A report from the Policy Advice Division of Inland Revenue
31 August 2001
Tax receipts for year to June 2001
Total Inland Revenue tax receipts for the year to June 2001 rose by $2,015 million, 7.3%, to $29,518 million.
Table 1: Tax Receipts (PDF 15KB)
Source deductions (tax withheld from salaries, wages, etc)
Source deductions for the year to June 2001 were $828 million (6.4%) higher than for the year to June 2000. Factors contributing to the rise in source deductions include a full year of the higher top personal tax rate (estimated to have contributed at least $280 million), greater levels of employment[1] and higher average weekly earnings.[2]
Tax from "other persons" (mainly individuals not taxed at source)
Other persons' receipts for the year to June 2001 were $668 million (18.8%) more than for the year to June 2000. The rise reflects an increase of $291 million in terminal tax payments as a result of higher incomes received in the 2000 income tax year and $281 million in higher provisional tax instalments for the 2001 income tax year. Provisional tax instalments from the agricultural industry -- predominantly dairy, sheep and beef farming -- were up $186 million. Most other industries recorded small rises. The exception was the retail trade, which recorded a small fall in provisional tax instalments.
Refunds to individuals
Refunds to individuals for the year to June 2001 were $132 million (12.7%) larger than for the year to June 2000. This growth is mainly a result of different timing, with faster processing of individuals' 2001 tax returns than was achieved a year earlier, and also with earlier issuing of the main run of personal tax summaries (in June 2001 as against July 2000).
Company tax
Company income tax receipts for the year to June 2001 were $484 million (11.8%) higher than for the year to June 2000. As shown in table 2, income tax receipts were higher for all industry sectors with the exception of transport and communication services and the finance and insurance industry. Industries with large increases in income tax payments generally benefited from higher export prices or higher tourist numbers.
| Total Receipts ($millions) |
Annual Change ($million) |
Annual Percentage Change |
|
|---|---|---|---|
| Industry | |||
| Agriculture, Forestry, Fishing and Mining | 178 | 87 | 95.6% |
| Manufacturing | 931 | 238 | 34.3% |
| Electricity, Gas and Water Supply | 288 | 14 | 5.1% |
| Construction | 131 | 30 | 29.7% |
| Wholesale Trade | 492 | 149 | 43.4% |
| Retail Trade | 289 | 61 | 26.8% |
| Transport and Communication Services | 402 | -80 | -16.6% |
| Finance and Insurance Services | 1,098 | -119 | -9.8% |
| Business and Property Services | 497 | 44 | 9.7% |
| Other Industries and Unknown | 286 | 60 | 26.5% |
| Total | 4,592 | 484 | 11.8% |
Resident withholding tax
Withholding tax on residents' interest for the year to June 2001 was $246 million (34.1%) higher than for the year to June 2000. Interest rates in the year to June 2001 were on average higher than in the year to June 2000.
GST
Net GST collected by Inland Revenue decreased by $247 million (4.2%) in the year to June 2001. A rise in gross IRD GST of $557 million was more than offset by a rise in GST refunds ($805 million). Refunds rose in line with increases in the value of New Zealand's exports, which were up $5.9 billion for the year to June 2001.[3] The value of refundable GST input credits for many exporters, especially for processors of agricultural products, rose in line with the higher market prices paid to their suppliers. In this same period, Customs GST receipts increased by $427 million (11.7%), reflecting the higher value of imports. Overall, the growth in GST on this time last year was $179 million (1.9%). This percentage growth is below the average growth for the preceding four years of 4.6%.
[1] In the Statistics New Zealand Household Labour Force Survey as at March 2001, total numbers of people employed as salary and wage earners had increased by 30,500 when compared with March 2000.
[2] In the Statistics New Zealand Quarterly Employment Survey as at February 2001, average weekly earnings for people in paid employment were up 2.6% when compared with February 2000.
[3] Statistics New Zealand Overseas Merchandise Trade (Imports) June 2001.