Woodhouse MichaelHon MICHAEL WOODHOUSE (National): Thank you Mr Chair. It's always a risk for a former Minister of Revenue to be speaking on a bill like this—particularly one where he wasn't on the select committee—but I'm going to give it a go nevertheless and try not to sound like the grumpy uncle at the family reunion.I do want to acknowledge the Minister in the chair Stuart Nash and his efforts to address the technical questions that the committee has put to him because I think it is a credit to him and to the process of the committee of the whole House that we don't always see in this Chamber which is a preface for a relitigation of an answer that he gave. I do so because I think it is fundamental to the powers that we are trying to give—and the curbs on the powers that we're trying to give—inland revenue in respect of the seven-year limitation on the transfer pricing arrangements.Now there was a very good exchange I think between the Hon Amy Adams and the Hon Stuart Nash in respect of that point and I want to come back to it because I believe there is a risk in not carefully wording the intention that the Finance and Expenditure Committee and the Government have in respect of this clause—I think it's clause 36(4) amending section GC 13. I know some very good tax accountants and lawyers in the market and we now have on record the Government's intent but I don't believe that we have it in the words that will end up in the Act if the bill is passed as it is now. Essentially we can break down clause 36(4) this way: there is a time bar; there is an exception to it. An amendment can be made for up to seven years if in the first four years—and these are the key words—the Commissioner notifies the taxpayer that this subsection applies."Hon Ruth Dyson: We've heard all this.Hon MICHAEL WOODHOUSE: That's right but here is the point. What we risk if this amendment is not approved is that every single decision inland revenue make to extend the time bar will have challenges brought to it probably into the courts by very very good lawyers and accountants who are working for large companies that will want to reduce the time bar to the shortest period possible. Now it may well be that there is a legitimate investigation under way but the law doesn't require that to be the case except we now have the select committee report and the Hansard of this debate where the Minister himself as well as the shadow Minister of Finance have accepted that the intention of this was for an investigation to have started. And if the law doesn't say that then my concern is that the decision will be challenged in the court and set aside and the taxpayers will be the worse for the fact that if the transfer pricing arrangements were found to be unlawful or incorrect in law then that cannot be properly challenged.It's no surprise that the IRD would like to take a longer time. I think that's understandable. Indeed these arrangements can be notoriously complex and if they are not subject to advance pricing arrangements as the law allows and they are not well-known to inland revenue then it is possible that they don't come to the department's attention until quite late in that four-year period. But the expectation that the committee had was that an investigation should have commenced.Now I was fascinated at the Minister's comment that the term "investigation" is not defined. I'm not a lawyer but I would have thought that in policing in commissions of inquiry and in tax law "investigation" has a nomenclature and is an understood term that is more than just kicking the tyres on a tax return—that something has to have happened. I go back to what I believe is a very well-worded handwritten amendment by the Hon Amy Adams and I would implore the Minister to rethink whether or not for the avoidance of any doubt—he has given us his assurance that he thinks the words in clause 36(4) are OK and I don't want to challenge that. But for the avoidance of doubt there is no harm in considering this amendment."