Taxation (Annual Rates for 2022-23, Platform Economy, and Remedial Matters) Bill (No 2) - Amendment paper No 319
Taxation (Annual Rates for 2022-23, Platform Economy, and Remedial Matters) Bill (No 2) - Amendment paper No 319
Taxation (Annual Rates for 2022-23, Platform Economy, and Remedial Matters) Bill (No 2) - Amendment paper No 319
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No 319
House of Representatives
Supplementary Order Paper
Tuesday, 14 March 2023
Taxation (Annual Rates for 2022-23, Platform Economy, and Remedial Matters) Bill (No 2)
Proposed amendments
Hon David Parker, in Committee, to move the following amendments:
Clause 2 amended
In clause 2(19) (page 13, line 1), replace “and 149”
with “149, and 150”
.
After clause 2(28) (page 13, after line 20), insert:
(28B)
Sections 31B, 31C, 31D, and 98(11B) come into force on 8 January 2023.
In clause 2(29) (page 13, line 21), delete “93B, ”
.
In clause 2(29) (page 13, line 24), delete “142B, ”
.
In clause 2(32) (page 13, line 29), delete “25, 26, ”
.
In clause 2(32) (page 13, line 29), delete “47B, ”
.
In clause 2(32) (page 13, line 29), replace “92”
with “92, 93B”
.
In clause 2(32) (page 13, line 33), replace “145, 170”
with “142B, 145, 170, 177(1B)”
.
Clause 17 amended
In clause 17, new section CE 1F(4) (page 21, lines 17 and 18), replace “120B(bc) and 141ED(1B) and (3)(c)”
with “23IB, 120B, and 141ED”
.
Clause 25 deleted
Delete clause 25 (page 25, lines 14 to 21).
Clause 26 deleted
Delete clause 26 (page 25, lines 22 to 27).
New clauses 31B, 31C, and 31D inserted
After clause 31 (page 27, after line 21), insert:
31B New section CZ 23B inserted (Employee benefits for North Island flooding events: exempt income)
(1)
After section CZ 23, insert:
CZ 23B Employee benefits for North Island flooding events: exempt income
Exempt income
(1)
Income derived by an employee from an employer is exempt income to the extent given by subsection (2) if the income—
(a)
would be assessable income in the absence of this section; and
(b)
is provided by the employer for the purpose of relief of employees from the adverse effects of a North Island flooding event; and
(c)
is derived in the period of 8 weeks beginning on the first day of the relevant North Island flooding event; and
(d)
does not replace a PAYE income payment; and
(e)
does not depend on the seniority of the employee; and
(f)
is available to another employee, who is not an associated person of the employer and is or was immediately before a North Island flooding event in full-time employment with the employer, if the employee is an associated person of the employer; and
(g)
is treated by the employer as being exempt income for the employee.
Extent of exemption
(2)
Income satisfying subsection (1) is exempt income to the extent to which the income is—
(a)
accommodation:
(b)
less than or equal to $5,000 in total, if the income is in a form other than accommodation.
Defined in this Act: accommodation, assessable income, employee, employer, exempt income, fringe benefit, income, North Island flooding event
(2)
Subsection (1) applies to payments made on or after the beginning of the relevant North Island flooding event.
31C New section CZ 24B inserted (Employee benefits for North Island flooding events relief: not fringe benefits)
(1)
After section CZ 24, insert:
CZ 24B Employee benefits for North Island flooding events relief: not fringe benefits
When this section applies
(1)
This section applies when an employee receives from an employer a benefit that—
(a)
would be a fringe benefit in the absence of this section; and
(b)
is for the purpose of the relief of employees from the adverse effects of a North Island flooding event; and
(c)
is received in the period of 8 weeks beginning on the first day of the relevant North Island flooding event; and
(d)
does not replace a PAYE income payment; and
(e)
does not depend on the seniority of the employee; and
(f)
is available to another employee, who is not an associated person of the employer and is or was immediately before the relevant North Island flood event in full-time employment with the employer, if the employee is an associated person of the employer; and
(g)
is treated by the employer as not being a fringe benefit.
