A revenue authority’s application of a general anti-avoidance rules (GAAR) is often a vexed issue... more A revenue authority’s application of a general anti-avoidance rules (GAAR) is often a vexed issue where taxpayers and their advisors complain about uncertainty while the revenue authority argues that the nature and effective operation of a GAAR precludes anything more than general guidance at best. In New Zealand this issue has festered for well over a decade, with the latest development being a second draft interpretation statement issued in late 2011. In this article the authors set the scene and review the key issues raised in the submissions, and suggest that there is plenty of scope for improving the draft statement before it is issued later in 2012.
The purpose of this thesis is twofold. The first purpose is to discuss the expansion of the conce... more The purpose of this thesis is twofold. The first purpose is to discuss the expansion of the concepts of income and business and the corresponding erosion of the concept of capital in Australia as a result of recent decisions of the Australian courts. The second purpose is the examination of the potential impact these Australian decisions may have in New Zealand on a specific area of taxation, the treatment for tax purposes of lease incentives.
It is unusual to find a tax in operation which does not represent a compromise between tax princi... more It is unusual to find a tax in operation which does not represent a compromise between tax principles, policy and administrative considerations. However, the third of these, tax administration, often does not receive the attention it should as proposals for tax reform are developed. This paper examines one particular case, the possibility that attempts to introduce a capital gains tax (CGT) in New Zealand (NZ) have been unsuccessful because the right balance between the three dimensions of tax reform has not been achieved and that for this and other possible reforms each of these aspects should be given the appropriate consideration. New Zealand does not currently have a comprehensive CGT. In fact, political commentators have long said that the enactment of a CGT in NZ would be 'political suicide'. The reasons for such antipathy towards a CGT are not entirely clear especially given the successful implementation and operation of CGT in many jurisdictions, including the United Kingdom (UK). However, sentiment towards a CGT in NZ appears to have softened more recently. Perhaps sensing this rise in support, the centre-left New Zealand Labour Party in the 2011 and 2014 general elections unsuccessfully campaigned on, inter alia, introducing a comprehensive CGT. It is unclear what part the CGT proposal played in its defeat in both elections with other factors in play. However, noting that the CGT policy may have alienated voters in the 2014 election, Labour Party leader, Mr Andrew Little has indicated that reform of the NZ tax system, including a possible CGT, would not be made 'without going to the people first and getting a mandate to do so'. 3 Accordingly, the electorate support for a CGT, and its design (including the administration of the tax), will be crucial for its political viability in NZ; hence the rationale for this paper. The paper finds that the UK CGT is a very robust tax but has never taken a pure form based only on the principles of good tax design. Indeed its success in tax policy terms has been largely accounted for by pragmatic modifications over the years to accommodate the different and changing political and economic pressures applying to modern tax systems. The paper concludes that a more pragmatic approach could lead to the design of a CGT that may gain the broad support of the NZ electorate and also be as enduring as it has been in the UK.
