Tabuteau Fletcher: Taxation (Transformation: First Phase Simplification and Other Measures) Bill — Third ReadingText is incorporated into the Bound VolumeTabuteau Fletcher: Taxation (Transformation: First Phase Simplification and Other Measures) Bill — Third Reading[Sitting date: 31 May 2016. Volume:714;Page:11540. Text is incorporated into the Bound Volume.]FLETCHER TABUTEAU (NZ First): It is my pleasure to rise on behalf of New Zealand First to support the Taxation (Transformation: First Phase Simplification and Other Measures) Bill. I would just like to thank Mr Bishop. I did always –well “always” is a big term but I listened intently to Mr Bishop’s contribution. He has got quite a background. He is a knowledgable young man. I just have to say he is kind of not standing up and stepping up to his usual standard. He was only slightly above par with Mr Bennett and that is a low hurdle to jump over. Mr Bishop—next time.Mr Bennett took the opportunity to attack the Opposition parties. He put the question mark out there about a capital gains tax. I just put it to him and to the National Party that you already have a capital gains tax. It is based on intent and you choose not to enforce it or empower the Inland Revenue Department (IRD) to do its job properly hence the mangled attempt at a clean-up which was called the brightline which made the legislation even worse. We had some good contributions from this side of the House outlining how that actually complicated and made the tax system more opaque and more difficult to deal with.The Minister got up and spoke about removing obstacles to reform. That is kind of half the story. Actually what he is doing is picking on people who have student loans and he is picking on people without fixed abodes which seems to be becoming more and more of a problem especially in Auckland but definitely around the whole country at the moment. It seems that this Government will let the problem grow and continue to grow into the future. Empowering the IRD to bill people without actually advising them and breaching their human rights is probably in National’s eyes a great way to go about trying to get those few pennies and the pound of flesh owed by New Zealanders.The Minister spoke about the IT upgrade. It is quite amazing to describe in the Budget nearly a billion dollars of spend on an IT upgrade as a core infrastructure spend. It is bordering on misleading. It is an interesting use of phraseology and terminology. People would think that that huge sum of money—what was it; $2.2 billion or $2.8 billion—was about investing in the infrastructure of New Zealand. Actually what we see from the past is that Mr Cosgrove spoke eloquently about Mr Dunne’s contributions as one of the longest-serving revenue Ministers. But under Mr McClay’s watch we had a supposed $35 million budgeted spend ballooning out to about $87 million. There were huge concerns around that. It was a blow out of the budget—I mean it was more than double for goodness’ sake. For the Minister to stand up and talk about nearly a billion dollars of expenditure on an IT upgrade—he put Dr Evil to shame.We acknowledge as a party the need to upgrade the technology of the Inland Revenue Department which is primarily the reasoning for our support tonight. We agree that the technology required is a necessity. There is a requirement for the IRD to upgrade its IT infrastructure in order to facilitate better communications in two directions with the New Zealand taxpayer. We need to get into that space.Finally for goodness’ sake the commentary from New Zealand business on this legislation—more about the time it has taken to get to the House—has been unbelievable and quite derogatory of this National Government. It has taken way too long. It has taken 8 years too long to get here. For example biometric scanning and things like that so that you can ring and tell them on the phone who you are—under this legislation that is OK and it is OK. We have seen banks especially lead the way showing us that there can be security of content and some security for users and the IRD that yes the integrity of that system is in place.What beggars belief and I think this is the main attack on the Government’s slow move forward is the need to simply allow businesses and individuals to communicate and do business with the IRD using email. We are only—I say “we”; the National Government is legislating for this only now. It is just unbelievable. So now the legislation allows—for example I use an accountant. I can say to the IRD: “You can communicate with my accountant using email.” That is a reasonable form of communication. It does not have to be in writing. We do not need the signatures at the bottom. Let us facilitate meaningful communication in a fast and expedited manner. Let us get the business done basically.What I do want to touch on though and I alluded to it before—I think there were about 500 student loan cases where the Government cannot track down these people in Australia so it is doing this two-way communication strategy with the Australian Taxation Office saying: “We need your help. We need to track down these student loan dodgers who aren’t paying their loans back.” So we had a discussion about this in caucus. The fundamental thinking here is yes fair enough. If you have got a student loan you used the New Zealand education system and you need to pay that back. But what we see here is that the ideology and the focus of this Government is so misdirected.The other case was—I do not have the numbers in front of me but I am sure I will be corrected by the other side of the House if I get this wrong—there were about 174 cases that the Inland Revenue Department (IRD) provided to the Finance and Expenditure Committee when it identified the need to bill employers for the tax commitments of their employees because it simply cannot find the employees. It cannot track them down. It cannot serve them notice in writing through a physical address so it is going to do it for the employer. We were told this was a breach of human rights but they are going to do it anyway for 174 cases. It just beggars belief and it paints a picture of where this Government is getting it so so fundamentally wrong. This is its priority list: 500 Kiwis in Aussie who are not paying their student loans—yes we should get them—and 174 people who do not have a fixed abode and IRD cannot track them down.I want to bring it to the attention of this National Government that there were many instances where IRD’s time could have been so much better spent in terms of digging into the big businesses that are avoiding their tax contributions—those that are using New Zealand not necessarily as a tax haven but overseas tax havens—and actually getting in there and communicating with not just Australia but other overseas jurisdictions to make meaningful changes. The numbers are amazing when put in perspective. I think we are talking about a $700000 tax take with the focus of this legislation versus 100 times that number $7 billion if we actually chased the corporate elite but this absolutely goes against what this Government believes in and what it is trying to achieve. For the practical solutions that this legislation offers New Zealand First will support the bill. We hope the Government sees that it is missing out on huge opportunities in terms of tax compliance and fairness as we move into the future. Thank you.