Benefits with known value for employee
(2)
Benefits satisfying subsection (1) that would, in the absence of this section, be fringe benefits having a value for the employee that the employer could estimate, are not fringe benefits to the extent to which their total value as fringe benefits for the period would be less than or equal to the amount by which $5,000 exceeds the income that is—
(a)
exempt under section CZ 23B(2)(b); and
(b)
derived by the employee from the employer in the same period.
Benefits without known value for employee
(3)
Benefits satisfying subsection (1) that would, in the absence of this section, be fringe benefits having a value for the employee that the employer could not estimate, are not fringe benefits.
Defined in this Act: associated person, employee, employer, exempt income, fringe benefit, income, PAYE income payment, North Island flooding event
(2)
Subsection (1) applies to payments made on or after the beginning of the relevant North Island flooding event.
31D New section CZ 29B inserted (Accommodation expenditure: North Island flooding events)
After section CZ 29, insert:
CZ 29B Accommodation expenditure: North Island flooding events
When this section applies
(1)
This section applies for the purposes of section CW 16B (Accommodation expenditure: out–of-town secondments and projects) when—
(a)
the employment duties of an employee require them to work on a project of limited duration for rebuilding or recovery, including the repair and reconstruction of land, infrastructure, and other property in the areas affected by the North Island flooding events; and
(b)
the distant workplace is a workplace in the areas affected by the North Island flooding events.
Exempt income
(2)
The value provided or expenditure incurred by the employer of the employee for or in relation to the accommodation is exempt income of the employee.
Modified definition of project of limited duration
(3)
Despite paragraph (c)(iii) of the definition of project of limited duration and section CW 16C(2)(d) (Time periods for certain accommodation expenditure), for the purposes of this section, the 3 year limit is ignored and is replaced by 5 years, if the employee starts work at the distant workplace in the period commencing on the date of the first relevant North Island flooding event, being 8 January 2023, 26 January 2023, or 12 February 2023, as the case may be, and ending 6 months after that date.
Time limit extension
(4)
The time limit imposed by subsection (3) may be extended or modified by Order in Council made—
(a)
on the recommendation of the Minister of Revenue; and
(b)
before the time limit in subsection (3) that applies immediately before the Order in Council comes into force.
Definitions for this section
(5)
In this section—
(a)
rebuilding includes—
(i)
extending, repairing, improving, subdividing, or converting any land, infrastructure, or other property; and
(ii)
rebuilding communities:
(b)
recovery includes restoration and enhancement.
Relationship with section CZ 30
(6)
Section CZ 30 does not apply to modify the application of this section.
Defined in this Act: accommodation, distant workplace, employee, employer, exempt income, land, North Island flooding event
Clause 44 amended
In clause 44(7) (page 31, line 26), replace “and (6B)”
with “(6), and (6B)”
.
Clause 47B deleted
Delete clause 47B (page 32, lines 18 to 23).
New clause 64B
After clause 64 (page 41, after line 4), insert:
64B Section FZ 9 amended (Transfers of trading stock to non-associates, donee organisations, or public authorities)
In section FZ 9(c)(i), replace “16 March 2022”
with “31 March 2024”
.
Clause 93 amended
In clause 93, new section RD 62B, list of defined terms (page 53, line 5), delete “salary and wages”
.
Clause 94 amended
In clause 94, new section RD 71B(2)(a) (page 53, line 36), replace “have.”
with “have; and”
.
Clause 98 amended
In clause 98(5), new definition of cross-border employee (page 58, line 8), replace “RD 62B”
with “RD 62B, RD 65”
.
After clause 98(11) (page 59, after line 17), insert:
(11B)
Insert, in appropriate alphabetical order:
North Island flooding events means flooding and other damage that occurred as a result of 1 or more of the following—
(a)
Cyclone Hale, which crossed the North Island of New Zealand during the period starting on 8 January 2023 and ending on 12 January 2023, in 1 or more of the following districts:
(i)
Coromandel:
(ii)
Gisborne:
(iii)
Northland:
(iv)
Wairarapa:
(v)
Wairoa:
(b)
heavy rainfall starting on 26 January 2023 and ending on 3 February 2023, in 1 or more of the following regions:
(i)
Auckland:
(ii)
Bay of Plenty:
(iii)
Northland:
(iv)
Waikato:
(c)
Cyclone Gabrielle, which crossed the North Island of New Zealand during the period starting on 12 February 2023 and ending on 16 February 2023, in 1 or more of the following regions or districts:
(i)
Auckland:
(ii)
Bay of Plenty:
(iii)
Gisborne:
(iv)
Hawke’s Bay:
(v)
Northland:
(vi)
Tararua:
(vii)
Waikato.
