Fuseworks Media

Repeal of Tax Principles Act undermines transparency – Tax Justice Aotearoa

The Government’s plan to repeal under urgency the Taxation Principles Reporting Act 2023 is short-sighted and a step backwards, says Tax Justice Aotearoa.

TJA supported the Tax Principles Reporting Act and is opposed to its repeal, which was announced today by Revenue Minister Simon Watts.

The Act aims to increase transparency and the public’s understanding of tax policy by establishing a reporting framework guided by tax principles.

“It is of real concern that the Government does not see increasing the transparency of our tax system as a priority,” says Tax Justice Aotearoa chair Glenn Barclay.

“Transparency is essential if we are to make our tax system more equitable.”

The Act requires Inland Revenue to publish regular reports on the operation of the tax system in light of tax principles and the first of these reports was due by the end of this year.

“The need to stop this initial report is the justification the Minister gives for ramming through this repeal under urgency, as he says IR needs to focus on the Government’s tax cuts,” says Tax Justice Aotearoa chair Glenn Barclay.

“However, the work involved in repealing the legislation is probably more than the work required of Inland Revenue to complete its first report – which would at least have the effect of establishing a kind of revenue baseline.

“If the Government thinks repeal is a good idea, they should allow it to be subject to appropriate scrutiny.”

“IR has a wider brief than to just collect tax and contribute to the Government’s tax cuts plan. For example, IR is also responsible for the integrity of the tax system and It is the duty of the IR Commissioner to collect over time the highest net revenue that is practicable within the law,” says Glenn Barclay.

“Good quality information is at the heart of what IR does and the repeal of the Act will make it harder to do that.”

“The Act provided a useful framework for judging how well our tax system was working – although we thought the set of principles was unnecessarily limited,” says Glenn Barclay.

“For example, the Act didn’t consider the impact of the tax system on the environment or its relationship to Te Tiriti o Waitangi.”

“Tax Justice Aotearoa urges the Government to reassess its stance and to consider the real aim of the act – namely to increase tax transparency,” says Glenn Barclay.

 

Powered by Fuseworks and Truescope - Media monitoring, insights and news distribution for New Zealand organisations.