Collins JudithTAXATION (BUSINESS TAX EXCHANGE OF INFORMATION AND REMEDIAL MATTERS) BILLThird ReadingHon JUDITH COLLINS (Minister of Revenue): I move That the Taxation (Business Tax Exchange of Information and Remedial Matters) Bill be now read a third time. For the benefit of members I will briefly recap the three main items contained in this bill. This is a bill that aims to ensure that people pay their fair share of tax. Ours is a good tax system and most people do the right thing and pay their tax as they should. The Government wishes to encourage more people to do so by making it easy to get tax right and difficult to get it wrong.The principal proposal in this bill therefore helps to support businesses to pay their taxes by making the processes as easy as possible and in doing so reducing compliance costs for those businesses. To that end the bill addresses a key concern for many businesses: the processes for calculating and paying provisional tax. This bill introduces a new option for calculating provisional tax: the accounting income method which aims to more closely match income earning with tax payments and thus reduce compliance costs for small businesses. The bill also seeks to reduce or remove the application of use of money interest for the vast majority of business taxpayers. In addition the bill proposes to reform the late payment penalty by no longer imposing the monthly incremental penalty from new GST income tax and overpaid Working for Families credits assisting businesses that could trade their way out of debt.I said before that most people comply with their tax obligations. Unfortunately there is a small group of people who seek to evade their tax obligations by hiding their taxable assets offshore. The OECD-led initiative the Standard for Automatic Exchange of Financial Account Information aims to prevent and detect such tax evasion through greater sharing of information between jurisdictions. The second major component of the bill therefore proposes legislation to enable New Zealand's participation in this global effort. Under this initiative applicable New Zealand financial institutions will report information to the Inland Revenue Department on accounts held or in certain circumstances controlled by non-residents. The Inland Revenue Department will then share relevant information with other tax jurisdictions in specific countries. The Government is keen to ensure that New Zealand plays its role and meets its international obligations but at the same time the Government is conscious of the compliance costs for financial institutions. The bill therefore contains specific measures to help to minimise compliance costs.The third and final main feature of this bill is also concerned with international tax matters and proposes amendments to our foreign trust rules to ensure our disclosure rules are fit for purpose. These amendments are recommendations adopted from the recent Shewan inquiry into New Zealand foreign trust disclosure rules. The proposed amendments to the foreign trust disclosure rules will strengthen our rules and help make sure that we maintain our reputation in the context of best practice of international exchange of information.These are the main features of this tax bill. The bill also contains a number of remedial changes intended to ensure that the tax rules continue to be applied consistently and clearly. In bringing this bill to its third reading I thank the policy officials and the drafters who worked on the detail of the bill the organisations and individuals who made submissions on the proposed legislation and the Finance and Expenditure Committee for its consideration and recommendations. It gives me great pleasure to commend the Taxation (Business Tax Exchange of Information and Remedial Matters) Bill to the House.