The United Kingdom (UK) is typical of many common law jurisdictions at present, in that the reven... more The United Kingdom (UK) is typical of many common law jurisdictions at present, in that the revenue authority (HM Revenue and Customs) has extensive powers in Schedule 36 of the Finance Act 2008 (Schedule 36) to inspect buildings and obtain information coercively, with one of the significant constraints on this power being the right of a legal adviser or client to claim the protection of the doctrine of legal professional privilege (LPP) in appropriate cases under paragraph 20 of Schedule 36. Unfortunately, this does not assist accountants and other non-lawyer tax advisers, because the recent UK Court of Appeal case of R (on the application of Prudential Plc) v Special Commissioners of Income Tax [2010] EWCA 1094 (Prudential (CA)) has confirmed that the protection of LPP is limited to tax advice provided by lawyers and does not apply to (the same) tax advice when given by accountants or other tax advisers, though there appears to be a developing groundswell of support for such an extension. Indeed, Lloyd LJ, in his concluding comments in Prudential (CA), stated that while he agreed with the observation by Charles J in the High Court-that it was "not easy to see" why the logic underpinning LPP should not also support the application of a similar privilege to accountants and other tax advisers who were not legally qualified-in his Honour's view, it was not for the courts to extend the scope of LPP to non-lawyers, as this could only be done by Parliament. While paragraph 20 of Schedule 36 applies the full protection of LPP to tax advice from lawyers, paragraph 25 (Schedule 36) provides only very limited protection when the same advice is given by tax advisers who are not lawyers. This substantial disparity in the level of protection for the very same tax advice-which is based solely on the status of the advice giver-creates an uneven playing field between the legal and accounting (and other) professions. This differential protection has been characterised as an "unfair penalty" on those seeking tax advice from an accountant rather than a lawyer 1 and has created direct competition and sometime tensions 2 Accordingly, the authors believe it may be timely for the UK and other jurisdictions to consider introducing legislation to "even out" the protection for advice from accounting and other non-legal tax advisers. This process could draw guidance from the approaches taken in the two foreign jurisdictions referred to in Prudential (CA)-New Zealand and the United States-as well as proposals currently under consideration in Australia. between the professions. It could in some cases cause a client to choose a lawyer rather than an accountant for advice on tax issues. This Paper seeks to analyse the pros and cons of these alternative systems, and to draw out some possible guidelines which might assist other jurisdictions to develop an appropriate system. For convenience, comparisons have been drawn with the UK system, but the insights gained are generalisable.
There has been much debate in recent times concerning the need for a separate and comprehensive c... more There has been much debate in recent times concerning the need for a separate and comprehensive capital gains tax (CGT) in New Zealand (NZ). Some of this debate can be attributed to the prominence that this topic gained in the 2011 and 2014 general elections when both the New Zealand Labour Party and Green Party of Aotearoa New Zealand included the introduction of a CGT in their respective tax policies. The arguments for such a tax include equity, base broadening, certainty, projected additional tax revenues and remedying the “housing affordability crisis”. On the other hand, counter-arguments such as tax complexity (in the design of the CGT), overstatement of projected tax revenues, high tax compliance and administrative costs and adverse economic effects on savings and investments have been raised by opponents of a CGT. The Taxation Review Committee 1967 generally favoured a realisation-based CGT on “equity” grounds. However, the committee concluded that “the significant administrative problems with such a tax” outweighed the benefits. Griffiths observes that “[o]ther reports in the following years have reached broadly similar conclusions for broadly similar reasons.” At the political level, commentators have long stated that the enactment of a comprehensive CGT in NZ would be “[a] sure-fire path to political suicide”. Indeed, former Prime Minister, the Rt Hon David Lange, is reputed to have characterised “a capital gains tax policy as one likely to lose you not merely the next election, but the next three”. After the defeat in the 2014 election, the (then) Labour Party leader, Mr Andrew Little acknowledged that their CGT policy may have alienated voters in that election. Since the formation of the centre-left Labour-led coalition government in 2017, the issue of a CGT has once again been singled out as an item to be considered, this time by the government appointed Tax Working Group. Against the background noted above, what has prompted the government to reconsider the issue (and to go as far as suggesting a CGT could be part of its tax policy in the 2020 general election)? The authors suggest non-taxation factors are at play, in particular socio-economic factors such as housing affordability, income/wealth inequality and fiscal sustainability - issues which resonate with the current government’s philosophy and may yet tip the scales in favour of a CGT in NZ
Legal professional privilege protects confidential communications between legal advisors and thei... more Legal professional privilege protects confidential communications between legal advisors and their clients from compulsory disclosure. In the taxation arena, this will include protection from disclosure to taxation authorities using coercive information-gathering powers. The common law privilege does not apply to the client-accountant relationship or to the tax advisor-client relationship where that tax advisor is not a lawyer. In 2005, New Zealand introduced a legislative regime to grant statutory privilege to confidential communications between accountants and their clients for the main purpose of providing or receiving tax advice. In 2008, the Australian Law Reform Commission (ALRC) recommended that Australia follow the New Zealand model and introduce a similar statutory regime. This article outlines both the ALRC proposal and the New Zealand client-accountant statutory regime. The rationale for the creation of a separate statutory privilege and the reasons for the rejection of the extension of the common law privilege to the client-accountant relationship are also considered. Finally, the article compares statutory privilege with legal professional privilege. This review highlights differences between the two forms of privilege and concludes that the practical level of protection afforded taxpayers claiming this new form of privilege is considerably less than common law privilege.
