Introduced on August 25. The Bill proposes a new “bright-line” test, which will require income tax to be paid on any gains from residential property purchased and sold within two years, with some exceptions. The exceptions include the sale of an owner’s main home, inherited property, or the transfer of property in a relationship settlement. Received its first reading on Sept 8 supported by all parties except NZ First despite reservations from Opposition parties about the effectiveness of the bill. Sent to the Finance and Expenditure Committee for consideration with a report back date of Oct 22 and submissions closing on Sept 17. The bill is set to take retrospective effect from Oct 1. Reported back from select committee on October 22 with minor changes. Labour, Greens and NZ First all opposed to the report saying the bill was a token political effort which would cause more problems than it fixed. Completed its second reading on Nov 3 heavily criticised by Opposition parties but progressed by 109 to 12 with just NZ First opposed. Committee stage completed on Nov 10 with an Opposition amendment to extend the bright line test from two years to five years defeated. Third reading completed on Nov 12 with just NZ First opposed. Taxation (Bright-line Test for Residential Land) Bill
Introduced on May 20. The Bill increases the Minimum Family Tax Credit threshold as a consequence of increases to benefits, and corrects a drafting error made in the Child Support Amendment Act , as to the timing of commencement for two of the late payment penalty changes. Passed through all stages under Urgency with ACT opposed and the Greens abstaining.
Taxation (Budget 2021 and Remedial Matters) Bill
Introduced on August 8. The Bill introduces new disclosure requirements for foreign trusts following the Shewan Inquiry. The Bill also provides a new pay-as-you-go option for small businesses to pay their provisional tax, from April 2018. It also proposes removing the 1% monthly incremental late payment penalty on new GST, income tax, and the Working for Families tax credit debts, from 1 April 2017. Received first reading on August 11 with all parties except NZ First supporting. Its MPs argued the disclosure regime did not go far enough. Other Opposition parties indicated they would argue for the register of foreign trusts to be publicly available and not restricted to the Police and IRD. Referred to the Finance and Expenditure Committee. Reported back on November 28 with a number of changes. These include limits on ministerial power to change tax rules to fit the capability of IRD’s systems to implement intended changes. Labour, the Greens and NZ First said they supported the Bill, however the changes to foreign trust laws did not go far enough. In particular not extending the reporting requirements to lawyers, accountants, and real estate agents. They also wanted a publicly available register. Second reading completed on February 7 and committee stage on February 8 with general agreement despite dispute over the detail of the bill. Third reading completed on February 14 on a voice vote. Taxation (Business Tax, Exchange of Information, and Remedial Matters) Bill
Introduced on May 19 under Urgency, the bill approves cost-of-living payments of $350 for low- to middle-income individuals earning up to $70,000 per annum and who are not eligible for the winter energy payment. The payments will be made in 3 monthly instalments from 1 August 2022. Passed through all stages with National and Act opposed and the Greens abstaining.
Introduced on Feb 16, 2021. The Bill sets up a new system of covid support payments for businesses hit by covid lockdowns of level 2 or over. As announced in Dec this includes includes a grant at a core per business rate of $1500 plus $400 per employee up to a total of 50 FTEs ($21,500) for firms experiencing a 30 percent drop in revenue. This is not tied to the payment of wages and firms with more than 50 FTEs can apply up to the maximum and is nationwide not tied to a region. However, it is capped at the amount of revenue lost. One change made since the Dec announcement is eligibility is over a 7 day period not 14. This will be calculated by comparing a seven-day period at alert level 2 or higher with the typical weekly revenue in the six weeks before the move from alert level 1. The Bill passed through all stages under Urgency and supported by all parties.
Taxation (COVID-19 Resurgence Support Payments and Other Matters) Bill
Introduced on Dec 1, 2020. The Bill introduces a new top personal income tax rate of 39% on annual income over $180,000 with accompanying changes to other imposts such as fringe benefit tax. Also gives powers for the IRD to investigate the historical activities of trusts for the purpose of policy formation. Passed through all stages under Urgency with National and ACT opposed. The Greens abstained saying there needed to be a capital gains tax as well or house price inflation will be further exacerbated. Taxation (Income Tax Rate and Other Amendments) Bill
An annual tax credit for resident married, civil union or de facto couples responsible for an under-18 dependent child. Under the bill, couples with dependent children would be assessed for tax according to household income as opposed to individual income as is currently the case. For example, a couple where one individual is employed earning $100,000 would face the same tax burden as a couple who earn $50,000 each. The bill was part of National’s deal with United Future which allowed for it to go to select committee. The select committee supported the policy intent but requested much more research in its report back to Parliament. First reading Oct 2010 with select committee report back in March 2011 been awaiting second reading ever since. Bill lapsed as it was not reinstated in the 52nd Parliament. Taxation (Income-sharing Tax Credit) Bill
Introduced Dec 1 and received its first reading on a voice vote and was referred to Finance and Expenditure Committee with a report back date of April 28. The main proposals relate to the withdrawal of member tax credits for KiwiSaver members purchasing their first home, and corrections to the tax, social policy, and KiwiSaver treatment of income replacement payments for some veterans and other claimants. Reported back early on March 13 with minor amendments. Despite objections over the details and debate over whether it would have a positive effect, the bill passed its third reading on March 26 with general support. Taxation (KiwiSaver HomeStart and Remedial Matters) Bill
Introduced on June 27. A tax omnibus bill mainly making administrative changes to KiwiSaver and student loans. Also extends the refundability of research and development tax credits. Completed first reading on July 23 and sent to the Finance and Expenditure Committee with just ACT opposed. Reported back on Dec 18 with a large number of changes including allowing the early pay out of KiwiSaver funds for those with congenital diseases, R&D credits, PIE tax treatment and student loan deductions. Second reading on March 4 and committee stage on March 11. Still opposed by National. Third reading on March 17 completed with no party opposing. Taxation (KiwiSaver, Student Loans, and Remedial Matters) Bill
Introduced on June 22 and received its first reading on June 25. Authorises some of the measures announced in Budget 2015 around property purchases and tax rules. Under the bill any “offshore person” buying a second home would have to provide an IRD number and bank account details. This would allow IRD to track purchases and sales of real estate and tax them accordingly. The bill was sent to the Finance and Expenditure committee with a truncated report back date of August 17. Parties supported the bill but not the shortened select committee consideration. Reported back from select committee on August 14 with a number of changes, mostly around the definitions of “main home”, “offshore person”, as well as rules around exemptions and what information should be collected. Labour indicated support for the bill despite concerns it created too many loopholes while also imposing unnecessary compliance costs. Completed committee stage on Sept 9 and given third reading on Sept 10. All parties with the exception of NZ First supported though Labour and the Greens said it was ineffective and full of loopholes. The Government indicated a third bill was on the way to deal with the treatment of withholding tax on property speculation. Taxation (Land Information and Offshore Persons Information) Bill