NZ Government
John Wright MP, Revenue Undersecretary
May 16 2000
Tax Relief Legislation Introduced
Legislation introduced into Parliament today will reduce the incremental penalty for overdue tax, and extend relief
provisions to all types of tax.
"These measures should help to reduce the costs and stress associated with overdue tax payments, and provide some
relief to taxpayers who find themselves in difficulty," Revenue Under-secretary John Wright said today.
"As a complementary measure, the grace period from use-of-money interest for taxpayers who receive a statement of
account for overdue tax is being increased to give them more interest-free time in which to pay their overdue tax," Mr
Wright said.
The changes include:
- The incremental penalty for late payment of tax is to be reduced from 2% to 1% each month that tax is overdue. -
Provisions allowing Inland Revenue to cancel, remit or accept payment by instalment will be extended from income tax and
fringe benefit tax to all types of taxes. - Inland Revenue will not have to seek the approval of the Minister of Finance
to remit tax, refund it or enter instalment arrangements for amounts of more than $50,000, which will speed up the
process of granting relief to taxpayers. - The grace period from use-of-money interest between issue of a statement of
overdue tax and payment of that tax is being extended from 15 days to 30 days.
"These changes were inspired by recommendations made by the Finance and Expenditure Committee as a result of its
inquiry last year into the powers and operations of the Inland Revenue Department. The committee concluded that more
flexibility and leniency were needed in the administration of the compliance and penalty legislation and the
department's debt management practices. The changes introduced today respond to that concern," Mr Wright said.