In 2007, David Beckham was in New Zealand to play an exhibition football match. While in Wellingt... more In 2007, David Beckham was in New Zealand to play an exhibition football match. While in Wellington, he dined at Nando's restaurant. Moments after finishing his meal a mystery diner swiped the football star's scraps and cutlery. The items were subsequently listed for sale on online auction site Trade Me. This article considers whether profits derived by the enterprising diner from this isolated transaction may be assessable under the Income Tax Act 2007 (NZ). Specifically, the article focuses on the application of s CB 32 (Property obtained by theft), s CB 4 (Personal property acquired for purpose of disposal), and s CB 3 (Profit-making undertaking or scheme). The article concludes that the intrepid diner may be subject to tax on her profits under two of these provisions.
Income taxation is complex. Complexity arises due to the nature of the subject matter as well as ... more Income taxation is complex. Complexity arises due to the nature of the subject matter as well as through the expression (drafting) of tax laws. In an attempt to address the second issue the New Zealand Income Tax Act has been reorganised and is currently being rewritten in an endeavour to simplify it. Tax complexity arising from the nature of the subject matter is potentially more difficult to address. One of the areas causing complexity in this context is the capital-revenue distinction. Against this background this paper examines recent judicial trends in New Zealand as evident in two 2006 cases to ascertain what guidance they provide in this complex area. The first, a decision of the New Zealand Court of Appeal, concerned the tax treatment of legal expenses incurred by the taxpayer in unsuccessfully seeking compensation arising from alleged unlawful acts or omissions in the course of a tender process the taxpayer was involved in (Fullers Bay of Islands Ltd v CIR). The overall approach of the New Zealand High Court in this case is also very instructive. At issue in the second case, TRA Case W26, was whether expenditure incurred in earthquake strengthening a building was deductible. These cases provide guidance on a number of issues including the continuing use of the fixed and circulating capital test; the use of the accounting treatment adopted; the impact regulatory requirements have on deductibility and the manner in which work is undertaken (including the issue of deferred maintenance). 3 For further information see http://www.taxpolicy.ird.govt.nz/. For details of the overall reorganisation and rewrite see
Legal professional privilege protects confidential communications between legal advisors and thei... more Legal professional privilege protects confidential communications between legal advisors and their clients from compulsory disclosure. In the taxation arena, this will include protection from disclosure to taxation authorities using coercive information-gathering powers. The common law privilege does not apply to the client-accountant relationship or to the tax advisor-client relationship where that tax advisor is not a lawyer. In 2005, New Zealand introduced a legislative regime to grant statutory privilege to confidential communications between accountants and their clients for the main purpose of providing or receiving tax advice. In 2008, the Australian Law Reform Commission (ALRC) recommended that Australia follow the New Zealand model and introduce a similar statutory regime. This article outlines both the ALRC proposal and the New Zealand client-accountant statutory regime. The rationale for the creation of a separate statutory privilege and the reasons for the rejection of t...
The current tax disputes resolution procedure, introduced in New Zealand (NZ) with effect from 1 ... more The current tax disputes resolution procedure, introduced in New Zealand (NZ) with effect from 1 October 1996, includes an extensive pre-assessment phase-the aim of which is to resolve tax disputes without the need for litigation. While this objective of the regime arguably has been achieved it has come at a price for taxpayers; in particular the costs of the new process are such that some tax disputes are not worth pursuing with taxpayers preferring to concede their dispute with Inland Revenue. In response to concerns raised by commentators and professional organisations about the operation of the disputes resolution process, in 2010 Inland Revenue released an Issues Paper for consultation. This included a cursory and, in the author's view, dismissive review of the approaches in Australia, Canada and the United Kingdom to dealing with small tax disputes. This article reviews the small tax dispute resolution processes adopted in these countries and concludes a separate forum or ...
