Monday, October 01, 2018

Priorities again

Newsroom this morning has an interesting piece on IRD's enforcement priorities:

IRD collected just $10,000 in unpaid tax from people living in Australia last year, but netted $1.7 million in student loan repayments from Australia.

The IRD made just eight requests for assistance from the Australian Tax Office (ATO) in the 2017/18 tax year to net the $10,777.44 in unpaid tax, according to information released under the Official Information Act.

A 1995 tax treaty with Australia, updated in 2009, allows the IRD and ATO to share information and request assistance in collecting tax.

The low take is especially surprising the IRD collected $1.7 million in student loan debts and $45.2 million in child support debts over the same period.

Terry Baucher, director of tax consultancy Baucher Consulting, filed the OIA request and told Newsroom he was “shocked” at the tiny amount of unpaid tax collected from Australia, especially given how many New Zealanders live there — including some who move to escape tax owed here.

As with the previous piece on the different levels of enforcement for students and property speculators, the message is clear: IRD is tough on students, but soft on tax cheats. Given that student debtors are just that - debtors, a civil matter - while tax cheats are actual criminals who undermine the integrity of the tax system, surely it should be the other way round?