New tax legislation will mean no more tax paperwork for hundreds and thousands of New Zealanders. Photo / NZME
New tax legislation will mean no more tax paperwork for hundreds and thousands of New Zealanders. Photo / NZME
A bill that will do away with paperwork at tax time for hundreds of thousands of Kiwis has passed its first reading in Parliament.
The bill will simplify tax obligations and means people with simple tax arrangements will no longer have to file a personal tax summary (PTS) as InlandRevenue will do the sums and automatically send tax refunds, or a bill.
"Filing a PTS is currently the only way for individuals to get a refund but around 750,000 people don't follow this process," Revenue Minister Stuart Nash said.
"They are missing out on their money as a result. We want people to get their refunds automatically," he said in a statement prior to the bill's first reading.
Filling in a PTS in future would be required only if more information was required by Inland Revenue.
The Taxation (Annual Rates for 2018-19, Modernising Tax Administration, and Remedial Matters) Bill also amends the Taxation Administration Act to clarify how Inland Revenue can collect, use and disclose taxpayer information.
"It strikes the right balance between careful treatment of taxpayers' confidential information and improved customer service," Nash said.
The bill will also bring in a raft of changes to the KiwiSaver retirement savings scheme including allowing over-65s to join and adds new contribution rates of 6 and 10 per cent.
Finance Minister Grant Robertson introduced the bill to the House today in Nash's absence.
Robertson told the House the primary purpose of the bill was to ensure people were getting what they were entitled to, such as Working for Families.
"The full benefit of the changes will be realised from the 2021 year when for the first time, people will be able to see a full year of pre-populated information for PAYE and all of their investment income. Most people will pay what they need to and get what they're entitled to during the year without having to do anything."
National's revenue spokesman Paul Goldsmith told the House his party agreed with most of the provisions in the bill but would not vote for it.
"It is fundamentally an annual rates bill which sets the taxation rate, and those taxation rates are the same as they were last year. They weren't the rates that would have been in place if this Government hadn't taken away the modest tax cuts that the previous National government had enshrined in law prior to the Government ," Goldsmith said.
"We will not support this bill on the basis of this change."
Act and the Green Party supported the bill and it was sent to the finance and expenditure committee.
