http://www.taxpolicy.ird.govt.nz/ News about tax policy developments in New Zealand, including new tax legislation and Government discussion documents and publications. policy.webmaster@ird.govt.nz en-nz Inland Revenue Department weekly 2 http://www.taxpolicy.ird.govt.nz/news/archive.php?year=&view=672 The Finance and Expenditure Committee has reported to Parliament on the Taxation (International Taxation, Life Insurance, and Remedial Matters) Bill, which was introduced in July 2008. The bill contains a number of major reforms, including the first stage of the reform of New Zealand's international tax rules, modernisation of the tax rules relating to the life insurance business, introduction of a payroll giving system for charitable donations, and changes to the definitions of "associated persons" in the Income Tax Act. The committee has recommended a number of changes to the proposed legislation, including deferring the application dates of many of the reforms. For more information on the recommended changes see the bill as reported back (PDF 12,113 KB) and the four-volume officials' report on submissions. start=2009-06-30 20090630-672-PADIRD Policy Advice Division, Inland Revenue Department News http://www.taxpolicy.ird.govt.nz/news/archive.php?year=&view=671 The introduction of a new double tax agreement between Australia and New Zealand took a major step forward with the signing on 27 June of an agreement that, once in force, will replace the existing 1995 DTA. Features of the new DTA include lower withholding taxes on dividend and royalty payments between the two countries, and making pensions that are tax-free in one country also exempt in the other when the recipients move across the Tasman. The new DTA will come into force once both countries have given legal effect to it. For more information see the media statement and the text of the DTA. start=2009-06-29 20090629-671-PADIRD Policy Advice Division, Inland Revenue Department News http://www.taxpolicy.ird.govt.nz/news/archive.php?year=&view=670 The taxation of distributions from profit distribution plans is the subject of an issues paper released today for consultation. The Government announced on 16 April that it intended to clarify the law to ensure that bonus issues of shares distributed under PDPs are taxed in the same way as shares issued under other dividend reinvestment plans, and that a forthcoming consultative document would canvass views on the more technical aspects of the law change. The issues paper released today sets out the details of a proposed legislative solution. Submissions close on 7 August. For more information see "The taxation of distributions from profit distribution plans". start=2009-06-25 20090625-670-PADIRD Policy Advice Division, Inland Revenue Department News http://www.taxpolicy.ird.govt.nz/news/archive.php?year=&view=669 The Government is inviting the public's views on proposed changes to simplify the way student loan repayments are managed, as part of Inland Revenue's move towards greater electronic interaction with the public. For people who have student loans, this means getting rid of yearly letters, square-ups and personal contact with Inland Revenue and gaining instant, online access to the information about their loan accounts. Consultation is taking place by means of an online forum, for those who prefer to make informal comments, and a discussion document, "Making it easier for borrowers to repay their student loans", which gives more details of the proposed changes and invites written submissions. For more information on today's announcement, see the media statement. start=2009-06-24 20090624-669-PADIRD Policy Advice Division, Inland Revenue Department News http://www.taxpolicy.ird.govt.nz/news/archive.php?year=&view=668 An Order in Council signed on 22 June gives eight local authorities until 30 June 2013 to change from a payments basis of accounting for GST to an invoice basis. The Far North, Gisborne, Kaipara, Opotiki, Ruapehu, Waitomo, Western Bay of Plenty and Whakatane district councils have been given a final extension of four years to resolve transitional problems associated with moving to an invoice basis of accounting for GST. For more information, see the Order in Council. start=2009-06-24 20090624-668-PADIRD Policy Advice Division, Inland Revenue Department News http://www.taxpolicy.ird.govt.nz/news/archive.php?year=&view=667 Yesterday's announcement of changes made to the use of money interest rates for overpayments and underpayments of tax have resulted in a number of requests for more information on how the rates are set. The special report published explains both the policy background of the rates and the formulas used for setting them - including the new method for setting the underpayment rate. start=2009-06-23 20090623-667-PADIRD Policy Advice Division, Inland Revenue Department News http://www.taxpolicy.ird.govt.nz/news/archive.php?year=&view=666 Use-of-money interest rates for unpaid and overpaid tax will fall from 28 June 2009. The rate for unpaid tax will drop to 8.91%, while the rate for overpaid tax will fall to 1.82%. For more information see the media statement. start=2009-06-22 20090622-666-PADIRD Policy Advice Division, Inland Revenue Department News http://www.taxpolicy.ird.govt.nz/news/archive.php?year=&view=665 The prescribed rate used to calculate fringe benefit tax on low-interest, employment-related loans will fall from 8.05% to 6.41% from 1 July. For more information see the media release. start=2009-06-22 20090622-665-PADIRD Policy Advice Division, Inland Revenue Department News