Tax Working Group completes final report
The Sir Michael Cullen chaired Tax Working Group (‘TWG’) has completed its Final Report on The Future of Tax. This is now with Finance Minister Grant Robertson and Revenue Minister Stuart Nash who will deliberate on the Report’s recommendations.
While there are many topics canvassed within the TWG Report, the “big elephant” with this Report is unquestionably the recommendations on a Capital Gains Tax (‘CGT’).
Last year (November 2018) in a Special Edition of our Tax Tips Update we reported extensively on The Spectre of a Capital Gains Tax for NZ and, as expected, this generated huge interest from our SME and entrepreneurial sector clients.
In that Special Edition we stated that:
- A CGT represents a monumental change to our tax settings and is a highly contentious topic across the wider electorate.
- Labour has traditionally supported a CGT, and this ideology remains unabated.
- A CGT is a natural fit within Minister Grant Robertson’s political philosophy.
Very soon we will know more definitively the extent of and design type of a CGT for New Zealand.
The timeframes relevant here are:
- 18th February – TWG Report presentation to Cabinet (with Ministers Robertson and Nash views);
- 21st February – TWG Final Report released publicly, with Government’s initial response;
- By 30th April – Governments formal response to TWG recommendations;
- April – August 2019 – Public Consultation process;
- September/October 2019 – Tax Bills with new tax policies introduced to Parliament;
- By September 2020 (Pre-election) – Passage of legislation on tax policies out of TWG;
- September 2020 Parliamentary elections;
- 1 April 2021 – effective date of new tax legislation
VCFO Group will report on the TWG’s Final Report in early March.