Skip to main content
Inland Revenue

Tax Policy

Matters raised in submissions


TRANSITIONAL SAVINGS PROVISIONS FOR PROVIDERS

Clause 6

Submissions

(Workplace Savings NZ, ANZ)

The bill should include a transitional “savings” provision to provide relief to KiwiSaver providers who would otherwise be required to update offer documents from 1 April 2015 or potentially be in breach of securities law. Such a provision would allow providers to update their documents to reference the new KiwiSaver rules during the next annual review cycle. (Workplace Savings NZ, ANZ)

The transitional savings provision should go further and include reference to other non-legislative changes to the KiwiSaver HomeStart policy which were announced in Budget 2014. (Workplace Savings NZ)

Comment

Officials agree with the submissions and note that similar transitional savings provisions have been made in similar circumstances in previous bills.

Recommendation

That the submissions be accepted.


WITHDRAWAL OF THE GOVERNMENT KICK-START CONTRIBUTION

Clause 6

Submission

(BNZ)

With the change to allow KiwiSaver members to withdraw their accumulation of member tax credits, the $1,000 kick-start contribution is the only portion of their savings which is unavailable for withdrawal under first home withdrawal rules. Is there any “overwhelming policy rationale” for this?

Comment

Excluding the $1,000 kick-start contribution means that KiwiSaver members’ accounts will remain open following a withdrawal under the first home withdrawal provision. This is a pragmatic rule to ensure members remain part of the scheme and their payments, deductions and tax credits have somewhere to go.

Recommendation

That the submission be noted.


DEFINED TERMS

Clause 4

Submission

(BNZ)

The bill seeks to amend the definition of “salary and wages”. The defined term in the KiwiSaver Act is “salary or wages”.

Comment

Officials agree with the submission that the correct term should be “salary or wages”, as defined in the KiwiSaver Act 2006. [Emphasis added].

Recommendation

That the submission be accepted.


OTHER ASPECTS OF THE HOMESTART PACKAGE

No clause

Submissions

(Alan Matteucci, BNZ)

The Government should not increase the first home deposit subsidy for newly built homes, which is changing from a maximum of $5,000 (or $10,000 for a couple) to $10,000 (or $20,000 for a couple). (Alan Matteucci)

The Government should review the price cap limits which set the maximum price for a house to still qualify for the first home deposit subsidy. (BNZ)

Comment

The submitters have raised matters that do not relate to the provision in the bill. Changes to the HomeStart deposit subsidy and the price cap are made through Cabinet directives rather than legislation.

Recommendation

That the submissions be declined.