The Greens will propose boosting resources for Inland Revenue (IR) to further scrutinise the money being sent out of New Zealand.
Expect a difference to last year’s alternative Budget, Swarbrick suggests. Photo / Mark Mitchell
The party argues current tax law needs to be “properly” enforced, though the Revenue Minister says his department has an eye on the activity of everyone from large corporations to individual taxpayers.
Citing a report from tax specialist Nick Miller, the Greens say service and licence fees sent overseas by multinationals could be considered royalties, which are meant to attract a withholding tax rate of 5%.
“The loss of tax to New Zealand from the minimisation strategies used by the companies discussed in this report, and other corporate groups, is significant, potentially running into the hundreds of millions of dollars each year,” Miller wrote in the report last year.
‘Cost of greed crisis’
Swarbrick told the Herald the main message New Zealanders should take from today’s tax policy is that “there is enough in this country”.
“If we are willing to have a rational discussion about fixing the tax system and making it fairer, then we can resource the things that allow all of us to thrive, and ultimately that’s what the Green Party stands for, is a country and an economy that works for all of us.”
Last year’s Green alternative Budget promised to raise $88b in new revenue, including through a wealth tax, an inheritance tax, and increasing income and company tax rates.
Although National attacking the Greens over tax is as common as night following day, the scale of the Greens’ plan last year opened the party up to relentless criticism, including from Labour leader Chris Hipkins, who said it was a “huge spend-up” and “unrealistic”.
Labour has said the extent of the tax measures it would introduce if it won power would be its capital gains tax and potentially changes to interest deductibility.
“I have made it very clear that our tax policy is as far as we go,” Hipkins said last year.
Labour’s Chris Hipkins says there isn’t room for Green tax policies in a Government he leads. Photo / Mark Mitchell
Asked by the Herald if the Greens’ policy this year would contain fewer taxes and be more palatable to its potential coalition partners, Swarbrick said the package would be focused on actions most people would see as being “common sense”.
She said the current system sees wealth “hoovered up” by a small group and large profits announced by corporations like banks, while at the same time “most regular hardworking New Zealanders have watched their material living standards slip backwards”.
“What we so often construe as a cost of living crisis is not hitting everybody equally, and I think it’s far more fairly characterised as a cost of greed crisis,” Swarbrick said.
“We can’t afford to continue to have such an unfair tax system which robs us of the investment in the basic infrastructure that all of us need.”
Was she suggesting this year’s plan would be more focused than the alternative Budget was? Swarbrick nodded.
From his comments about tax policy to suggesting the smaller parties can get away with promising more fanciful policies, Hipkins hasn’t indicated his party could move much to accommodate the Greens.
In part, that’s likely a message to voters that Labour won’t roll over to its coalition partners as it alleges National has to Act and NZ First.
Swarbrick didn’t bite when the Herald asked if she believed Labour would need to shift its own position to secure the Greens’ support should the two parties be in a position to form Government.
“Obviously, everything is on the table,” she said.
“The fact that I genuinely get so excited about an election campaign because every potential future for our country is on the table and people are paying attention.”
She said she could “spend time lecturing other political parties about what they should do”, but “what I’m far more interested in is regular people seeing themselves reflected in the Green Party”.
The Greens want tech companies to pay their fair share. Photo / Getty
Going after big tech
The Greens will today announce how it will resource Inland Revenue (IR) to crack down on what the party considers to be multinational tax evasion.
The current Government has provided additional funding to chase tax evaders, which Revenue Minister Simon Watts has said is having results.
But Swarbrick believes some corporations aren’t getting the attention they deserve.
“Multinational corporations that are making billions and billions of dollars out of New Zealand to not be having the baseline law applied to them for the tax that they should be paying, just feels pretty galling and would strike many New Zealanders as deeply unfair.”
She highlighted Miller’s report, supported by Tax Justice Aotearoa and Better Taxes for a Better Future, which questioned whether existing legislation could be used to capture a greater proportion of the income of some companies.
It said applying the 5% withholding rate, stipulated in the New Zealand-US double taxation agreement, to the service and licence fees of Google, Facebook, Amazon Web Services and Microsoft would yield revenue of $130m.
“Under the service fee model, the local subsidiary of a multinational tech firm pays substantial ‘service fees’ to related offshore subsidiaries,” the report said.
“These ‘service fees’ account for a majority of that firm’s revenue. Tech firms’ own financial statements appear to suggest that all or part of these ‘service fees’ may in substance be royalties that are potentially subject to withholding taxes.”
Importantly, the paper said no allegation of illegality was being made against the entities mentioned.
In an update this week, Miller said “a conservative estimate of the tax loss to New Zealand over the last five years is over $600m from just eight of the big tech companies”.
Some of the tech companies have previously told the Herald they pay their taxes as required by New Zealand’s legislative requirements.
Swarbrick said the Greens would ensure IRD is “resourced to properly enforce the law as we see it”.
“I don’t think that’s a particularly radical position. I think it’s a very fair one.”
She raised the issue during a select committee session this week with Watts and IR officials present.
Watts said there was “no safe harbour if you’re not complying with the law with regard to tax”.
But he said he had been assured by IR that “their programme of compliance activity covers all spectrums, from significant enterprises down to individuals and everything in between”.
“The area around the way in which companies do move profits between jurisdictions is one in which is complex
“However, [it] is well understood in the context of how those firms do so and I think it’d be fair to say that those entities that are operating in an international area will be very aware of what the rules are.”
He acknowledged there was a challenge where there were differences between the New Zealand system and other jurisdictions, particularly where there wasn’t a double taxation agreement in place.
Revenue Minister Simon Watts says there should be no safe harbour to avoid tax. Photo / Mark Mitchell
Watts pointed to work underway by the OECD on this issue, though acknowledged that was moving slowly. The OECD’s work was cited as one reason for why the Government decided not to go forward with the Digital Services Tax, introduced by Labour in 2023.
Asked by Swarbrick whether he had considered giving direction to IR or progressed work on ensuring the 5% withholding rate is applied to practices by the tech companies, Watts said he couldn’t “direct this group of people over that group”.
“But what I can do is, where we are made aware of potentially areas of gap in the legislation that may not be aligned with the expectations or objectives of the Government, then we will [look] at that.”
Peter Mersi, the chief executive of IR, told the committee the department would “enforce the law” but issues around service and licence fees were “very specific to individual cases”.
“We’re driven by the interpretation of the law as it relates to that individual circumstance.”
Jamie Ensor is the NZ Herald’s Chief Political Reporter, based in the press gallery at Parliament. He was previously a TV reporter and digital producer in the Newshub press gallery office. He was a finalist in 2025 for Political Journalist of the Year at the Voyager Media Awards.