SpeechHon Dr DAVID CLARK (Labour—Dunedin): Thank you Madam Speaker. It is a pleasure to speak on this bill as we set the annual rates for the 2022-23 year and it is entirely appropriate of course that the Parliament debates these rates every year. It is part of the process of affirming that Governments have responsibility for those challenging but important decisions around how to have a tax system to afford the necessities that we all rely on: the hospitals the schools and the roads that we all use and all need and must be paid for somehow. But appropriate scrutiny of the Parliament is an important part of that process and that's what we're engaged in right now. Now of course in New Zealand we have what is described as a low rate - broad based tax system and the rates that are proposed in this bill are a continuation of the rates that have existed previously. So we are arguing for the status quo by and large. But I'll come to the fact that within this bill there are also some improvements to our tax system that improve equity that improve fairness that improve the integrity of our tax system and that remove some of the distortions that have emerged over time because of course technologies change the use of different technologies changes the way our businesses respond to new technologies changes and of course the way the tax system applies to them subsequently changes as well. And it's appropriate that we should update the rules as parliamentarians to ensure we retain the integrity of that low rate - broad based tax system that we have here that serves us so well that makes it easy to collect taxes that makes it—the important step of making sure that everyone pays their fair share. And we know that in systems where everyone feels that they are paying their fair share of tax that compliance goes up. It becomes easier to collect tax requires less resource to collect the tax necessary to pay for our schools for our hospitals and for our roads. And with that of course comes a lower overhead on the actual collection of those taxes. So I'm very much in support of the bill before us. It does address I think some important distortions in our system that have emerged between the platform economy on the one hand and the traditional providers of services on the other. It's interesting; I was looking back in researching this speech at some of the previous positions taken in this House on the platform economy and one that stood out to me was a member of this House being really clear that A strength of the New Zealand tax system is the fact that taxes are applied fairly and evenly and there are few exceptions. There's a whole lot of positivity around our GST rules being applied equally with few exceptions to help us ensure that tax is fair efficient and simple." These are all words of the sometimes very wise the Hon Michael Woodhouse who we heard speak in the debate not so long ago speaking in favour of the National Party app tax in 2016—not so long ago. And to be fair those were about a tax that would ensure that our system remains broadbased that it actually applies fairly to businesses large and small and it doesn't create distortions in our tax system that enable large often overseas-based digital platforms to compete on an uneven playing field with an unfair advantage over our locally owned businesses who are paying their tax and operating perhaps in a more traditional manner or perhaps just simply complying with the rules as they stand here. We want a fair system where every business can compete in the market including those who are providing services traditionally but also in the future as more businesses shift to a digital platform we want a fair application of the rules across the board. So one important thing this bill is doing is removing a potential distortion in our tax system that is emerging as more and more people shift to work in the digital economy. So that broad based - low rate approach that helps to ensure that our GST is fair generally free of all sorts of complexities seen in the other taxes around and other taxes around the world and I'm quoting Michael Woodhouse again "is the system indeed that we want here". It seems a shame that the National Party may now suddenly take umbrage at a proposal that they have sung the merits of before in a different context when they were in Government because I think everybody in this House really appreciates the fact that we should have a fair system. We might debate around the edges about what that looks like but we want a fair system where people pay their fair share where it can continue to be low rate and broad base. So this bill does a number of other things though which I want to touch upon in the remaining time. One of those is the implementation of the information-reporting and exchange framework developed by the OECD on digital platforms. Some members of the House will be familiar with BEPS work that the OECD has done in the past—base erosion and profit shifting—acknowledging that with these digital service models it's possible to have tax residence in a way that's advantageous to a company—a large company that's able to structure its tax affairs in a way that benefits it sometimes is unfair to those who derive the services under that system that they've set up. Again—I mean we know that the likes of McKinsey have estimated that tax evasion globally is worth trillions and that tax evasion around the world undermines the integrity of the tax systems undermines confidence in Governments in providing those services those hospitals those schools those roads that we all need. It's very important that tax systems around the world have integrity and that information can be shared across a common framework. So I commend this part of the bill that we've got before us in adding in the ability to have those information-reporting and exchange frameworks and that New Zealand is a part of them.Further reducing complexity of a tax system where appropriate—we've got a reform in this bill of the GST apportionment rules and that will make it less onerous and less complex for businesses to work out how GST apportionment rules apply. Again that's about improving fairness overall so that there isn't an increased burden for our small businesses. The bill reduces complexity also in that it's modernising and enabling greater flexibility for tax treatment for cross-border workers—it's quite a mouthful. But we've heard Ingrid Leary speak a little about that and other members about the technical aspects of the bill and the debates that were had in select committee to make sure that those rules were fair and more modern. And again it is good that we're updating our tax system—again to reduce complexity to make sure it's fair and that people can comply with their obligations easily. Further to removing distortions in the bill we've got the proposal it contains to remove from fringe benefit tax from commuting via public transport for work purposes. I think this is a really great step forward. We don't want distortions in our economy that encourage people to use cars where they don't need to where they obviously can be more harmful to the environment than public transport where there becomes a competition for car parks and we end up building more car parks that are not necessarily the most attractive things in our urban centres unnecessarily. We just want to remove the distortions to make it equally advantageous for people to take public transport if that's their choice and we want to make it easier also—and this is also in the bill—for people to make other environmentally friendly choices like taking bikes or electric scooters or electric bikes to work if a business is wanting to support their employees in those modes of transport. So the fringe benefit tax changes there I commend to the House as well as a removal of unwanted distortions in our tax system.So if we go back and look from start to finish in this bill we see that it does those things that a good tax bill should do. It confirms the rates and enables us to have a debate about what the rates should be in this Parliament to make sure that everyone's paying their fair share of tax that we've got the tax necessary to afford the hospitals the schools the roads we need that our tax system has integrity that we remove the distortions that we set the incentives up right for a system that everyone can then know is fair. And it ensures overall that it's brought up to date so that as business practice changes as consumer preferences change we've got a tax system that holds water that is able to collect the tax that's required for the projects that we have as a Government on behalf of the people of New Zealand an up-to-date modern tax system that serves all of our needs and above all is fair. Thank you Madam Speaker. I commend the bill to the House."