More Kiwis than ever are in debt to the IRD, and one expert has a theory about why it’s gotten so bad.
As of March this year, more than half-a-million people had debt to Inland Revenue, and overall tax debt sat at $9.4 billion, of which Inland Revenue said 62 percent, or $5.9 billion, was collectable.
Chartered Accountants Australia New Zealand lead, John Cuthbertson, says there’s been a significant build-up of debt, largely as a result of the Covid-19 pandemic.
“As debt ages, it becomes harder to collect – and we know that about 43 percent of it is over 2 years old. So once you get into that territory, it gets harder and harder to collect.”
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