Monthly Archives June 2012

IRD Nabs Million Dollar Tax Evader

June 19, 2012 New Zealand Taxation

IRD Nabs Million Dollar Tax EvaderThe IRD has won a case against an Auckland based business man, who willfully ignored his tax obligations and fled the country for two years to avoid legal procedures.

On June 18th the Auckland District Court sentenced an Auckland man for tax offenses which allegedly cost the Inland Revenue Department over NZD 1 million.

Chandar Prakash pleaded guilty to deliberately evading tax obligations of more than NZD 170 000 in the years between 2001 and 2006, and received a sentence of one year and ten month in jail for his offenses.

The accused filed for bankruptcy in 2009, and, according to the IRD, approximately NZD 1 million of his debts to the IRD had to be written off, including his Student Loan debt, his unpaid tax obligations, and the penalties and interest due to the IRD.

According to the ...

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Tourist Taxes Not Well Recieved

June 15, 2012 New Zealand Taxation

Taxes on Tourism in New ZealandThe New Zealand tourism industry has voiced it disapproval of new proposals to levy more taxes on tourists, citing concerns of inefficiency and fairness.

On June 14th Tourism Industry Association New Zealand (TIA) spoke out against a proposal to impose more taxes on local and international tourists in New Zealand.

Last week both the Mayor of Napier Barbara Arnott and the Mayor of Hastings Lawrence Yule suggested that the cities could implement a “bed tax” on tourists who stay at a local hotel or motel. Under the current proposal the tax would be brought in over the span of three years, eventually reaching NZD 1 per night per person.

According to the TIA Chief Executive Martin Snedden, the tax is “lazy” and would impose unfair penalties on tourists choosing to use local commercial accommod...

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OCR Left at 2.5 Percent

June 14, 2012 New Zealand Finance

New Zealand Cash rateThe New Zealand Official Cash rate will not be changed today, as the Reserve Bank remains cautious over the potential for economic downturns in Europe.

On June 14th the Governor of the Reserve Bank Alan Bollard announced that the New Zealand Official Cash Rate would be left unchanged at the current level of 2.50 percent.

The Governor explained that the decision to leave the OCR at 2.5 percent was because “…New Zealand’s economic outlook has weakened a little since the March Monetary Policy Statement“.

According to Alan Bollard, New Zealand has recently seen ongoing deterioration in its economic indicators, and there is still some risk of further economic instability in the euro area...

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Superannuation System Needs Update

June 12, 2012 New Zealand FinanceNew Zealand Taxation

Retirement SavingsNew Zealanders will need to pay more taxes or retire later in life if they wish to maintain the country’s current superannuation system.

On June 11th the Financial Services Council, a lobby group representing New Zealand fund managers and life insurance companies, released a statement, claiming that New Zealanders under the age of 45 will not have access to the current superannuation system unless the government raises personal taxes or reduces entitlement.

According to the FSC, personal tax rates would need to be hiked by at least 28 percent in order to raise the money necessary to maintain the current superannuation system into the future. Alternatively, the age of entitlement could also be raised, forcing workers to increase their own personal savings.

The chief executive of the FSC Pe...

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