In clause 98(27) (page 61, line 33), replace “(15B)”
with “(5C)”
.
Clause 145 amended
In clause 145, new section 24HB(4) (page 88, line 33), replace “a person associated”
with “a party to the arrangement”
.
Clause 150 amended
After clause 150(2) (page 92, after line 5), insert:
(3)
Subsections (1) and (2) apply for the 2021–22 and later income years.
Clause 164 amended
In clause 164, new section 120B(bc)(ii) (page 101, line 21), replace “the failure”
with “a relevant failure to withhold and pay, or pay”
.
Clause 169 amended
In clause 169, new section 141(1B)(b) (page 102, lines 36 and 37), replace “the failure”
with “a relevant failure to withhold and pay, or pay”
.
Clause 170 amended
In clause 170, new section 141GC(1)(d) (page 103, line 19), replace “made a reasonable effort”
with “taken reasonable measures”
.
Clause 177 amended
In clause 177(1), new section 177C(5BA) (page 106, line 31), delete “or EL 20”
.
After clause 177(1) (page 106, after line 37), insert:
(1B)
In section 177C(5BA), replace “EL 4”
with “EL 4 or EL 20”
.
Explanatory note
This Supplementary Order Paper (SOP) proposes to insert provisions into the Taxation (Annual Rates for 2022-23, Platform Economy, and Remedial Matters) Bill (No 2) (the Bill) in response to the North Island flooding events. The proposed provisions exempt from tax certain amounts of income and fringe benefits provided to employees who are affected by the North Island flooding events. The proposed provisions also exempt from tax some employee accommodation provided to employees who are doing work in relation to rebuilding and recovery in the wake of the North Island flooding events. Also, it is proposed to ensure tax relief for gifts of trading stock in response to the events is effective.
Proposed new clauses 31B and 31C exempt from tax certain amounts of income and fringe benefits provided to employees who are affected by the North Island flooding events. New clause 31D exempts some employee accommodation in the wake of the North Island flooding events.
Proposed new clause 64B extends the application period of a temporary tax concession for donated trading stock.
This SOP also proposes various minor remedial changes to the Bill.
It is proposed to delete clauses 25 and 26, because they have been superseded by changes made at Select Committee to the cross-border worker regime. Similarly, it is proposed to delete clause 47B.
A new clause 98(11B) is proposed, to insert a new definition of North Island flooding events as part of providing tax exemptions in relation to those events.
A new clause 150(3) is proposed, to provide the correct application date for the amendments proposed in clause 150(1) and (2).
Clauses 93, 94, 145, 164, 169, and 170 are amended to correct minor faults of expression.
Clauses 17, 44, 98(5), 98(27), and 177 are amended to correct faulty cross-references.
Various subclauses of clause 2 are amended, to provide appropriate commencement dates for proposals in this SOP and to correct mistaken commencement dates in the Bill.
Departmental disclosure statement
The Inland Revenue Department is required to prepare a disclosure statement to assist with the scrutiny of this Supplementary Order Paper. The disclosure statement provides access to information about any material policy changes to the Bill and identifies any new significant or unusual legislative features of the Bill as amended.
A copy of the statement can be found at http://legislation.govt.nz/disclosure.aspx?type=sop&subtype=government&year=2023&no=319
Regulatory Impact Assessment
Due to the nature and timing of the proposals in this Supplementary Order Paper, regulatory impact assessments were not prepared, as provided by Government guidance.
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Taxation (Annual Rates for 2022-23, Platform Economy, and Remedial Matters) Bill (No 2) - Amendment paper No 319
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