Penk ChrisCHRIS PENK (National—Helensville): Thank you Mr Chair. It's a pleasure to speak on the Taxation (Neutralising Base Erosion and Profit Shifting) Bill at this the committee stage. I didn't have the benefit of—Hon Ruth Dyson: Committee of the whole House. Select committees are in the morning. CHRIS PENK: Excuse me—committee of the whole House. I thank the Hon Ruth Dyson for her intervention which is assisting my deliberation and indeed my timekeeping. Not having spent the time in the select committee I feel I know enough to speak to the bill but not so much that I have no questions of the Minister so perhaps he will allow me to pose some slight queries that I have. He might be able to gain some guidance from either the officials or perhaps Dr Deborah Russell or indeed himself—an expert in his own right of course. My focus has been very much the banking groups' role within the regime. It seems to me an important one given that banking groups themselves might be entities that have parent bodies and obviously exist and operate within New Zealand. Of course those are also gatekeepers to some extent in that they manage in a certain meaning of that phrase the tax or indeed the financial affairs of other entities again overseas and within New Zealand. So within Part 1 therefore I've been interested in particular in clauses 29B and 29C. Taking the first of those first I note that the bill will amend section FE 21(3) in the parent Act the definition of equity value" so that whereas the Act currently states that " 'Equity value' is the total financial value" of some five different criteria a sixth is now being added of course at new paragraph (f). I won't read the entire thing—Dr Deborah Russell: Oh go on.CHRIS PENK: —much as I would be encouraged by members opposite to do so but it seems that it's a pretty clear invitation to add into that calculation of value or indeed that definition of "value" financial arrangements that are not included in paragraphs (a) to (e). In other words to that which has not already been contemplated and captured in the first five criteria a sixth is to be inserted by way of a catch-all type of provision. So then the proportion of the financial value of such an arrangement—again as not already previously included—as the proportion of the total interest expenditure under the arrangement in the income year is denied in one of three ways. I won't spell them out in detail to the relief no doubt of all members of this committee including myself. But suffice it to say that it's a pretty comprehensive part of the section I believe and certainly that will have been the intent. The overall flavour of the Act—and indeed this bill to amend the Act—essentially is to be comprehensive. It is to capture those arrangements which have not already been contemplated and indeed caught by our existing tax regimes—of course specifically in the context of overseas parent entities operating in New Zealand under some part. So my question then Minister is whether you are confident now with the insertion of that point that the definition of "equity value" is going to be sufficiently comprehensive or if something even broader even more generic might be added to that section. I won't dwell on the fact that a third subsection relates to the timing of the commencement—1 July 2018 which feels like it might arrive before the end of my time speaking. That may or may not be just myself who feels that way but that's been noted by fellow members of the House as well as by submitters—the very short period of time that there will be for compliance and arrangement of affairs that would be appropriate so that entities can meet their obligations under this Act. So that's one of the two sections that I've been focusing on in relation to the rights and responsibilities of banking groups with the other being section 29C which amends in section FE 23(2) the formula for the funding debt that is to be made by a reporting bank which as I understand it is the broader entity which might have an overseas element."