Russell DeborahHon Dr DEBORAH RUSSELL (Labour): Oh thank you Mr Chair. I'm actually really concerned about something now. I want to track back to the concerns around payroll providers and the Minister gave us a fairly firm assurance that officials had consulted with payroll providers and they were pretty confident about this 31 July start date. I want to draw the Minister's attention and the committee's attention to paragraphs 38 39 and 40 of the regulatory impact statement.So 38 goes through the fact that Inland Revenue (IR) is going to be responsible for the ongoing operation and enforcement of the tax system—pretty standard stuff—when Inland Revenue can get changes made in their system so that the whole new changes to tax thresholds can get into place. But then in 39 it was talking about the process; it was saying that Inland Revenue would need to contact significant groups such as payroll providers software providers as soon as possible after the changes are announced to help ensure there are no delays.Now that's interesting because I understood that Inland Revenue had consulted with payroll providers but now 39 is saying that Inland Revenue will need to contact significant groups such as payroll providers as soon as possible after the changes are announced. So that's kind of a little bit of an anomaly there.Now there's probably a perfectly good explanation but I would like to have it as to why on the one hand this House was certainly given the impression that payroll providers had been consulted. But now in paragraph 39 of the regulatory impact statement we have this this line saying that IR will need to contact significant groups as soon as possible after the changes are announced". Those changes were only announced today. So a little bit of—just to clarify that would be really helpful.It goes on to say that IR needs to have a communications plan in place. So now having worked with the excellent officials at IR I know that that will all be happening. But here's the bit that's actually really a bit worrying OK? It's paragraph 40 and I'm going to read it out because I think this needs to be in the Hansard after the assurances that have been given to us by the Minister.In paragraph 40 it says: "If the changes come into effect on 31 July 2024 and are only announced on 30 May 2024 it is likely that some employers will not be able to make the changes in time and will incorrectly calculate the income tax to be deducted from their employees pay." Just a note for the IR officials: there's an apostrophe missing there. Sorry—but carrying on. Now you know so I just want to repeat that. It says "it is likely that some employers will not be able to make the changes in time". But we were given assurances that they would so that really is a bit worrying.Now IR officials go on to say—and this is quite correct; it says in the later part of this paragraph that "This can be corrected in later pay runs by the employer or can be corrected as part of the end of year tax assessment process that Inland Revenue runs." So it can all be squared up.The point is that ordinary New Zealanders—the people who are worried about a cost of living crisis; the people who want to make sure they've got more money—they have been told that these tax threshold changes are going to take place in effect from 31 July. They will be expecting that their pay packets will change in first pay period coming in after 31 July. That's the reason we're here today.It's the expectation that has been given to them by the Minister of Finance by the Minister of Revenue by the Prime Minister by the entire approach to this Budget that they will get the effect of those tax threshold changes—will throw flow through to their pay packets from 31 July. So they're expected they're going to get paid; their first payroll rolls through say on about 7 August. They would expect to see some change in their pay packet. But here in the regulatory impact statement despite the assurances that have been given to us we now find out that it is likely that some employers will not be able to make the change in time.This just doesn't stack up with what was being said earlier.Hon Member: Well they'll back pay it.Hon Dr DEBORAH RUSSELL: I know—I know it could all be corrected later on. It can be squared up in the end-of-year tax return or it can be squared up in later pay periods. But even if that doesn't flow through correctly what else is not going to be done correctly? What's going to be the impact on the independent earner tax credit? What's the impact on the family tax credit? What's the impact on all the other stuff that has been promised in this Budget? I think the Minister needs to clear this up."