Flavell Te Ururoa: Taxation (Consequential Rate Alignment and Remedial Matters) Bill — First Reading 
Text is incorporated into the Bound Volume 
Flavell Te Ururoa: Taxation (Consequential Rate Alignment and Remedial Matters) Bill — First Reading 
[Sitting date: 28 July 2009. Volume:656;Page:5170. Text is incorporated into the Bound Volume.] 
TE URUROA FLAVELL (Maori Party—Waiariki) 
: 
 Tena koe Mr Assistant Speaker. Kia ora tatau katoa i tenei Wiki o te Reo Maori.  
[ 
Greetings to you Mr Assistant Speaker and to all of us in this Maori Language Week. 
]  
Franklin D Roosevelt once said that “Taxes after all are dues that we pay for the privileges of membership in an organized society.” Koina tana korero. Ma te pire nei e whakahouhia ai nga paearu whai turanga i runga i nga rerenga ketanga ki te Income Tax Act 2007. He pire tenei ki te whakatika i nga ture e hangai ana ki nga reanga take e puritia ana kia orite ki nga reanga take o naianei. Ko te pire nei he hangai ki nga rereketanga i mahia ai i mua; he whakahou hoki i nga ture take. 
[ 
That is what he said. With this bill the membership form is updated and the organised society gets a facelift as consequential changes are made to the Income Tax Act 2007. This is a catch-up bill one that makes the necessary changes to certain withholding tax rates to ensure they align with recent tax rates and threshold adjustments. The bill catches up with earlier tax changes as well as making changes to update tax law 
.] 
So amendments are made to the Income Tax Act 2007 and also to the Income Tax Act 2004 the Goods and Services Tax Act 1985 the Tax Administration Act 1994 the Income Tax Act 1994 and the Maori Trustee Amendment Act 2009. 
E hoa ma e toru nga wahanga motuhake nei o tenei pire hei aro tahitanga ma te Paati Maori. Tuatahi ko te whakamaramatanga o tenei mea te pakihi ngaherehere kia tapirihia ko nga mahi permanent forest sink initiative me ki ko te permanent forest sink initiative ae kia orite tonu te utu take ki nga kaimahi ngahere katoa. Kei roto nei te kupu whakamahukihuki kia ahei ai te hunga permanent forest sink initiative ki te tuhi i ana utu hei “utu pakihi” i roto i te kaupapa take. Kei te mohio tatou o te whare nei ko tenei mea te permanent forest sink initiative he mahi tiaki i te taiao. Ma te whakatipu ano i te ngahere e whiwhi ai te tangata i nga piro whai-ao. E ai ki nga ture take o naianei ahakoa e riro mai ai te kamupene nga piro whai-ao ehara i te mea ka whai mana hei pakihi ngahere. Ko te raru ia he pai ake nga hua take o nga pakihi ngahere i o era atu pakihi. No reira ko te rawekeweketanga e kitea ana i roto i tenei pire he whakaae kia noho ai nga permanent forest sink initiative hei pakihi ngahere i raro i ture. Na te mea e tika ana kia orite te utu take o nga permanent forest sink initiative ki ta nga pakihi ngahere kua tinihia te tautahi o te “pakihi ngahere” i roto i te wahanga YA 1 o te Ture Taake 2007 kia noho tau ai te permanent forest sink initiative i roto. Koina te ahuatanga tuatahi. 
Ko te ahuatanga tuarua ko nga rawekeweketanga ki te ture Take Hokohoko 1985 kia utuhia te take hokohoko o te kaupapa paranga i raro te ture Whakakore Parahanga 2008. He kaupapa nui tenei e whakatumeke mai i a matou na te mea 27 ra noa iho tona pakeke a kei te rawekewekehia ano. Kei te hiahia ki te whakarongo ki nga korero o te Minita mo nga take e whakamarama mai ana he aha i kore ai ia i aro atu ki nga ahuatanga GST i mua i te whakamana i te Waste Minimisation Act hei ture. 
