Taxation Principles Reporting Act Repeal Bill

Members, the House is in committee on the Taxation Principles Reporting Act Repeal Bill. I will start by reminding members that wording of the closure motion has changed in this Parliament. The new wording is, “That debate on this question now close.” I refer members to Standing Order 137(1). Members, we come first to Part 1. This is the debate on clause 3, “Repeal of this Act”. The question is that Part 1 stand part.

Madam Chair, I thank you for the call, although it may not be in my long-term interests that you’ve given it to me. Part 1 of the bill repeals this Act, and I want to start with a very simple question for the Minister, and that is: why do we have this clause? We’ve been in the House over the course of the last—well, it’s three or four days and then last week with the Government’s agenda of repealing anything it can find. None of the bills that have done that has included this type of clause. They’ve done repeals, but they don’t repeal the repeal. Just to be really clear, that’s what this clause is doing. What this clause does is repeal this bill. It’s kind of remarkable in its own way. It does give a date for that, which is 1 January 2025. I reckon I might know the answer to this question, but it is actually a genuine question for the Minister, because all the other bills that we’ve done that repealed all sorts of really good and important things that the previous Government did didn’t have a clause that repealed themselves. I think we’ve just got an epidemic of repeal. The Government is so excited about repealing things that they’re going to repeal their own bills as well as the Acts that they were repealing before. So that’s exactly what clause 3 of the bill does. It repeals the repeal. Now, we’re going to get ourselves into some pretty farcical territory shortly, so I would like to know from the Minister: why do we have clause 3?

I was interested in this repeal clause as well because, as the Hon Grant Robertson says, it states “on 1 January 2025.” It’s interesting because, reading through the bill, I sort of said, “Hang on a second, why that repeal date?” It took me a while to sort it through because it is an unusual clause. The thing is that in the Act that this bill is repealing—so in the Taxation Principles Reporting Act 2023—in section 10(1) of the Act which is being repealed by this bill, it says that, “The Commissioner must give the Minister an interim Commissioner’s report annually, before the end of a calendar year, for the tax year that ends in the calendar year, using the best information that the Commissioner has on hand at that time.”

So that’s all quite confusing because we’ve now got three dates in play: we’ve got a calendar year and we’ve got a tax year and then we’ve got the date that this bill is coming into the repeal. Now, ordinarily, I was thinking that if we’re repealing an Act, you’d expect to see a specific date for that Act. But instead, we’ve got the tax year, the calendar year, interim reports—so a whole lot of stuff floating around. I could work it out—it took a while, but I worked it out to see what was going on.

💬 Hon Grant Robertson: Don’t do his work for him.

But it was confusing in respect to—no, no, I’ve got the tax year, the calendar year, and that repeal date. So I would like the Minister to explain it for the benefit of this House. I think he needs to explain to this House why we have those several dates in play, to make it clear for all of us what we’re actually talking about here.

After all, he’s the one with the officials and he’s the one who’s promoting this. So I would expect him to be able to explain it for the benefit of those of us here in the House and also for those who are watching at home—hi Dad, I know you’ll be watching; daughter of a tax person, it’s genetic. So I would actually like the Minister to explain that to us.

So that clause, section 10(1) in the Act which is being repealed, the dates in there, how the calendar year and the tax year relate, and then how that relates to this date of 1 January 2025, which is in the bill.

Thank you, Madam Chair. I just note that this clause 3 in Part 1 of the Taxation Principles Reporting Act Repeal Bill is of course a very narrow clause. But I think it is very important to take it into the full context of the legislation that we are speaking about.

So just for those who are following along at home, such as Dr Deborah Russell’s father, what this clause states is that this Act—this Act itself which the Minister is seeking to pass today will itself be automatically repealed from our statute book on 1 January 2025. It is effectively a repeal of the repealment Act. Which means, if I’m to take it correctly, they are here seeking not only to do the undoing of this legislation, but to leave it without a trace on our statute book; to hide away the proof that they have repealed legislation which would have enabled New Zealanders to have consistent and clear reporting on the efficacy and operation of our taxation system.

So my question for the Minister is: why is it that he is seeking to repeal the repealment legislation? Is it that my intuition on this point is correct, that he is seeking not only to do this deed but to do it in such a way that it is now gone without a sense of any trace or any ability or any evidence—evidence and data mind, that this had happened in the first place?

Oh thank you. I think you’re right, Chlöe Swarbrick, that they’re simply covering their tracks here. But I guess mine’s a technical question. I’m pretty sure, but I’d like the Minister’s assurance—and also kind of the authority for the point—because, of course, repealing a repeal: does that put you back essentially to the status quo ex ante? That is to say: does that un-repeal the Taxation Principles Reporting Act?

Now, I suspect that that’s not the case—and I think, somewhere in the mists of time, I remember that the repeal of a repeal doesn’t un-repeal the repeal—but I think it’s quite important, seeing that you are going to repeal a repeal, that you explain exactly how it is that that doesn’t put us back to the status quo ex ante and the Taxation Principles Reporting Act springs back to life? Whilst that would be a good thing, I suspect that’s unlikely. But I would like you to confirm exactly how that is the case. Let me know if you need a hand.

Thank you, Madam Chair, for the opportunity to take this first call in the debate. I have an amendment to this clause 3 of Part 1 to propose to the Minister, and I hope you will consider it. I have been in a select committee context with the Minister before, and I commend him on his discursive approach within those select committee rooms. I hope that he will consider this amendment, because it would allow that kind of engagement which he himself is very good at around the table of a select committee to determine which way forward this Parliament can take to finding a broader-based tax system and one that works for everyone.

