the employee to meet their tax obligations at the end of the period. It will allow IRD to prepopulate employee income reducing the need for employees to file returns on this income and of course it will change some of the outdated measures around the requirement to have signatures and the delivery of correspondence by IRD by old technologies like post or in writing. Certainly we are now in a much more electronic and ubiquitous world where those sorts of modern digital communications will make it much easier and more efficient for both Inland Revenue Department and the taxpayer.There are some other taxpayer-friendly changes proposed in the bill. It will allow Inland Revenue Department to give better service to its customers by providing a KiwiSaver scheme with the names and details of members who have transferred out of their schemes in the name of the member’s new KiwiSaver scheme; halving the time that taxpayers with personal tax summaries will have to wait for their refund providing they meet a new automated refund threshold thus benefiting around 400000 more taxpayers; and providing special tax codes directly to the Ministry of Social Development to help people receiving New Zealand superannuation or a veterans pension to meet their income tax obligations.At the Committee of the whole House stage there were some small but important changes and provisions inserted into the bill. Those changes will allow the Canterbury earthquake provisions to continue to apply as intended despite the repeal of the Canterbury Earthquake Recovery Act.In bringing the bill to its third reading I want to thank again those who contributed to its success so far in particular the officials who worked on the policy details behind the measures the drafters the submitters and the very good Finance and Expenditure Committee for its consideration under the guidance of its able chairman Mr Bennett. This bill contains some very useful taxpayer-friendly groundwork for the continued modernisation of our tax administration system and I commend it.