Hei kupu whakamutunga ko te take tino whakaharahara ko nga rereketanga e pa ana ki te take pupuritanga. Na te uaua ki te whai i nga tohutohu maha o te take i etahi wa he ngawari ake te mahi moni tuturu i te whakakiki i nga tono take. Kei roto i tenei pire nga reanga take pupuri hou i runga ake i tera ka utua ki ia tangata kia orite ki nga rereketanga ki nga take ake a-tangata. Hei ta te pire nei ki te kore te tangata e whaki i te utu take tika ki te peke ka 38 pai heneti te rahi o te take e utua. E ai ki etahi he huarahi nanakia tenei ki te akiaki i te tangata ki te tuku i te utu take tika mo te huamoni ka riro mai i nga peke.  
He pai tonu ki a au nga korero a te mangai take o te Deloitte ki Otepoti a Peter Truman. E ai ki a ia ki te whakaturehia tenei pire hou ka nui atu te utu take ki runga i te putea tuku. Hei ta Mr Truman i tatari ai kei te patua-a-pukoro e te Kawanatanga te hunga e ngoikore ana ki te tuku i te reanga take tika ki nga peke ana ko ihu mangere raua ko ihu wareware tera. E ai ki nga wheako o tenei matanga take o Te Tai Tonga ko te rahinga o te tangata kaore i te tuku i te reanga take tika ki o ratou peke a ko tera te hunga ka patua e te pire nei. Na runga i tera me noho whakahirahira te rautaki whakatairanga o te Tari Taake kia tae marama kia tae tika nga tohutohu ki te hunga mahi huri noa i Aotearoa. No reira kei te tautokona e matou te panuitanga tuatahi o te pire nei i runga i te mohio hei te wa komiti whaiti e puta mai ai te matauranga me te maramatanga. 
[An interpretation in English was given to the House.] 
[ 
There are three features of this bill in particular that the Maori Party wants to comment on.  
The first aspect is the new definition of forestry business to include permanent forest sink initiative activities so that all foresters receive the same tax treatment. Basically it clarifies the state of play so that the expenses of participants in the permanent forest sink initiative can now be treated as forestry business expenses for tax purposes. The permanent forest sink initiative as the House will be aware is a climate change initiative in which a person intending to reforest can in exchange for meeting certain conditions receive emission units. Under current practice the earning of these emission units may not always constitute a forestry business under the Income Tax Acts whereas forestry businesses are entitled under the Act to more favourable tax treatment than other businesses. So the simple change introduced in this bill is that the reference to forestry business is now amended to include initiatives under the p 
ermanent forest sink initiative. Since permanent forest sink initiative foresters should receive the same treatment as foresters who carry on a forestry business the amendment defines “forestry business” in section YA 1 of the Income Tax Act 2007 to include permanent forest sink activities.  
The second area of interest relates to the proposed a 
mendments to the Goods and Services Tax Act 1985 to provide that GST is payable on the waste levy imposed by the Waste Minimisation Act 2008.  
This is particularly of interest in that it has been only 27 days since the new waste disposal levy was introduced and already we are changing it. It would be interesting to hear from the revenue Minister how the Waste Minimisation Act 2008 could have been passed into law without the necessary adjustments such as GST being taken into account. 
Finally the last—and probably the most significant—of all the changes is that related to the resident withholding tax. Sometimes it appears as if more brain and effort are required in understanding all the tax compliance requirements in order to complete the income tax form than is required to make the income in the first place. The bill introduces new resident withholding tax rates on interest paid to individuals to bring them into line with recent changes to personal tax rates. In particular the bill introduces a new default rate of 38 percent for people who do not notify their bank of their correct tax rate. The changes to the default rate are being described as a type of perverse incentive to motivate people to use the correct tax rate for the interest they receive from their financial institution.  
I was interested to read the analysis of Dunedin Deloitte associate tax director Peter Truman. It was his opinion that the tax changes being proposed by the Government would catch investors unaware leaving them paying more tax on their investment income. According to the analysis by Mr Truman the Government is increasing its tax take from those who are not motivated or organised enough to advise financial institutions of their correct tax rate. In the experience of this Te Tai Tonga tax director many New Zealanders did not get around to notifying their financial institutions of their correct tax rate and so may be unfairly penalised by the change in law. It is for this reason that we think it is really essential that the Inland Revenue Department plan out a top-notch communications strategy to ensure the message gets through to all New Zealanders. We will support this bill at the first reading and look forward to views about how effective the proposed changes will be at the point of select committee 
.]