New Zealand


  • Service: Tax
  • Type: Business and industry issue
  • Date: 3/10/2012

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Rebecca Armour

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Taxmail - Salary trade-off tax proposals narrowed 

Issue 2, October 2012


The Government has announced that the proposals to tax salary trade-offs will be narrowed.  These changes have been made in response to public concerns about the proposals’ workability.  The rules now target only Auckland and Wellington CBD car parks and vouchers issued by charities, rather than all explicit and implicit salary sacrifice benefits as originally proposed.  


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We  welcome the changes to make the proposals more workable. 


The original proposals cast the net too wide and did not take account of the compliance costs to employers from implementing the new rules.  However, there still remains much detail that needs elaboration. 


Individuals will also need to be aware of the impact the  proposals will have on their income for social assistance (e.g. Working for Families entitlements and student loan and child support payments).


Taxmail - Comment on topical tax issues from KPMG NZ Tax.