So my amendment reads, “In clause 3, delete the words after ‘repealed’ and insert, ‘on whichever date occurs first—(a) 1 January 2026, or (b) the day after an inquiry of a committee of the House of Representatives is reported back to the House of Representatives on those parts of the Taxation Principles Reporting Act that should be given effect in policy’.”

I haven’t suggested that any part of this bill be retained. What I’m suggesting for the House is that the House consider a select committee piece of work to determine what principles within the Act, particularly in Schedule 1, should be retained within the commissioner’s policy remit. All of these things in Schedule 1 are things that the commissioner should be taking into account and should have some consideration of in the course of their ordinary work—that’s a given. In the course of the public service that Inland Revenue provides to the people of New Zealand, that would continue within the department itself.

What I’m seeking to do here is for the select committee to be able to inquire into how to retain the principles in some form of policy that is publicly available, which members of Parliament can use to, say, consider policy options when having these sorts of tax debates.

I would suggest, myself, that there is a place for this schedule to be retained as a new Schedule 9 to the Tax Administration Act, however I haven’t proposed that here. What I’m asking for is that the Minister might take a chance to consider that select committee’s work as a way to find a bipartisan way forward.

I am going to continue this call because I know that there is something going on. So let me tell you, Minister, the opportunity for us to look into this as a select committee would be really warmly received, I think. You’ll see that there are a number of colleagues on my side of the House who are enthusiastically taking calls in this committee stage. We have questions for you about how you seek to reach the principles that are provided in Schedule 1, and those are things that I think we can all probably agree on. Whether they are in primary legislation, regulations, or policy is a question that we all can engage on, that we can engage with experts on who might advise us of the right approach.

Minister, I know you will have read the works of people like Dr Craig Elliffe, who was my supervisor for my tax Master’s. The kind of evidence that we can seek from the experts would be really good and we would love to have a discussion with you about that in the committee room. Thank you, Mr Chair.

Mr Chair, thank you very much for the opportunity. I do appreciate a bit of time there; we had a little bit of an issue up here at the front desk, but I’m glad that that’s been resolved.

What is clear from the contributions—I’ll go through each of the members, but we’ve obviously got a bit of duplication already on the same matter. Hon Grant Robertson, in terms of clause 3, around why we’ve got that clause—similar to the Hon Deborah Russell’s points around the repeal—member for Auckland Central, Chlöe Swarbrick, also noted around the repeal, and the Hon Duncan Webb’s question was around the repeal. So let’s cover the repeal point in clause 3.

So basically, clause 3—and it is quite simple—of this Act is repealed on 1 January 2025. The purpose of that clause—and it’s not the first piece of legislation that’s had that in it; what it does ensure is that there is a period of time in which the bill and the legislation is and does remain within the public forum, on the IRD website for about a year, before it is moved off. This makes sure that, just as a courtesy to people, they can see that the bill has done its job for 2024, and before it is tidied away on 1 January 2025. So that’s the purpose of the clause, nothing more complex than that. There is precedent around that, and that will cover off those four questions.

In regards to the last question from Arena Williams in regards to her tabled amendment, which is in regards to the same aspect, the reality is that the first part of that clause, which is basically changing the name—which doesn’t seem aligned with the principles of the Act. Clause 2, in terms of adding an additional 18 months—as I’ve said there in clause 3 around deleting the words in terms of “1 January 2026”, it’s not necessary for having such an elongated time for that bill to be up. One year is about right, based on the advice that we’ve got, and so the suggestions in this amendment are something that we will not be supporting.

I thank the Minister for responding there, but I do believe he’s opened up a number of questions on this part. The first of those for me is the choice of “one year for people to see that the Act has done its job.” I think in the interests of transparency, New Zealanders deserve to know for time ad infinitum what’s happened in this House today, because otherwise this fulfils the very thing that Opposition members spoke about in the first and second readings. That is that there seems to be a lack of transparency from the Government about tax policy. So the idea that clause 3 will make this entire debate that we’re having this morning vanish. And magically, on 2 January 2025, when someone, perhaps Dr Russell’s father, wakes up and says, “What did they do to that tax principles Act?”, and they will go and look, and there’ll be nothing. In all seriousness, if the Government is so proud and so urgently bringing this law to the House, how on earth can clause 3 be the kind of thing that they would do for a matter that they considered to be so urgent?

So I think the Minister needs to give a bit more of an explanation beyond the idea that it’s just a time period chosen so that people for a short period of time can know that an Act existed, as opposed for a longer period of time. I’m not aware of the precedents that the Minister has mentioned, so I would also like him to tell us what precedents those are so that we can understand what the logic was for those laws, because I’m not sure, but I would question whether or not they were Acts that were, for example, repealing something that was in place for a very short time, where the report in the case of this bill we know has been drafted and is ready to go. And it does beg that question that, actually, what the Minister is doing is trying to make sure this is scrubbed from history so that the questions won’t continue to be asked about a report that clearly will have been finished and should be available to the New Zealand public. So I don’t believe that the Minister has sufficiently answered the questions that I raised, and I would like him to answer these two questions: firstly, what are the other Acts that he’s relying on for precedent? Secondly, why does he feel that on the 2 January 2025, no one deserves to know that this Act passed through Parliament?

Tēnā koutou, e te Māngai. I just really wanted to continue prosecuting, particularly, this point on the repeal of this repeal Act, because it is a really, really important point when it comes to that trail of bread crumbs that is necessary for future lawyers and law students and politicians and people who may be interested in gathering the data and the evidence, which this Government has said that they are so intent on.

