Government Tying Its Own Hands With Tax Bill Repealing Transparency Provisions – Tax Justice Aotearoa

Tax Justice Aotearoa are outraged by the proposed repeal of transparency provisions in the Government’s new omnibus Taxation (Annual Rates for 2025–26, Compliance Simplification, and Remedial Measures) Bill, comparing the move to putting a blindfold on IRD, at a time when we need to be taking a closer look at how our tax system operates.

The Minister has described these as practical changes that make the tax system simpler and more effective, but when it comes to the repeal of s 17GB nothing could be further from the truth. This was the provision that enabled the IRD to conduct its groundbreaking research into high net worth individuals in 2023, which revealed the extreme inequality between the effective tax rates of the most well off and the average working New Zealander.

“This repeal is a fundamental blow to transparency in our tax system and shields the rich and powerful from legitimate scrutiny, making it harder to ensure our tax system is balanced and not asking too much of workers and those least able to pay,” says Glenn Barclay, spokesperson for Tax Justice Aotearoa.

“While it is very clear that s 17GB was necessary because pre-existing powers were insufficient to gather information that could inform policy change to address our unbalanced tax system, it is not clear what the problem is that the government is trying to fix with its repeal,” says Barclay.

“We understand that there were no reported problems during the research and reporting process relating to the High Net Worth Individuals project. No formal complaints were received and no legal action was taken against IR. IR appears to have conducted the process with integrity.”

“Most importantly, IR was able to produce important research that should inform the development of our tax settings going forward to address inequities revealed in that study,” says Barclay.

“While it is for the government to decide what tax policies it advances in light of such research, ignoring the evidence is one thing, but this measure is essentially outlawing crucial evidence from even being collected in the first place. That is deeply concerning when we’re talking about fairness across our tax system and hardworking New Zealanders having confidence that they are getting a fair go.”

“We encourage all political parties to reconsider this matter as it goes through the select committee process and urge them to remove the repeal of s 17GB from this Bill.”