New Zealand

Details

  • Service: Tax
  • Type: Business and industry issue
  • Date: 6/08/2010

Taxmail - Zero-rating GST on land sales etc 

The Taxation (GST and Remedial Matters) Bill introduces a fundamental change to the GST zero-rating rules, for land, and an entirely new method of calculation for GST change-of-use adjustments. It also seeks to clarify some aspects of the GST rules where there has been confusion.

 

While KPMG broadly supports the GST changes, we consider the new change-in-use adjustment requirements will not be practical for many organisations.

 

Further, these latest amendments come at a time when many businesses are struggling to cope with the imminent GST rate change and will create an additional strain on already stretched businesses.            

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Other changes on the way

The Taxation (GST and Remedial Matters) Bill reflects the Government’s new approach of limiting the content of taxation legislation.

 

This follows concerns raised by Parliament’s Finance and Expenditure Select Committee that Tax Bills were becoming too large to consider properly.

 

While this approach makes it easier, it also means a constant stream of legislation during the year. For example, separate tax bills are expected later this year changing the rules for qualifying companies, and further amending the international tax rules.

 

We are also expecting legislation to be introduced shortly to deal with various transitional issues arising from the increase in the GST rate from 1 October 2010.

 

KPMG will provide more details on these

measures once further detail is released.

 

If you have any questions on the above, please speak to your usual KPMG advisor or contact:

 

Peter Scott
Partner - Tax
KPMG
Phone: +64 9 367 5852

pcscott@kpmg.co.nz

John Cantin
Partner - Tax
KPMG
Phone: +64 4 816 4518

jfcantin@kpmg.co.nz
Taxmail - Comment on topical tax issues from KPMG NZ Tax. 

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