McClay Todd: Taxation (Annual Rates Employee Allowances and Remedial Matters) Bill — Third ReadingText is incorporated into the Bound VolumeMcClay Todd: Taxation (Annual Rates Employee Allowances and Remedial Matters) Bill — Third Reading[Sitting date: 18 June 2014. Volume:699;Page:18686. Text is incorporated into the Bound Volume.]Hon TODD McCLAY (Minister of Revenue):I move That the Taxation (Annual Rates Employee Allowances and Remedial Matters) Bill be now read a third time. The purpose of this wide-ranging tax bill is to bring greater clarity to the tax rules to ensure that they remain fit for purpose that they support business and innovation and that everyone pays their fair share of tax.The bill therefore proposes a number of practical measures to clarify the tax treatment of employer-provided accommodation accommodation allowances and other payments provided by employers to employees to reimburse them for expenditure incurred. There is clarification for the treatment of accommodation provided to ministers of religion based upon a historical agreement with the Inland Revenue Department as well as clarification for the Defence Force. Equally there are measures to assist employees who receive a clothing allowance as well as a uniform. This will be welcomed by the New Zealand Police force and other employees in New Zealand. In particular the measures proposed in this bill will help employers and their employees to determine where to draw the line between what is taxable and what is not when payments are linked to business travel secondments and projects.A second group of measures in the bill is designed to support business growth and innovation by clarifying certain rules and removing distortions created by the way some existing rules apply such as those arising from the current black hole tax treatment of certain types of expenditure. Under the changes proposed the deductibility of certain company running costs will be clarified and the expenditure on abandoned applications for patents resource consents and plant variety rights will be immediately deductible. A range of technical or remedial changes is also proposed to the GST rules to make them easier to understand and to apply.The acquisition date of land and agreements for the sale and purchase of property or services in foreign currency have also been clarified to give greater certainty to taxpayers as have the tax rules for charities that have been removed from the register of charitable entities. Other proposals such as changes to tighten thin capitalisation rules and the rules relating to the tax treatment of land-related lease payments are intended to remove distortions and protect New Zealand’s tax base. Finally the bill contains revisions to allow our financial institutions to more easily comply with the intergovernmental agreement signed between New Zealand and the United States last week.In reaching the third reading I would like to thank all those who have contributed to the passage of this bill: the policy officials for their work on the detailed content of the bill the drafters who have put the policy intent into the required legal framework the many people in the organisations who made submissions on the proposed legislation and the Finance and Expenditure Committee for its consideration of the bill and its recommendations for further fine-tuning. Finally I thank members of this House for their consideration. I commend this worthy Taxation (Annual Rates Employee Allowances and Remedial Matters) Bill to the House.Hon David Parker: I rise to take a call on behalf of the Labour Party—