Monday, October 08, 2012

New Zealand supports tax evasion

60 Minutes [video] had a piece on New Zealand's tax evasion industry on Sunday night, looking into the institution of New Zealand foreign trusts and how they are used by the world's wealthy to evade taxes. As part of this, they interviewed Revenue Minister Peter Dunne about the issue. His response? This wasn't evasion, it was "legitimate tax avoidance".

Bullshit. We're providing a legal vehicle which allows people to hide assets from their governments, with no disclosure and no oversight. And thanks to our extensive network of double-taxation treaties, the income from those assets goes untaxed: we don't tax it, because its all foreign, and the destination government doesn't tax it, because it came from New Zealand and so has already been taxed. If another country - the Cook Islands, say - was doing this to us, we would call it exactly what it is: evasion. And we would be pointing out to the world how anti-social it is. But when we provide this service to the world's plutocrats, its all OK. The hypocrisy is astounding.

But it also displays Dunne's attitudes. Dunne is rich - as a Minister outside Cabinet, he pulls down a cool $217,000 a year - and he's done that for a decade. So of course he approves of tax evasion. Whether this is an appropriate attitude for our Minister of Revenue to have is left as a question for voters.