89N(3). Where such an application is made, the time bar is extended until the application is dete... more 89N(3). Where such an application is made, the time bar is extended until the application is determined, see s 89N(5). 9 Limited exceptions are provided for in s 89C. 10 See s 89E. 11 Section 89G. 12 Section 89H(1). 13 See SPS 08/01: Disputes Resolution Process Commenced by the Commissioner of Inland Revenue at [219] and ff. 14 See ss 89M(2) and 89N(1)(c). 15 See s 89M(1) and (3). 16 See s 89M(5). 17 Section 138G(1). 18 Section 138G(2). 19 See s 89N(1)(c). 20 See s 89N(2). 21 See n 20.
In his 2011 comparative study, Maples 3 observes that, despite the then recent positive administr... more In his 2011 comparative study, Maples 3 observes that, despite the then recent positive administrative changes implemented by Inland Revenue (including facilitated conferences and the ability to opt-out of the dispute process after the conference phase), "these changes do not alter the fact that the [New Zealand] dispute process essentially provides 'a one size fits all' procedure for tax disputes, irrespective of their complexity and the amount in dispute." Moreover,
Political commentators have long said that the enactment of a comprehensive capital gains tax (CG... more Political commentators have long said that the enactment of a comprehensive capital gains tax (CGT) in New Zealand would be "[a] sure-fire path to political suicide". (Edlin, 2008) However, in more recent times there may be a change in the mood of the nation-or at least in the Boardroom-to the adoption of a CGT: "The Herald's Fran O'Sullivan said this year's
The purpose of this thesis is twofold. The first purpose is to discuss the expansion of the conce... more The purpose of this thesis is twofold. The first purpose is to discuss the expansion of the concepts of income and business and the corresponding erosion of the concept of capital in Australia as a result of recent decisions of the Australian courts. The second purpose is the examination of the potential impact these Australian decisions may have in New Zealand on a specific area of taxation, the treatment for tax purposes of lease incentives.
A revenue authority’s application of a general anti-avoidance rules (GAAR) is often a vexed issue... more A revenue authority’s application of a general anti-avoidance rules (GAAR) is often a vexed issue where taxpayers and their advisors complain about uncertainty while the revenue authority argues that the nature and effective operation of a GAAR precludes anything more than general guidance at best. In New Zealand this issue has festered for well over a decade, with the latest development being a second draft interpretation statement issued in late 2011. In this article the authors set the scene and review the key issues raised in the submissions, and suggest that there is plenty of scope for improving the draft statement before it is issued later in 2012.
The purpose of this thesis is twofold. The first purpose is to discuss the expansion of the conce... more The purpose of this thesis is twofold. The first purpose is to discuss the expansion of the concepts of income and business and the corresponding erosion of the concept of capital in Australia as a result of recent decisions of the Australian courts. The second purpose is the examination of the potential impact these Australian decisions may have in New Zealand on a specific area of taxation, the treatment for tax purposes of lease incentives.
It is unusual to find a tax in operation which does not represent a compromise between tax princi... more It is unusual to find a tax in operation which does not represent a compromise between tax principles, policy and administrative considerations. However, the third of these, tax administration, often does not receive the attention it should as proposals for tax reform are developed. This paper examines one particular case, the possibility that attempts to introduce a capital gains tax (CGT) in New Zealand (NZ) have been unsuccessful because the right balance between the three dimensions of tax reform has not been achieved and that for this and other possible reforms each of these aspects should be given the appropriate consideration. New Zealand does not currently have a comprehensive CGT. In fact, political commentators have long said that the enactment of a CGT in NZ would be 'political suicide'. The reasons for such antipathy towards a CGT are not entirely clear especially given the successful implementation and operation of CGT in many jurisdictions, including the United Kingdom (UK). However, sentiment towards a CGT in NZ appears to have softened more recently. Perhaps sensing this rise in support, the centre-left New Zealand Labour Party in the 2011 and 2014 general elections unsuccessfully campaigned on, inter alia, introducing a comprehensive CGT. It is unclear what part the CGT proposal played in its defeat in both elections with other factors in play. However, noting that the CGT policy may have alienated voters in the 2014 election, Labour Party leader, Mr Andrew Little has indicated that reform of the NZ tax system, including a possible CGT, would not be made 'without going to the people first and getting a mandate to do so'. 3 Accordingly, the electorate support for a CGT, and its design (including the administration of the tax), will be crucial for its political viability in NZ; hence the rationale for this paper. The paper finds that the UK CGT is a very robust tax but has never taken a pure form based only on the principles of good tax design. Indeed its success in tax policy terms has been largely accounted for by pragmatic modifications over the years to accommodate the different and changing political and economic pressures applying to modern tax systems. The paper concludes that a more pragmatic approach could lead to the design of a CGT that may gain the broad support of the NZ electorate and also be as enduring as it has been in the UK.
