BEPS decisions welcome, but ignore the real tax evaders
3 AUGUST 2017 - The Taxpayers’ Union is welcoming the Government’s base erosion and profit shifting (BEPS) decisions announced today, however says they ignore the real anomaly in the law allowing commercial companies to evade paying tax, because their
shareholders are iwi or religious 'charities'.
Jordan Williams, Taxpayers' Union Executive Director, says, “It suits politicians to beat up on foreign companies over corporate tax evasion, because it
distracts from the elephant in the room. Companies owned by charities pay no company tax whatsoever, even where none of
their profits are actually spent on charitable purposes.”
“Last month, Waikato-Tainui announced record profits of $137.8 million. On those profits, not one cent of company tax was paid – despite only a small fraction actually
going back to the community.”
“Companies such as NZ Bus, Shotover Jet and Sanitarium pay no company tax because their shareholders are ‘charities’,
even when profits aren’t used for charitable purposes, and are re-invested. That is wrong. Ordinary companies get a tax
credit for profits donated to charity. That’s a good thing."
On 25 July, Chair of the tribal authority Te Whakakitenga o Waikato, Maxine Moana-Tuwhangai said that the charitable status was recognition of historical injustices including the Land Wars and subsequent land
confiscation.
“The claim that special tax status exists because of a Treaty settlement is nonsense on stilts, and the Māori-owned
companies which take advantage of this very well know it," says Mr Williams.
ENDS