16 February 2016
Wide ranging Tax Bill passes 3rd reading
A wide ranging tax bill passed its final stage in Parliament today [Tuesday], bringing together a suite of proposals to help support the Government’s work in creating a more productive economy, Revenue Minister Michael Woodhouse says.
Welcoming today’s third reading of the Taxation (Annual Rates for 2015–16, Research and Development, and Remedial Matters) Bill, Mr Woodhouse says the bill contains some practical measures for businesses, while other measures clarify rules for taxpayers more generally.
“One of those solutions deals with a timing problem in the current tax rules, which prevents innovative start-up companies from being able to use tax losses incurred during their start-up research and development phase,” says Mr Woodhouse.
“Another measure relieves the problem of “black hole” expenditure on research and development, when some development expenditure is never able to be deducted for income tax purposes.
“These are straightforward, targeted solutions to problems affecting innovative start-up firms, and are part of the Government’s wider agenda of removing obstacles to business growth.
“As a whole, the proposals in the bill continue the Government’s focus on fine-tuning and maintaining the tax system.”
They include new rules for New Zealand’s 13,800 bodies corporate to provide assurance on their GST position, and business-friendly changes to the tax rules, such as giving greater flexibility to users of tax pooling funds.
“Other measures are designed to fine-tune social policy matters, such as proposals to reduce long-term child support debt, and changes to Working for Families tax credits to clarify some rules and reduce compliance costs for recipients of the scheme.
“Many of these measures 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,” says Mr Woodhouse.