Because just reflecting on the regulatory impact statement, which accompanies this legislation and is indeed quite light—a good old two- to four-pager, which, you know, is quite an interesting contrast to the 17-odd pages of the regulatory impact statement for the initial legislation. But there’s a point here under the header “Views from consultation with stakeholders and the general public: Views of the general public”, and I quote: “Due to time constraints, no consultation with stakeholders was undertaken on the repeal of the Taxation Principles Reporting Act 2023.” This is “no consultation with stakeholders … undertaken”, no consultation whatsoever.

And now we have a clause here in the form of clause 3 saying that after a year on the statute book, there is going to be an automatic repeal of the evidence that this repeal occurred in the first place. We also have contained within this regulatory impact statement some really important points I think that we’ll continue to prosecute throughout other clauses, but this is an important one, particularly, on that point that there has been no consultation. Now, there’s an intent to repeal the repealment legislation, which is that “Inland Revenue”—here I’m quoting—“intends to consider means of improving its current reporting under the Tax Administration Act 1994, subject to internal resourcing and government priorities.” From that, we are to assume that IRD is still going to undertake some form of reporting on something akin to something like these principles, yet we have no idea what format that might take, what resources might be necessary, despite also knowing that the only resources that are necessary for them to do the reporting against the legislation as it currently sits in the status quo of the statute book is 2.5 fulltime-equivalent, 0.06 percent of the IRD’s staffing fulltime-equivalents.

But this point, again, I really put to the Minister—because there has been absolutely no consultation, as is here in black and white on the regulatory impact statement as issued to him—that there has been no consultation with stakeholders undertaken. It has been one of his core points of contention in putting forward this legislation that there was some disconcert from some of the submitters with some of the principles throughout the fulsome select committee process that we undertook at the Finance and Expenditure Committee in the middle of this year. Yet now he’s looking to remove this legislation and to then remove the removal of the legislation without a trace. It’s a Houdini kind of endeavour, isn’t it, Minister Watts? So I really want to ask him: what comes next from this point? If he is to remove the evidence that he removed this legislation from the statute book for transparency and accountability, what comes next?

Mr Chair, we’ve had a lot of talk of repeal today and this is a really unappealing repeal of a repeal. I’m going to appeal the unappealing repeal of the repeal—there’s a lot of peeling going on, like Christmas bells. It’s kind of like “Ding Dong Merrily on High” around here at the moment, isn’t it.

I just want to go back to the question I asked before, because the Minister did not answer it. He just explained the nature of the repeal clause again, but he did not answer the question that I asked, and it’s actually quite an important one, because anyone reading this bill might look at that repeal clause and wonder what on earth is going on here because it simply refers to the Act. You have to go back through the definitions and things to find out what’s going on. So I’m going to refer the Minister back to section 10(1) of the original Act, the Taxation Principles Reporting Act, and I still want that explanation from the Minister. It is for the benefit of other people in this Chamber who perhaps don’t have the specialised tax knowledge that people like Nancy Lu, Arena Williams, and Barb Edmonds have.

I’m assuming the Minister has this knowledge. I know he has been an accountant, I think, in his previous life, so he’s worked in that space. So I’m assuming he does actually know, but I’d like him to explain it for the benefit of people who don’t. The relationship between the repeal date in the bill, 1 January 2025, and section 10(1) of the Taxation Principles Reporting Act—so that’s the relationship between the calendar year, the tax year, and the repeal date in this bill. We haven’t had that explanation yet, so I’d like the Minister to demonstrate that he actually does know what is meant by the tax year and how it relates to the calendar year and how, then, that relates to the unappealing repeal of the repeal of the legislation.

Thank you, Mr Chair. I will begin this call, but welcome your guidance if this is the wrong place to debate this. The Minister has sought to debate my amendment to clause 1 in this part, where he began his contribution in answer to my colleagues’ questions, by speaking about my amendment to clause 1, which is to delete the “Taxation Principles Reporting Act Repeal Act 2023” and replace it with the “Taxation Principles Reporting Act Repeal and No Reporting on New Zealand’s Taxation Settings Act 2023.” This is a good amendment, Mr Chair. However, if I was to give a call on that now, I would be in the wrong part, but I’m seeking to debate with the Minister what he has raised in the chair and I hope my colleagues will support the questions that he has asked me.

I’m taking the call on clause 1, which the Minister spoke to. The reason for my proposal to amend the name of the Taxation Principles Reporting Act Repeal Act 2023 is that it doesn’t include the reference to what the repeal of this would actually do. The actual effect of this bill right now is that there is a piece of work which the IRD has conducted, at the expense of the New Zealand taxpayer, into the distribution of wealth within New Zealand, particularly for high net-wealth individuals, and they would be expected to make an interim report to the Minister very shortly and then a full report in the 2025 calendar year. That work is largely done. The effect of this bill that the Minister has proposed would be to keep all of that work and put it in a box and boot it out the window.

So I want to make that clear in the wording of the name of this bill, which the Minister has sought to debate with me in this part—and the reason why we need to change the name of the bill is because we need to be really clear about the wastage that this Minister is proposing, about the public work that has gone on for the benefit of the New Zealand people that is already done that will be put in a drawer, filed away, and never used again should this bill progress. I don’t want that to happen. On this side of the House, we don’t think that is a good use of taxpayers’ money and we think that the Minister should release the report today so that we can debate it within this committee stage.

