National has come up with a solution so taxpayers can keep their own money after Revenue Minister Stuart Nash tried to short change them, National’s Revenue spokesperson Andrew Bayly says.
“In 2018 the Government was warned default KiwiSaver account holders had already overpaid tax to the tune of $70 million on their investment (PIE) income.
“New Zealanders shouldn’t pay any more tax than necessary. This especially impacts those New Zealanders on low incomes, the Kiwis that just cannot afford to be paying more tax than they should be. We want to ensure they get their refund.
“Historically refunds were not made because the system couldn’t cope with them, however the new Inland Revenue IT system doesn’t have this restriction.
“Under the PIE arrangement, tax is deducted at a maximum of 28 per cent. Some taxpayers have been paying much less than they should have while others have paid much more.
“For those who’ve underpaid, the Minister has chosen to go back to the year from 1 April 2018 and ask them to stump up tax to the tune of almost $50 million. A similar amount will be paid in the 2019/20 financial year.
“Some couples will be in the situation where one half may have to pay back money to Inland Revenue but the other half isn’t entitled to their refund. How is that fair?
“The Minister knows a change of legislation is needed so taxpayers can be refunded what they’re owed. When I asked him repeatedly about it, he claimed it was an operational matter for Inland Revenue and then said it required a legislative change.
“National believes New Zealanders shouldn’t have to pay more tax than necessary. That’s why I’ve drafted a Supplementary Order Paper (SOP) which will allow Mr Nash to make these changes in Parliament.
“I intend to table this as soon as the House resumes and I encourage Mr Nash to do the right thing so that New Zealanders can be paid back the money that belongs to them.
“There’s a principle with tax that you pay your fair share. Inland Revenue is also duty bound to refund any overpayment of tax.
“This is a tight-fisted Tax Minister who wants to take with one hand but not give back with the other. I’ve done all of the work for him, he now needs to do the right thing.”
Andrew Bayly's SOP can be found HERE.