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Reflections on 30 years of tax reform – lessons from history

Reflections on 30 years of tax reform – lessons from history 2560 1707 Taxpolicy

Three former Treasury heads came together to discuss NZ’s approach to tax reform over the past 30 years, at a forum hosted by the Tax Policy Charitable Trust.

The Tax Policy Charitable Trust, funded by Tax Management New Zealand (TMNZ) aims to promote broader tax thinking for the public good, helping to shape discussion on positive tax policy for all New Zealanders.

This year, the Trust brought together three of New Zealand’s great economic leaders to discuss New Zealand’s approach to tax reform and to reflect on tax policies developed during their time as the Secretary to the Treasury.

Dr Graham Scott, Dr Murray Horn and Dr Alan Bollard led Treasury from 1986 to 2002, a period of significant change across all aspects of the New Zealand economy. Facilitated by Sir Rob McLeod, they discussed changes they oversaw during their time, and shared their views on the tax challenges and opportunities facing the country today.

The session was a great opportunity for to hear about the benefits good tax reform processes have delivered over the past three decades.

Chris Cunniffe, CEO of TMNZ said “Their shared observations on that massive period of economic change in New Zealand’s history is invaluable knowledge for young tax policy stakeholders. It was fascinating to reflect on how the tax system was restructured in that time for the better.”

The evening was attended by leaders in tax, professional services firms, public service and academia. The insightful commentary from Dr Alan Bollard, Dr Murray Horn, Dr Graham Scott and Sir Rob McLeod sparked many conversations on the current economic challenges of the country.

John Shewan, Chair of the Tax Policy Charitable Trust said “Collectively the presentations and associated Q&A shone the light on a remarkable period of New Zealand history. We can learn a great deal from history.

Young professionals expressed astonishment at Dr Graham Scott’s description of New Zealand’s situation in 1984, and at the speed and depth of reform that followed. We sometimes assume that everyone knows what happened back then, but clearly not. One of the core objectives of the Tax Policy Charitable Trust is to engender interest in policy among young professionals, and the evening achieved that in spade loads.”

Tax Policy Scholarship showcases the next generation of talent

Tax Policy Scholarship showcases the next generation of talent 2048 1365 Taxpolicy

Four bright young industry minds have emerged as finalists in this year’s Tax Policy Scholarship Competition, an annual prize hosted by the Tax Policy Charitable Trust. 

From left: Jordan Yates, Mitchell Fraser, Daniel Doughty, Vivien Lei, Michelle Redington – IR Chief Tax Counsel, John Shewan – Tax Policy Charitable Trust Chair, Ian Kuperus – TMNZ Founder.

The biannual competition, which supports the continuation of leading tax policy research and thinking in New Zealand, enters its fourth round in 2022. The first competition was run in 2015. 

The scholarship is designed to inspire the next generation of tax industry leaders. This year, entrants under the age of 35 were invited to propose significant reforms to our current tax system or analyse potential weaknesses and unintended consequences from existing laws, and propose changes to address them.

Entrants were asked to tackle one of three topics: environmental taxation, tax administration, or the powers granted to the Commissioner of Inland Revenue to collect information for tax policy purposes. Participants were invited to address the topics with creative ideas backed up by reasoned research and analysis.

We are delighted to announce the four finalists for this year’s competition, selected by our panel of leading tax industry professionals.

Daniel Doughty

Daniel is a Senior Consultant with EY in Wellington. He has proposed the introduction of a small business consolidated reporting regime to simplify tax reporting for small companies.

The regime would consolidate pre-existing tax obligations into a single report to be filed every second month. Inland Revenue would send an automated income summary out at the end of the year, similar to those currently prepared for individuals.

Mitchell Fraser

Mitchell is a Tax Solicitor with Mayne Wetherell in Auckland. Mitchell is concerned that the recently-expanded powers granted to Inland Revenue to collect information for tax policy purposes could create unintended consequences.

He believes the new powers risk political interference, conflicting with the IR’s need to be politically neutral. Mitchell proposes identifying alternative means to collect this information, including through Statistics New Zealand.

Vivien Lei

Vivien is Group Tax Advisor with Fisher & Paykel Healthcare, and finance lead with the Fisher & Paykel Healthcare Foundation.

Vivien proposes to change New Zealand’s environmental practices through the introduction of an impact-weighted tax regime. Under this model, organisations would be taxed on their net positive or negative impact on the environment.

