Potential big change for US citizens living abroad
Latest IR consultation
Last week, with immediate effect, the Government announced changes in visa conditions, which will allow visitors to work remotely for an overseas employer/client during a visit to New Zealand. This change will affect all applications received from 27th January. It includes tourists, people visiting families together with partners and guardians on longer term visitor visas.
A faster growth track
Basically, the changes are designed to encourage digital nomads to come here and enable them to carry on working for their overseas employer without breaching their visa conditions. As Nicola Willis in her role as Minister for Economic Growth explained in the accompanying press release “The change is part of the Government’s plan to unlock New Zealand’s potential by shifting the country onto a faster growth track.”
These new visitor visas are subject to the following conditions: the visa holder cannot work for a New Zealand employer, nor can they provide goods or services to people or businesses in New Zealand, nor can they do work that requires them to be physically present at a workplace in New Zealand.
What about income tax?
What difference, though, does the new visa make from a New Zealand income tax perspective? The short answer is ‘not an awful lot.’ Much of this possible digital nomad activity is already within section CW19 of the Income Tax Act 2007.
Under that provision the income that a non-resident person derives from performing personal or professional services in New Zealand is exempt if the visit is for 92 or fewer days, the services are performed for a person who’s not resident in New Zealand and that income is taxable in the jurisdiction in which the person is resident. This would typically capture most of activity of a digital nomad.
Section CW 19 is a long standing provision and, as the New Zealand Immigration announcement noted, the 92 day exempt period can be increased to 183 days if the visitor is tax resident in a tax country with which we have a double tax agreement.
As the Immigration Minister Erica Stanford noted, updating these visitor visas reflects the realities of current modern flexible working environment. It’s probably a good move to bring the visas up to date and make clear that it’s generally not a major issue if you are working remotely when visiting and are not in breach of any tax obligations.
Keep in mind the 92-day exemption in section CW 19 is for employees only, it does not apply to any self-employed person who might provide goods or services to people or businesses in New Zealand.
Yes, but what about Taylor Swift?
The other group of people who aren’t covered by the section CW 19 exemption are ‘public entertainers.’ Which means that if we ever did manage to get Taylor Swift here, theoretically the earnings that she made from any concert would be taxable in New Zealand. As an aside there are all sorts of very interesting and complex tax rules around entertainers.
Overall, it’s an interesting move which seems to now bring our visa practices in line with what’s happening globally. It reflects that, because of the greater interconnectivity available now people have quietly been working remotely, effectively acting as digital nomads without actually realising that they may have been in breach of their visa conditions.
In any case, if the person has been here for under 92 days, then generally speaking, they shouldn’t be in breach of any of their tax obligations. As I said an interesting move and no harm clarifying the visa situation. What the economic impact will be, who knows.
An end to citizenship based taxation for US citizens?
In our last podcast of 2024, we discussed Inland Revenue’s paper on changing the Foreign Investment Fund (FIF) regime to make it more attractive for migrants. One of the issues the paper discussed was how the FIF regime created headaches for American citizens and Green Card holders tax resident in New Zealand but who still have to file U.S. Federal tax returns. The paper was proposing changes that might help deal with the essential double taxation issue for these taxpayers.
It so happens an Illinois Republican Congressman, Darren LaHood, has introduced the Residence-Based Taxation for Americans Abroad Act, which would implement a residence based taxation system for U.S. citizens currently living overseas.
LaHood’s press release doesn’t mention it, but I’d be very curious to know exactly how much tax these expat American citizens pay in the US.
The preamble in the press release notes that the United States is the only major country that uses citizenship based taxation. According to recent estimates, there are about 5 million U.S. citizens currently living aboard. Based on the last census there are over 30,000 US born persons here in New Zealand.
LaHood is also a member of the highly influential House Committee on Ways and Means, (their equivalent of the Finance and Expenditure Select Committee) so perhaps this is a serious move. This bill could also gain from the general tax cutting mood of the new Trump administration. We’ll be interested to see how much further this goes.
In the meantime we’ll also be watching for progress on Inland Revenue’s proposals to try and deal with the anomalies the FIF regime creates for U.S. citizens resident here.
New Inland Revenue guidance on depreciation
Finally, Inland Revenue as always has been busy pushing out guidance and draft consultations on issues. One which caught my eye and will be worth perhaps thinking further about is Interpretation Statement IS25/03Income tax. Identifying the relevant item of property for depreciation purposes. There’s also an accompanying fact sheet which is always very helpful.
