A question for David Cunliffe about CGT



Killer question for Cunliffe on CGT.

How much will it cost to implement?

The IRD is in the process of spending about $1.5B replacing their current software.

I can be pretty sure that CGT has not been factored into that. The cost will mostly be upfront and will be 100s of millions of dollars.

This does not even count the whole compliance costs. Lawyers and accountants will be collectively licking their lips.

Best guess it will take at least 3 years to put in place and will be cash negative for at least 7 years.

Why doesn’t anyone ever ask these questions?

Too busy looking at private emails I guess.


IRD Scam warning

This needs a wider audience

A woman says she was almost swindled out of nearly $1000 by a “very well-rehearsed” scammer claiming to be from Inland Revenue and demanding payments.

IRD says it’s looking into the scam after it received at least 18 reports of scammers calling people claiming to be from the IRD, including a man who says he’s been duped out of $6500 by the scammers.

Clara Iqbal told TVNZ’s Breakfast this morning that a man phoned yesterday and said he was the chief investigating officer at the IRD and that there was a warrant out to arrest her as she owed $987 “and if I didn’t pay within 24-hours they would take me to court which could cost thousands”.

The problem is that this will fluster people into complying.

Ms Iqbal said the scammer knew all of her details and even appeared to be calling from an IRD number.

The scammers have managed to spoof IRD’s 0800 number, making it seem a legitimate call on caller ID.

Knowing everything about someone… well, you know, welcome to being an idiot and putting your life on the Internet.  But the spoofing of an 0800 number?  That’s something else altogether.     Read more »


In business? Hate provisional tax? Vote National


I, like many others, hate provisional tax.  It’s annoying, it frequently wants money from you before you have actually received it from your customers, and there is a big stick that if you guess too low, they’ll come beat you up a bit.  Great reward for managing your business into growth.

Tom Pullar-Strecker reports on some changes that appear to be welcome at first glance

The much-hated provisional tax system that forces small businesses to forecast their tax liability a year in advance will be overhauled, Revenue Minister Todd McClay has all but confirmed.

McClay said he did not believe the provisional tax system was “fit for purpose”.

A “business transformation” programme under way at Inland Revenue, which the department expects to cost up to $1.5 billion, could allow firms to pay tax on their income in, or closer to, real time, he said.

It would be “wonderful” if Inland Revenue could get to a point when income was taxed only when it was earned, but any changes would need to be balanced against the Government’s needs, he said.

If provisional tax was linked to being paid, more like GST, then that could be less of a burden.  End of the month, tote up your total payments, cough up x percent.   Read more »

National going after tax dodgers? Someone get Labour to sit down

Labour’s narrative is that the uncaring National government looks after its rich mates and only goes after the poor and the vulnerable, like benefit cheats.

It plays well to the choir, but it isn’t actually true.

210214-ird300Inland Revenue will get more funding to chase tax evaders when this year’s Budget is announced on Thursday.

At his post-Cabinet news conference yesterday, Prime Minister John Key announced the department would receive $132 million over the next five years to increase tax compliance activities, including chasing unfiled returns and writing off tax unlikely to be paid.

He estimated the extra money will conservatively increase gross tax revenue by around $300m over the next five years.

Mr Key also rubbished the Labour Party’s long-held policy of introducing a Capital Gains Tax, saying the IRD has gone after property speculators and those not paying their share.

Ah, but is Key going after the true cheats?  The corporate tax dodgers?   Read more »

Doing nothing? Another Cunliffe mistruth proved wrong

David Cunliffe posted this extremely misleading image on Facebook with a claim that National was doing nothing about tax dodgers.



Unfortunately for David Cunliffe he has shot his mouth off without first garnering the facts and today Revenue Minister Todd McClay has announced exactly what National is doing to attack tax dodgers.

Speaking at the OECD Cash and Hidden Economy Conference today, Revenue Minister Todd McClay reiterated the Government’s commitment to clamping down on tax evasion and avoidance.

“This is an area the Government has invested heavily in and we are starting to see results,” says Mr McClay.

“In Budget 2010, we invested $120 million in going after tax non-compliance; another $78.4 million was further invested in Budget 2012.”  Read more »

Is the IRD IT System Upgrade Going to Blow Up in Minister’s Faces?