However, if he does not, then it must be the case that this committee should change the name of this bill and make sure that the New Zealand public are just clear that that’s the Minister’s preference—that he would keep from the New Zealand public the work that has already gone on by the hard-working people at IRD, and we would never know what they were going to tell the Minister, and that this bill is progressing in urgency. The reason for its urgency is because he doesn’t want to know. He’s days away from receiving the interim report and he wants to make sure that the empowering legislation that he’s probably already got on his desk—he doesn’t want to read that over summer. He doesn’t want to be sitting in his office reading that over summer. He doesn’t want to know how his taxation policies that he must defend as the Minister of Revenue in his party—he doesn’t want to know how that will affect the low-income workers of New Zealand but, as well, the hard-working homeowners who he represents in his electorate of the North Shore; he doesn’t want to know. So he’d better change the legislation so he doesn’t get that work.

That is why the name of the bill must change or the Minister should take a call and explain that he will be tabling that report very shortly.

Thank you very much, Mr Chair. Look, I do acknowledge the energy in the room as we head into Christmas for a clause which has eight words, just for the record—eight words are in this clause, and we’ve heard a lot of clauses inside it.

As I outlined clearly in my first response to the questions in regards to that, I’ve covered off why that clause is there. The question raised by the Hon Grant Robertson, I think, was in regards to the other bills that there were. We had the fair pay repeal legislation, which included a clause similar to that within this. So just to reply to that question: different time duration acknowledged, but the view is that 12 months is an appropriate time.

The questions from Chlöe Swarbrick and also from the Hon Dr Deborah Russell: those are, again, consistent around clause 3, which I’ve already covered.

Again, going back to the amendment on the Table, well, the title of the clause is not part of the part that we’re currently discussing. I think you can be pretty clear that the title on this bill is pretty clear on what it’s doing and that’s exactly what it says, so anything other than that is not going to be accepted.

Thank you very much, Mr Chair. I’d have to say I was a little bit disappointed with the answers that have been provided so far. They’ve been very fair questions, in my view, and I hope to provide a fair question myself as I rise to speak in support of the proposed amendment in the name of Arena Williams, which proposes to insert that, as one option, the day after an inquiry of a committee of the House of Representatives has reported back to the House of Representatives on those parts of the Taxation Principles Reporting Act, that should be given effect in policy. What on earth is wrong with that? If the bill is going to be repealed and wiped off the books and the dust’s covered over it, why not at least look into it first?

So my question to the Minister is: what’s changed? Why has his view changed, because I was sitting here listening to the response and I was thinking, I’m pretty sure that before the election, Simon Watts was a huge advocate for ensuring that the public had their say. So I had a little bit of a nosy and I found here a quote from Hansard, which is part of a debate on a bill that went to select committee and had a full public hearing—and I quote—“I placed a motion on the table to extend the process, to give them more time—more time for scrutiny, to listen to those submissions—but it is clear from those members on that side of the House that they have no interest in listening to Kiwis”. We did listen, because we had a select committee process, and there’s a clear difference between that and this.

As we’ve seen throughout urgency, there’s been no opportunity for the public to have their say, and in this instance, not only have the public not had their say but, as is proposed in this clause, they’re going to wipe it. They’re going to wipe all record of the fact that there was a bill, there was a repeal bill, and we’re just going to fritter it away.

However, Arena Williams has come up with an elegant solution, in my view—as she has done throughout this entire period of urgency. She has proposed—look, fine, we get it. As the Minister has explained, the purpose of clause 3 is to indicate that this bill will be repealed. We get that—fine. But why not do that after we have an inquiry, because the public hasn’t had their say.

The Government says it’s not needed. Why don’t we put that to the test—why don’t we put that to the test? I imagine that the report is actually written, as has been talked about. Give it to the select committee, have a nosy, and I tell you what—here’s a promise. I haven’t consulted my colleagues, but I’m pretty sure they’ll back me on this. If, after the independent inquiry, it says, “You know what? This isn’t needed. This is a waste of time.’’, we’ll go, “Fair enough—fair enough. We’re not into that.”

💬 Hon Barbara Edmonds: I’m not sure I can give my support to that.

Ha, ha! Yep. All right, I’ll reconsider my proposal.

But it’s a fair question, and it’s a question that quite clearly has a range of responses, and that’s good. We’re here to debate. But the only response that really matters right now is that from the Minister, so let’s hear it. Will you give it a go? Will you stick up for what you used to believe and let this go to an inquiry?

Thank you, Mr Chair. Really great—

💬 Hon Kieran McAnulty: Oh no!

Yeah, I’m going to take this call. I too want to support the amendment that’s been put forward by the formidable MP for Manurewa in relation to having a select committee review after this bill to be able to actually provide some assurance to the public of New Zealand that actually the actions taken by this Government can be scrutinised because, clearly, under urgency we have not had that opportunity.

I’m a little bit indifferent as to what the Hon Kieran McAnulty has proposed, but you know, I can take things into consideration, you know, just a bit more. I might just have to think about that one. But, you know, I absolutely agree with the Hon Kieran McAnulty that a select committee process should follow this. And there’s also something that I have seen over the last couple of weeks that we’ve been under urgency; even external people such as Professor Dean Knight from Victoria University has also said that, actually, this is something that should be done as part of good process when a bill goes through under urgency—is to allow select committee process to go through it.

When I asked that question of a previous Minister, the Hon Chris Bishop, in the departmental disclosure statement, it actually made reference to: “The 100-day initiatives will be reviewed by the Government.” So I actually specifically asked that Minister who is going to undertake that review and that Minister’s response was Ministry for the Environment and Treasury. So my question to the Minister is: given that this bill meets that criteria that it is within the 100-day period, that it is going through under urgency, who is going to undertake that post-implementation assessment? Is it going to be Inland Revenue? Is it going to be Treasury? I still agree with the member from Manurewa that it should be a select committee to look to it, but if the Minister does not agree with that particular amendment, then, actually going back to what his Government has put in the disclosure statements, who’s going to be doing that post 100-day implementation and assessment?

