The Greens will propose boosting resources for Inland Revenue (IR) to further scrutinise the money being sent out of New Zealand. <\/p>\n
Expect a difference to last year’s alternative Budget, Swarbrick suggests. Photo \/ Mark Mitchell<\/p>\n
The party argues current tax law needs to be \u201cproperly\u201d enforced, though the Revenue Minister says his department has an eye on the activity of everyone from large corporations to individual taxpayers. <\/p>\n
Citing a report from tax specialist Nick Miller<\/a>, 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%. <\/p>\n \u201cThe 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,\u201d Miller wrote in the report last year. <\/p>\n \u2018Cost of greed crisis\u2019<\/p>\n Swarbrick told the Herald the main message New Zealanders should take from today\u2019s tax policy is that \u201cthere is enough in this country\u201d.<\/p>\n \u201cIf 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\u2019s what the Green Party stands for, is a country and an economy that works for all of us.\u201d <\/p>\n Last year\u2019s Green alternative Budget promised to raise $88b in new revenue<\/a>, including through a wealth tax, an inheritance tax, and increasing income and company tax rates. <\/p>\n Although National attacking the Greens over tax is as common as night following day, the scale of the Greens\u2019 plan last year opened the party up to relentless criticism, including from Labour leader Chris Hipkins, who said it was a \u201chuge spend-up\u201d and \u201cunrealistic\u201d<\/a>. <\/p>\n 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.<\/p>\n \u201cI have made it very clear that our tax policy is as far as we go,\u201d Hipkins said last year<\/a>.<\/p>\n Asked by the Herald if the Greens\u2019 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 \u201ccommon sense\u201d. <\/p>\n She said the current system sees wealth \u201choovered up\u201d by a small group and large profits announced by corporations like banks, while at the same time \u201cmost regular hardworking New Zealanders have watched their material living standards slip backwards\u201d. <\/p>\n \u201cWhat we so often construe as a cost of living crisis is not hitting everybody equally, and I think it\u2019s far more fairly characterised as a cost of greed crisis,\u201d Swarbrick said. <\/p>\n \u201cWe can\u2019t 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.\u201d <\/p>\n Was she suggesting this year\u2019s plan would be more focused than the alternative Budget was? Swarbrick nodded. <\/p>\n From his comments about tax policy<\/a> to suggesting the smaller parties can get away with promising more fanciful policies<\/a>, Hipkins hasn\u2019t indicated his party could move much to accommodate the Greens. <\/p>\n In part, that\u2019s likely a message to voters that Labour won\u2019t roll over to its coalition partners as it alleges National has to Act and NZ First. <\/p>\n Swarbrick didn\u2019t bite when the Herald asked if she believed Labour would need to shift its own position to secure the Greens\u2019 support should the two parties be in a position to form Government. <\/p>\n \u201cObviously, everything is on the table,\u201d she said. <\/p>\n \u201cThe 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.\u201d <\/p>\n She said she could \u201cspend time lecturing other political parties about what they should do\u201d, but \u201cwhat I\u2019m far more interested in is regular people seeing themselves reflected in the Green Party\u201d. <\/p>\n Going after big tech <\/p>\n 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. <\/p>\n The current Government has provided additional funding to chase tax evaders, which Revenue Minister Simon Watts has said is having results. <\/p>\n But Swarbrick believes some corporations aren\u2019t getting the attention they deserve. <\/p>\n \u201cMultinational 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.\u201d <\/p>\n She highlighted Miller\u2019s 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. <\/p>\n 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. <\/p>\n \u201cUnder the service fee model, the local subsidiary of a multinational tech firm pays substantial \u2018service fees\u2019 to related offshore subsidiaries,\u201d the report said. <\/p>\n \u201cThese \u2018service fees\u2019 account for a majority of that firm\u2019s revenue. Tech firms\u2019 own financial statements appear to suggest that all or part of these \u2018service fees\u2019 may in substance be royalties that are potentially subject to withholding taxes.\u201d <\/p>\n Importantly, the paper said no allegation of illegality was being made against the entities mentioned. <\/p>\n In an update this week, Miller said \u201ca 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\u201d.<\/p>\nLabour’s Chris Hipkins says there isn’t room for Green tax policies in a Government he leads. Photo \/ Mark Mitchell <\/p>\n
The Greens want tech companies to pay their fair share. Photo \/ Getty<\/p>\n