The United Kingdom (UK) is typical of many common law jurisdictions at present, in that the reven... more The United Kingdom (UK) is typical of many common law jurisdictions at present, in that the revenue authority (HM Revenue and Customs) has extensive powers in Schedule 36 of the Finance Act 2008 (Schedule 36) to inspect buildings and obtain information coercively, with one of the significant constraints on this power being the right of a legal adviser or client to claim the protection of the doctrine of legal professional privilege (LPP) in appropriate cases under paragraph 20 of Schedule 36. Unfortunately, this does not assist accountants and other non-lawyer tax advisers, because the recent UK Court of Appeal case of R (on the application of Prudential Plc) v Special Commissioners of Income Tax [2010] EWCA 1094 (Prudential (CA)) has confirmed that the protection of LPP is limited to tax advice provided by lawyers and does not apply to (the same) tax advice when given by accountants or other tax advisers, though there appears to be a developing groundswell of support for such an extension. Indeed, Lloyd LJ, in his concluding comments in Prudential (CA), stated that while he agreed with the observation by Charles J in the High Court-that it was "not easy to see" why the logic underpinning LPP should not also support the application of a similar privilege to accountants and other tax advisers who were not legally qualified-in his Honour's view, it was not for the courts to extend the scope of LPP to non-lawyers, as this could only be done by Parliament. While paragraph 20 of Schedule 36 applies the full protection of LPP to tax advice from lawyers, paragraph 25 (Schedule 36) provides only very limited protection when the same advice is given by tax advisers who are not lawyers. This substantial disparity in the level of protection for the very same tax advice-which is based solely on the status of the advice giver-creates an uneven playing field between the legal and accounting (and other) professions. This differential protection has been characterised as an "unfair penalty" on those seeking tax advice from an accountant rather than a lawyer 1 and has created direct competition and sometime tensions 2 Accordingly, the authors believe it may be timely for the UK and other jurisdictions to consider introducing legislation to "even out" the protection for advice from accounting and other non-legal tax advisers. This process could draw guidance from the approaches taken in the two foreign jurisdictions referred to in Prudential (CA)-New Zealand and the United States-as well as proposals currently under consideration in Australia. between the professions. It could in some cases cause a client to choose a lawyer rather than an accountant for advice on tax issues. This Paper seeks to analyse the pros and cons of these alternative systems, and to draw out some possible guidelines which might assist other jurisdictions to develop an appropriate system. For convenience, comparisons have been drawn with the UK system, but the insights gained are generalisable.