Our very detailed tax depreciation rules system rules have numerous depreciation rates available so it’s often a worthwhile exercise identifying what assets are involved and maximising the available depreciation.
The Interpretation Statement therefore provides general guidance on how to identify the relevant item of property when applying the depreciation rules. The key issue is determining whether the item is physically distinct from a wider asset of which it might from a part.
In determining this you would first consider its location or size, whether it’s integral to the physical functioning of a wider asset and the degree of physical attachment to other related assets.
Secondly, is the item largely functionally complete, in other words, can it function on its own? That doesn’t necessarily mean that it has to be self-contained or used separately, but could it function on its own??
Thirdly, does the item vary the function of another item? What this means is two items will remain separate items where one varies the function of another item, enabling it to perform more specialised function.
The Interpretation Statement provides a few examples together with a useful flow chart.
A key part of the analysis is it always comes down to a question of fact and that means that there will be different outcomes for apparently similar situations.
The Interpretation Statement contains links to other Inland Revenue guidance on depreciation related issues. All this is very useful because in the run up to the end of the tax year on 31st March, we often have situations where clients are looking at investments and wanting to maximise depreciation.
And on that note, that’s all for this week, I’m Terry Baucher and you can find this podcast on my website www.baucher.tax or wherever you get your podcasts. Thank you for listening and please send me your feedback and tell your friends and clients. Until next time, kia pai to rā. Have a great day
As previously leaked, on Sunday Labour announced that if re-elected, it would introduce legislation to zero rate GST on fresh and frozen fruit and vegetables, with effect from 1st April next year. This is a key plank of what it’s calling its ten-point plan to address the cost of living.
According to the fact sheet supplied at the time of the launch, based on the latest statistics from the New Zealand Household Economic Survey in 2019, the policy is estimated conservatively to save households about $18 to $20 per month. Now, one of the key criticisms of this policy is of course its complexity. But Labour is confident that in defining where the boundary will lie, it will be able to draw down on overseas experience in this area. “There are boundaries everywhere in the tax system and we are confident tax officials can make it work”.
The framework around the policy is whether the fruit or vegetable has been processed or not. And processed in this context means cooked or combined with other ingredients. This therefore rules out anything canned because of the heating process that is involved. Processed does not include being cut up and wrapped without additives, so that prepared vegetables such as fresh spinach in a bag, presumably salads, would be zero rated. Similarly, mixed vegetables frozen together would be zero rated for GST. But on the other hand, the release gives an example of potatoes mashed into chips, coated in canola oil and then frozen, would be excluded and therefore still attract GST.
There is a proposal to establish a consultative expert group immediately after the election to work through the final details of the policy. One of the criticisms of the policy is, and I’ve said so previously, whether the benefit of the GST reduction would be passed through to consumers. This is to be addressed by tasking the newly established Grocery Commissioner with ensuring that supermarkets and other grocery outlets are not profiting from this change. The Grocery Commissioner has powers under the new Grocery Industry Competition Act 2023 to require it to request information and reports from supermarkets on matters such as their prices and margins.
Depreciation on commercial property to be removed, again
Labour estimates the cost of this policy to be about $2 billion over a four-year forecast period to 30th June 2028. And the sting in the tail is that this is going to be paid for by commercial property landlords. Because Labour is proposing to remove what it has called in the fact sheets, “the last remaining large COVID 19 economic stimulus measure”, which was the introduction of depreciation for non-residential buildings.
According to Treasury’s costing of the COVID 19 Response and Recovery funding decisions, that particular decision back in March 2020 costs an estimated $545 million annually. it should be said that back in 2020 when depreciation was reintroduced, there was no indication that this was going to be a temporary measure. In fact, the accompanying commentary noted:
“New Zealand’s position of a zero-depreciation rate for almost all buildings is unusual internationally. International studies have generally found buildings do depreciate. The Tax Working Group reviewed and recommended changes to these tax settings. The Government has accepted the group’s recommendation to reinstate depreciation for industrial and commercial buildings.”
So the news that barely three years after it was brought back in, it’s to be removed again will be a big surprise for the commercial property sector. And you can expect very strong representations about that. Certainly, some projects in the pipeline may be delayed as companies and investors work out the impact of the withdrawal of depreciation.
