A newspaper that pays no tax complains about tax avoidance!

January 16th, 2014 at 11:00 am by David Farrar

The Dom Post editorial:

Taxes are what we pay for a civilised society, according to the great American Supreme Court judge Oliver Wendell Holmes.

If that is so, then aggressive is an offence against civilisation.

I’d love to know what the Dom Post defines as aggressive tax avoidance. I presume it means tax avoidance done by other companies, but not by ourselves.

Google, for instance, whose slogan used to be “Don’t be evil”, in 2012 paid a mere $165,000 in tax in New Zealand. Amazon paid $1.6m tax on sales of $46.5m. And Apple paid $2.5m on sales of $571m. Does anyone think these companies are paying their fair share?

I’ve got a much better example. Australia (owns the Dom Post) paid no tax at all last year on revenue of A$2.01 billion. That’s outrageous I’m sure the Dom Post agrees, and I look forward to them joining with the NZ Herald to campaign on their owners paying more tax. The fact it means they may have to sack a few editorial staff to afford their increased tax bills I’m sure is not what is preventing them from not being total hypocrites.

Or maybe the Dom Post will say you can’t compare them to Google and Apple because tax is paid on profits, not revenue. Well yes they are, so why the hell did the editorial not mention that actual profits made by Google and Apple in New Zealand? They made a conscious decision not to tell their readers that essential piece of information.

For the record I’m all for the IRD taking court action against tax avoidance that is artificial, as defined in the Tax Act. They do this on a regular basis. For example, they are battling APN (NZ Herald) for $48 million.

Some will argue that companies are entitled to minimise their taxes. Tax avoidance, after all, is legal, unlike tax evasion. Some even say that companies owe their loyalty only to shareholders, not the taxpayer, the government or their fellow citizens.

This is plainly wrong. Taxes provide the schools, hospitals, infrastructure and social services on which we all depend. Corporations benefit directly from state-funded education, research, roads, courts and public health programmes. So they should contribute to “the cost of civilisation”.

I agree people should pay their taxes. Fairfax has paid no income tax in the last year. This means they are not contributing to the cost of civilisation. According to their editorial it doesn’t matter what their taxable profit is, as that may have been minimised by accountants. Amazon paid tax equal to 3% of their revenue. As the Dom Post seems to think you should pay tax on revenue, I think Fairfax should pay A$60 million immediately as their contribution to the cost of civilisation.

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54 Responses to “A newspaper that pays no tax complains about tax avoidance!”

  1. burt (8,324 comments) says:

    In the feeble brain of somebody dumb enough to believe socialism works – taxes are what other people pay so you can be supported by the state.

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  2. dime (10,137 comments) says:

    lmao

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  3. Joanne (177 comments) says:

    They should pay the readers to read it. Except for a couple of journos, it is so shallow.

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  4. lazza (387 comments) says:

    “As the Dom Post seems to think you should pay tax on revenue, I think Fairfax should pay A$60 million immediately as their contribution to the cost of civilisation.”

    Touche’/Brill/”O” for Oarsome DNF.

    Take “that”! APN/NZ Herald … you bunch of hyprocritical tossers.

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  5. redqueen (583 comments) says:

    Like all things in socialist moralism: taxes are something others should suffer, not you…

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  6. queenstfarmer (782 comments) says:

    So the Dom Post is saying its owners are commiting “an offence against civilisation”. Perhaps they’d like to rectify that before trying to take the moral highground on anything else.

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  7. redqueen (583 comments) says:

    Also, just to clarify, does that mean they’re ranking tax avoidance with genocide, slavery, and oppression? Not trying to be hysterical here, but what is an ‘offence against civilisation’ if not something duly repugnant to the civilised?

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  8. burt (8,324 comments) says:

    Funny before the days of blogs the MSM would have never been called on this – they are just like Winston complaining about secret trusts..

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  9. david (2,564 comments) says:

    Now we should collectively hold our breaths while The Herald and DomPost editorial writers and Chief Executives prepare and publish a damning response to this heretical ranting by Mr Farrar proving for once and for all that they are journalists, trained and skilled and as such would never, ever, let facts get in the way of a good story and that they can straightfacedly paraphrase Chris Trotter when he talked about the nobility of corruption as long as it is for a cause as great as supporting the Socialist Left.

