General update by IBBZ Accounting on latest tax news, business growth and technology tips.
As amended, section 11A(1)(k) land related services provided to non-residents outside New Zealand at the time the services are performed are eligible for zero-rating, if they are:
• not directly in connection with land in New Zealand or
• not in connection with land in New Zealand and intend to enable or assist a change in physical condition, ownership or other legal status of that land or
• directly in connection to land outside New Zealand
On 01 Feb 2019 Tax working group headed by sir Michal Cullen has recommended the Government to introduce capital gain tax. The formal report is due to be released to the public on 21 Feb 2019. The government may consider the introduction from 01 April 2021
It is expected the scheme will be broad based with very little and no exemptions, excluding family home.
Sir Michael Cullen is the same person who was behind the introduction of GST in New Zealand. The GST scheme is a broad based with very little exemptions, almost everything in New Zealand attract GST. It makes New Zealand GST unique in the world. New Zealand is the only country in the world who has broad based consumption tax with no exemptions not even on essential items. GST collects significant revenue for the government.