9. Dr RUSSEL NORMAN (Co-Leader—Green) Link to this
to the Minister of Finance
Does he have any concerns regarding the membership of the Tax Working Group?
Hon BILL ENGLISH (Minister of Finance) Link to this
No, I do not. The members of the Tax Working Group were appointed by Victoria University, and where they have need for a wider range of expertise, they invite people in, including experts on poverty and economists who may have views that do not correspond with those of the group.
Does he have any concerns about PricewaterhouseCoopers’ chairman, John Shewan, being on the Tax Working Group, in light of Mr Shewan’s advice to Westpac to use tax reduction measures that the High Court subsequently found to be unlawful and that cost taxpayers hundreds of millions of dollars in lost revenue?
No, I do not. As I said, Victoria University appointed a group of acknowledged tax experts, and, regardless of who their clients are, their advice to the Government will stand or fall on its merits.
Stuart NashWhy did the Government lend its support to the formation of the Tax Working Group, when the Minister appears to have ruled out the vast majority of its recommended options as presented to date?
Is he concerned that, according to the Auckland High Court, Mr John Shewan advised Westpac to use tax reduction measures in order to pay a tax rate of only 6.5 percent instead of the corporate rate of 30 percent, and that those tax reduction measures were subsequently found to be unlawful tax avoidance?
I do not intend to make comment on the case in any way that might compromise the Crown’s position. As I said before, from the Government’s point of view the advice of the Tax Working Group will stand or fall on its merits, regardless of who offered that advice.
How does he think the recommendations from the Tax Working Group will look in the eyes of ordinary New Zealanders if, for example, the Tax Working Group suggests increasing GST for ordinary New Zealanders, when one of the experts on the group has been advising overseas banks on how to avoid tax to the tune of hundreds of millions of dollars?
I think the public will judge the outcome of this exercise by the wisdom of the Government’s decisions. The Government will have a look at the advice, it will decide whether there is a strong enough case for change, and any case for change will have to balance equity with positive economic effect.