    They will of course cease to be faceless men who won’t (or can’t) stand up for the claims they make or the bullshit they peddle, but instead will expose themselves to question and debate on the validity of their stances and their manipulation of the news by acts both of commission and omission and will justify their double standards of being in the 1% on the one hand and preaching for redistribution of wealth (OPM) on the other.

    Yeah right.

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  10. EAD (1,331 comments) says:

    F**k I hate that first line – “Taxes are what we pay to live in a civilized society”

    The thing that most awakened me as to the true nature of the state was hearing Ron Paul, who ran for the last President of the US, saying, “Shut down the IRS” and the media smeared him as being crazy!

    His philosphy on tax policy as it is constructed is based on the premise that government owns you and allows you to keep some arbitrary amount of your labour. In effect you are a slave of the governement and have to pay over to your master however much the rest the population decides by way of a vote.

    Alan Greenspan of all people knew this well and how best to defend before he turned coat and headed up the Federal Reserve. http://www.peakprosperity.com/forum/1966-greenspans-article-gold-and-economic-freedom-deficit-spending-simply-scheme-confiscation-

    The sad thing is that through decades of school & media indoctrination most people think taxation is just a part of life! In reality, taxes aren’t a fact of life and are solely extortion. Imagine how much your life would change if you were free to spend your own money as you choose. Of course the defenders of taxation will always stupidly say “but who will build the roads”. See below for the answer.

    http://dollarvigilante.com/blog/2013/7/17/if-one-more-person-asks-me-who-will-build-the-roads.html

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  11. RRM (10,034 comments) says:

    All animals are equal but some animals are more equal than others.

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  12. ross69 (3,652 comments) says:

    Amazon paid tax equal to 3% of their revenue. As the Dom Post seems to think you should pay tax on revenue

    You’re being more pathetic than usual. You know full well that multi-nationals like Amazon rort the tax system. Google and Apple pay about 2% on their overseas profits – which (you’re probably aware) are in the billions of dollars.

    I can’t see any outrage from you that multi-nationals are not paying their fair share of tax.

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  13. wreck1080 (3,972 comments) says:

    “why the hell did the editorial not mention that actual profits made by Google and Apple in New Zealand? ”

    Because google/apple use legal loopholes and accounting tricks to lower profit. The profit figures are meaningless and you can calculate them anyway from the tax paid.

    Doesn’t everyone understand tax is paid on profits not revenue anyway? You’d have to be very very stupid person not to know this.

    But, I think it is sloppy journalism not to investigate the figures in further detail to show readers exactly how these companies are reducing the nz tax liability.

    I wonder if DPF is willing to pay more tax so google/apple can enjoy their money? The trick of diverting the subject to the dominion posts tax affairs does not pull the wool over my eyes. This is a trick of the left usually, not expected from DPF.

    Actually, I’m trying to ascertain whether DPF supports transfer of google profits to Ireland? It appears so from his comments so far.

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  14. queenstfarmer (782 comments) says:

    Um @ross69: “I can’t see any outrage from you that multi-nationals are not paying their fair share of tax.”

    Well then you’re wrong, as always! Try again and you might read this:

    Fairfax Australia (owns the Dom Post) paid no tax at all last year on revenue of A$2.01 billion. That’s outraegous

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  15. redqueen (583 comments) says:

    @ross69

    The point is not that multi-nationals are not paying tax. There are two points: first, this is blatant hypocracy, and the second is blatant moral superiority. It is not the obligation of taxpayers to pay the maximum tax possible, only the minimum they are legally obliged to pay. This is then based on parliamentary and executive decisions, which must factor in things like the cost of collection, enforceability of collection, and so forth.

    Telling Google they’re going to pay more tax in New Zealand is a giant waste of time, both because they aren’t actually based here and because our enforcement would be laughable. What are we going to do? Send a frigate and a SAS team to raid their headquarters for non-payment of NZ tax? Finally, if this is about ‘civilisation’, then they aren’t based here and aren’t benefit from the schools and hospitals. So seems rather odd to tax them for not actually being in NZ, whereas the users are based in NZ…

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  16. alwyn (438 comments) says:

    @Joanne at 11.09am.
    “Except for a couple of journos, it is so shallow”
    Please, please tell me who those journalists are? I read it each day and as far as I can see they are all shallow.

