Katene Rahui: Taxation (Business Tax Measures) Bill — Second Reading 
Katene Rahui: Taxation (Business Tax Measures) Bill — Second Reading 
[Volume:652;Page:1941] 
RAHUI KATENE (Maori Party—Te Tai Tonga) 
: 
 The Taxation (Business Tax Measures) Bill represents one of the more unusual moments in this House whereby the rapid passage of legislation is acceptable. Indeed I would go so far as to say that this bill should earn the unqualified support of the entire House because it is very much a product of the unique set of circumstances of the time. The Taxation (Business Tax Measures) Bill aims to improve the business environment for small and medium sized enterprises by easing the pressure of taxes on business cash flows and reducing business tax compliance costs. It responds to a call that was heard by a new Government with an eye to smoothing the inevitable rough journey ahead in the impending recession. 
We know from the expert advice of organisations such as the Federation of Maori Authorities that the arena of tax laws and business compliance costs for small and medium sized businesses is an area full of challenge. The federation has consistently promoted the view that the whole area of business tax needs urgent review. Its view is that tax laws need to be adjusted to allow businesses to grow and develop wealth for the whole nation. If the business tax laws are amended to support the growth of small and medium sized businesses the logical flow-on effects will be seen in employment higher wages investment research development and innovation. We know that Maori small businesses would particularly benefit from early intervention and the opportunity to undertake a process of being managed through difficulties. The advice again of those in the field is that such support would assist many to either stay afloat or if need be finish up with the minimum of administration and expenses. 
I said earlier that this bill is a product of its time and to persuade the House just how timely it is I bring attention to the initiative established by my colleague the hard-working Minister of Maori Affairs the Hon Dr Pita Sharples. My colleague is an action man. Dr Sharples moved fast hosting a very successful Maori economic workshop on 28 January 2009—a mere 7 parliamentary sitting days after he was appointed the Minister. I have it on very good authority that the world was created in 7 days. My colleague Dr Sharples was clearly setting out to follow that precedent. 
At the Maori economic workshop held in January there was considerable interest in this whole area of the nature of the assistance that would be useful to support small and medium sized enterprises facing difficulties in the current economic climate. Participants at the hui thought it was important to look at ways of reducing both the amount of regulation affecting business and the costs of complying with regulations. Specific concerns raised at the forum were to do with tax legislation and some of the suggestions proposed included tax relief for small and medium sized enterprises. Another proposal mooted at the Maori economic workshop was the deferral of provisional tax to small and medium sized enterprises over the next 3 years. A range of initiatives to support small and medium sized enterprises were proposed including developing an overarching organisation and investment fund to assist such enterprises to access finance. The thinking was that this could act as a clearing house to pool small and medium sized enterprise investment opportunities. 
Maori small and medium sized enterprises need to be positioned through advice and other support to take advantage of opportunities presented by the recession and future economic trends. I share some of these good points—OK brilliant ideas—with the House to make the point that Maori are investing in creative enterprise and applying their full entrepreneurial talents to create workable solutions to address the current economic climate. This therefore provides a very fertile ground for receiving the number of measures proposed in this bill. In fact when I consider that only six submissions were received and just 1 day was dedicated to hearing from interested groups and individuals I think the House should be very appreciative of the feedback I have been able to provide from these key stakeholders—the movers and shakers of the Maori business world. Indeed it is very good news for the Maori business community to be able to look over the host of amendments to current and proposed tax laws that are included in this bill. 
The aims of the bill are to reduce business compliance costs for small and medium sized businesses by raising reporting thresholds on PAYE fringe benefit tax and GST and by introducing simplified rules for deducting legal expenditure. These are in fact initiatives that reflect much of the korero that was laid down at the Maori economic hui. There was unreserved support from all participants at the hui to invest in job and business retention and stabilisation as the key short-term priorities. Change to reduce the tax liability faced by small and medium sized businesses was seen as a targeted measure to achieve the aspiration for job security and stabilisation. 
One of the particular strategies proposed by the small to medium enterprises cluster group was that tax relief should be provided for small and medium enterprises such as goods and services tax and pay-as-you-earn tax. Another proposal was grouped around the relaxation of penalties for late payment or staggered payment of compliances such as those related to Accident Compensation Corporation levies or GST.We believe that the Government could play a useful role in this period of transition through the means of tax relief and investment to maintain small and medium enterprise employment and cash flow. 
Another aspect of this taxation bill is related to instalments. Like Mr Boscawen I am a new member of the Finance and Expenditure Committee. The committee’s view on instalments in the context of difficult times was that it would be useful if taxpayers were able to enter into instalment arrangements with the Inland Revenue Department regarding tax payments This thoroughly good idea was shared with officials from the Inland Revenue Department and we were told that some new initiatives are being investigated to do exactly that. We in the Maori Party believe this initiative could be thoroughly relevant for providing assistance against the sharp edge of recession so we will be keenly looking forward to any updates from the Inland Revenue Department to this effect. 
We will be supporting this bill because we support any initiatives and interventions that allow businesses to grow. We support the reduction in business compliance costs; we support changes to reduce the tax liability faced by small and medium sized businesses; and we most particularly support the great initiatives taken by the Minister of Maori Affairs in bringing to the debate the perspectives of Maori in business of whanau hapu and iwi and of the greater Maori population about how to achieve growth and well-being while at the same time facing the current economic climate. I say to members that they should watch this space because very soon there will be more announcements to come regarding opportunities for Maori economic development. Kia ora.