Yesterday, when I—actually, it wasn’t long after the Minister was just made the co-captain of the Parliamentary Rugby Team, so I have to congratulate you on that one. I don’t think you quite understood what you were signing up to given, you know, possibly Fiji, South Africa, and there’s only $57 in the balance book, but I congratulate you on that. So when I turned my mind to this particular repeal bill, I too actually questioned when this actually comes into force and I had to go talk to a bunch of lawyers—it happens to be just on this side of the House over here, and it had to be clarified to me this is what they thought was the interpretation of clause 3. And I did worry because I thought, hang on, Inland Revenue drafters—they’re an absolutely amazing bunch of drafters that I have had the privilege of working with for over 10 years when I worked for Inland Revenue. I thought, no, they can’t get this wrong, I’m pretty sure that they have this right. And I still haven’t had that clarification from the Minister as to—exactly what Dr Deborah Russell has gone through—how this interacts with the reporting Act, which is then going to be repealed, and then this repeal bill which will become an Act which will then be repealed in January 2025.

I’m still trying to understand how that alignment works, so I’d really like the Minister to be able to really clarify. The Minister did talk about the precedents around the fair pay agreements, that there was a particular bill that, again, went through under urgency with no select committee process, and that that was in that bill. However, I want to ask the Minister: have there been other tax bills similar to this or tax bills where this type of precedent has been used? And then the Minister also, in his response to one of the earlier questions, said that, basically, they’re going to be maintaining it for a year. So my next question is, given that the purpose and intention of this particular repeal bill is to remove wastage and to remove bureaucracy, given that we have seen right throughout the regulatory impact statement that it’s only going to be 2.5 full-time equivalents (FTEs), how many FTEs will be required to maintain these pieces of repealed legislation on the Inland Revenue—I’m guessing maybe the Inland Revenue website, if you can clarify where it’s going to be held, given that we want to be able to have it on some record where members of the public can find it. I want to understand from the Minister how many FTEs will be required for that.

Thank you. Look, in the spirit of the new committee stage and a conversation, I just want to get an answer to my original question, which wasn’t answered at all, which was: does a repeal of a repeal restore the original legislation; if not, why not? If the Minister could respond to that, that would be great.

I move, That debate on this question now close.

Thank you, Mr Chair. I’m just going to finish my contribution, and it will be very short while we’re waiting for the Minister to get some advice on it, to be able to provide a response to the committee. What other tax bills has this precedent been used in? Not just other bills; I’m talking about tax bills, because there are particular drafters that draft these tax bills, which are different from the Parliamentary Counsel Office.

I also want to know how many fulltime-equivalents will be used to maintain this repeal of a repeal bill over the next year, up to January 2025, given that the purpose and intention of this repeal bill is to remove waste and bureaucracy. I’d be really keen to know what the Minister’s response is in relation to that, especially given we do not have a select committee process, we do not have the ability for the public or for members of the Finance and Expenditure Committee, the great committee that it is, to be able to ask Inland Revenue officials or an independent adviser, which we always have as part of tax bills, these particular questions. Because even for myself, who has practised in tax, at my first blush at looking at this bill, I too was confused. I do have confidence in the Inland Revenue drafters and I just want to understand if the Minister can provide those answers to those very different questions.

Thank you very much, Mr Chair, and thank you for those contributions.

I’ll start off with, firstly, the, I think, partial contribution by the Hon Kieran McAnulty—until his colleague interrupted and he sat down. But the reality is we won’t be taking him up on their offer, so I think we’ll just cut to the chase on that.

The other contribution from the Hon Barbara Edmonds was in regards to, again, the prioritisation between these clauses, so let’s work it through. The commencement date is the date that the Taxation Principles Reporting Act is repealed. That will be the date at which that actually occurs and it gets published. So that would be the date which follows post Royal assent.

Then clause 3, which we’ve extensively been through, over and over, the eight words—at that point this bill, on 1 January 2025, in effect will be repealed. Basically, what happens with these bills is that they go on to the legislation website. Once they are repealed, they go into another bucket of old bills that have been repealed. So from a point of process, that’s what’s happening. It’s no more complex than that. It’s eight words in that clause. I appreciate there’s a lot of interest in that, but it is as simple as that.

There were a couple of other questions from the Hon Duncan Webb, that cover, I think, in terms of where there were examples of other bills where we’ve used that. I’ve given an example of the one that was being done in the last few days. And, as I said, why we’re doing it is it does, in effect, clear up the statute book. So those are the three questions.

Thank you, Mr Chair, and I’d like to congratulate the Minister on his new role. I want to know about the report and the work that’s been done pursuant to the bill that is going to be repealed, and whether the Minister would look at really putting hard-working New Zealanders’ money to good use in letting us see the work that’s been done and, perhaps, consider an extension in terms of the repeal for a few years so that we can see this information and its value and then make a considered decision about whether in fact it provides value for New Zealanders.

It does seem to me that the work that’s been done—even if we may I disagree on whether in fact that is good value for money, the money has now been spent, largely. I would like the Minister to answer very plainly whether he has such a report already, or if he does not, how much work would be involved in getting that report into a position where we would be able to see it. If it involves particular people, what happens to those people? Are they going to be made redundant? In which case, it’s on notice, and, actually, they’ve got time on their hands that they might be able to finish this work. So what’s the cost of retaining those people till they finish this time?