    It is such a pleasure to go to Britain where they still have good papers like the Times, Telegraph and the Mail.
    There even the tabloids like the Guardian have some competent writers.
    Across the Tasman there is one decent paper in The Australian. In NZ unfortunately they are all crap.

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  17. ross69 (3,652 comments) says:

    Well then you’re wrong, as always! Try again and you might read this:

    You’ve confused faux outrage with genuine outrage. Nice try though.

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  18. queenstfarmer (782 comments) says:

    Not so @ross69 – you need to wise up. Are you not also outraged at Fairfax?

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  19. ross69 (3,652 comments) says:

    I’m outraged at all companies that rort the system. What about you?

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  20. Ed Snack (1,927 comments) says:

    Ross, actually, Amazon make fuck-all profits world wide, always have and so far they are sticking to it. They are still going all out for market penetration and not profit. Hard to tax a non-existent profit.

    But why should companies pay tax anyway, they don’t benefit from it. Their owners and employees do, that’s where the tax burden should lie. The only reason companies are taxed is because it makes people think that they are getting something from someone else, sheer greed in other words. In the end, the tax is borne by a real person somewhere.

    Did you know that in NZ a company pays taxes on behalf of its shareholders, any tax paid is claimable as tax paid by a shareholder receiving a dividend. So company tax is only a mechanism, not an actual tax, if the company doesn’t pay tax then the shareholders ultimately will.

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  21. adamsmith1922 (890 comments) says:

    I am outraged at the conflation of avoidance with evasion.

    Last time I checked it was perfectly legal to arrange your affairs so as to minimise the tax impost. This is precisely why many people have trusts and why sensible governments seek to have corporate and top personal rates at similar levels. It is and has always been illegal to evade taxes.

    However, what we seem to have here is a case of various commentators, including the leader writers at NZ Herald and DomPost assuming a ‘moral’ position and fuelling anti business sentiment and perhaps anti American sentiment as well with silly at best and deliberately malign statements about the tax paid by multi-nationals and citing Apple and Google in particular, both essentially American corporations.

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  22. wreck1080 (3,972 comments) says:

    @adamsmith: outraged? Really?

    So , you think it is right that a plumber pays more tax than google?

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  23. queenstfarmer (782 comments) says:

    Yes, absolutely. And while neither of us speak for DPF, I imagine based on his writings on the subject that he is too.

    On this topic, the IRD has made great strides in recent years in prosecuting tax evasion and greatly reigning in what constitutes legal avoidance. I remember some Labour & Green people claiming that National was going to de-fund the IRD from prosecuting corporate tax dodgers to “help their rich mates” or such nonsense. Of course, they were completely wrong – the exact opposite has happened.

    Likewise, this Govt has removed many of the massive residential property and trust taxation rorts that Labour not only put in place, but actively allowed to flourish, which was part of why housing prices became so unaffordable for the average person under Labour.

    I’d like to see this [tightening up on tax rorts] continue. Transfer pricing is one of the great rorts, but it is a tricky one to attack. However, using meaningless, childish but emotive phrases like “pay your fair share” does not achieve anything.

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  24. Adolf Fiinkensein (2,924 comments) says:

    Funny thing is, you know, the whole thing sounds as though it was written by a Labour Party press secretary. Word for word.

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  25. unaha-closp (1,180 comments) says:

    Fairfax is a multinational media group that doesn’t pay any tax to NZ.

    Google and Amazon are multinational media companies that pay tax $ to NZ.

    Seems simple – boycott Fairfax until they start paying some tax.

