New Student Loan Bill Introduced

August 5, 2009 New Zealand FinanceNew Zealand Taxation  No comments

Numerous changes to the Student Loan system have been introduced in front of Parliament in a new Bill.

The Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill was tabled in Parliament on the 4th of August. Revenue Minister Peter Dunne emphasized the need for an efficient and consistent student loan system, as the current student loan amount has reached $9.6 billion, and currently has over half a million borrowers.

Changes introduced into the system include the allowance of residence of Niue, the Cook Islands, Tokelau or the Ross Dependency to utilize the interest free aspect of the student loans. This provision extends to those who are eligible to reside within those territories for 183 consecutive days. Thos wishing to pursue further studies in other countries will also be able to use the interest free element, provided New Zealand and the recipient country have a pre-arranged formal study exchange agreement. Those who are returning to New Zealand and repaying their student loans in less than 183 days will also be eligible for an interest write off. There has also been an allowance for Inland Revenue to increase their standard repayment deduction rate from 10 percent to 15%.