Ardern Jacinda: Taxation (Budget Measures) Bill — First Reading Second Reading In Committee 
Text is incorporated into the Bound Volume 
Ardern Jacinda: Taxation (Budget Measures) Bill — First Reading Second Reading In Committee 
[Sitting date: 24 May 2012. Volume:680;Page:2458. Text is incorporated into the Bound Volume.] 
JACINDA ARDERN (Labour) 
: 
 It is my pleasure to stand and give a contribution during the Committee stage of the Taxation (Budget Measures) Bill. I do so with a strange sense of irony. I started this afternoon at a protest on the forecourt that was led by people who were protesting on behalf of children in New Zealand. At that time they were protesting on their behalf to try to keep those children’s assets. By “assets” at that point in time they of course meant a majority share in our power companies probably not realising that actually the attack on their assets was a little more direct than that. In fact it was going directly to their back pockets.  
I want to explore that because we are debating Part 1 of the Taxation (Budget Measures) Bill which goes directly to the issue of exemptions that relate to minors and in fact to slightly above minors. I want to discuss that in a little more detail also.  
Part of me also wonders whether or not this is part of the Government’s attempt to try to educate children in the area of financial literacy because any under-18-year-old is now going to need to be aware of where their earnings sit to see whether or not they are eligible for exemptions. But let us get into that in a little more detail.  
Part 1 relates to the children’s active income tax credit. I wonder whether most New Zealanders knew such a thing existed. The Government is stating in its general policy statement that these tax credits along with others which we will discuss with my other colleagues are being abolished as “they are fiscally expensive but have long since ceased to have a strong policy justification.” It goes on to state that “a new exemption is created for children using the same eligibility criteria as for the abolished credit.” I find that there is a slight contradiction in the general policy statement because it goes on to state: “This new rule aligns more closely with the original objective of the children’s active income tax credit: reducing compliance costs for children by not forcing them to file income tax returns for small amounts of income.”  
First of all I would not mind the Minister in the chair the Minister of Revenue sharing with us how many tax returns are involved in this particular area. How many children are affected who would have been filing these income tax credits for such small amounts of money? Secondly if it really was about saving them compliance costs why would this change alone be generating revenue for the Government of $14 million? This is not about trying to reduce bureaucracy for children. This is about trying to increase revenue for the Government from our most vulnerable—from our most vulnerable. This is truly a “paper boy Budget” and it is an absolute disgrace that we have got to that level of desperation.  
But let us dig into this a little bit more deeply because I want to explore where the exemption level now lies as set out in Part 1. Basically it says that a child earning over $2340 of such income is required to pay tax on every dollar of that income. So $2340—what does that mean if we were to distil it down for a paper run for instance? I am sure the members on that side of the Chamber have not done this level of research in their break so I am very happy to share this with you. 
Peseta Sam Lotu-Iiga 
: Share it. 
JACINDA ARDERN 
: Mr Lotu-Iiga I can see you listening intently. From the brief research I have had an opportunity to conduct I can tell you that one paper run for a child of say 100 houses will generate an income for that child of roughly $16 per week. If you increase that to delivering to say 300 houses for your poor paper-run boy or girl you would immediately be over $45 a week which is where the threshold the Government has now set for them lies. So basically if a paper boy or girl delivers to 300 houses or more they are going to now be “required to pay tax on every dollar of that income” and that is how this Government is generating $14 million in revenue in its desperate “paper boy Budget”. It is an absolute disgrace that this aspirational Government is digging—