The New Zealand tax system is coherent and stable, and is well suited to the economic goals of the country’s government, according to a new document released by the national tax authority.
The New Zealand Inland Revenue Department (IRD) has issued the Briefing for the Incoming Minister of Revenue, outlining the state of the national tax system and evaluating the effectiveness of current tax policies and potential future tax changes.
According to the IRD, the tax system in New Zealand “…is in a good place. The tax bases are broad, robust and provide reliable sources of revenue to fund Government programmes. The broad tax bases and the relatively low tax rates make the tax system among the most coherent in the OECD.”
The briefing outlined several options for potential tax changes in New Zealand, such as shifting the majority of tax payments away from income payments towards capital gains and consumption expenses. However, the previously completed research by the IRD does not suggest that any of the potential changes would result in any significant improvement in the efficiency or effectiveness over the current tax system.
In the next few month the IRD and the Minister will begin discussing a new work programme to ensure that any future changes to the national tax system continue to be efficiently implemented and in line with the government’s economic goals.