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  26. lastmanstanding (1,304 comments) says:

    IMHO tax avoiders should be hung drawn and quartered. I have no problem with those who like myself and many other tax payers use the tax laws to minimize the tax we pay as this has been enshrined in case law where a UK Judge in a 19thcentury case said that a man was only obliged to pay the amount of tax due no more or no less.
    The NZ IRD goes after small business as its easy pickings to terrify and bully even in cases of genuine mistake. To be fair the IRD have taken on the Aussie Banks over their extreme deals designed to evade paying tax in NZ.
    However the IRD have been very lax on property developers and property traders over the past decade in particular.
    They have taken very few cases against those who have bought spruced up and sold residential properties in short order often and usually not even bothering to at least live in them for a short period.
    IMHO if even tax payer paid their tax to the amount due the IRD would collect at least 20% to 25% more than it does now and that means the Gumint could lower the tax rates by that amount and still get the same revenue.
    So for me harsher penalties debtors prisons the stocks are all legitimate weapons that the IRD should have at its disposal.

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  27. dime (10,137 comments) says:

    “Amazon paid $1.6m tax on sales of $46.5m”

    that percentage is pretty high for them!

    As Ed said, they dont make a lot of profit. maybe 2 billion on 100 billion sales.

    but hey, its not like the papers care about facts. just the shock value of a sentence..

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  28. queenstfarmer (782 comments) says:

    @lastmanstanding, they have improved signficantly under this Government. Again, it is one of the ironies that Labour & the Greens claim that National bows down to property owners, when in fact it has tightened up the rules significantly on residential property. Contrast that to what happened under Labour – if you were a property speculator and looking to avoid paying tax, the best times ever were under the last 9 years of Labour!

    Something I would like to see is direct penalties against accountants and lawyers who advise or design arrangements that are held (by a court) to be unlawful and tax-abusive.

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  29. OneTrack (3,237 comments) says:

    It’s Ok when the left does it.

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  30. nickb (3,696 comments) says:

    Quite amazing amounts of misinformation in this debate on many fronts….

    I’ve got a much better example. Fairfax Australia (owns the Dom Post) paid no tax at all last year on revenue of A$2.01 billion.

    David, you are being disingenuous here. You know as well as anyone that tax is levied on net profit and not turnover/gross revenue, because you and Cactus Kate took No Right Turn to task for making this mistake recently. In the absence of any evidence Fairfax Australia is engaged in any aggressive tax avoidance, the obvious answer is that it the company is simply making a loss. Clearly you do not pay tax if you are in a tax loss situation.

    I don’t really see how its hypocritical for the editor of a NZ newspaper (who is an employee) to say tax avoidance is bad when the parent company miles up the corporate chain in a different country has paid no tax, which, as I have said, is in no way a sure indicator of being tax avoidance. Indeed when I google “Fairfax Australia Tax avoidance” I get no results on topic which suggests you may have drawn your own long (and probably incorrect) bow on the situation.

    Google, for instance, whose slogan used to be “Don’t be evil”, in 2012 paid a mere $165,000 in tax in New Zealand. Amazon paid $1.6m tax on sales of $46.5m. And Apple paid $2.5m on sales of $571m. Does anyone think these companies are paying their fair share?

    All of these companies, and no doubt many more, are taking the piss with their aggressive transfer pricing and restructuring of IP. This generally involves tactics such as moving supply chains and IP to a low tax jurisdiction like the Netherlands, Switzerland, Ireland etc and charging high fees to the NZ (or other country’s) subsidiary for ingredients (such as in the case of Starbucks) the use of IP, corporate logos, tech support etc etc.

    The main aim of all these clever tricks is to load up the tax deductions where they are most effective, namely in high tax countries (like NZ) and then book profits in a country where they are taxed lower.

    However, with that being said, it is incorrect to simply assume there is tax avoidance going on simply because a multinational company might be paying low tax here relative to its turnover. This is because there is a fundamental difference to trading in New Zealand as compared to trading with New Zealand.

    If you are a foreign entity looking to make money in NZ, and you are from a company which has a double tax agreement with us (as they invariably will as we have them with all of our main trading partners) then you are only taxed to the extent that you have a permanent establishment in NZ, such as a business premises.

    The rationale for this is that if you do not have a business premises, i.e. you are an Australian company making online sales from Australia to NZ, it is perfectly logical that you could have $1m of sales in NZ, to NZers, but pay no tax in NZ. This is not tax avoidance, merely just an established part of international tax law – the rationale being that you are located offshore, do not have a place of business in NZ, and you will be paying tax in your home country (Australia). Therefore, to tax these profits would be double taxation.