There was some interesting stuff in the accompanying fact sheet about the proportion of weekly expenditure on fruit and vegetables by household income. And what might surprise people is that it’s the lower deciles, deciles one to four, who actually spend the greatest proportion of their budget on fresh fruit and vegetables. It works out nearly 2.5% for some of the deciles. So that’s greater in relative terms than what happens for decile ten households.
But what’s also notable here is that this survey apparently shows that the amount of fruit and vegetables being purchased as a proportion of all expenditure has been declining for some time, and it declined from just under 2% in 2013 to just over 1.7% in 2019.
What’s happening there would be interesting to know, but it could be that the cost pressures on fresh fruit and vegetables are actually more longstanding than just the post COVID 19/climate related events burst we are experiencing at the moment. The Grocery Commissioner will obviously be paying particular attention to that on a longer term.
Increasing Working for Families support
The announcement, or the focus on the GST policy, overshadowed the other big announcement made, which was a proposal to increase the Working for Families in-work tax credit by $25 a week from 1st of April next year. This is going to provide additional support to around 175,000 low- and middle-income working families. It’s the sort of measure which is supported by many, and I would be in that group, because it’s targeted and it gives to those most in need. Although I do note that Child Poverty Action Group are still disappointed that the criteria for this is still about being in work. Their long-standing position is that the in-work criteria should be removed because that would benefit all families and particularly children of those on the lowest incomes.
The other thing that Labour’s also planning to do is to lift the Working for Families abatement threshold from its current level of $42,700 to $50,000. But that’s not going to happen until 1st April 2026. That would be worth another $13 a week to eligible families.
I’ve spoken before about what goes on with the abatement levels, and it’s worth pointing out again that when Working for Families was first introduced in 2006, the abatement thresholds were adjusted annually. That was stopped by Bill English in the 2009 Budget, with the effect that if the then threshold of $36,827 had continued to be indexed to CPI, it would now be $51,702. In that context, Labour’s promise to raise to $50,000 in three years seems a little ungenerous.
Whether yesterday’s announcements are the sum of Labour’s tax policy for the election is not yet clear. Apparently, they are. But I note that they are still promising three more cost of living policy announcements to be made during the election. So, we’ll have to wait and see.
More GST – the importance of GST groups
Moving on, Inland Revenue is presently engaged in updating its various Interpretation Statements and other guidance, such as Questions We’ve Been Asked and in various statements of practice, to update various legislative updates that have happened over time. Some of this advice refers to the Income Tax Act 1994, whereas now we’re on the Income Tax Act 2007. So, Inland Revenue has been releasing a steady stream of updated guidance for consultation, and most of these updates confirm the existing position.
The latest released last week and also continuing this week’s GST theme, are two draft interpretation statements for consultation on the treatment of GST groups. One looks at when GST groups may be formed in general, and the second looks specifically at the rules around GST groups for companies
There has been a little bit of uncertainty around how the GST group rules interacted with other parts of the GST Act, and that was taken care of by an amendment included in the Taxation (Annual Rates for 2021-22, GST and other Remedial Matters) Act in 2022, which clarified the interaction of the GST group rules with the Income Tax Act. The position now is that the GST grouping rules are applied before the other provisions in the GST Act.
The idea behind the GST grouping rules is to eliminate the need to be charging and recovering GST on intra group sales. Think of a large group that’s supplying goods and services to another group member. If they are not within the same GST group, one party would charge GST and the other party would have to recover the GST. So, the idea of the grouping rules is to simplify administration.
How it’s done is that there is a representative group member chosen that carries on all the group members activities and that entity, whoever it is, is responsible for all the administration of GST. If a sale is made by someone outside the GST group, to a member of the group, it’s deemed to be made to the representative member as the registered person. Similarly, the various sales that might be made by group members to outside the GST group, are all treated as taxable supplies made by the representative member.
However, taxable supplies between group members are mainly disregarded with the idea of simplifying administration. One paper considers what happens with GST groups of companies. These can be formed where there is 66% commonality of shareholders, similar to the income tax rules for loss-offsets between group companies. In some cases, you can have non-registered entities as part of the GST group. The other paper covers the rules in general and where you can have groups of other entities such as trusts, for example, or maybe limited partnerships.
So, the two papers explore that and explain the background behind how the GST group rules operate. And as I say, these are part of a wider Inland Revenue project to update its material. These are very useful Interpretation Statements and consultation on these is open until 14th of September.
