Revenue Minister Dunne eyes up tax assistance for people and businesses in Christchurch

Revenue Minister Peter Dunne has announced Inland Revenue is considering a number of measures to assist people and businesses in Christchurch with tax support in the wake of the devastating earthquakes that hit the city on September 4 and February 22.

Dunne said areas identified for consideration to date included: Depreciation issues including laws clawing back depreciation from the insurance proceeds on destroyed buildings; A number of statutory dates that oblige taxpayers to take action, especially around 31 March; The tax treatment of donated goods; The redundancy tax credit that expires on 1 April this year and; The tax treatment of welfare benefits provided by employers (including ex gratia payments).

Here is the release from Dunne:

Although Inland Revenue had already put in place a number of urgent measures in response to last month’s Christchurch earthquake, the Government is looking at further measures in response to issues raised by the public, Revenue Minister Peter Dunne said today.

“I am very pleased with Inland Revenue’s response to the position people found themselves in after the earthquake.

”The flexibility they have shown from immediately after the quake has helped alleviate undue stress and concern on tax matters at least during this terrible time,” Mr Dunne said.

He explained that Inland Revenue’s response had to date been focused on the plight of business and individual taxpayers, and on its own people and how it operates in Christchurch with its premises closed.

He said Inland Revenue’s policy team has been involved in the earthquake support package developed by the Ministry of Social Development, and in ensuring that Inland Revenue's powers to forgive interest are appropriate. 

Mr Dunne said that the department had also been helping to facilitate and encourage donations to charities at work in helping Christchurch’s post-quake recovery.

“The Christchurch Earthquake Appeal, launched by the Prime Minister in the days after the quake, has been granted donee and tax exempt status.  New Zealand donors to the Appeal can therefore claim a tax credit or deduction for donations, while officials are clarifying the tax treatment of donations from overseas with foreign tax administrations,” he said.

Mr Dunne said public feedback on what is needed in the wake of the quake would potentially drive some urgent legislative changes.

"I am working through a list of issues compiled by officials and considering possible legislative responses.”

Areas identified for consideration to date include:

·        Depreciation issues including laws clawing back depreciation from the insurance proceeds on destroyed buildings.

·        A number of statutory dates that oblige taxpayers to take action, especially around 31 March.

·        The tax treatment of donated goods.

·        The redundancy tax credit that expires on 1 April this year.

·        The tax treatment of welfare benefits provided by employers (including ex gratia payments).

Mr Dunne said that he would be working on these issues with his ministerial colleagues and expected to be in a position to announce details of decisions in a couple of weeks.

“The tax system can provide valuable help to the people of Christchurch.

“It is important that we do all we can to provide the greatest assistance, while maintaining the integrity of the tax system,” he said.