And I guess my bigger point here—and I would like an answer to this, and I am absolutely genuine about this—is the taxpayer is someone who we all know; it’s us. We are all paying tax at the moment.

CHAIRPERSON (Teanau Tuiono): Can the member bring the focus to clause 3, please?

Yes. Sorry. So in a situation, is it really something where we want to repeal an Act if in fact we are about to see whether that taxpayer is being overtaxed? Given the position of the Government on the situation, I’d like a genuine answer as to why we wouldn’t wait and see whether in fact the tax balance is right, even in this current work that’s been done. Thank you.

Just in terms of the next contributions, they do need to be focused on clause 3. I do note that previous contributions have focused on clause 3 and have brought up new material, but continuing on from here, we need to keep that focus.

Thank you, Mr Chair. I don’t like having to do this, but I have still not received an answer from the Minister on the initial question I asked, and this is starting to worry me. So let me reprise the question, and I’ll tell you why it’s worrying me.

All right. So we have three dates in play here. So first of all is the date for the repeal of the repeal, so that’s 1 January 2025. So this bill has a self-repeal clause in it that’s set at 1 January 2025. The problem is that as I read the bill, as a tax person, I looked and I thought, “Hang on a second; what’s that date and why?” I couldn’t quite understand it, so I went back to the original Act and I looked, in particular, at the date at which the first interim report is due under the Taxation Principles Reporting Act, and I’m going to direct the Minister to it. It’s section 10(1), where it says, “The Commissioner must give the Minister an interim Commissioner’s report annually, before the end of a calendar year,”—so that’s the second date that’s in play—“for the tax year that ends in the calendar year,”—so that’s the third date that’s in play.

As a tax person, it took me a little while to sort that through, but I got it. It just took a moment of reflection and I got there, but I wanted the Minister to explain—he has not done this yet—the relationship between section 10(1) in the Taxation Principles Reporting Act and clause 3 of the Taxation Principles Reporting Act Repeal Bill.

Now, that’s the question I’ve asked three times now and still have not received an answer. The reason I’m starting to get a bit worried is because I’m not sure that the Minister understands this. Now, that’s alarming, because Ministers ought to understand the nature of the legislation they’re putting in front of the House. In this case, it’s a repeal bill. I would anticipate that the Minister would understand the nature of the original bill, the Taxation Principles Reporting Act 2023.

Now, these are common concepts in tax: tax year, calendar year, and how they relate. I would anticipate that the Minister of Revenue and his officials would be able to explain that to us and to the House. Now, I’m happy to step outside and explain it to people, but that’s not my role in the House. But I would like the Minister to explain it to the House for the benefit of the House and for the benefit of people watching. So, Minister, the ball is in your court on that one. Answer the question and I’ll stop asking it.

Thank you, Mr Chair. I have 10 questions for the Minister about clause 3. I will take him through my first six questions, and then I would really appreciate a short call after that about clause 3.

Now, as the Hon Kieran McAnulty explained, there is a real purpose in spending some time within a select committee context, or another group context, to find a way through this, where we’re appealing some taxation principles that we actually all agree with. The Minister hasn’t said that we do not all agree with these taxation principles. He has not said that he disagrees with sunlight as the best disinfectant to work through a bipartisan way forward on these tax principles, and so I’m here to help. I have some suggestions.

The first question that I have for the Minister is: will he be taking to Cabinet a proposal for a Cabinet committee to consider those principles within the Taxation Principles Reporting Act 2023, which should be given effect in policy?

My second question is: would he consider a futures forum - like setting, which is a tool of the Scottish Parliament, to consider those principles of New Zealand’s taxation reporting regime as it exists now, particularly Schedule 1, and whether those are still relevant and how they should be given effect in policy, regulation, or secondary legislation which would be subordinate to the Tax Administration Act? A futures forum for the Minister’s benefit is a tool which uses a cross-partisan approach, alongside experts, to conduct inquiries into issues which are long-term political issues for the good of a nation. Two examples from Scotland’s Futures Forum are its inquiry into drug use in Scotland, which was a cross-partisan approach to healthcare, and an inquiry into their superannuation settings.

The third question I have for the Minister is: would he consider that forum being chaired by a presiding officer of this House and it being a genuinely bipartisan forum where members of this House were represented in proportion to their party vote that they received, or one representative per party? Because that would genuinely give us the opportunity to have a cross-partisan way of working, most similar to the Business Committee.

My fifth question for the Minister is: would he consider me chairing it? I would love to.

And the sixth question that I have for him before I ask the further four is: would he consider Dr Dean Knight as a special adviser, given his interest in this debate and the submissions that you have heard from my colleagues on this side of the House about his advice about how to proceed with this particular clause 3?

Thank you, Mr Chair. Look, I have a new question on clause 3, which is really, I know that the Minister has made the point that it is a short clause, but I think what I haven’t heard from the Minister is: what is the reason for the repeal of the repeal? My question to the Minister is: would he be able to give to the committee today the reports or any advice or information or drafts that he has received pursuant to the Act which is being repealed to show the intention of why he is doing the repeal?

Now, if, for example, there is information in that report that shows that there aren’t great disparities, that things are going all according to plan, and everything looks fair, that would really behove well for the Minister to share that, because it would show a genuine intention from the Government that this is really about bureaucracy, which is what has been said in the House.

But without seeing that report, and given the timing of this repeal and the repeal of the repeal, the fact that we’re doing it without a select committee process and then trying to remove the breadcrumbs, as Chlöe Swarbrick said, I think it’s really important for the transparency to show the work that’s been done and, therefore, New Zealanders who are watching this debate—and this is the only debate that we’re having on this bill. This is the only time that New Zealanders will get to hear from the Minister, get to hear the intention behind what he is doing and why there is this complexity in clause 3.