    See: http://www.kpmg.com/nz/en/services/business-advisory/overseas-companies/manage-people/permanent-establishment/pages/default.aspx

    This is all a bit long winded but is just trying to demonstrate that far from all cases where there appears to be lots of turnover but no tax paid will there be any sinister tax tricks at play. In fact, given the current environment it is safe to assume the reverse is the case, given IRD’s successes in winning tax avoidance cases and the huge risks in carrying out aggressive tax planning in NZ. Because of this it is probably also safe to assume that Starbucks, Google, Facebook, Amazon etc’s New Zealand operations are pretty watertight and probably the subject of prior binding rulings etc with regards to their transfer pricing.

    So whilst some people may not like what they are currently doing, it is likely to be well within the current tax laws. To change this type of behaviour really needs a multilateral approach by all countries, as it will necessitate wide-ranging changes to the international network of double tax agreements and international tax law. The OECD is currently working on a BEPS (Base erosion and profit shifting) project to try and target this, and our IRD is playing a key part in this and monitoring things closely.

    See: http://www.oecd.org/ctp/beps.htm

    I think Fairfax should pay A$60 million immediately as their contribution to the cost of civilisation.

    Taxation by the blogging decree of David Farrar doesn’t really help understanding of the situation.

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  31. Tauhei Notts (1,749 comments) says:

    All this ranting about tax avoidance.
    A friend had investments in excess of $400,000. He was paying 33% tax on the income therefrom.
    I suggested that he transfer his funds to a Portfolio Investment Entity where the maximum tax rate is 28%.
    He did so.
    Were his actions tax avoidance?
    A rational person would say that his actions were merely sensible and any tax avoidance was purely incidental.
    An irrational person would rant and rave as some contributors to this blog have done.

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  32. nickb (3,696 comments) says:

    Just as I suspected. In 2013 Fairfax Australia made a loss of $16m, improving from a loss in the hundreds of millions in 2012:

    http://www.fairfaxmedia.com.au/shareholders/FAIRFAXFullYearResultsMediaRelease220813.pdf

    Come on DPF, you are better than this. Or do you think you should pay tax when you are not making money?

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  33. nickb (3,696 comments) says:

    That’s a good example Tauhei and what makes understanding tax avoidance so difficult. It is caught under the black letter of the tax law, but you would argue that in the reasoning put forward in Ben Nevis that kind of tax avoidance (using PIEs) is within Parliament’s contemplation….so moral is use PIEs if you are a high earner!

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  34. Dirty Rat (383 comments) says:

    “Likewise, this Govt has removed many of the massive residential property and trust taxation rorts that Labour …….. ”

    ummm …pardon ?

    you may want to look up LAQC’s and distributions to Minors…

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  35. MikeG (425 comments) says:

    Has anyone paused to think that the writer of the editorial and the owner (and tax accountants) are two different individuals, with both of them capable of independent thought? Isn’t it good to see that the journalists don’t always take the line of their overlords?

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  36. nickb (3,696 comments) says:

    And this is somewhat ironic of course as National has steadfastly refused to close by far the biggest loophole of all, one that dwarfs anything multinationals do….capital gains and residential property

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  37. Dirty Rat (383 comments) says:

    I must say this thread began as a clusterfuck by Farrar…nice to see it improving.

    BTW I still believe APN will win their case with the IRD

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  38. peterwn (3,314 comments) says:

    Tauhei – Investing in PIE’s is not tax avoidance, because Parliament intended that ordinary investors should not be effectively paying a higher tax on their investment income than the marginal tax rate on ordinary income. Four things that are ‘avoidance’ are:
    1. Loan arrangements by NZ subsidiaries of international companies that look ‘different’ to different tax authorities, thus avoiding or minimising tax payment in either NZ or the company’s main country of business. That was what the Aussie banks were doing. These schemes rely on compliance of the ‘black letter’ of tax law but are obviously abusive when considered in the light of the purpose of tax law.
    2. ‘Transfer pricing’ where a multinational runs all ‘branches’ on a break even except te one in Ireland (or similar) that has a very low company tax regime. Labour seems to think it can fix this one with the wave of a wand, although IRD folk are driven up the wall trying to get a handle on this.
    3. Complex investmnt schemes that supposedly comply with the black letter of tax law but are highly abusive as to purpose. These will now be far lass common following the comprehensive clobbering of Trinity / Nevis by Justice Venning supported by appeal / supreme judges.
    4. Abusive use of companies/ trusts to avoid high marginal personal tax rates – the two Christchurch surgeons. Things are a bit tricky here – seems there is no problem with the owners/managers of a struggling or expanding company underpaying themselves as long as the money involved stays in the company/ trust. But to milk it out in the form of ‘never never’ interest free loans as the surgeons did is just plain abusive. In particular the surgeons’ companies would have had nil ‘working’ assets as they would have rented their consulting rooms and operating theatres and all the gear needed would be provided by the private hospital.