The IRD IT system is a huge potential headache for the government, as the IRD has kept a very closed shop and is not really releasing any information about their proposed $1.5B spend.

The problems for the government are multiple. Being a bunch of technophobes they have been stitched up by a government department who has budgeted roughly double what the New Zealand industry thinks they should be spending on their system.

Then they have appointed a series of people who think industry engagement means repeatedly cancelling all engagement at short notice so no one in the industry knows what is going on.

Worse still is that IRD has spent $50m so far and yet doesn’t have a publicly available project plan.

IRD insiders are seriously concerned that a testing contract worth $30m has been awarded without anything for anyone to test.

There is more to this story but facts have to be checked and questions have to be asked.


Herald hypocrites busted again


The NZ Herald likes to point the finger at other companies and accuse them of being tax cheats.

They did it last year in March and I busted them then. Their IRD dispute is still ongoing and IRD reckon they owe $48 million. Then there is the $611 million of accumulated losses meaning that they pay bugger all tax in New Zealand anyway.

Yesterday David Farrar came out of the blocks and kicked them fair in the cods too.

The Herald editorial:

Many firms that practice tax avoidance probably do feel wretched about it. But they owe it to their shareholders to pay no more tax than their lawyers and accountants say they must, and they transfer the blame to the legislators who leave loopholes for them, or who set taxes too high or spend the revenue unwisely. With the company tax rate at 28 per cent in New Zealand, lower than the top personal income rate, it is hard to justify corporate avoidance here.  Read more »

Dead beat dads

After drug dealers, dead beat dads disgust me more than even lying politicians

More than 10,000 parents have been saddled with debts to the Inland Revenue they were powerless to avoid, and one angry solo mum is calling for change.

As well as collecting tax, the IRD administers child support arrangements, which are a financial lifeline to single parents.

But one mother is facing a large debt as the IRD tries to claw back “overpayments” by her former partner – a debt she did nothing to incur and could not have prevented.

According to official figures 10,002 people were in a similar position as of April this year, paying back child support debts totalling $11.5 million.

The issue arises because the IRD calculates child support payments based on information provided privately by both parties.

Read more »


IRD sending out personal information

Oh dear, it looks as though IRD is following ACC’s lead.  I wonder which National Party activist the IRD has sent them to?

Inland Revenue has apologised after personal details for just under 30 customers were incorrectly released.

Deputy Commissioner Service Delivery Arlene White said a preliminary internal investigation indicated last week’s incident may have been caused by a manual handling error.

The part I am most concerned about is that they haven’t got the information back.  May be the recipient is negotiating a deal?

“We have contacted the recipient of this information and our highest priority is the return of the information,” Ms White said.

“We are also contacting the customers whose information has been released to apologise and letting them know the steps we are taking to remedy the situation.”

So, do the initial ‘steps’ to the ‘remedy the situation’ look something like this:

1. Ask for the information back

2. Ask again for the information to be returned

3. Have meetings to have the information returned.

4. Strike a deal to get the information returned – lower tax rate perhaps?

5. Ask the recipient really nicely to stay away from Phil Kitchin.





Still no sign of the lawyers

Terry the Piss threatened to sue this blogger for telling the truth about his financial affairs. I still haven’t seen the process server or heard from the lawyers, not even so much as a cease and desist letter. Now what do we read:

Terry Serepisos is flying to Zurich in a bid to save the Phoenix football team and four of his other companies – but Inland Revenue is pushing ahead with plans to liquidate them.

The IRD says it is owed more than $3.5 million in outstanding tax and penalties and wants to advertise its plans to liquidate the companies. Mr Serepisos applied to the High Court at Wellington to stop the advertisements, but a judge refused and the adverts are due to run in The Dominion Post tomorrow.

Justice Forrie Miller was told at an urgently arranged hearing on Friday that Mr Serepisos was going to Zurich this week to sign loan documents that would allow IRD and other creditors to be paid within three weeks, assuming various conditions were met.

However, Inland Revenue doubted Mr Serepisos would be able to meet the conditions.

I doubt the gnomes of Zurich will listen to his bullshit. Word on the street in Wellington now is that Terry the Piss is now “owned” by the Italians in town and the little upstart Greek is jumping to their tune. It is simply a matter of time before the Boss flicks the whole house of cards and cleans up for good.

The Phoenix will continue, with Italian bosses.