At the same time, I can’t help but think that Inland Revenue should be exploring the idea of introducing compulsory zero rating of GST between all GST registered entities. This would largely eliminate the need for rules around GST grouping. I think what it would also do is tackle an area of GST fraud which incurs relatively frequently where a fraudster might register for GST and then files a number of false GST returns, claiming input tax based on made up invoices.
Although Inland Revenue tracks down and catches these people, there is a time lag while the fraud is going on. I’m beginning to think if you want to try and tackle that, compulsory zero rating between GST registered businesses is perhaps a place to start. Giving Inland Revenue more resources to look into it, is another interim measure that could be done.
Trans-Tasman Tax issues
And finally on the Thursday and Friday just gone I was at the International Fiscal Association Australia-New Zealand Joint Conference in Queenstown. This is the first time in over 30 years the Australian and New Zealand branches have held a joint conference. It was highly successful. One reason IFA conferences are so attractive is because very senior Inland Revenue, and Treasury officials, and for this conference, Australian Tax Office and Australian Treasury officials, attend and share their views on insights on current tax topics. (Consequently, the conferences are held under Chatham House rules to enable officials to speak freely).
It’s always interesting to swap notes with other attendees and this conference was no exception, but it was particularly interesting because of the focus on Australasian issues. Both sides got to see differing perspectives on common topics, which included the question of tax treaty policy and updates from very senior people from both Australia and New Zealand on the OECD Pillar One and Pillar Two proposals. Australia and New Zealand are very well represented on the key working groups on this, we’ve got very good knowledge of how things are progressing. We also got a view on the latest environmental and tax developments, including a view from the IMF’s principal environmental fiscal policy expert.
“A hot steaming mess” – the perils of Australian taxation
A particularly interesting session was on the taxation of trusts in the trans-Tasman context. the current state of Australia’s trust tax law was described as a “steaming hot mess”. I regularly encounter scenarios where trustees have migrated to Australia without considering the tax ramifications, and a steaming hot mess is perhaps an understatement of the consequences. Overall a very useful session.
Incidentally, Australia and New Zealand are currently renegotiating the double tax agreement between the two countries. And the point was made that although as tax professionals we tend to look at tax treaties solely tax related, one panelist reminded everyone that they’re actually often part of bigger trade negotiations.
For example, as part of its efforts to obtain a free trade agreement with the EU, Australia has opened negotiations with double tax agreements with several EU countries. Apparently one reason a UK a double tax agreement between the United States and the United Kingdom in the mid-1970s was so advantageous for the Americans was because at that time the UK was negotiating the purchase of upgraded missiles for its submarine fleet.
Well, that’s all for this week. I’m Terry Baucher and you can find this podcast on my website www.baucher.tax or wherever you get your podcasts. Thank you for listening and please send me your feedback and tell your friends and clients. Until next time, kia pai to rā. Have a great day.
Inland Revenue has released Interpretation Statement IS 22/04 on claiming depreciation on buildings. Critical to this issue is determining the meaning of a “building” for depreciation purposes and the distinction between residential and non-residential buildings. The Interpretation Statement addresses this issue when it sets out when depreciation may be claimed for non-residential building and also for some fit outs. It confirms that no depreciation is available for residential buildings.
The Interpretation Statement then sets out where you can find the right depreciation rate for buildings when fit outs attached to buildings may be depreciable. How to treat an improvement of a building for depreciation purposes. And then finally, what happens when the building is disposed of or its use changes?
To recap, depreciation for all buildings was reduced to zero, with effect from the 2011-12 income year. Back in 2020 as part of the initial response to the pandemic, the Government reintroduced depreciation for non-residential buildings with effect from the start of the 2020-21 income year. Generally, the depreciation rate is 2% on a diminishing value basis, or 1.5% on a straight-line basis. Some other depreciation rates may be used where the building has a shorter than normal useful economic life. Examples would be barns, portable buildings or hot houses. Additionally, it’s possible to claim a special rate if the building is used in an unusual way.
Now for depreciation purposes “building’ retains its ordinary meaning which means anything that is structural to the building or used for weatherproofing the building. The Interpretation Statement emphasises that whether a building is residential or non-residential is an all or nothing test. If the building is non-residential depreciation is available, otherwise not, there’s no apportionment.
Residential buildings are any places mainly used as a place of residence. This includes garages or sheds included with that building. Places used as residential residences for independent living in retirement villages and rest homes are residential buildings are is short stay accommodation where there’s less than four separate units.
