Wong Pansy: Taxation (Depreciation Payment Dates Alignment FBT and Miscellaneous Provisions) Bill — First Reading 
Wong Pansy: Taxation (Depreciation Payment Dates Alignment FBT and Miscellaneous Provisions) Bill — First Reading 
[Volume:626;Page:21227] 
PANSY WONG (National) 
: 
 That sounds like a party that is readying to go into Opposition mode. It is obsessed with the National Party. Mark Peck devoted three-quarters of his speech to talking about National and I thank him for that. 
Before I start getting into this bill I wish to reflect on the title. It is known as the Taxation (Depreciation Payment Dates Alignment FBT and Miscellaneous Provisions) Bill. But what happened to annual income tax rates? The Hon Dr Michael Cullen the Minister of Finance who has that title for about 3 more months is obviously embarrassed to talk about this bill. In fact it is about confirming the high income tax rate. He is ashamed to even include that in the title. 
Anybody picking up this bill will miss Part 1 in total. The whole of Part 1 is devoted to reaffirming the high income tax rate. This is about the ninth Budget debate we have had on a taxation bill since I have been in this Parliament and it is the first time there has been a confirmation of income tax rates. But I am sure it is also the first time that that term has been totally omitted from the bill’s title. 
I think it is very clear that the public has sent a message to Labour: they are wholeheartedly disgusted with the arrogant minority Labour Government that actually thinks a 67c tax cut in 3 years’ time is what hard-working New Zealanders are entitled to. So National is opposing this bill because we are totally committed to cutting the tax that has been imposed on hard-working New Zealanders through both income tax and business tax. 
I want to pick up on some of the statements made by Labour members about how friendly this bill is for businesses particularly small to medium sized businesses in terms of compliance costs. One example is the subsidy for payroll agents. Clayton Cosgrove claimed that he has been a small-business owner although we do not know in what form or for how long. However this measure shows that he does not understand anything about being a small-business owner. 
Small businesses do not want a subsidy. They do not want to have to prepare their data to submit to payroll agents in order to meet compliance requirements; they simply want the Government to reduce compliance costs. That single initiative by the Labour Government supposedly to help small-business agents has resulted in about four or five pages of legislation that spells out for example who will qualify to be listed by the Inland Revenue Department as a payroll agent entitled to service businesses that claim a subsidy. 
For a start I have a warning for small-business people: they should watch out for the name cards of those so-called listed PAYE intermediaries. Three pages of the legislation actually outline who qualifies to be agents but small businesses must watch out. This is really scary stuff because the bill also spells out the consequences when employers and listed PAYE intermediaries terminate their arrangements with each other. There are also very strict criteria stating that both the agent and the business have to claim those subsidies within 30 days. I want to know whether business owners would be penalised if the agents made mistakes. Members should think about that. 
This is a typical Labour Government initiative. When Labour members say they want to reduce a compliance cost they introduce a whole range of compliance requirements for businesses in order for them to qualify to receive a subsidy—that is they introduce a whole raft of more compliance costs. 
The other matter I want to introduce into this debate is the change to depreciation rates. In general being an accountant I know that depreciation rates are introduced to reflect—[ 
Interruption 
] A fellow accountant as well. In general a depreciation rate is meant to reflect the economic life of plant and equipment in generating assessable income. So I welcome the fact that the Inland Revenue Department is revising its depreciation rates but I am slightly concerned that Labour members are saying that they know better how to influence business people’s decisions. Instead of saying that depreciation rates are meant to be objective and to reflect the economic life of the assets used in deriving assessable income the Labour Government is high-handedly moving to tell people what types of investment decisions they have to make. 
During the bill’s time in the select committee I will be looking forward to the Inland Revenue Department demonstrating to us what research it has done because it has decided to introduce a set of depreciation rates that will increase the economic life of buildings thereby discouraging so-called rental income. I am looking forward to campaigning in Clayton Cosgrove’s electorate and telling people how he dislikes New Zealanders who happen to earn their money and purchase a second property for investment for saving or for whatever purpose. He is going to make sure that those people will pay higher taxes. We want to know why Labour is hell-bent on penalising people who happen to be owners of properties and may rent them out to manufacturers etc. I shall give that member an example: owning property does have its purpose as well—manufacturing has to be carried out in buildings. So this bill is not entirely beneficial to businesses. 
National will also make sure that a lot of hard questions are asked of the Government so that it will have to explain to hard-working New Zealanders why the tax rates have not been adjusted and why it will take 3 years to bring in a 67c tax cut. 
I also want to share a piece of information that will be of interest to all small-business people. When looking at the Budget I found that in respect of the Inland Revenue Department the personnel cost for tax collecting is going up by $33 million. There will be $33 million more for tax collecting but the police will have an increase of only $41 million. My suspicion is that this Labour Government is more interested in ensuring that hard-working New Zealanders are subject to more scrutiny by tax collectors than in ensuring they get the protection they are crying out for. This Labour Government has seen fit to allocate more in the Budget for tax collecting but I want to know why hard-working small-business owners applying to have a subsidy under the payroll tax are actually going to be given the run-around again.