Jordan Yates

Jordan is a Senior Tax Consultant with ASB in Auckland.

Jordan believes the tax policy landscape is fractured, and suffocated by political roadblocks. His proposal is to establish an independent statutory authority that would be responsible for the independent management of fiscal policy, as it relates to the tax base.

Selecting a winner

The finalists were announced on 2 June, and each will go on to develop a 4,000-word submission on their proposal.

The four will be invited to present their final proposals and answer questions at a function in October 2022. The winner will be announced that evening.

Our Tax Policy Scholarship Competition celebrates creative thinking from young professionals and also provides a springboard for the brightest industry minds to develop their careers.

Nigel Jemson, the winner of the 2019 competition, says: “Entering the competition was a terrific opportunity for me to grow and develop my tax policy thinking and connect with leading minds in the tax community.  Winning the competition has given my career a boost and since, I have enjoyed a range of great roles in tax for leading businesses, Spark and PwC, and continued my involvement in and passion for New Zealand tax policy.”

Chris Cunniffe, Tax Policy Charitable Trust Committee Member and TMNZ Chief Executive, says this year’s entries underline the strength of the next generation.

“We’re consistently delighted with the breadth and the freshness of thinking young people bring to this competition. The competition provides a forum to share ideas, and secondly, ensures that creative tax policy is not the sole domain of people who have worked in the industry for a long time. As an industry, we are open to fresh thinking and new ideas.”

Tax Policy Charitable Trust Chair John Shewan says the entries prove the industry’s future is in good hands.

“New Zealand has been very fortunate to have so many competent tax leaders involved in developing policy for the betterment of our country. It’s very exciting to be around the next generation of future tax policy influencers, who are already, at a young age, focused on innovative opportunities to enhance the tax landscape.”

Michelle Redington, Chief Tax Counsel at Inland Revenue, who was the guest speaker at the event where the four finalists were announced, says it is fantastic to see the Tax Policy Charitable Trust create opportunities for the next wave of tax policy thinkers.

“Throughout my career, I have been very lucky to be supported by some of New Zealand’s preeminent tax leaders, who have been fantastic teachers and mentors,” she says. “I’ve enjoyed a diverse career in tax, spurred on by a need to solve complex problems, and I’m proud to be able to give back to the next generation of talented tax enthusiasts.”

Find out more about the Tax Policy Scholarship Competition, here.

Minister of Revenue announces tax policy competition finalists

Minister of Revenue announces tax policy competition finalists 510 300 Taxpolicy

Minister of Revenue Judith Collins was on hand to announce the finalists for this year’s Tax Policy Competition.

They are Talia Smart and Nicholas Coyle (both from Inland Revenue), Treasury’s Matt Woolley, and PwC’s Chris Park.

The finalists for the competition, which has been organised by the Tax Policy Scholarship Charitable Trust (TPSCT), were announced during a live stream of events simultaneously held in Wellington and Auckland.

Smart’s proposal looked at removing the business income exemption for charities, while Coyle’s reconsidered the claw back of interest deductions. Woolley discussed full corporate-personal tax integration and Park revisited the idea of a land tax.

As well as Minister Collins, other notable attendees were Inland Revenue Commissioner Naomi Ferguson and TPSCT Chair and former PwC Chair John Shewan, who delivered the opening address.

The finalists will present their full proposals in front of a heavyweight panel of judges during the awards dinner in Wellington on 17 October.

Joining Shewan on the panel are ex-Bell Gully Tax Partner Joanne Hodge, former IRD Deputy Commissioner Robin Oliver, Victoria University Business School Dean Bob Buckle and ex-Secretary of Treasury John Whitehead.

The winner will receive $10,000, the runner-up $4000 and the other finalists $1000 each.

Late last year, the TPSCT invited tax professionals under the age of 35 working in the public and private sector or academia to submit progressive and innovative reform ideas for the New Zealand tax system.

Given 2017 is an election year, proposals had to outline a significant reform of the New Zealand tax system in terms of its bases, method of collection, interface with taxpayers, legal framework or structural amendment.

Twenty-five applications were received by the judges.

The TPSCT was established in 2012 by Tax Management NZ and its Founder Director Ian Kuperus. Its aim is to inspire the next generation of leaders in New Zealand tax policy and administration.