    So there you have it.

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  39. queenstfarmer (782 comments) says:

    @Dirty Rat, I am aware of LAQC’s and distributions to Minors – what about them?

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  40. Cato (1,095 comments) says:

    @nickb – could you please contact me at e30zat1+luc8ag@sharklasers.com?

    I’d like to ask you a question.

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  41. Adolf Fiinkensein (2,924 comments) says:

    peterwn

    ” Four things that are ‘avoidance’ are:”

    Can one assume you mean ‘evasion’?

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  42. nickb (3,696 comments) says:

    Cato – ???

    I can’t make much sense out of that address. Is that actually it?

    Do you make Dr Evil’s sharks with laser beams?

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  43. Dirty Rat (383 comments) says:

    queenstfarmer (575 comments) says:
    January 16th, 2014 at 2:08 pm
    @Dirty Rat, I am aware of LAQC’s and distributions to Minors – what about them?

    Link them to this statement

    “Likewise, this Govt has removed many of the massive residential property and trust taxation rorts that Labour …….. ”

    Then link the years they came into place

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  44. nickb (3,696 comments) says:

    Can one assume you mean ‘evasion’?

    Adolf – No.

    This is perhaps the most common misconception in tax.

    Extremely simplified:

    Evasion = deliberately not including income in your tax returns, fraudulently completing tax returns, fake invoices, claiming fake deductions etc. Consequences = criminal conviction, huge monetary penalties, potentially jail time / home detention.

    Avoidance = Tax “avoidance” is a defined term in our tax laws. Basically this means you have got over-aggressive, too “clever” or “cute” with your taxes in a way that Parliament did not anticipate when drafting tax legislation. This includes situations like the Penny/Hooper cases where the surgeons used trusts and companies to get the 33% tax rate instead of the 39% personal tax rate, after Labour raised personal tax rates.

    Consequences of this = IRD reassessing your tax returns so you pay the amount of tax you would have had to if you were not “clever”, monetary penalties, but no criminal convictions.

    This tool in IRD’s arsenal is generally reserved for extreme cases, liek Penny/Hooper, the big bank cases, Alesco etc, although there is currently a lot of controversy in tax circles that it it being used to strike down what was formerly considered legitimate tax planning.

    So logically there is also a third category, which could be called “tax mitigation”, which are strategies to lower your tax that are considered legitimate and beyond reproach. An example could be, as Tauhei has said, a person earning $100,000 using a PIE savings fund to put money into instead of an ordinary term deposit, as you will be taxed at 28% in the PIE instead of 33% in the ordinary term deposit. As Parliament bought in the PIE regime for the purposes of encouraing savings, it is accepted that using a PIE is legitimate. A second example could be setting up a look through company (formerly LAQC) to own a rental property.

    Clear as mud after all that?!

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  45. nickb (3,696 comments) says:

    BTW I still believe APN will win their case with the IRD

    That’s interesting…even after Alesco?

    Don’t know the particular facts of APN dispute but thought it involved convertible notes…in which case I would have thought odds of success were around 0.00000000001%

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  46. nickb (3,696 comments) says:

    Cato – if you want to contact me, nicksb2014@gmail.com

    cheers

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  47. Albert_Ross (311 comments) says:

    nickb, thank you for the explanation of “tax avoidance”. I must say I am very uncomfortable at the idea of retrospectively preventing people from doing the best they can for themselves within the letter of the law. If the law isn’t tight or clear enough to prevent the behaviour you dislike, then by all means amend it so they can’t do it again in future, but it doesn’t seem just or equitable to apply it to the past.

