Woodhouse MichaelHon MICHAEL WOODHOUSE (National): Well what we heard there from Dr Deborah Russell was the kind way of saying We won. You lost. Eat that." because that's exactly what we heard. People voted for a tax increase; we got the super strong mandate—sit down be quiet. She said something else actually that was quite revealing and I doubt that she'll be getting a muffin bought by David Parker for her at the next morning tea. Because what David Parker has been saying in his first intervention in this debate was that the reason we're here in urgency is because it's so hard and it takes so long to adjust the computer systems of payroll providers and the IRD but Dr Russell just said "Hang on. That's pretty straightforward. It's maths. They know maths; it's all computers. You just update the schedules upload them into the payroll system and that's it." And she's right—she's absolutely right. So why are we actually pushing this through with a regulatory impact statement and a risk impact assessment that talks about the level of consultation—but it's pretty brief? Here's what it said and I talked about this in my first reading speech. The IRD had a very proud actually reputation for the degree of consultation that it would make over tax and tax policy changes—the generic tax policy process the small business Tax Working Group the corporate Tax Working Group Chartered Accountants Australia and New Zealand. Where is all of that?Well the departmental disclosure statement provides some quite revealing insight into it. No external or general public consultation has been conducted regarding the new tax rate proposal. No external consultation has been undertaken on the information collection measures—none. Wouldn't it have been OK to actually kick this to select committee? Get them over the Christmas break doing that consultation coming back in February passing it pretty quickly with a full couple of months to get what Dr Russell has just told us is a pretty straightforward process of upgrading the tax rate tables in payroll software—job done. But oh no what we have is a ham-fisted and rushed process. And when rushed processes are put in we know in this House that mistakes are made and they'll need to be fixed in the future. In fact it's not even in the future. At the same time that the bill landed on the table so did the Minister's first amendment. It was an amendment that was necessary because he got a very good telling off. Who did he get a good telling off from? The Attorney-General. Who's the Attorney-General? Mr Parker. It must have been a slightly odd conversation I have to say in either the Attorney-General's or the Minister of Revenue's office. But I've got to say and I'm going to be raising these questions in the committee of the whole House I think there are some really important questions and some amendments to debate around the part of this bill that failed the New Zealand Bill of Rights Act (BORA) vet. It's clause 33 if memory serves me correctly. Mr Brownlee stole my bill so I'll just steal it back. Mr Parker's own discussion about this is very interesting. So firstly Mr Parker the Attorney-General says that this is a breach of a couple of things. What are they Mr Attorney-General? Freedoms and the right to something else—I'll find them in a minute. So he says in his own description of what the bill does that what this amendment does is merely clarify the existing powers of the Commissioner of Inland Revenue which begs a very important question: if this clause fails the BORA vet but it's only designed to clarify the powers the commissioner already has are those original already-in-law powers also a breach of the New Zealand Bill of Rights Act 1990? I will be asking officials about that. If it's bad once it won't matter. If it's bad twice it is a very very poor way to pass what are quite strong measures of power of the commissioner to collect and require information to be provided.The amendment that the Attorney-General has probably asked the Minister of Revenue to table basically says "Well don't worry. The commissioner won't be able to use that information when she gets it for policy or research purposes for any punitive purpose." But I ask this: what stops officials from the Inland Revenue Department who now know that incriminating information exists to ask it again through another vehicle through another part of the Tax Administration Act to say "Well actually guess what? This time we're going to ask it because we're not sure you've complied with the law." And therefore a prosecution is a secondary impact of the primary purpose of being compelled to provide that information and when we come to the committee of the whole House I'll be asking the Minister to check with his officials about whether or not there is any prohibition on any further use of that information because it's a form of double jeopardy. I'm not a lawyer and there's probably a better term for it.But one can't say "Oh no it's OK because we only wanted it for research. And by the way we're going to knock on your door on another day as part of another part of the Act and say we'll want that information again and this time you have the right to an attorney." That's what it looks like to me it's doing. So I have tabled an amendment to clause 33 to delete it because I don't believe we know enough about the impact of this and that is exactly the sort of thing that the consultation process was designed and set up to do and I think we have time to actually change that because that's not needed for 1 April 2021; it just isn't. The other thing that I want to talk about and Mr Brownlee has already alluded to it is the issue of retrospectivity. What the Commissioner of Inland Revenue is able to do is go back through records and in fact taxpayers are required to keep records for at least seven and in some situations I think up to 10 years. We're being asked to consider a bill that will increase quite materially on the face of it the requirements of trusts to furnish information on an annual basis with effect from 2021/22. But actually the commissioner has the power for some trusts certain trusts and I'm not sure which because it's very hard for me to see within the bill. What Mr Parker the Minister has put in his explanation is actually a list of the criteria. We can see when it's not required—foreign trusts and so on—but I can't see where the "certain trusts" is further defined. I think that will need clarification.But most importantly we're asking trusts potentially to retrospectively go back seven years and furnish a greater level of information than they were required to under the law when it existed in 2014. That's retrospective legislation and it may be physically impossible to comply with the law because they won't have collected the information in the manner in which it would be required now because it wasn't necessary then.It's really bad law but it's actually a terrible terrible imposition which highlights again in the departmental disclosure statement the question of costs and benefits for trusts because there wasn't an analysis done. IRD have simply said apart from the 39 percent tax rate risk impact assessment as indicated in another section there is little or no publicly available analysis on the size of potential costs and benefits of this new trust reporting requirement. But the IRD proposes—or the risk impact assessment notes that Inland Revenue will conduct a post-implementation review of the proposed information requirements for trusts that will include a consultation with affected trustees to determine the compliance costs associated with the new requirements. So what we're being asked to do is consider and pass a bill that will have a cost on trusts. They haven't gone out to find out what that cost could be and their only answer is to say "Well we're going to do a post-implementation review and ask people how much it cost them to comply with the Act." That is shabby in the extreme and frankly for that reason I'm inclined to think that clause 35 should also be deleted but I'm open to the Minister's and the officials' comments about why that shouldn't occur."