That would be a very revealing thing, because the Minister could say anything that he wants about the clauses, but actually the data would speak for itself and it would be great evidence for this committee to have. It would be great evidence to show that all the statements made by the Minister and others on his side of the Chamber—they’re saying that this is about busting bureaucracy. That is an admirable thing to want to do, to bust bureaucracy, but when we put that in the context of 2½ full-time employees and we haven’t seen even just a sliver of any of the data that has been gathered or what work has been done, it’s very difficult for us and for the New Zealanders watching this debate to be able to make an informed judgment about what the purpose is for clause 3 and why there is this complexity around it.

So this is a new point, because my colleagues have asked about why it’s complex, but I think what I’d like to hear from the Minister is the motivation for doing it, as shown by the evidence. So, Minister, if you cannot bring that report today or share with us the work that has been done on it, my subsequent questions are when could you bring that to the House? Would you be prepared to do that? Even if this repeal does go through before Christmas, would you be prepared to show the House at a later date, rather than having to go through an Official Information Act process? Because that would be much more efficient and less bureaucracy for you than having Official Information Act requests come from every side of the House. So when could you do that?

Or if you are not going to, then I’d really like to know your reasons why you’re not going to, because this is really material evidence to show your intention and so that we can accept, at face value, the answers—or the semi-answers, because I haven’t heard them answered yet, as my colleagues have said—to this really important, strange removal of the breadcrumbing under clause 3. So I’d really like to hear that from you, Minister. Will you share the report? Will you do it today? If not, when will you share it with the House, and will you do that proactively rather than subject to Official Information Act requests?

If you’re not going to do that, can you please give us a really clear reason why you’re not going to, so that we can feel reassured that there isn’t sort of some kind of hidden agenda, which is partly what I’m hearing you say, so that you can evidence the things you’re saying about this being just a simple eight-word clause. That’s what I’d really like to hear from you, Minister.

Thank you very much. Again, I acknowledge the questions, and I’m going to be free and frank in regards to my responses on these questions. I do not have a copy of such report and have not seen any copies or views in regards to that report. So there is no magic report that is sitting on my desk, in my office in regards to that.

The reality is, going back to the questions around dates by the Hon Deborah Russell, around the tax year dates—so the report which is going to be technically required under legislation which we are now repealing would be as at the 31 March tax year this year. That report needs to be delivered by 31 December this year. And this bill will, in effect, repeal the need to do that reporting and that will be effective post this bill passing through a Royal assent. So the timeline in terms of those dates is as follows, and, to be honest, it is as simple as that.

To the questions from Arena Williams—and I acknowledge the feedback—no, I will not be taking any papers to Cabinet in regards to the principles. We’re pretty clear. We do not see the need for this legislation in regards to what it’s purporting to do. The reality is that the tax system already, and Inland Revenue and many policy aspects within that already refer to tax principles. That’s not a new concept. The tax principles actually, in the annual report from Inland Revenue, include a wide range of information in regards to the integrity of the tax system. So the conversation around the member asking in terms of, you know, am I as Minister open to suggestions by the member in terms of other aspects that aren’t in that annual report that might be of value, of course, and I’d encourage the member to get in touch and I will consider that in a best interests and genuine manner. So I think that that covers off the questions around principles, covers off the questions in regards to dates, and, from Helen White and Ingrid Leary, covers off the questions in regards to the actual report.

Members, before we move to the next call, I just want to acknowledge the probing questions of members, but I would also note that it’s the prerogative of the Minister how he chooses to address them or not, and I’m asking and looking for new material in terms of this clause. I do understand that you want to get specific answers, but that is the prerogative of the Minister, and members need to understand that.

Point of order, Mr Chair. Thank you, Mr Chair. I hope to seek your guidance on Speakers’ ruling 79/4, which sets out at (1)—and I will read it to you—it was ruling of Speaker Tolley in 2020. “I encourage you to keep your contributions focused”—which is what I did in my last contribution; I did not use my full five minutes, which she refers to there—“and [it is] relevant to promote good interaction with the Minister in the chair. We have the ability then to take short calls, and have a series of questions and answers between members and … Minister[s].” Her ruling there was that someone in my position could be confident that they would receive the next call after the Minister had answered a short series of questions. As I’ve indicated to the Minister, I have 10 questions to ask him, and a further four, given what he has told me, and I’d like to take the next call.

I shall take some advice. In your following contribution, I do want you to focus on clause 3, and I acknowledge that the Hon Barbara Edmonds will allow me to give you the call.

Thank you, Mr Chair. Speaking on clause 3 of the Minister’s proposed amendment bill, I have an amendment on the Table to refer the Act that is being repealed to a committee of the House. The Minister has indicated to me that he is not considering a committee, but he said in his contribution recently to the House that he would encourage me to get in touch with him and to further discuss these principles. He also told the House that the principles are something that IRD uses frequently. So I hope to help him with some further assurances to the House, which can get us there and then can leave us all happy around the House to vote for his amended clause 3.

So my further three questions are: would the Minister be open to an amendment to my amendment to make Schedule 1 of the Act, which is being repealed here, a new section 9 of the Tax Administration Act? It would only require one small operative provision to make sure that that schedule was given effect and remained in the statute book. The reason why I’m proposing that within this clause 3 is that it’s relevant to when this entire Act that the Minister has proposed is repealed and we then lose all of the legislation on the book. So what I’m proposing here is sort of like a transitional savings provision whereby Schedule 1 of the Act which is being repealed is then retained somewhere on our statute book, which I think should be the Tax Administration Act.