On the other hand, non-residential buildings include buildings used predominantly for commercial and industrial purposes, but not residential buildings. This also includes hotels, motels, inns, boarding houses, serviced apartments and camping grounds. Retirement villages and rest homes where places are not being used for independent living are non-residential buildings as is short stay accommodation where there are four or more separate units.
If improvements are made to a building, you must treat it as a separate item of depreciable property in the first tax year. Then you can either continue to treat it as a separate item of depreciable property or simply add it to the building by increasing the adjusted taxable value of the building.
In some cases, a fit out can be separately depreciated depending on the nature of the building and the nature of the fit out. Where the fit out is considered structural to the building or used to weatherproof the building it must be treated as part of building and not depreciated separately. Fit outs are depreciable in a wholly non-residential building and sometimes in a mixed-use building. But remember, the key point is that depreciation is not available under any circumstances for a residential building. So overall, this is a useful Interpretation Statement and is also, as has become the norm, accompanied by a very handy fact sheet.
The agencies tackling organised crime and its tax evasion
Moving on, last week I discussed a suggestion by ACT Party leader David Seymour to use Inland Revenue against the gangs. I looked at the powers available to Inland Revenue and discussed how practical his proposal was. To summarise, Inland Revenue has extensive powers which would be useful in tackling gangs and organised crime. However, this is a resource intensive approach which probably in Inland Revenue’s view, would divert its attention from other areas it considers equally important.
This prompted some discussion in the comments section and thank you again to all those who contributed. As I said, my view is Inland Revenue probably thinks other agencies, such as the Police, are better suited for this activity. But it will cooperate with those agencies. Its annual reports make clear they pass information to other agencies. So Inland Revenue is probably working on this matter in the background.
It was interesting just to take a look to see what other agencies were doing in this space and get a gauge of what’s happening. A key tool for the Police is the use of restraining orders to seize assets. According to the Police’s Annual Report for the year ended 30th June 2021 the value of restraints for the year totalled just over $100 million, including nearly $30 million seized from anti-money laundering.
The Department of Internal Affairs also has responsibilities for anti-money laundering, as it’s a key regulator on that. Its Annual Report to June 2021 indicates that perhaps it could do more in this space, as its budget for its regulatory services for the year was set at $52 million, but it only spent $44 million.
And then when you look at the DIA’s performance metrics, such as desk-based reviews of reporting entities, it’s supposed to be targeting between 150 and 350 such reviews annually, but managed only 219 for the year, up from 198 in the previous year. And on-site visits were meant to be somewhere between 70 and 180 but came in at 79. To be fair these were probably disrupted by the impact of COVID 19.
Still, there are other agencies involved in pursuing gangs including Customs who will also be very interested. Inland Revenue will be playing a role, it shares information with these other agencies. So even if it’s not wielding a very big stick publicly, it’s working in the background.
The interaction of tax and abatements on social assistance
Now tax has been in the news a lot recently with the election coming up even though it’s still just over a year away probably. National and the ACT Party have both set out they would proposed some tax cuts. Last Saturday, Max Rashbrooke, a senior associate at the Institute of Governance and Policy Studies, who has written quite a lot on wealth and taxation put out some counter proposals to National and ACT’s proposals.
He suggested that really the focus should be on middle income earners. And he made a suggestion, for example, that we could have a $5,000 income tax free threshold, something we see in other jurisdictions. Britain’s is just over £12,500, Australia’s is A$18,200 and the US has a slightly different thing. It gives you a standard deduction of US$12,000. But anyway, let’s take that comment elsewhere. And Max suggested that something could be done in that space.
But it got me thinking about the question of who does actually pay the highest tax rates in the country. And the answer isn’t those on over $180,000 where the tax rate is 39%, it’s actually more around $50,000 mark if those people are receiving any form of government assistance, such as Working for Families. If they have a student loan as well, then an additional 12% of their salary after tax gets deducted.
The interaction of tax and abatements on social assistance, such as the family tax credit and parental tax credit can mean in some cases, the effective marginal tax rate for some families is more than 100% on every extra dollar they’re earning. This is an issue which the Welfare Expert Advisory Group touched on, but the Tax Working Group wasn’t allowed to address. But it’s a huge problem.
Take, for example, someone earning $50,000, just above the $48,000 threshold where the tax rate goes from 17% to 30%. And that, by the way, is the rate where I think we need to focus our attention on adjustments to thresholds and tax rates. At that level every extra dollar they’re earning is taxed at 30%. If they’ve got a student loan then they pay a further 12%. If they have a young family and are receiving Working for Families tax credits, then these are abated at 27%. Incidentally, the abatement threshold is $42,700. So that means that that person is on a marginal tax rate of 69%. Definitely not nice.
