Taxation Principles Reporting Bill

2.1. Are there any publicly available inquiry, review or evaluation reports that have informed, or are relevant to, the policy to be given effect by this Bill?

YES

A commentary on the Bill is available at: https://www.taxpolicy.ird.govt.nz/publications/2023/2023-commentary-tax-principles-bill. The commentary provides a more detailed explanation of the main proposed legislative changes in the Bill.

2.2. Does this Bill seek to give effect to New Zealand action in relation to an international treaty?

NO

2.2.1. If so, was a National Interest Analysis report prepared to inform a Parliamentary examination of the proposed New Zealand action in relation to the treaty?

N/A

2.3. Were any regulatory impact statements provided to inform the policy decisions that led to this Bill?

YES

A regulatory impact assessment (A reporting framework informed by tax principles, Inland Revenue, April 2023) was prepared and is available at: https://www.taxpolicy.ird.govt.nz/publications/2023/2023-ria-pack-tax-principles-bill

2.3.1. If so, did the RIA Team in the Treasury provide an independent opinion on the quality of any of these regulatory impact statements?

NO

2.3.2. Are there aspects of the policy to be given effect by this Bill that were not addressed by, or that now vary materially from, the policy options analysed in these regulatory impact statements?

NO

2.4. Has further impact analysis become available for any aspects of the policy to be given effect by this Bill?

NO

No significant further impact analysis has become available for any aspects of the policy to be given effect by the Bill. Therefore, for the purposes of this statement, the answer is “No” as per the scope of this question explained in page 29 of the Disclosure Statements for Government Legislation: Technical Guide for Departments (June 2013).

However, the commentary on the Bill, available at https://www.taxpolicy.ird.govt.nz/publications contains analysis of the proposal in the Bill. This may supplement existing published analysis.

2.5. For the policy to be given effect by this Bill, is there analysis available on:

(a)   the size of the potential costs and benefits?

YES

(b)   the potential for any group of persons to suffer a substantial unavoidable loss of income or wealth?

YES

2.5(a) Size of potential costs and benefits

The regulatory impact assessment listed under 2.3 provides analysis on the potential costs and benefits for the policy proposal in the Bill. The benefits are qualitative in nature.  

The annual cost of the reporting framework is likely to average 2.5 full time equivalents (FTE). However, this could fluctuate due to a range of factors, including whether additional data collection is required to complete the reporting, how the report is published and level of official engagement with the public.

2.5(b) potential for any group of persons to suffer a substantial unavoidable loss of income or wealth

Although this Bill would be listed among the Inland Revenue Acts, the proposal is solely to report information. Therefore there is no potential that any group of persons would suffer a substantial unavoidable loss of income or wealth because of the policy proposal.

2.6. For the policy to be given effect by this Bill, are the potential costs or benefits likely to be impacted by:

(a)   the level of effective compliance or non-compliance with applicable obligations or standards?

NO

(b)   the nature and level of regulator effort put into encouraging or securing compliance?

NO

The effectiveness of taxation legislation is, by its nature, reliant on effective and voluntary compliance. The level of effective compliance or non-compliance with specific applicable obligations or standards, and the nature of regulator effort, may have an impact on the potential costs or benefits for some policy items to be given effect by the Bill. This may be discussed in more detail in the regulatory impact assessment listed under 2.3 or, where appropriate in the commentary on the Bill.

3.1. What steps have been taken to determine whether the policy to be given effect by this Bill is consistent with New Zealand’s international obligations?

There have been no formal steps to determine whether the policy to be given effect by this Bill is consistent with New Zealand’s international obligations.

3.2. What steps have been taken to determine whether the policy to be given effect by this Bill is consistent with the principles of the Treaty of Waitangi?

Consultation with Inland Revenue’s Māori Advisory Panel occurred during the policy development process and the resulting analysis did not indicate anything in the reporting framework that would be inconsistent with the rights and interests protected by the Treaty of Waitangi.

3.3. Has advice been provided to the Attorney-General on whether any provisions of this Bill appear to limit any of the rights and freedoms affirmed in the New Zealand Bill of Rights Act 1990?