There has been much debate in recent times concerning the need for a separate and comprehensive c... more There has been much debate in recent times concerning the need for a separate and comprehensive capital gains tax (CGT) in New Zealand (NZ). Some of this debate can be attributed to the prominence that this topic gained in the 2011 and 2014 general elections when both the New Zealand Labour Party and Green Party of Aotearoa New Zealand included the introduction of a CGT in their respective tax policies. The arguments for such a tax include equity, base broadening, certainty, projected additional tax revenues and remedying the “housing affordability crisis”. On the other hand, counter-arguments such as tax complexity (in the design of the CGT), overstatement of projected tax revenues, high tax compliance and administrative costs and adverse economic effects on savings and investments have been raised by opponents of a CGT. The Taxation Review Committee 1967 generally favoured a realisation-based CGT on “equity” grounds. However, the committee concluded that “the significant administrative problems with such a tax” outweighed the benefits. Griffiths observes that “[o]ther reports in the following years have reached broadly similar conclusions for broadly similar reasons.” At the political level, commentators have long stated that the enactment of a comprehensive CGT in NZ would be “[a] sure-fire path to political suicide”. Indeed, former Prime Minister, the Rt Hon David Lange, is reputed to have characterised “a capital gains tax policy as one likely to lose you not merely the next election, but the next three”. After the defeat in the 2014 election, the (then) Labour Party leader, Mr Andrew Little acknowledged that their CGT policy may have alienated voters in that election. Since the formation of the centre-left Labour-led coalition government in 2017, the issue of a CGT has once again been singled out as an item to be considered, this time by the government appointed Tax Working Group. Against the background noted above, what has prompted the government to reconsider the issue (and to go as far as suggesting a CGT could be part of its tax policy in the 2020 general election)? The authors suggest non-taxation factors are at play, in particular socio-economic factors such as housing affordability, income/wealth inequality and fiscal sustainability - issues which resonate with the current government’s philosophy and may yet tip the scales in favour of a CGT in NZ
Legal professional privilege protects confidential communications between legal advisors and thei... more Legal professional privilege protects confidential communications between legal advisors and their clients from compulsory disclosure. In the taxation arena, this will include protection from disclosure to taxation authorities using coercive information-gathering powers. The common law privilege does not apply to the client-accountant relationship or to the tax advisor-client relationship where that tax advisor is not a lawyer. In 2005, New Zealand introduced a legislative regime to grant statutory privilege to confidential communications between accountants and their clients for the main purpose of providing or receiving tax advice. In 2008, the Australian Law Reform Commission (ALRC) recommended that Australia follow the New Zealand model and introduce a similar statutory regime. This article outlines both the ALRC proposal and the New Zealand client-accountant statutory regime. The rationale for the creation of a separate statutory privilege and the reasons for the rejection of the extension of the common law privilege to the client-accountant relationship are also considered. Finally, the article compares statutory privilege with legal professional privilege. This review highlights differences between the two forms of privilege and concludes that the practical level of protection afforded taxpayers claiming this new form of privilege is considerably less than common law privilege.
In 2007, David Beckham was in New Zealand to play an exhibition football match. While in Wellingt... more In 2007, David Beckham was in New Zealand to play an exhibition football match. While in Wellington, he dined at Nando's restaurant. Moments after finishing his meal a mystery diner swiped the football star's scraps and cutlery. The items were subsequently listed for sale on online auction site Trade Me. This article considers whether profits derived by the enterprising diner from this isolated transaction may be assessable under the Income Tax Act 2007 (NZ). Specifically, the article focuses on the application of s CB 32 (Property obtained by theft), s CB 4 (Personal property acquired for purpose of disposal), and s CB 3 (Profit-making undertaking or scheme). The article concludes that the intrepid diner may be subject to tax on her profits under two of these provisions.
