Cabinet Legislation Committee
Minute of Decision
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Income Tax (Fringe Benefit Tax, Interest on Loans) Amendment Regulations 2022
Portfolio Revenue
On 31 March 2022, the Cabinet Legislation Committee:
1 noted that the Income Tax (Fringe Benefit Tax, Interest on Loans) Amendment Regulations 2022 set the prescribed rate of interest for calculating the taxable benefit of low-interest, employment-related loans;
2 agreed that the fringe benefit tax (FBT) prescribed rate of interest should be increased from 4.50% to 4.78% from the quarter commencing on 1 July 2022;
3 noted the following changes as a result of the decision in paragraph 2, with a corresponding impact on the operating balance:
| $millions increase/(decrease) | |||||
| Vote Revenue | 2021/22 | 2022/23 | 2023/24 | 2024/25 | 2025/26 & out years |
| FBT Revenue | 0.00 | 0.82 | 0.82 | 0.82 | 0.82 |
| Company Tax | 0.00 | (0.23) | (0.23) | (0.23) | (0.23) |
| Net Revenue | 0.00 | 0.59 | 0.59 | 0.59 | 0.59 |
| Impact on Operating Balance | - | (0.59) | (0.59) | (0.59) | (0.59) |
4 noted that the changes are forecast changes and do not have appropriation implications;
5 authorised the submission to the Executive Council of the Income Tax (Fringe Benefit Tax, Interest on Loans) Amendment Regulations 2022 [PCO 24578/3.0].
Rebecca Davies
Committee Secretary
Present:
Hon Chris Hipkins
Hon Andrew Little
Hon David Parker
Hon Poto Williams
Hon Jan Tinetti
Hon Michael Wood (Chair)
Hon Dr David Clark
Hon Phil Twyford
Keiran McAnulty, MP (Senior Government Whip)
Officials present from:
Office of the Prime Minister
Officials Committee for LEG