YES

Advice provided to the Attorney-General by the Ministry of Justice, or a section 7 report of the Attorney-General, is expected to be available on the Ministry of Justice’s website upon introduction of a Bill. Such advice, or reports, will be available on the Ministry’s website at https://www.justice.govt.nz/justice-sector-policy/constitutional-issues-and-human-rights/

3.4. Does this Bill create, amend, or remove:

(a)   offences or penalties (including infringement offences or penalties and civil pecuniary penalty regimes)?

NO

(b)   the jurisdiction of a court or tribunal (including rights to judicial review or rights of appeal)?

YES

Clause 7 of the Bill provides that reports produced under the Act and the taxation principles in the Act may not be used as evidence as to matters of law or fact, or to be used in interpretation of law.

3.4.1. Was the Ministry of Justice consulted about these provisions?

A draft copy of the Bill was provided to the Ministry of Justice in April 2023 as part of agency consultation.

3.5. Does this Bill create, amend or remove any provisions relating to the collection, storage, access to, correction of, use or disclosure of personal information?

YES

Clause 8 of the Bill would allow the Commissioner to use any information which the Commissioner already holds in discharging their obligations under the Act.

Clause 8 the Bill also requires that any information used in the report be anonymised (i.e. not include personal identifying data). Accordingly, the information used in the reporting framework will be anonymised, aggregated data and will not identify individual taxpayers.

3.5.1. Was the Privacy Commissioner consulted about these provisions?

YES

These changes have been discussed and no concerns were raised by the Privacy Commissioner. However, the Privacy Commissioner has commented that Inland Revenue will need to take appropriate steps to mitigate the risk of re-identification of individuals in the context of publishing anonymised, aggregated information.

3.6. Has there been any external consultation on the policy to be given effect by this Bill, or on a draft of this Bill?

YES

There was limited discussion with some external groups on the general policy proposal which informed the development of the policy and Bill. Further information is included in the regulatory impact assessment.

3.7. Have the policy details to be given effect by this Bill been otherwise tested or assessed in any way to ensure the Bill’s provisions are workable and complete?

YES

All proposals in the Bill have been reviewed by internal operational subject matter experts under Inland Revenue’s standard process for assessing the administrative impacts of any new policy initiatives and ensuring they are workable and complete. This involves assessing whether systems need to be changed and, if so, whether formal testing needs to be carried out. None of the measures in the Bill have required formal testing.

4.1. Does this Bill contain any provisions that could result in the compulsory acquisition of private property?

NO

4.2. Does this Bill create or amend a power to impose a fee, levy or charge in the nature of a tax?

NO

Although this Bill is will be listed among the Inland Revenue Acts, amending tax legislation, it does not contain provisions that create or amend a power to impose a charge that is a tax.

Therefore, for the purposes of this statement, the answer is “No” as per the scope of this question explained in pages 53 and 54 of the Disclosure Statements for Government Legislation: Technical Guide for Departments (June 2013).

4.3. Does this Bill affect rights, freedoms, or impose obligations, retrospectively?

NO

There are no policy items in the Bill that may have a retrospective effect.

4.4. Does this Bill:

(a)   create or amend a strict or absolute liability offence?

NO

(b)   reverse or modify the usual burden of proof for an offence or a civil pecuniary penalty proceeding?

NO

4.5. Does this Bill create or amend a civil or criminal immunity for any person?

NO

4.6. Does this Bill create or amend a decision-making power to make a determination about a person’s rights, obligations, or interests protected or recognised by law, and that could have a significant impact on those rights, obligations, or interests?

NO

The Bill specifically says that decision-making and determinations are not to be impacted by the reporting under the Bill or the tax principles included in the Bill.

4.7. Does this Bill create or amend a power to make delegated legislation that could amend an Act, define the meaning of a term in an Act, or grant an exemption from an Act or delegated legislation?

NO

4.8. Does this Bill create or amend any other powers to make delegated legislation?

NO

4.9. Does this Bill contain any provisions (other than those noted above) that are unusual or call for special comment?

NO