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  48. nickb (3,696 comments) says:

    Exactly right Albert. That is where the concern comes from.

    In my opinion (being the opinion of a cloistered tax geek) the tax avoidance area is a really big threat to the rule of law in NZ.

    The fact that you can arrange your affairs within the black letter of the tax law, but then be punitively penalised years later because a court decides that it did not accord with Parliament’s “contemplation” of the law (whatever that is) is concerning, especially when so much of our tax legislation is written in absolutely tortured prose (which makes life tough for even the best tax lawyers and accountants). Parliament has completely failed in its duty to make the law clear, and we are hit 5-6 times a year with another 2-300 page amendment to the Income Tax Act.

    We should be avoiding taxation by administrative discretion at aboslutely all costs, yet this seems to be what DPF and others would prefer.

    If you are really REALLY bored, or just have another week off like the lucky ones like me, this is a good read on this topic:

    http://www.law.auckland.ac.nz/webdav/site/law/shared/about/our%20staff/academic%20staff/files/Michael%20Littlewood/Tax%20Avoidance,%20the%20Rule%20of%20Law%20and%20The%20New%20Zealand%20Supreme%20Court.pdf

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  49. calendar girl (1,272 comments) says:

    nickb@1:07

    “Taxation by the blogging decree of David Farrar doesn’t really help understanding of the situation.”

    Am I missing something here, Nickb? You know your stuff on this subject better than most, but I read DFB’s post rather differently from your interpretation. When DPF wrote:

    ” I think Fairfax should pay A$60 million immediately as their contribution to the cost of civilisation.”

    I interpreted him as using heavy irony – adopting Fairfax’s own wrong-headed editorial reasoning and applying the same rationale (i.e. tax on turnover, rather than on net profit) to Fairfax’s own commercial turnover. If you accept his irony for what it is – mere irony – he was not arguing at all that Fairfax should actually pay a A$60 million tax liability. As you point out subsequently, Fairfax made a net loss, thereby creating no tax liability.

    DPF does use this mocking form of irony from time to time to make a point that he thinks is clear and obvious to all. It has its dangers if some readers take him too literally.

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  50. nickb (3,696 comments) says:

    Haha yes I think you are right cg. Apologies DPF where I have interpreted your statements in the wrong light.

    I blame it on the jet lag!!!!! Exacerbated by staying up late to watch the T20 last night (don’t tell Longknives or big bruv)

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  51. igm (1,413 comments) says:

    Let us just pray for the day when Fairfax close their doors in NZ, taking their left-wing messengers (they don’t deserve to be called journos), leaving what is left to be run by editorial people of substance, giving NZ public the right to read something decent again. They have of late become a real foul and evil mouthpiece for the distortion of facts (especially Fonterra), and discrediting anyone of decency, yet greasing to the likes of Dotcom, or anyone else who tries to destabilise our fragile return to economic prosperity.

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  52. SPC (5,787 comments) says:

    The enemies on the left, the locals and their foreign backers. A threat to both national security and now conflated with a threat to a secure economic prosperity. These being of a lack of decency.

    McCarthy suggested removing the left from their places in the public office, academia and media and once left means anyone not towing the right wing party line …

    Of course McCarthy was just borrowing a line from the Germans about a people with foreign, rather than local, loyalty.

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  53. aquataur (59 comments) says:

    Late to the party but DF is incorrect

    He states Fairfax paid no tax on revenues of whatever ($2bn)

    Wrong !!!

    They would have paid GST, Fringe Benefit Tax, Super Contribution Tax, tax on petrol they used, etc, etc. they may not have paid INCOME tax but that was presumably because their income (revenues less expenses) was less than 0
    Just like many other tax paying entities
    Including many iconic NZ companies (Xero, etc)

    If you really want a tax system based on revenues (not net income) why don’t you come out and say it. But you would be on dangerous territory – tax AirNZ on revenues ?

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  54. The Scorned (719 comments) says:

    The existence of coercive taxation means that your “civilization” is nothing of the sort. Loony fucktard socialist dupe…

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