Nash Stuart: Taxation (Land Information and Offshore Persons Information) Bill — In CommitteeText is incorporated into the Bound VolumeNash Stuart: Taxation (Land Information and Offshore Persons Information) Bill — In Committee[Sitting date: 09 September 2015. Volume:708;Page:6442. Text is incorporated into the Bound Volume.]STUART NASH (Labour—Napier): There is one thing that we have not discussed that was brought up at the Finance and Expenditure Committee. It did take a little bit of time to work through it and understand the consequences. This is actually going back to section 24BA in clause 10 which is headed “Offshore persons’ bank accounts and tax file numbers”. A little bit has been said about this and I will quote section 24BA(1): “The Commissioner must not allocate a tax file number in response to an offshore person’s request unless the Commissioner first receives a current bank account number for the offshore person.”Where the Labour members had some concerns about this is that as we know we are a destination for a lot of young travellers. People who come over here work in the orchards. They work during the tourist season and then they disappear. Back in the day when people were paid wages obviously everyone had a bank account. That is how transactions were done. But what we saw as an unintended consequence of this—and this was also I must admit brought up in a submission from Chartered Accountants Australia and New Zealand—was that if a traveller or a young person was passing through and wanted say an orchard job or a grape job they would need an IRD number to get paid. In Hawke’s Bay there are a lot of travelling seasonal workers. But what they will require in order to get an IRD number is a bank account.The unintended consequence that was raised by Chartered Accountants Australia and New Zealand and the Labour members was that this provides upon a certain group a level of compliance that perhaps should not be there or is unnecessary—so for example if I want to go and work in an orchard or a Chilean person for example does. We have a number of these agreements with different countries. Let us say they want to go and work in an orchard in Hawke’s Bay. They need an IRD number in order to get paid. Well gone are the days when you got paid under the table in Hawke’s Bay orchards. I do not know what it is like in the Wairarapa but it certainly does not happen in Hawke’s Bay.So they need an IRD number but they also need a bank account. To have a bank account you need various forms of ID. I am assuming that your passport would do but normally when you open a bank account you need two forms of ID and it is usually two forms of picture ID. What has happened in recent times is we have tightened up the law due to as I mentioned earlier tax-avoidance provisions and concerns. In fact it is in the Anti-Money Laundering and Countering Financing of Terrorism Act 2009. It is quite a large piece of legislation. But what it has done is tighten up the means to achieve a bank account.So what the Chartered Accountants Australia and New Zealand said and what we said is that we do not think that actually having a bank account in the first place should be a prerequisite for getting an IRD number because it may provide a level of compliance that is unnecessary for a certain group of people who are coming in here. In fact one group that was actually used as an example was oil rig workers. They come in here and they earn a substantial amount of money. This is not my example but it was certainly brought forward—it might have even been by the Inland Revenue Department but it was certainly by someone with much greater understanding of this than I have.They come in here and they are paid in New Zealand dollars because they are in the New Zealand tax jurisdiction. They sort of fly in and fly out. But their money is paid into an offshore bank account because that is the nominated bank account and that is the way it apparently works in the industry. But they will now need a New Zealand bank account. Again it just provides a level of compliance that we think is unnecessary and I say that especially because the Minister has stood up and said that they want to limit compliance and get rid of complexity. But we think that this is just opening up a level of compliance and complexity that does not necessarily need to be there.But as the Chair knows incredibly well how the select committee process works and the reason I think it is fantastic is that we get a whole lot of experts in and they put forward their views on how to better draft legislation that is workable in the real world. In terms of Part 2 we heard from Ernst and Young and the Chartered Accountants Australia and New Zealand. PricewaterhouseCoopers put in a couple of submissions—three or four actually. We heard from the New Zealand Bankers’ Association ANZ and Chapman Tripp. They were all querying the need to actually get a bank account number before you get an IRD number. The concerns ranged from the time it actually took—