Woodhouse Michael: Taxation (Annual Rates for 2015-16 Research and Development and Remedial Matters) Bill — Third ReadingText is incorporated into the Bound VolumeWoodhouse Michael: Taxation (Annual Rates for 2015-16 Research and Development and Remedial Matters) Bill — Third Reading[Sitting date: 16 February 2016. Volume:711;Page:9034. Text is incorporated into the Bound Volume.]Hon MICHAEL WOODHOUSE (Minister of Revenue): I move That the Taxation (Annual Rates for 2015-16 Research and Development and Remedial Matters) Bill be now read a third time. This large and wide-ranging tax bill brings together a suite of proposals to support the Government’s work in creating a more productive and competitive economy for New Zealand. The main proposals in the bill are designed to encourage business innovation by dealing with certain obstacles in the current tax rules that can prevent smaller start-up businesses from undertaking research and development.To recap briefly the first proposal deals with a timing problem in the tax rules that prevents innovative start-up companies from being able to use tax losses incurred during their start-up research and development phase. The second research and development proposal relieves the problem of so-called black hole expenditure where some development expenditure is never able to be deducted for income tax purposes. In offering straightforward targeted and pragmatic solutions to these problems the proposals in this bill will support the Government’s wider agenda for business growth and will be welcome news for New Zealand’s innovative start-up firms.The remaining proposals in the bill continue the Government’s focus on fine-tuning and maintaining the tax system. They include new rules to clarify the GST rules for New Zealand’s 13800 bodies corporate to give them assurance on their GST position as well as targeted business-friendly changes to the tax rules such as giving greater flexibility to users of tax-pooling funds.This bill also confirms the annual rates of tax for the 2015-16 tax year. This is a small but important part of the bill that provides certainty for all taxpayers. Other measures are aimed at fine-tuning our social policy settings. These include proposals to reduce long-term child support debt; changes to Working for Families tax credits to clarify certain provisions and reduce compliance costs for recipients of the scheme; and measures to allow greater flexibility to more quickly align the tax exemption criteria for community housing entities with the Government’s HomeStart grant thresholds. Together the proposals in this tax bill make for a much more workable system for tax and social policy payments.Many of the measures I have described are the direct result of public consultation and cooperation with the private sector. This is a crucial part of the way we develop our tax rules. It helps to ensure that the new rules reflect current social and economic practicalities as well as the Government’s broader economic vision for New Zealanders. In bringing this large tax bill to its third reading I thank the policy officials the drafters who worked on the detail of the bill the organisations and individuals who made submissions on the proposed legislation and the Finance and Expenditure Committee for its consideration and recommendations to improve the workability and fairness of the provisions. I commend this bill to the House.