Sharples Pita: Income Tax Bill — Third Reading 
Sharples Pita: Income Tax Bill — Third Reading 
[Volume:643;Page:12751] 
Dr PITA SHARPLES (Co-Leader—Maori Party) 
: 
 Tena koe Mr Assistant Speaker. For most tangata whenua across Aotearoa today will not be remembered for being the day the Income Tax Bill passed its third reading in the House but today may have taken on some interest if tangata whenua had been aware of the connection that can be made between this Income Tax Bill and the seventh Maori monarch Kingi Tuheitia Paki. 
Tuheitia is a direct descendant of King Tawhiao who lived from 1825 to 1894. Tawhiao the second Maori king was absolutely committed in his drive for Maori autonomy. He established a Parliament Treasury and a bank to house Treasury. His Cabinet included Ministers of Pakeha affairs—that sounds good—lands justice laws and taxes. Revenue was raised by voluntary donations ferry charges in Waikato tithing taxes fees and fines taken by the local runanga. It was all paid into the king’s Treasury. Indeed as the record goes it was King Tawhiao who had the first banknote in New Zealand printed. So significant was this early monetary foundation that to this day the Reserve Bank of New Zealand retains King Tawhiao’s profile in its formal coat of arms. 
Having established the symbolic relationship that exists between Turangawaewae Marae in Ngaruawahia and the debating chamber it remains only to be seen what practical contemporary relevance the Income Tax Bill has for tangata whenua today. Has the pursuit for rangatiratanga that was first anticipated by King Tawhiao borne fruit in the way in which the current Act will apply to income derived in the 2008-2009 and later income years? Did the drive for the Bank of Aotearoa anticipate that in 2007 only 10 percent of Maori would make it to the top income quintiles as compared with 25 percent of Pakeha? Did the Maori people in their desire for financial autonomy ever expect that many of them would be unable to retain a high proportion of income through the impact of GST student loans and now KiwiSaver? 
The Income Tax Bill is motivated by the objective of making the legislation clear while also minimising changes to the effects of the legislation and the associated compliance requirements of the Act. It all seems so uncomplicated—the genuine desire to rewrite the law to make it clear plain and consistent. They are laudable goals. The problem however is not just in the remedial amendments and corrections to the Act; the problem lies in the very nature of the taxation system which is for the benefit of some users and not others. 
Over the last few months we have seen New Zealanders placed in a precarious financial position due to the market failure of their investment in Bridgecorp VTL and Nathans Finance. We have also witnessed a Hamilton businessman from Rafia Trading Company being able to clock up evaded GST and income tax payments of more than $1.1 million with associated interest and penalties of about $2 million and New Zealanders who have either been dealt a savage blow by the vagaries of an uncertain market or who themselves have dodged and deceived their taxation responsibilities. But the criminal offence that we find most objectionable is the deliberate cryptic and complex confusion the State has instituted in the wilful elimination of some families from the tax credit system. 
We have talked previously about the way in which the Government has bracketed together three component parts of the existing taxation structure: minimum family tax credit which used to be family tax credit; in-work tax credit; and family tax credit which used to be family support. We are to refer to them now as the singular Working for Families tax credit. 
If all of that sounded scrambled to us just imagine what it is like for so many families who do not know the actual value of the component parts of the system who are not able to calculate their entitlements and abatements and who are therefore unable to know how to work the system to maximise their income and to know when and how abatement makes it unprofitable. 
The very real fear we have is that too many families will find it too confusing to apply for their tax credits and will simply miss out. The system reeks of the emperor’s new clothes. The obvious truth is that Working for Families and the in-work payment discriminate against specific targeted parents despite the proclamation by the Government that it is a Government that cares. It is a Government that says it cares for young trainee apprentices even though the majority—54 percent—of those enrolled in 2001 and 2002 dropped out of the Modern Apprenticeships programme. 
It has taken 15 years to rewrite the Income Tax Bill into its current version of some 3041 pages. It was a pleasure to note the recommendation of the Finance and Expenditure Committee that Part M should be redrafted to give effect to the purpose of clarifying and simplifying the legislation. Given the complexity of the Working for Families tax credits the select committee recommended that any review of Part M should be taken separately. Those are views we certainly support. 
We endorse the intention of promoting accessibility of the rewritten version to be easily understood by non-specialists but we remind the House that it is not simply a matter of renumbering or reformatting on the basis of the advice of the Rewrite Advisory Panel that the House is being asked to consider this afternoon. 
Today we are considering the influence of the neo-liberal policies that at the very least have not created the equitable distribution of wealth through wages and benefits. This has resulted in large disposable income increases for high-income earners in direct contrast to ongoing decreases for low-income earners. At the very minimum we would expect that the worst-off families in Aotearoa have an adequate income to invest in and sustain their children’s future. 
Back in 1886 the prospectus of Te Maungatautari Whare Utu the Bank of Aotearoa included the following statement: “whereas the Maori People so banking have been grievously wronged in their dealings with these Europeans who have largely profited thereby: and whereas our hearts being greatly grieved at this robbery of our people: be it known therefore that we the Chiefs of the tribes aforementioned in council assembled have decided to start a Bank for the use of the Maori people.” 
The quest for self-determination resulted in the establishment 121 years ago of the Maori bank. In 2007 there is continuing and solid evidence to support the initiative of such an institution but the ongoing responsibility and opportunity provided within the Treaty partnership should also be seen in income tax reform and based on the equitable distribution of wealth. 
The Maori Party suggests that at its very basic form the income tax rewrite project could have provided the means to progressively transform the in-work payment into a form of family support that could be transferred and that could benefit all children on the same basis. 
The ultimate outcome of the transformation project could have been to achieve a universal family benefit that truly acknowledged the unique role of parenting and caregiving and that treasured and valued the significance of children as the wealth of the nation. Now that would have been a day that all New Zealanders would remember this third reading of the Income Tax Bill for.