My eighth question to the Minister is: given what he has told me in answers to his questions, will he write to the Commissioner of Inland Revenue and recommend that it become the practice of the commissioner to publish those principles that are within Schedule 1 that the commissioner has taken into account when preparing the annual report that the Minister spoke of? That would be really useful, I think, for transparency within our system and would improve the operation of clause 3, which repeals the Act in its entirety.

My last question to the Minister is, given that he does not support my amendment, clause (b), whether he would consider, then, doing the intent of that, which would be by giving a 90-minute briefing to the Finance and Expenditure Committee alongside the Commissioner of Inland Revenue. Thank you, Mr Chair.

In the interests of free and frank conversation in regards to those questions, it’s not something that I’m going to consider. The whole purpose of this repeal bill is to take the legislative requirement around the reporting out, and hence the purpose of the bill. So to, in effect, take on board the feedback that you’re providing, or the suggestion, would, in effect, go against the principle of the bill. In regards to the conversation around tax principles and writing to the commissioner, look, the reality is that the annual report for IRD is publicly available. There’s a page at the back in which you can provide feedback and suggestions in regards to information in regards to that. That’s open for all New Zealanders to do so. As I’ve indicated to the member, if they wish to converse and write to me about their ideas around what’s not in that report that might be of use, then please feel free to do so and I will consider that in good faith. But in regards to any other aspects around protocol, this is a very simple bill. It is repealing a reporting requirement which the Government do not believe is necessary. That is the effect of the bill. On that basis, we’re not going to be considering the amendments that are proposed by that member.

Thank you, Mr Chair. Always charitable this time of the year, and a really great contribution there from the MP for Manurewa.

We’re going to clause 3, in response to a question that I gave to the Minister, and he addressed it in the sense that the maintenance of this particular repeal bill will go into a bill box. Now, my—

💬 Hon Grant Robertson: Bucket.

Oh sorry—bill bucket. My bad—a bill bucket. The reason why I question this in relation to clause 3 is because clause 3 provides the date in which that particular bill bucket closes or gets filled up or disposed of or whatever, which is in January—

💬 Hon Simon Watts: Comes in a sleigh.

What was that, Minister, sorry? I didn’t hear you.

CHAIRPERSON (Teanau Tuiono): He said, “Comes in a sleigh.”

Oh, OK. So January 2025, which goes to clause 3. But, again, the reason why—and I understand from various speakers across that side of the House and the Government side of the House—this bill needed to be repealed was because of the wastage and the bureaucracy. Therefore, the bill bucket, which will be filled up by January 2025—I’m trying to get through my train of thought here—how many fulltime-equivalents will be required to maintain that bill bucket, given that the purpose and intention of this repeal bill is wastage and bureaucracy? I think that is a valid question in relation to clause 3, because clause 3 is when that bill bucket closes—in January 2025.

So my question is to the Minister: does he have any advice as to how much that bill bucket maintenance is going to cost? Has he received any information as to how many full-time employees will be required for the maintenance of that? And if he hasn’t, why has the Minister not asked for that information, given the purpose and intention of this bill, which clause 3 brings into effect?

Then my second question—and this is in relation to, again, another response by the Minister around clarifying how this interacts with the Taxation Principles Reporting Act, which is going to be repealed. I thank the Minister for providing that clarification, because he said the reporting time frame is for the tax year ended 31 March, and I’m assuming 2024.

So in relation to that, does that mean that there’s been seven months that the Inland Revenue has been able to develop a report? The Minister has confirmed that he has not seen the report. I’m not sure whether he’s asked for the report. But within that seven-month period, has he got any advice from his officials as to what they’ve done in that seven months, how much that has cost for that seven months of work, so that we here on this side of the House can be able to assess that? Because, again, this bill and the foundations on which this bill are predicated are, according to the Government, wastage and bureaucracy.

So those two relative questions in relation to clause 3, given that’s when this repeal bill is coming into effect. Again, I just acknowledge the Minister and thank him for clarifying the time frames in relation to 31 March, 21st, and I think when this bill comes into force so it’s not delivered on 31 December 2023.

I have a new question, and it follows from comments made by my colleague the Hon Barbara Edmonds but also following from the answer that the Minister gave to my question about the release of any work done. I want to thank the Minister for engaging so authentically and directly with that very authentic and direct question. If I recall his answer correctly, he said that there was no magic report on his desk or whatever. My colleague didn’t ask this question, but I’d like to pick up on her train of thought where she said she didn’t know if the Minister had proactively asked for information. She’s talking about the cost of full-time employees and the cost of gathering the data.

So my question to the Minister, in response to what he told me, and in the spirit of this engagement as a debate, Minister: will you proactively get some of the data collated for us, even if it’s not in a final form? I hear you when you say that you haven’t been given any advice by your officials. The question is, really, not only have you proactively asked for it—which my colleague asked—but my question to you is: will you proactively ask for this information? Not how much the reporting of it would cost or the full-time employees—all of that. This is a new question around: will you actually give us some substantive data—

CHAIRPERSON (Teanau Tuiono): The member is starting to repeat.

—could you please collate some of, and proactively ask your officials to collate what they have, even if it’s not in a perfect final form so that we can make an assessment about what work has been done. So I’ll ask that, also because the Minister did raise that when he was answering my question. Thank you.

The time has come for me to leave the Chair. The House is suspended and will resume at 2 p.m.

Sitting suspended from 12.58 p.m. to 2 p.m.