Income taxation is complex. Complexity arises due to the nature of the subject matter as well as ... more Income taxation is complex. Complexity arises due to the nature of the subject matter as well as through the expression (drafting) of tax laws. In an attempt to address the second issue the New Zealand Income Tax Act has been reorganised and is currently being rewritten in an endeavour to simplify it. Tax complexity arising from the nature of the subject matter is potentially more difficult to address. One of the areas causing complexity in this context is the capital-revenue distinction. Against this background this paper examines recent judicial trends in New Zealand as evident in two 2006 cases to ascertain what guidance they provide in this complex area. The first, a decision of the New Zealand Court of Appeal, concerned the tax treatment of legal expenses incurred by the taxpayer in unsuccessfully seeking compensation arising from alleged unlawful acts or omissions in the course of a tender process the taxpayer was involved in (Fullers Bay of Islands Ltd v CIR). The overall approach of the New Zealand High Court in this case is also very instructive. At issue in the second case, TRA Case W26, was whether expenditure incurred in earthquake strengthening a building was deductible. These cases provide guidance on a number of issues including the continuing use of the fixed and circulating capital test; the use of the accounting treatment adopted; the impact regulatory requirements have on deductibility and the manner in which work is undertaken (including the issue of deferred maintenance). 3 For further information see http://www.taxpolicy.ird.govt.nz/. For details of the overall reorganisation and rewrite see
Legal professional privilege protects confidential communications between legal advisors and thei... more Legal professional privilege protects confidential communications between legal advisors and their clients from compulsory disclosure. In the taxation arena, this will include protection from disclosure to taxation authorities using coercive information-gathering powers. The common law privilege does not apply to the client-accountant relationship or to the tax advisor-client relationship where that tax advisor is not a lawyer. In 2005, New Zealand introduced a legislative regime to grant statutory privilege to confidential communications between accountants and their clients for the main purpose of providing or receiving tax advice. In 2008, the Australian Law Reform Commission (ALRC) recommended that Australia follow the New Zealand model and introduce a similar statutory regime. This article outlines both the ALRC proposal and the New Zealand client-accountant statutory regime. The rationale for the creation of a separate statutory privilege and the reasons for the rejection of t...
The current tax disputes resolution procedure, introduced in New Zealand (NZ) with effect from 1 ... more The current tax disputes resolution procedure, introduced in New Zealand (NZ) with effect from 1 October 1996, includes an extensive pre-assessment phase-the aim of which is to resolve tax disputes without the need for litigation. While this objective of the regime arguably has been achieved it has come at a price for taxpayers; in particular the costs of the new process are such that some tax disputes are not worth pursuing with taxpayers preferring to concede their dispute with Inland Revenue. In response to concerns raised by commentators and professional organisations about the operation of the disputes resolution process, in 2010 Inland Revenue released an Issues Paper for consultation. This included a cursory and, in the author's view, dismissive review of the approaches in Australia, Canada and the United Kingdom to dealing with small tax disputes. This article reviews the small tax dispute resolution processes adopted in these countries and concludes a separate forum or ...
89N(3). Where such an application is made, the time bar is extended until the application is dete... more 89N(3). Where such an application is made, the time bar is extended until the application is determined, see s 89N(5). 9 Limited exceptions are provided for in s 89C. 10 See s 89E. 11 Section 89G. 12 Section 89H(1). 13 See SPS 08/01: Disputes Resolution Process Commenced by the Commissioner of Inland Revenue at [219] and ff. 14 See ss 89M(2) and 89N(1)(c). 15 See s 89M(1) and (3). 16 See s 89M(5). 17 Section 138G(1). 18 Section 138G(2). 19 See s 89N(1)(c). 20 See s 89N(2). 21 See n 20.
In his 2011 comparative study, Maples 3 observes that, despite the then recent positive administr... more In his 2011 comparative study, Maples 3 observes that, despite the then recent positive administrative changes implemented by Inland Revenue (including facilitated conferences and the ability to opt-out of the dispute process after the conference phase), "these changes do not alter the fact that the [New Zealand] dispute process essentially provides 'a one size fits all' procedure for tax disputes, irrespective of their complexity and the amount in dispute." Moreover,
Political commentators have long said that the enactment of a comprehensive capital gains tax (CG... more Political commentators have long said that the enactment of a comprehensive capital gains tax (CGT) in New Zealand would be "[a] sure-fire path to political suicide". (Edlin, 2008) However, in more recent times there may be a change in the mood of the nation-or at least in the Boardroom-to the adoption of a CGT: "The Herald's Fran O'Sullivan said this year's
The purpose of this thesis is twofold. The first purpose is to discuss the expansion of the conce... more The purpose of this thesis is twofold. The first purpose is to discuss the expansion of the concepts of income and business and the corresponding erosion of the concept of capital in Australia as a result of recent decisions of the Australian courts. The second purpose is the examination of the potential impact these Australian decisions may have in New Zealand on a specific area of taxation, the treatment for tax purposes of lease incentives.
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Papers by Andrew Maples