Postage free for business tax payments

By BRIAN FALLOW


Businesses will be able to freepost their payments of PAYE, GST and fringe benefits tax from the beginning of next year.

"Having to pay postage on tax payments was a recurring gripe," Finance Minister Michael Cullen said. "For many it is a matter of principle. They see themselves as unpaid tax collectors who should at least be compensated for the price of the stamp to post their payments."

ICANZ tax director Annabel Young said it sounded trivial, but for an accounting practice with 3000 clients all those 40c stamps added up.

"When Telecom and other companies are able to provide reply-paid envelopes, people resent having to pay postage to the Government when the amounts involved are larger and when it owns NZ Post."

KPMG said it and Business New Zealand had undertaken a compliance cost survey, which showed tax issues were the number one compliance cost priority for businesses.

"While the costs of postage to IRD did not feature highly in the responses to the compliance cost survey, KPMG is aware that the requirement to pay postage on taxation payments collected on behalf of Government is an irritant to businesses."

Free postage was provided on a three-year trial basis between 1995 and 1998 but was then discontinued.