Then there’s a separate credit, the Best Start tax credit which has a separate abatement regime in addition to the Working for Families abatement regime I just explained. So that’s why people could be suffering an effective marginal tax rate of over 100%.
In my view, this is the area where we really need to be thinking about changing the tax system, because to compound matters, governments have been very cynical about not adjusting thresholds for inflation, something I’ve raised repeatedly in the past.
Working for Families thresholds were adjusted for inflation every year until National was elected in 2008. Starting in the 2010 Budget they started freezing thresholds. They also increased the abatement rate which used to be 20% and is now 27%. The current Working for Families abatement threshold is $42,700, which is less than what someone working full time on the minimum wage will earn annually
Looking at student loans the threshold where repayments start in 2009 was $19,084. That is now $21,268 but for a long period of time under the last government it was frozen. National also increased the repayment rate from 10% to 12% in 2013.
So this is an area where governments of both hues have been really quite cynical in my view, and where a lot of serious thought needs to go in about trying to address the inequities that have arisen. The Welfare Expert Advisory Group suggested the abatement rate should be 10% on incomes between $48,000 and $65,000, then increase to 15% before rising to 50% on family incomes over $160,000. (Yes, large families with that level of income could be receiving social assistance in some instances).
There’s a lot of work to be done in this space and inflation adjustments to thresholds is something that should be done anyway. But I think we need to think carefully around the thresholds and how the interaction with social assistance works. At the moment we’re not getting that sort of analysis from either any of the main parties and that’s disappointing, as it’s something that really needs to be addressed.
Why the FER deals with recurrent taxes better
And finally this week, just hot off the press is an OECD report on Housing Taxation in OECD countries. This makes for some interesting reading. Briefly, the report is concerned about how housing wealth is mostly concentrated amongst high income, high-wealth and older households. And in some cases, they believe that a disproportionately large share of owner-occupied housing wealth is held by this group. There’s been unprecedented growth in house prices, not just in New Zealand, but across the whole OECD, making housing market access increasingly difficult for younger generations.
In terms of suggestions the OECD believes that housing taxes are “of growing importance given the pressure on governments to raise revenues, improve the functioning of housing markets and combat inequality.” The report notes the way housing taxes are designed often reduces their efficiency. Recurrent property taxes, such as rates, are often levied on outdated property values, which significantly reduces their revenue potential. This also reduces how equitable they are because where housing prices have rocketed up, people are underpaying based on current values. And conversely people in places where prices are falling or have been stagnant are paying more relative to those in richer areas.
One of the suggestions the report makes is that the role of recurrent taxes on immovable property should be strengthened, by ensuring that they are levied on regularly updated property values. And this is one of these reasons why Professor Susan St John and I have been promoting the Fair Economic Return approach. One of the strongpoints of our proposal would be strengthening the role of recurrent taxes.
Capping a capital gains tax exemption on the sale of a primary residence
Another proposal would not at all popular. It is to consider capping the capital gains tax exemption on the sale of main houses so that the highest value gains are taxed. This should strengthen progressivity in the system and reduce some of the upward pressures. This is what happens the U.S. There is a US$250,000 exemption on the main home per person, and above that the gains are taxed. There’s no reason why we shouldn’t have a similar type exemption here if we want to introduce a capital gains tax. But as I said, that would be particularly unpopular.
The OECD also believes there should be better targeted incentives for energy efficient housing, because housing, according to this report has a significant carbon footprint, maybe 22% of global final energy consumption and 17% of energy related CO2 emissions.
So, there’s a lot to consider in this report, and we come back to it and consider it in more detail. But again, it sort of comes to this point we’ve talked about repeatedly on the podcast, the question of broadening the tax base and the taxation of capital. These issues aren’t going to go away, particularly when you consider, as I mentioned a few minutes ago, how very high effective marginal tax rates are paid by people on modest incomes who may not have any housing. No doubt we’ll be discussing all these issues sometime again in the future.
Well, that’s all for this week. I’m Terry Baucher and you can find this podcast on my website www.baucher.tax or wherever you get your podcasts. Thank you for listening and please send me your feedback and tell your friends and clients.
Until next time kia pai te wiki, have a great week!
