Revenue Minister Todd McClay today welcomed the passing of the Taxation (Annual Rates, Foreign Superannuation, and Remedial Matters) Bill which will contribute to a fairer and more accessible tax system.
“The Government is committed to fostering growth and delivering better public services. This new legislation continues the work of further improving the fairness of the tax system and providing a better service to taxpayers,” Mr McClay says.
“It is important that taxpayers are asked to comply with tax rules that are cohesive, fair and applied consistently.”
A major change ushered in by the new legislation is to simplify the rules for taxing foreign superannuation.
“The old tax treatment of interests in foreign superannuation was complex and difficult to understand. Different sets of rules could apply and as a result, some people paid more tax than others depending on how their foreign superannuation scheme was structured.”
“The changes provide a much simpler and fairer approach for taxing foreign superannuation interests held by New Zealand residents,” Mr McClay says.
The change will come into effect on 1 April 2014.
Another key feature of the new legislation is aimed at providing greater consistency in the tax treatment of mining certain minerals such as gold, silver and iron sands.
“It’s important that the tax system is applied as fairly as we can. Mining is an important and valued part of our economy but the old rules were unjustifiably concessionary and needed to be brought more into line with the rules applying to other industries.
This change will apply from the beginning of the 2014–15 income year.
“This Government aims to raise its required revenue not through raising tax rates, but by ensuring that the existing tax bases are applied efficiently and fairly. The legislation passed today contributes to this ongoing programme,” Mr McClay says.