- Hon Simon Watts
Revenue Minister Simon Watts says a Bill introduced into the House today will help grow the economy by reducing compliance costs, simplifying rules and removing unnecessary obligations.
“My aim is for a world-leading tax system, and these sensible changes bring us a step closer to that. For fringe benefit tax, we’re proposing a much simpler ‘close enough is good enough’ approach to employer-provided vehicles.” Mr Watts says.
“Rather than requiring detailed records and logbooks, employers would simply choose the category that best reflects how much a vehicle is used privately – substantially lowering compliance costs and unnecessary stress.”
The Bill also makes several changes to the Foreign Investment Fund rules to help attract and retain skilled workers and investment.
This includes increasing the de minimis threshold so smaller investors do not need to apply the FIF rules, and opening up the Revenue Account Method to all New Zealand residents for unlisted foreign shares.
The Bill also includes:
- Improving cash flow for start-ups by allowing eligible businesses to receive R&D Tax Incentive payments during the year based on expected entitlements.
- Reducing red tape for charities and not-for-profits by keeping membership subscriptions and levies non-taxable, increasing the statutory deduction for smaller taxable not-for-profits to $10,000, and removing income tax filing requirements for smaller organisations.
- Making it easier to support charities by allowing eligible donors to receive donation tax credit refunds during the year and enabling credits to be transferred directly to charities. The tax treatment of volunteer honoraria will also be simplified.
- Strengthening student loan enforcement by preventing overseas-based borrowers from avoiding enforcement by deliberately avoiding Inland Revenue communications.
“It’s a substantial Bill covering a wide spectrum of tax issues, and all of these items aim to ensure the tax system works better for all,” Mr Watts says.
